The U.s. Securities Class Action Research

In recent years, fraudulent securities activities emerge in an endless stream in the Chinese securities market. However, the current securities civil action system fails to provide full and effective protection to investors. The conflict between the claims of investors and the absence of a relief system urges the Chinese academic circle to do deep research on securities group action systems.In the comparative law study of securities group action systems, the American securities class action system has always been a hot topic. The Unities States is the first country to establish a class action system in the form of statutory law and the developed securities market with the largest number of securities class actions. The securities class action practice in the United States demonstrates to us the necessity of securities class actions, the special problems faced by them, and the extent to which these problems can be solved by the enactment of special rules. Thus it is of a great reference value.Therefore the author applies the research methods of historicism, comparative law and empirical study to introduce and discuss several aspects of the American securities class actions system, and analyze what China can learn from this system, in hopes of improving the legislation of the Chinese securities group action system and benefiting the theory and practice of Chinese securities civil actions.Besides the preface and the conclusion, this article includes five chapters. Each chapter is as follows:The first chapter introduces the historical development and reform effect of American securities class actions. American securities class actions came into being in the 1930s, flourished in the 1970s until being considered to be abused. The class action abuse led the United States Congress to pass the Private Securities Litigation Reform Act and the Securities Litigation Uniform Standards Act in 1995 and 1998 respectively. The development of the American securities class action system has been relatively stable since the reform.The second chapter introduces the legal bases of American securities class actions, which include the bases of substantive law and procedural law. The latter includes Rule 23 of the Federal Rules of Civil Procedure, the Private Securities Litigation Reform Act and the Securities Litigation Uniform Standards Act.The third chapter introduces different basic procedures of American securities class actions in details, namely, how judges concretize abstract rules when handling cases, and how they design various methods for implementation of the rules.The fourth chapter conducts a deep analysis of the advantages and drawbacks of American securities class actions through cases and empirical statistics. The most important purpose and function of securities class actions are to deter lawbreakers. However, the current system impairs this deterrence function and harms the interest of shareholders. Luckily, this is not the inherent drawback of securities class actions and can be rectified through amendments of the relevant system. This chapter also introduces the influence of American securities class actions on other countries and regions.The fifth chapter introduces the development of Chinese securities civil actions, analyzes the drawbacks of the Chinese securities civil action system and the representative action system with an uncertain number of people, and discusses what we can learn from the American securities class action system to reform the Chinese securities civil action system and the significance of this reform.