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> Typically shareholder lawsuits are brought by minority shareholders I don't know if this is true - I just asked Claude and it said the type of lawsuits I des
by idopmstuff 2y ago
> Typically shareholder lawsuits are brought by minority shareholders
I don't know if this is true - I just asked Claude and it said the type of lawsuits I described are significantly more common, at least among suits against public companies.
But regardless of relative frequency, you say it's pointless, so why does it happen? (The answer seems clearly to be because the lawyers want it to happen, but still seems like it's a very inefficient process for most shareholders.)
- doe_eyes 2y agoI think that's basically the answer. In many cases, the process is initiated by lawyers looking for litigants. It's a big payday for the law firm and peanuts-out-of-your-own-pocket for actual shareholders.
- nequo 2y agoI think what parent meant is that the lawsuit is not pointless if and only if it is brought by a minority shareholder. Minority shareholders don’t control the cash held by the company so they need to sue to get access to it.