證券關聯集團訴訟制度에 관한 硏究

Abstract

A securities-related class actions bill has taken effect in January 2005. The purpose of this bill is to effectively protect the interests of a class that have been damaged in securities transactions and to enhance corporate transparency. Securities-related class action is defined as one or several persons bringing a claim on behalf of a group of individuals for damages sustained in the course of securities dealings. Securities-related class actions are limited to the following circumstances : falsification of stock certificates, business proposals, business reports, and semi-annual or quarterly reports ; use of unofficial information for internal trade ; manipulation of market-conditions ; and fraudulent audits. The primary benefit of allowing securities-related class action lawsuits is that the result of the lawsuit will bind those who have not actually participated in the lawsuit, thereby providing an efficient means of giving relief to a larger class. Secondly, a class action protects the rights of minority investors. Though the amount of damage to a single investor may be minimal and the cost of litigation against a corporation prohibitive, thus precluding any incentive for investors to litigate individually, the class action offers a method of relief for a class of investors. Finally, a class action system will deter corporate wrongdoing and encourage transparency, which will eventually encourage greater investment into the corporation. To prevent abuse, securities-related class actions are limited by the following requirements : the injured class must be a group of 50 or more persons ; the class must hold at least 1/10,000 of the total number of securities issued by the defendant corporation ; relevant legal or factual issues must be common and important to all members of the class ; and the lawsuit must be an adequate and efficient means of fulfilling the rights of, and protecting the interests of, the class members. According to the new legislation, lead plaintiffs and lead counsels may not qualify in their leading roles if they have participated in at least three securities-related class actions within the last three years as lead plaintiff or lead counsel. In the United States, the restriction is slightly less stringent, limiting lead plaintiffs to no more than five securities-related class actions within any three year period. These restrictions, both in the United States and South Korea, are clearly an effort to curb frivolous claims that can be brought in a habitual manner. The significant difference between the restrictions of the new legislation and that of its counterpart in the United States is that Korea's new law applies the restriction to both lead plaintiff and lead counsel, whereas the Reform Act in the United States only applies the restriction to lead plaintiffs. There is no rational basis for the restriction on lead attorneys. An attorney is only permitted to bring three securities-related class actions during any three year period. This restriction, in effect, allows inexperienced lawyers rather than lawyers that are experienced in securities class actions to be responsible for class action suits. Consequently, this will impede the efficient execution of class actions, and most importantly, will impractically limit the plaintiff's choice of lead counsel. Furthermore, in contrast to the development of professional securities class action law firms in the Unites States that significantly contribute to the development of the stock market, there striction prohibits the creation of any sort of class action law firm in Korea. Additionally, our bill requires that a class must hold at least 1/10,000 of the total number of securities issued by the defendant. Such a requirement does not further the overall purpose of a securities-related class action system which is to allow a class of shareholders whose individual interests may be small compared to the interest of the class as a whole, to initiate a law suit as an adequate means of reparation for a class so numerous. And the other restrictions in our securities class action bill prevent our class action system from protecting the interest of a class that have been damaged in securities transactions. Finally, I suggest that many restrictions articles in our securities-related class actions bill should be abolished in order to activate our securities class action. And the abuse of securities class action should be deterred in order to protect many innocent corporations.