Massive Class Action Lawsuit Against Wall Street For Artificially Inflating Dot Com Bubble Rejected
from the go-your-own-way dept
For years and years and years, class action lawyers have had a field day with the fallout from the dot com bubble bursting, trying to pin much of the blame on Wall Street. Wall Street firms pretty clearly did some questionable things during dot com IPOs -- though, it was a pretty open secret what they were doing. They put in place deals to flip new IPOs to drive the stock price higher while also putting out only favorable research on the stocks they brought to market. It was such an open secret that anyone who did the slightest due diligence knew about it beforehand. However, part of what happened was that in the mad greedy rush to cash in on the bubble, no one cared. They knew it -- but didn't care as long as it made them rich. Then, the bubble collapsed and they wanted to find someone to blame. So, while it's a good thing that efforts have been made to stop firms from doing these types of things again (though, it still happens in slightly modified ways), many of the class action lawsuits that were filed in the wake of the bubble bursting were obviously more about trying to pass the blame, rather than accept the fact that everyone knew they were investing in duds, but were playing the game because it was making so many other people money. Most people weren't really being deceived -- and if anyone was deceiving them, it was probably themselves. That's why it's probably a good thing that a huge (perhaps largest ever) class action lawsuit against many of the top Wall Street firm has been rejected. There may still be separate lawsuits against individual banks, but there won't be a massive class action suit to tie them all together. Again, this is probably for the best. People who invested their money should know to have done their own due diligence while also recognizing that these were highly risky investments. While the firms were clearly misleading in some of their activities, and should have those practices stopped, to place all the blame on them isn't right either. A successful class action lawsuit would have put all the punishment on these firms, and then shifted money from them mainly to the lawyers on the case.