Author: Priya Cherian Huskins
The year 2025 was an interesting one for securities class action (SCA) lawsuits.
On the one hand, we saw a modest slowdown of SCA filing activity. Plaintiffs filed 186 SCA lawsuits, representing a 10% decline from the 206 cases in 2024. However, those 186 cases were in line with the five-year average of SCA filings.
On the other hand, settlement totals were still high. While they didn't reach 2024's all-time high of $4.1 billion, they still exceeded $3 billion in total settlements. This total made 2025 the second-highest year on record for SCA payouts.
In this article, I'll break down SCA filing trends from our D&O Databox™ 2025 Year-End Report.
We typically observe that new public companies are more likely to be sued than more mature public companies, something that's proven to be objectively true over time. In 2025, however, 51% of the companies hit with an SCA were mature public companies.
However, an analysis of companies by market cap tells a familiar tale. Specifically, among companies with a market cap of $10 billion or less, a high share of SCAs targeted newly public companies.
For instance, 44% of the companies in the $2 billion or more category were sued within five years of going public.
Across all companies with $10 billion or less in market cap, between 30% and 44% sued were newly public (within five years).
Industry matters, and the usual suspects dominate
Industry continues to be a factor in SCA activity.
In 2025, the familiar sectors once again led the way with regard to volume of filings. Those sectors include technology, biotechnology, manufacturing and financial services (in that order).
A five-year review shows that these four industries have consistently attracted the most SCA claims, with only slight year-over-year variations in most years. Technology in 2025, however, saw a more significant drop, as illustrated in the image below:
Earnings disclosures remain a primary driver of securities litigation
In 2025, 54% of SCAs were tied to misrepresentations or misleading statements made about revenue growth. Unsurprisingly, these cases often coincided with missed market expectations.
But SCA plaintiffs didn't confine themselves to earnings issues. Alleged misstatements about operations, products or services made up 20% of complaints cited, and 12% of SCAs were tied to clinical trial issues.
Other SCA filings were focused on issues such as accounting, mergers and acquisitions, liquidity, regulatory investigations, AI, de-SPAC transactions, COVID-19, initial public offering (IPO) Section 11 and even tariffs.
Large settlements continue to be a risk factor
While 2025 didn't eclipse the record-setting $4.1 billion in settlements in 2024, it still became the second-highest year on record (excluding settlements of $1 billion or more) with $3.6 billion paid across 80 settlements.
In addition, the proportion of settlements that exceeded $20 million was consistent with 2024 data.
A notable shift in 2025 was the sectors that paid out the most in settlement dollars.
Companies in the services industry accounted for the largest share of settlement payments in 2025, while technology fell to second place after leading in 2024.
Get access to the full report for more
For the full scope of data and insights, access the D&O Databox™ 2025 Year-End Report to learn more about:
- High-profile companies named in SCAs
- Key drivers behind filings, including whether tariff-related litigation is trending
- The status of SCAs involving foreign companies
- Average and median settlement values over the past decade
- The top 10 settlements in 2025
- Settlement-versus-dismissal trends
- Indicators of what may lie ahead
We'll continue to track and analyze SCAs as 2026 progresses and report back in our midyear Databox report.
Published February 2026
