"Recent criticism of securities class actions has principally concerned the 'circularity' found in the damages remedy prescribed by the U.S. securities laws. The circularity argument is more correctly characterized as a number of related but distinct arguments. These circularity arguments are related in that they each emanate from the fact that a company’s current shareholders (or its insurers) pay the remedy for securities fraud to former and current shareholders. The circularity arguments are distinct in that the underlying economic basis for each argument can be analyzed and addressed separately."

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