Launched in 1996, the Securities Class Action Clearinghouse (SCAC) is a free, online database of all securities class actions filed in U.S. federal court since the passage of the Private Securities Litigation Reform Act (PSLRA) of 1995. Through a single website and its in-depth, advanced search that enables search by the litigation name, ticker symbol, litigation type, dates, classification and other topics, the SCAC provides investors, judges, lawyers, policymakers, scholars, and the media with historical information on these securities class action cases with accompanying full-text complaints, motions, dockets, judicial opinions and other major court filings. Currently, the SCAC maintains information on more than three thousand securities class action cases with a total repository of over 50,000 court related materials.
Stanford Law School Professor Joseph Grundfest, as both founder and director of the SCAC, pointed out that in 1914, Justice Louis D. Brandeis observed, “Sunlight is said to be the best of disinfectants, electric light the most efficient policeman.” [Louis D. Brandeis, Other People’s Money, ch.5 (1914)] According to Professor Grundfest, “The Internet’s ability to disseminate information and to harness the forces of disclosure in the public’s interest are, we believe, at least as powerful as Brandeis’s “electric light” and we hope that the SCAC website makes a contribution in this direction.” Together with summaries and analyses of securities class action lawsuits and analyses in the arena of securities fraud class action litigation and law, the SCAC is the most comprehensive source for federal securities fraud class action litigation in the United States. With the SCAC site, each user can form his or her own opinion as to whether litigation is with or without merit, whether too few or too many companies are being sued and whether recoveries are too small or too large.
The SCAC site contribution has been recognized through the years. Upon its foundation the Smithsonian Institution recognized the site as an example of “visionary use of information technology in the field of education and academia.” Furthermore, one of the best indicators of the site’s success has been its potential as a model. A considerable number of projects have been modeled after the SCAC. For example, the Civil Rights Litigation Clearinghouse from the Washington University in St. Louis, the Stanford originated project’s Intellectual Property Litigation Clearinghouse (IPLC), and Stanford Securities Litigation Analytics are all modeled after the SCAC. In 2009, during a roundtable discussion on Securities Claims Statistics, the SCAC was distinguished as the one containing the best methodologies and protocols for counting, classifying and reporting on securities class action lawsuits.