Class Actions
A federal securities class action is a court action filed on behalf of a group of shareholders under Rule 23 of the Federal Rules of Civil Procedure . Instead of each shareholder bringing an individual lawsuit, one or more shareholders bring a class action for the entire class of shareholders.
Concept at a glance
Definition and explanation
A federal securities class action is a court action filed on behalf of a group of shareholders under Rule 23 of the Federal Rules of Civil Procedure . Instead of each shareholder bringing an individual lawsuit, one or more shareholders bring a class action for the entire class of shareholders. [1]
In a securities class action, shareholders who purchased or sold the company’s securities during a specific period of time, known as the class period, usually allege the company and its officers and directors violated the federal and state securities laws. [1]
Although you may be part of the class, you don't have to join the class action. Instead, you can "opt out." If you opt out and still want to pursue an action, you may have to hire an attorney. [1]
Frequently asked questions
What does Class Actions mean in the cited reference?
A federal securities class action is a court action filed on behalf of a group of shareholders under Rule 23 of the Federal Rules of Civil Procedure . Instead of each shareholder bringing an individual lawsuit, one or more shareholders bring a class action for the entire class of shareholders. [1]
Sources and review dates
Reviewed 23 October 2026. Historical dates and award-time affiliations retain their original context. A review date is not an event date. Background sources are identified separately from official records.