IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this article

Why Shareholders Sue: The Evidence from Japan

Author Info

Listed author(s):
  • West, Mark D
Registered author(s):

    Abstract

    This article explores the dynamics of shareholder litigation in a heretofore overlooked context: Japan. Following a 1993 reduction of filing fees, the number of shareholder derivative suits filed in Japan has increased dramatically, creating a database from which to study litigation incentives. This article shows that most plaintiffs in Japan lose, few suits settle, settlement amounts are low, and shareholders do not receive direct stock price benefits from suits. Most derivative suits in Japan, as in the United States, can be explained not by direct benefits to plaintiffs but by attorney incentives. Still, derivative litigation has more than one cause. The residuum of suits not wholly explained by attorney incentives is best explained by a combination of (1) nonmonetary factors, (2) corporate troublemakers, (3) insurance, and (4) "piggyback" enforcement. These findings suggest that the difficult and messy issues of derivative suits are not unique to the United States. Copyright 2001 by the University of Chicago.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: http://dx.doi.org/10.1086/322056
    Download Restriction: Access to the online full text or PDF requires a subscription.

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Article provided by University of Chicago Press in its journal Journal of Legal Studies.

    Volume (Year): 30 (2001)
    Issue (Month): 2 (Part I June)
    Pages: 351-382

    as
    in new window

    Handle: RePEc:ucp:jlstud:v:30:y:2001:i:2:p:351-82
    Contact details of provider: Web page: http://www.journals.uchicago.edu/JLS/

    Keywords:

    No references listed on IDEAS
    You can help add them by filling out this form.

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    as
    in new window


    Cited by:

    1. Milhaupt, Curtis, 2004. "A Lost Decade for Corporate Governance? What’s Changed, What Hasn’t, and Why," EIJS Working Paper Series 202, The European Institute of Japanese Studies.
    2. Sergey Stepanov, 2010. "Shareholder access to manager-biased courts and the monitoring/litigation trade-off," RAND Journal of Economics, RAND Corporation, vol. 41(2), pages 270-300.
    3. Badawi, Adam B. & Chen, Daniel L., 2016. "The Shareholder Wealth Effects of Delaware Litigation," TSE Working Papers 16-683, Toulouse School of Economics (TSE).
    4. Masao Nakamura, 2011. "Adoption and policy implications of Japan’s new corporate governance practices after the reform," Asia Pacific Journal of Management, Springer, vol. 28(1), pages 187-213, March.
    5. Katsuhiko Muramiya & Tomomi Takada, 2010. "Auditor Conservatism, Abnormal Accruals, and Going Concern Opinions," Discussion Papers 2010-64, Kobe University, Graduate School of Business Administration.
    6. Chen Chun-Yuan, 2016. "D&O Insurance, Corporate Governance and Mandatory Disclosure: An Empirical Legal Study of Taiwan," Asian Journal of Law and Economics, De Gruyter, vol. 7(1), pages 19-62, April.
    7. Takuya Iwasaki & Norio Kitagawa & Akinobu Shuto, 2013. "Managerial Discretion over Their Initial Earnings Forecasts," Discussion Paper Series DP2013-31, Research Institute for Economics & Business Administration, Kobe University.
    8. Badawi, Adam B. & Chen, Daniel L., 2016. "The Shareholder Wealth Effects of Delaware Litigation," IAST Working Papers 16-41, Institute for Advanced Study in Toulouse (IAST).
    9. Takuya Iwasaki & Norio Kitagawa & Akinobu Shuto, 2015. "Managerial discretion over initial earnings forecasts," CARF F-Series CARF-F-369, Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo.
    10. Yoshiro Miwa & J. Mark Ramseyer, 2001. "The Myth of the Main Bank: Japan and Comparative Corporate Governance," CIRJE F-Series CIRJE-F-131, CIRJE, Faculty of Economics, University of Tokyo.

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Access and download statistics

    When requesting a correction, please mention this item's handle: RePEc:ucp:jlstud:v:30:y:2001:i:2:p:351-82. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Journals Division)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.