Corporate liability carriers in the future may have to defendagainst more class actions, but they will likely see more of themdismissed, judging by a new study.

According to a report by researchers at NERA Consulting,companies face an increased likelihood of being named as defendantsin a class action suit, with 10 percent probability of at least oneshareholder class action lawsuit over a five-year period based onthe filing rate for 2003-2005.

On the positive side for corporations, 40.3 percent of the casesfiled against companies between 1998 and 2003 ended indismissals.

NERA senior consultant Dr. Ronald I. Miller and vice presidentsTodd Foster and Dr. Elaine Buckberg, who wrote the report,cautioned that this figure may be "slightly overstated" as itincludes those cases dismissed without prejudice that could berefiled.

However, the dismissal figure is a sharp change from the periodbetween 1991 and 1995 when "dismissals accounted for only 19.4percent of dispositions for cases filed," the authors said in thereport.

Additionally, the authors noted, "There is good reason to expectthat, apart from the biggest of the mega-settlements, averagesettlements will not rise further over the next two or three yearsand, instead, could even fall."

The authors said that even as a few record-breaking settlementscontinue to make headlines the situation for the rest of the classaction defendant population appears to be stabilizing.

The study, titled "Recent Trends in Shareholder Class ActionLitigation: Beyond the Mega-Settlements, is Stabilization Ahead?"reported that the top 10 list of most expensive class actionsettlements has changed dramatically since the beginning of2005.

"In 2005 and the first two months of 2006, the list of the 10largest shareholder class action settlements was almost completelyrewritten," the authors wrote.

"Seven slots on the list are now filled by 2005 and 2006settlements. As of 2004, Cendant was the only settlement largerthan one billion dollars. Now there are six."

The average settlement also increased, from $23.7 million in2002 to $24.3 million in 2005 if the WorldCom settlement isexcluded. Including WorldCom would increase the 2005 average toalmost $71 million.

Still, the authors said recent massive class action settlementsreflect the increased investor losses rather than a more difficultlegal environment, and the worst may be over as the stock bubble ofthe early 21st century fades into the past.

"Many of the largest suits in this recent period have classperiods ending during the collapse of the stock market bubble in2000-2002," the authors said. "The large market losses that camewith the end of this bubble have led to large settlements."