Private Securities Litigation Reform Act of 1995 investment & finance definition

A law that was passed with the purpose of reducing the number of lawsuits by disgruntled investors. The law raised the standards that had to be met before a securities lawsuit could be started. The law also allowed companies the leeway of adding disclaimers to its statements as a way to protect against lawsuits in the event of unintentional errors. The law did have the effect of initially reducing the number of lawsuits filed for securities law violations, but those numbers have since increased.