The first half of 2026 has reinforced a reality that institutional investors have been experiencing for several years: securities class action litigation continues to evolve in both volume and complexity. While the headlines often focus on record settlements or high-profile cases, the broader trends reveal a more important story that underscores the growing need for sophisticated monitoring, analytics and claims administration.
A recent industry research report by expert economists at National Economic Research Associates (NERA) indicates that federal securities class action filings are on pace to exceed recent annual highs, while average settlement values have reached their highest level in a decade (excluding billion-dollar settlements). At the same time, new litigation themes centered around artificial intelligence, regulatory scrutiny and market manipulation are reshaping the investment risk landscape. These developments should prompt institutional investors to assess strengthening recovery programs and enhancing fiduciary oversight.
Litigation Activity Continues to Accelerate
The pace of federal securities class action filings remains robust. SS&C Battea agrees with NERA’s projection of approximately 236 federal filings by the end of 2026, which would surpass 2025 levels and be one of the busiest periods in recent years. Securities fraud pursuant to Rule 10b-5 continues to be the dominant claim against defendant companies, while technology and healthcare remain the most frequently targeted sectors.
As filing activity increases, institutional investors have a greater number of potential recovery opportunities. At the same time, the NERA report identified that more than half of the litigation will ultimately not yield in settlement funds. This creates the challenges of tracking the relevant litigation until resolution, understanding the complexities of the settlement process, and then verifying that recoveries received are accurate.
Investors relying on manual processes or fragmented data sources may struggle to keep pace with continuously assessing the growing number of eligible cases.
New Risk Themes Are Emerging
Perhaps the most notable shift in 2026 is the changing nature of the allegation themes prompting new securities litigation.
Artificial Intelligence (AI)-related filings are no longer novel. Securities litigation related to AI at mid-year 2026 have already exceeded the total number filed during all of 2025. This development reflects that the pervasiveness of this technology has increased scrutiny of AI-related disclosures, business strategies, and investor communications. Meanwhile, allegations involving misleading future performance have become the most common type of claim. Regulatory-related allegations (e.g. price declines after disclosure of enforcement activity) are also increasing.
These trends highlight an important reality: litigation increasingly follows innovation.
As companies introduce new technologies and adapt to evolving regulatory expectations, investors should anticipate continued expansion into emerging areas of risk. Further, new approaches by regulators will impact the types of securities litigation that follows.
Larger Recoveries Increase the Importance of Comprehensive Filing
Settlement values also tell an important story.
Although most settlements remain below $20 million, the average settlement value reached approximately $54 million during the first half of 2026. This is the highest level observed over the past decade when excluding outlier mega-settlements in excess of one billion dollars. The aggregate value of newly announced settlements reached approximately $2.3 billion in just the first six months of the year.
The growing settlement values means even a single missed filing could cause an institutional investor to lose out on a meaningful financial recovery that its own stakeholders are expecting. Therefore, comprehensive claims filing has become an essential component of fiduciary responsibility to an institution’s beneficiaries, shareholders and clients.
Global Litigation Demands Global Monitoring
The NERA report also points to renewed growth in litigation involving foreign issuers, reversing several years of decline. However, this trend is not exclusive to the U.S. The increased competition by other countries to attract issuers has contributed to a rise in international securities litigation. As cross-border securities actions continue to expand, investors must evaluate opportunities across multiple jurisdictions, each with unique procedural requirements and participation deadlines.
An effective recovery program today requires visibility beyond U.S. settlements. Monitoring international collective actions, understanding jurisdiction-specific filing requirements and evaluating participation opportunities have become increasingly important for globally diversified portfolios.
Technology Has Become a Competitive Advantage
Growing case volumes, evolving litigation themes and increasingly complex eligibility requirements reinforce the importance of technology-enabled claims recovery services. Modern recovery programs leverage automation, advanced analytics and centralized data management processes to:
Combining the right technology with experienced professionals enables institutional investors to recover more efficiently while maintaining confidence in every filing.
Looking Ahead
The securities litigation environment will continue to evolve as practitioners respond to emerging technologies, geopolitical events and changing market dynamics. Despite these uncertainties, AI, cybersecurity, global disclosure standards and market conduct are likely to remain significant drivers of future litigation. For institutional investors, the question is whether their recovery processes are prepared to keep pace with the continuing complexities of the securities class action space.
At SS&C Battea, we believe the strongest recovery programs combine deep industry expertise with advanced technology, comprehensive market monitoring and rigorous operational controls. As litigation trends continue to evolve, our focus remains on helping institutional investors identify every eligible opportunity, maximize recoveries and navigate an increasingly complex global claims environment with confidence.
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