What happens to class action awards for a stock in an IRA?
"In most cases, if you are a member of the class the law-firm will contact you via postal mail to notify you of the class action and give you an opportunity to opt-in or opt-out of participating in any settlement that happens.  More often than not, they take the opt-out approach, meaning that if you don't say you want out of the class it is assumed that you agree with the complaints as defined in the class action and would like to receive your portion of the money if there is a settlement.  If you haven't gotten such a letter and you think you should have, it is a good idea to contact the law firm. How do you find the law firm? Usually some Googling on ""class action"" and the name of the defendant company will get you there. Also, check the legal section of the classifieds of the local newspaper, they sometimes advertise them there.  Typically they aren't hard to find because it is in the law firm's best interest to have everyone sign on to their class action for a number of reasons including: If you have a lot of people who are supposedly aggrieved, it makes the defendant look more likely to be guilty, and more participants can equate to higher settlement amounts (for which the law firm gets a percentage). That is why you see non-stop ads on daytime TV for lawyers marketing class action cases and looking for people who took this drug, or had that hip implant. Once a settlement occurs and you are a member of that class, there are a number of ways you might get your piece including: - A credit to your account. - A check in the mail. - A coupon or some other consideration for your damages (lame) - A promise that they will stop doing the bad thing and maybe some changes (in your favor) on the terms of your account. A final note: Don't get your hopes up. The lawyers are usually the only ones who make any substantial money from these things, not the class members. I've been paid settlements from lots of these things and it is rare for it to be more than $25, but the time the spoils are divided. I've gotten NUMEROUS settlements where my share was less than a dollar. There are some decent resources on ClassAction.com, but beware that although the site has some good information, it is primarily just an ad for a lawfirm. Also, note that I am not affiliated with that site nor can I vouch for any information contained there. They are not an impartial source, so understand that when reading anything on there."
Neither party gives an F about the consumer.   The real issue is class action lawsuits, in which the consumer gets shafted and the lawyers make a killing.   Real class action reform would not come in the form of favoring arbitration over lawsuits (or vice versa) but in requiring that attorneys’ fees in class action suits be paid in the same form as the payment to consumers and requiring that people opt-in to join a class, rather than having to actively opt-out. Ending payment of attorneys’ fees in cash but consumers getting coupons (which are only good one buys more of the alleged wrong-doing firms’ products/services) would ensure consumers get a fair shake.  This would hurt the lawyer lobby, and thus most Democrats (and many Republicans) would never support it. Requiring people to opt-in to class-action suits (rather than go through a long process of opting-out) would reduce the number of frivolous class action suits.  Again, this would hurt the lawyer lobby, and thus most of our politicians wouldn’t support it. In short, it comes down to most Democrats favoring the lawyer lobby over the business lobby, and most Republicans favoring the opposite. Neither cares about the consumer/citizen. "Summarized article: Facebook will pay $10 million to settle a proposed class action lawsuit from 5 users who claimed their names, images and other information were used improperly in advertising called ""sponsored stories"" without giving compensation or a chance to opt out.   A sponsored story is an ad that appears on a user's Facebook page that shows another friend's name, profile picture and a ""like"" by the friend as an implied endorsement of the company.   The district judge ruled that economic injury could occur through the use of the user's name and likeness in Facebook advertising.   The case, filed in California, reached a settlement in May but the terms were not disclosed until recently. The proposed class action suit could have included almost 1 of every 3 Americans totaling billions of dollars in damages.   The $10 million settlement will be given to charity.  * For more summarized news, subscribe to the [/r/SkimThat](http://www.reddit.com/r/SkimThat) subreddit" Options are an indication what a particular segment of the market (those who deal a lot in options) think will happen. (and just because people think that, doesn't mean it will)  Bearing in mind however that people writing covered-calls may due so simply as part of a strategy to mitigate downside risk at the expense of limiting upside potential.  The presence of more people offering up options is to a degree an indication they are thinking the price will fall or hold steady, since that is in effect the 'bet' they are making.  OTOH the people buying those options are making the opposite bet.. so who is to say which will be right.  The balance between the two and how it affects the price of the options could be taken as an indication of market sentiment (within the options market) as to the future direction the stock is likely to take. (I just noticed that Blackjack posted the forumula that can be used to model all of this)  To address the last part of your question 'does that mean it will go lower' I would say this.  The degree to which any of this puts actual pressure on the stock of the underlying instrument is highly debatable, since many (likely most) people trading in a stock never look at what the options for that stock are doing, but base their decision on other factors such as price history, momentum, fundamentals and recent news about the company.  To presume that actions in the options market would put pressure on a stock price, you would need to believe that a signficant fraction of the buyers and sellers were paying attention to the options market.  Which might be the case for some Quants, but likely not for a lot of other buyers.   And it could be argued even then that both groups, those trading options, and those trading stocks, are both looking at the same information to make their predictions of the likely future for the stock, and thus even if there is a correlation between what the stock price does in relation to options, there is no real causality that can be established.  We would in fact predict that given access to the same information, both groups would by and large be taking similar parallel actions due to coming to similar conclusions regarding the future price of the stock.  What is far MORE likely to pressure the price would be just the shear number of buyers or sellers, and also (especially since repeal of the uptick rule) someone who is trying to actively drive down the price via a lot of shorting at progressively lower prices.  (something that is alleged to have been carried out by some hedge fund managers in the course of 'bear raids' on particular companies) "I don't want to sue them on my own.  I don't want them sued in the first place.  Anyone could see that this was a typical class-action suit with minimal merits that companies usually just pay off to make go away.  Fucking ambulance chasing lawyers are fucking us all over, and those idiots like yourself who cover up for them.  If only the judges would get some balls and say, ""Hey, this so called 'settlement' doesn't benefit the class at all and is basically a payoff for the scum sucking lawyers, so I'm going to deny it"".  Good luck with that happening." Anytime you invest in stocks, you do that inside an investment account - such as the type you might open at ETrade, Vanguard, Fidelity or Charles Schwab.   Once you have the account and fund it, you can tell the system to invest some/all of your money in  When you open your investment account, their first question will be whether this is a cash account, traditional IRA, or Roth IRA.  The broker must report this to the IRS because the tax treatment is very different. The tax cost at election should be zero.  The appreciation is all capital gain beyond your basis, which will be the value at election. IRC §83 applies to property received as compensation for services, where the property is still subject to a substantial risk of forfeiture.  It will catch unvested equity given to employees. §83(a) stops taxation until the substantial risk of forfeiture abates (i.e. no tax until stock vests) since the item is revocable and not yet truly income.  §83(b) allows the taxpayer to make a quick election (up to 30 days after transfer - firm deadline!) to waive the substantial risk of forfeiture (e.g. treat shares as vested today). The normal operation of §83 takes over after election and the taxable income is generally the value of the vested property minus the price paid for it.  If you paid fair market value today, then the difference is zero and your income from the shares is zero. The shares are now yours for tax purposes, though not for legal purposes.  That means they are most likely a capital asset in your hands, like other stocks you own or trade.  The shares will not be treated as compensation income on vesting, and vesting is not a tax matter for elected shares. If you sell them, you get capital gain (with tax dependent on your holding period) over a basis equal to FMV at the election.  The appreciation past election-FMV will be capital gain, rather than ordinary income.  This is why the §83(b) election is so valuable.  It does not matter at this point whether you bought the restricted shares at FMV or at discount (or received them free) - that only affects the taxes upon §83(b) election. I would ask your HR or benefits department to be certain, but here's how I read that without any specific knowledge of the situation: What is right to receive the RSU consideration? Company A was bought by Company B.  You had unvested Restricted Stock Units in A, which is now gone.  B is saying that you now have the right to receive consideration equivalent to the value of those RSUs in A. Since B is private, there's no publicly traded stock, so it will likely be in cash, but read the rest of the paperwork or talk to HR to be certain.   For example, if you had 100 RSUs vesting next year and the price of stock in A was $50 when the company was bought, those RSUs would be worth $5,000.  B is give you the right to consideration for those RSUs, hopefully for somewhere around $5,000.  That consideration is unvested, meaning you must stay employed until the vesting period in order to claim that right. If you are fired without cause (i.e. laid off), you will receive those unvested claims as compensation.   I assume the same will be applicable if employee leaves the company  Probably not.  In any situation, if you voluntarily leave a company, any unvested stock, RSUs, options, etc. are forfeited. Summarized article: The NASDAQ announced it will offer $40 million to compensate clients who were disadvantaged by technical problems during Facebook's IPO on May 18.   NASDAQ's technical glitch caused a delay in the opening of first day trading of Facebook shares and traders experienced slow order confirmations.   NASDAQ said $13.7 million will be paid to its affected investment firms and the balance will be given to the firms as credit to reduce trading fees. The benefits would last as long as 6 months.   Investors who are eligible for compensation are those who placed orders to buy Facebook shares at $42 or less but were executed at an inferior price or those whose orders went through but were not immediately confirmed.  The New York Stock Exchange (NYSE) opposed the compensation offer saying the move would allow NASDAQ to undercut them on prices and would take market share from competing exchanges.   NASDAQ's compensation plan is subject to regulator approval.    Facebook shares are currently down 30% from the IPO price of $38.  *For more summarized news, subscribe to the [/r/SkimThat](http://www.reddit.com/r/SkimThat) subreddit*