An aggrieved shareholder will file a lawsuit on behalf of themselves and all other shareholders similarly harmed by the actions of the wayward corporate officers. The lawsuit asks the court’s permission to allow the plaintiff to represent all other aggrieved shareholders. However, there may be other aggrieved shareholders who also wish to represent all aggrieved shareholders. In fact, there may be several different shareholders who initiate lawsuits, each seeking to represent all other aggrieved shareholders. The court will then set a deadline to consolidate all cases into one and to pick a shareholder to represent all other shareholders in the consolidated action. The representative that the court chooses is called the “lead plaintiff.”
