In my December 2003 post entitled, "Puncturing the Myths of Opting Out," one of the key points in support of the idea that opting out of securities class action settlements was generally ill-advised was the following:

"Indeed, the plaintiffs' law firm Bernstein Litowitz Berger & Grossman, co-lead counsel in the WorldCom case discussed above, offers the following eye-opening bit of research: to its knowledge, no individual action has ever settled prior to a pending class action or settled on more favorable terms."

This is now open to debate, however, because according to this Reuters article, the $78.9 million settlement reached by five NYC pension funds that opted out of the WorldCom securities class action is "about three times bigger than what they would they would have gotten as part of the wider class-action case." 

"This settlement fully validates the decision of the funds' trustees to opt out of the class action to pursue an individual case," Michael Cardozo, the city's corporation counsel, said in a statement.

In addition, the article notes that the NYC pension funds expect to receive payment "within the next few weeks," which, barring some unexpected turn of events in the WorldCom securities class action claims administration, will be way before any money is received by the class.

Interestingly, in this updated version of the same Reuters article, there is a quote from Sean Coffee of Bernstein Litowitz taking issue with Cardozo's statement.  Coffee states:

"I would be very skeptical of any claim that an individual plaintiff did better than a class member given the representations that had been made to the federal court about the individual plaintiff's damages, and the significant disparity in attorneys fees," he said.

The opt out plaintiffs reportedly paid attorneys fees of 15%, whereas the class paid just 5.5%.