These comparisons do not include the 312 "IPO Allocation" securities class action filings in 2001 alleging fraud in the IPO underwriting process, or the more recent "Analyst" class actions naming securities analysts and investment banks as defendants, which are categorized separately by the Clearinghouse.

"From a measurement perspective, it makes sense to treat the IPO Allocation and Analyst allegations as extraordinary events that do not most accurately describe the underlying trend in litigation activity," explained Professor Joseph Grundfest of Stanford Law School, who was formerly a Commissioner of the Securities and Exchange Commission.

The average market cap loss of $9.3 billion for companies sued in 2002 is similar to the $9.7 billion average loss in 2001.

"This multibillion-dollar average is a result of 40 'mega' filings in 2002 where the defendant companies each lost more than $10 billion in market capitalization," said John Gould, vice president of Cornerstone Research in Boston and the principal author of the study. "These cases alone account for 82 percent of the total market cap loss reflected in the 224 filings."

The study found that the suits filed in 2002 cut a broad swath across industries. The communications, including Internet-related companies, consumer products and financial services industries, were especially hard-hit.

The Clearinghouse also found that 85 percent of the filings charge defendants with 10b-5 violations (such as affirmative fraud or failures to disclose material information).

More than 80 percent of the complaints cite misrepresentations in financial documents. Almost 60 percent allege GAAP violations, and half of those contain allegations related to revenue recognition. Insider trading is alleged in 26 percent of the complaints.

"The focus on financial misrepresentations and GAAP violations reflects the current securities class action environment," noted Professor Grundfest.