Will SPAC Restatement Wave Trigger Shareholder Litigation?


In this Law360 article, the authors examine restatements for warrants issued by special purpose acquisition companies from April to June 2021, and consider whether securities class actions will follow.

On April 12, 2021, the SEC issued a statement highlighting concerns about the accounting treatment of warrants issued in conjunction with special purpose acquisition companies (SPACs). Almost 500 SPACs restated their accounting for warrants in the months following that statement. For at least one entity created through a SPAC, a securities class action has been filed alleging improper accounting and deficient internal controls following a warrant restatement.

In this article, authors Elaine Harwood, Steven McBride, and Laura Simmons consider the SPACs that have restated and whether other class actions will follow. The authors conclude that accounting issues involving SPACs will be a continuing area of interest for plaintiff counsel involved in securities class actions.

This article was originally published by Law360 in June 2021.

The views expressed herein do not necessarily represent the views of Cornerstone Research.

Will SPAC Restatement Wave Trigger Shareholder Litigation?


  • Los Angeles

Elaine M. Harwood

Senior Vice President

  • Washington

Steven McBride


  • Washington

Laura E. Simmons

Senior Advisor