To protect investors by fostering transparency and accountability of attorneys in private securities litigation.

Summary: Securities Litigation Attorney Accountability and Transparency Act - Amends the Securities Exchange Act of 1934 and the Securities Act of 1933 to require, in any private action in which the court enters a final judgment, that the court award the defendant reasonable fees and expenses, and impose such fees and expenses on the plaintiff's attorney, if the plaintiff's position was not substantially justified.

Requires each plaintiff and plaintiff's attorney in a private action to provide sworn certifications, filed with the complaint, that identify any conflict of interest, including any direct or indirect payment, between the attorney and the plaintiff.

Authorizes the court, in exercising its discretion over the approval of lead counsel, to employ alternative means in the selection and retention of counsel for the most adequate plaintiff, including a competitive bidding process.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Securities Litigation Attorney 
Accountability and Transparency Act''.

SEC. 2. LOSING PLAINTIFF'S ATTORNEY PAYS.

    (a) Securities Exchange Act of 1934.--Section 21D(c) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78u-4(c)) is amended by 
adding at the end the following new paragraph:
            ``(4) Assessment of fees and expenses.--
                    ``(A) Determination required.--If the court in any 
                private action arising under this title enters a final 
                judgment against a plaintiff on the basis of a motion 
                to dismiss, motion for summary judgment, or a trial on 
                the merits, the court shall, upon motion by the 
                defendant, determine whether--
                            ``(i) the position of the plaintiff was not 
                        substantially justified;
                            ``(ii) imposing fees and expenses on the 
                        plaintiff's attorney would be just; and
                            ``(iii) the cost of such fees and expenses 
                        to the defendant is substantially burdensome or 
                        unjust.
                    ``(B) Award.--If the court makes the determinations 
                described in clauses (i), (ii), and (iii) of 
                subparagraph (A), the court shall award the defendant 
                reasonable fees and other expenses incurred by the 
                defendant and impose such fees and expenses on the 
                plaintiff's attorney.
                    ``(C) Basis of determination regarding position; 
                burden of persuasion.--The determination of whether the 
                position of the plaintiff was substantially justified 
                shall be made on the basis of the record in the action 
                for which fees and other expenses are sought, but the 
                burden of persuasion shall be on the defendant.''.
    (b) Securities Act of 1933.--Section 27(c) of the Securities Act of 
1933 (15 U.S.C. 77z-1(c)) is amended by adding at the end the following 
new paragraph:
            ``(4) Assessment of fees and expenses.--
                    ``(A) Determination required.--If the court in any 
                private action arising under this title enters a final 
                judgment against a plaintiff on the basis of a motion 
                to dismiss, motion for summary judgment, or a trial on 
                the merits, the court shall, upon motion by the 
                defendant, determine whether--
                            ``(i) the position of the plaintiff was not 
                        substantially justified;
                            ``(ii) imposing fees and expenses on the 
                        plaintiff's attorney would be just; and
                            ``(iii) the cost of such fees and expenses 
                        to the defendant is substantially burdensome or 
                        unjust.
                    ``(B) Award.--If the court makes the determinations 
                described in clauses (i), (ii), and (iii) of 
                subparagraph (A), the court shall award the defendant 
                reasonable fees and other expenses incurred by the 
                defendant and impose such fees and expenses on the 
                plaintiff's attorney.
                    ``(C) Basis of determination regarding position; 
                burden of persuasion.--The determination of whether the 
                position of the plaintiff was substantially justified 
                shall be made on the basis of the record in the action 
                for which fees and other expenses are sought, but the 
                burden of persuasion shall be on the defendant.''.

SEC. 3. DISCLOSURES OF CONFLICTS OF INTEREST BETWEEN PLAINTIFF AND 
              ATTORNEYS.

    (a) Securities Exchange Act of 1934.--Section 21D(a) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78u-4(a)) is amended by 
adding at the end the following new paragraph:
            ``(10) Disclosures regarding conflicts of interest.--In any 
        private action arising under this title, each plaintiff and any 
        attorney for such plaintiff shall provide sworn certifications, 
        which shall be personally signed by such plaintiff and such 
        attorney, respectively, and filed with the complaint, that 
        identifies any conflict of interest, including any direct or 
        indirect payment, between such attorney and such plaintiff and 
        between such attorney and any affiliated person of such 
        plaintiff. The court shall make a determination of whether such 
        conflict is sufficient to disqualify the attorney from 
        representing the plaintiff.''.
    (b) Securities Act of 1933.--Section 27(a) of the Securities Act of 
1933 (15 U.S.C. 77z-1(a)) is amended by adding at the end the following 
new paragraph:
            ``(10) Disclosures regarding conflicts of interest.--In any 
        private action arising under this title, each plaintiff and any 
        attorney for such plaintiff shall provide sworn certifications, 
        which shall be personally signed by such plaintiff and such 
        attorney, respectively, and filed with the complaint, that 
        identifies any conflict of interest, including any direct or 
        indirect payment, between such attorney and such plaintiff and 
        between such attorney and any affiliated person (as such term 
        is defined in section 2(a)(3) of the Investment Company Act of 
        1940 (15 U.S.C. 80a-3(a)(3))) of such plaintiff. The court 
        shall make a determination of whether such conflict is 
        sufficient to disqualify the attorney from representing the 
        plaintiff.''.

SEC. 4. SELECTION OF LEAD COUNSEL.

    (a) Securities Exchange Act of 1934.--Section 21D(a)(3)(B)(v) of 
the Securities Exchange Act of 1934 (15 U.S.C. 78u-4(a)(3)(B)(v)) is 
amended by adding at the end the following: ``In exercising the 
discretion of the court over the approval of lead counsel, the court 
may employ alternative means in the selection and retention of counsel 
for the most adequate plaintiff, including a competitive bidding 
process.''.
    (b) Securities Act of 1933.--Section 27(a)(3)(B)(v) of the 
Securities Act of 1933 (15 U.S.C. 77z-1(a)(3)(B)(v)) is amended by 
adding at the end the following: ``In exercising the discretion of the 
court over the approval of lead counsel, the court may employ 
alternative means in the selection and retention of counsel for the 
most adequate plaintiff, including a competitive bidding process.''.