Litigation Risk and Corporate Voluntary Disclosure: Evidence from Two Quasi-Natural Experiments

References

• Ali, A., Klasa, S., & Yeung, E. (2014). Industry concentration and corporate disclosure policy. Journal of Accounting and Economics, 58(2–3), 240–264. doi: 10.1016/j.jacceco.2014.08.004
   Web of Science ®Google Scholar
• Anilowski, C., Feng, M., & Skinner, D. J. (2007). Does earnings guidance affect market returns? The nature and information content of aggregate earnings guidance. Journal of Accounting and Economics, 44(1–2), 36–63. doi: 10.1016/j.jacceco.2006.09.002
   Web of Science ®Google Scholar
• Appel, I. R., Gormley, T. A., & Keim, D. B. (2016). Passive investors, not passive owners. Journal of Financial Economics, 121(1), 111–141. doi: 10.1016/j.jfineco.2016.03.003
   Web of Science ®Google Scholar
• Baginski, S. P., Conrad, E. J., & Hassell, J. M. (1993). The effects of management forecast precision on equity pricing and on the assessment of earnings uncertainty. The Accounting Review, 68(4), 913–927.
   Web of Science ®Google Scholar
• Baginski, S. P., & Hassell, J. M. (1997). Determinants of management forecast precision. The Accounting Review, 72(2), 303–312.
   Web of Science ®Google Scholar
• Baginski, S. P., Hassell, J. M., & Kimbrough, M. D. (2002). The effect of legal environment on voluntary disclosure: Evidence from management earnings forecasts issued in US and Canadian markets. The Accounting Review, 77(1), 25–50. doi: 10.2308/accr.2002.77.1.25
   Web of Science ®Google Scholar
• Balakrishnan, K., Billings, M. B., Kelly, B., & Ljungqvist, A. (2014). Shaping liquidity: On the causal effects of voluntary disclosure. The Journal of Finance, 69(5), 2237–2278. doi: 10.1111/jofi.12180
   Web of Science ®Google Scholar
• Ball, R., Jayaraman, S., & Shivakumar, L. (2012). Audited financial reporting and voluntary disclosure as complements: A test of the confirmation hypothesis. Journal of Accounting and Economics, 53(1), 136–166. doi: 10.1016/j.jacceco.2011.11.005
   Web of Science ®Google Scholar
• Bamber, L. S., & Cheon, Y. S. (1998). Discretionary management earnings forecast disclosures: Antecedents and outcomes associated with forecast venue and forecast specificity choices. Journal of Accounting Research, 36(2), 167–190. doi: 10.2307/2491473
   Web of Science ®Google Scholar
• Bertrand, M., Duflo, E., & Mullainathan, S. (2004). How much should we trust differences-in-differences estimates? The Quarterly Journal of Economics, 119(1), 249–275. doi: 10.1162/003355304772839588
   Web of Science ®Google Scholar
• Billings, M. B., & Cedergren, M. C. (2015). Strategic silence, insider selling and litigation risk. Journal of Accounting and Economics, 59(2–3), 119–142. doi: 10.1016/j.jacceco.2014.12.001
   Web of Science ®Google Scholar
• Boone, A., & White, J. (2015). The effect of institutional ownership on firm transparency and information production. Journal of Financial Economics, 117(3), 508–533. doi: 10.1016/j.jfineco.2015.05.008
   Web of Science ®Google Scholar
• Bourveau, T., Lou, Y., & Wang, R. C. (2018). Shareholder litigation and corporate disclosure: Evidence from derivative lawsuits. Journal of Accounting Research, 56(3), 797–842. doi: 10.1111/1475-679X.12191
   Web of Science ®Google Scholar
• Cao, Z., & Narayanamoorthy, G. S. (2011). The effect of litigation risk on management earnings forecasts. Contemporary Accounting Research, 28(1), 125–173. doi: 10.1111/j.1911-3846.2010.01045.x
   Web of Science ®Google Scholar
• Cazier, R. A., Christensen, T. E., Merkley, K. J., & Treu, J. S. (2017). Litigation risk and non-GAAP reporting (Working Paper).
   Google Scholar
• Choi, S. J., & Pritchard, A. C. (2012). The supreme court’s impact on securities class actions: An empirical assessment of Tellabs. The Journal of Law, Economics, and Organization, 28(4), 850–881. doi: 10.1093/jleo/ewr014
   Web of Science ®Google Scholar
• Cox, J. D., Thomas, R. S., & Bai, L. (2009). Do differences in pleading standards cause forum shopping in securities class actions: Doctrinal and empirical analyses. Wisconsin Law Review, 32(2), 421–453.
   Google Scholar
• Crane, A. D., & Koch, A. (2018). Shareholder litigation and ownership structure: Evidence from a natural experiment. Management Science, 64(1), 5–23. doi: 10.1287/mnsc.2016.2561
   Web of Science ®Google Scholar
• Dass, N., & Massa, M. (2011). The impact of a strong bank-firm relationship on the borrowing firm. Review of Financial Studies, 24(4), 1204–1260. doi: 10.1093/rfs/hhp074
   Web of Science ®Google Scholar
• Donelson, D. C., McInnis, J. M., Mergenthaler, R. D., & Yu, Y. (2012). The timeliness of bad earnings news and litigation risk. The Accounting Review, 87(6), 1967–1991. doi: 10.2308/accr-50221
   Web of Science ®Google Scholar
• Field, L., Lowry, M., & Shu, S. (2005). Does disclosure deter or trigger litigation? Journal of Accounting and Economics, 39(3), 487–507. doi: 10.1016/j.jacceco.2005.04.004
   Web of Science ®Google Scholar
• Francis, J., Philbrick, D., & Schipper, K. (1994). Shareholder litigation and corporate disclosures. Journal of Accounting Research, 32(2), 137–164. doi: 10.2307/2491279
   Web of Science ®Google Scholar
• Hand, J. R. (2003). Profits, losses and the non-linear pricing of internet stocks. In J. Hand & B. Lev (Eds.), Intangible assets: Values, measures and risks. Oxford University Press.
   Google Scholar
• Hopkins, J. (2018). Does the threat of securities litigation deter earnings management? Contemporary Accounting Research, 35(4), 2030–2057. doi: 10.1111/1911-3846.12367
   Google Scholar
• Houston, J. F., Lin, C., Liu, S., & Wei, L. (2015). Shareholder litigation and management earnings forecasts (Working Paper).
   Google Scholar
• Jhong, C. P. (2016). Application of common-law doctrine of forum non convenient in federal courts after enactment of 28 U.S.C.A. § 1404(a) authorizing transfer to another district. 10 A.L.R. Fed. 352.
   Google Scholar
• Johnson, M. F., Kasznik, R., & Nelson, K. K. (2001). The impact of securities litigation reform on the disclosure of forward-looking information by high technology firms. Journal of Accounting Research, 39(2), 297–327. doi: 10.1111/1475-679X.00014
   Web of Science ®Google Scholar
• Kasznik, R., & Lev, B. (1995). To warn or not to warn: Management disclosures in the face of an earnings surprise. The Accounting Review, 70(1), 113–134.
   Web of Science ®Google Scholar
• Kim, I., & Skinner, D. J. (2012). Measuring securities litigation risk. Journal of Accounting and Economics, 53(1), 290–310. doi: 10.1016/j.jacceco.2011.09.005
   Web of Science ®Google Scholar
• Lang, M. H., & Lundholm, R. J. (1996). Corporate disclosure policy and analyst behavior. The Accounting Review, 71(4), 467–492.
   Web of Science ®Google Scholar
• Levy, H., Shalev, R., & Zur, E. (2018). The effect of CFO personal litigation risk on firms’ disclosure and accounting choices. Contemporary Accounting Research, 35(1), 434–463. doi: 10.1111/1911-3846.12378
   Web of Science ®Google Scholar
• Li, X. (2010). The impacts of product market competition on the quantity and quality of voluntary disclosures. Review of Accounting Studies, 15(3), 663–711. doi: 10.1007/s11142-010-9129-0
   Web of Science ®Google Scholar
• Lowry, M. (2009). Discussion of ‘shareholder litigation and changes in disclosure behavior’. Journal of Accounting and Economics, 47(1), 157–159. doi: 10.1016/j.jacceco.2008.11.006
   Web of Science ®Google Scholar
• Naughton, J. P., Rusticus, T. O., Wang, C., & Yeung, I. (2018). Private litigation costs and voluntary disclosure: Evidence from the Morrison ruling. The Accounting Review. Advance online publication. doi:10.2308/accr-52203
   Web of Science ®Google Scholar
• Rajan, R. G. (1992). Insiders and outsiders: The choice between informed and arm’s-length debt. The Journal of Finance, 47(4), 1367–1400. doi: 10.1111/j.1540-6261.1992.tb04662.x
   Web of Science ®Google Scholar
• Rogers, J. L. (2008). Disclosure quality and management trading incentives. Journal of Accounting Research, 46(5), 1265–1296.
   Web of Science ®Google Scholar
• Rogers, J. L., & Van Buskirk, A. (2009). Shareholder litigation and changes in disclosure behavior. Journal of Accounting and Economics, 47(1), 136–156. doi: 10.1016/j.jacceco.2008.04.003
   Web of Science ®Google Scholar
• Rogers, J. L., & Van Buskirk, A. (2013). Bundled forecasts in empirical accounting research. Journal of Accounting and Economics, 55(1), 43–65. doi: 10.1016/j.jacceco.2012.06.001
   Web of Science ®Google Scholar
• Skinner, D. J. (1994). Why firms voluntarily disclose bad news. Journal of Accounting Research, 32(1), 38–60. doi: 10.2307/2491386
   Web of Science ®Google Scholar
• Skinner, D. J. (1997). Earnings disclosures and stockholder lawsuits. Journal of Accounting and Economics, 23(3), 249–282. doi: 10.1016/S0165-4101(97)00010-4
   Web of Science ®Google Scholar
• Vashishtha, R. (2014). The role of bank monitoring in borrowers’ discretionary disclosure: Evidence from covenant violations. Journal of Accounting and Economics, 57(2), 176–195. doi: 10.1016/j.jacceco.2014.04.002
   Web of Science ®Google Scholar
• Zhang, H., & Zheng, L. (2010). The valuation impact of reconciling pro forma earnings to GAAP earnings. Journal of Accounting & Economics, 51(1), 186–202.
   Web of Science ®Google Scholar