Outside of regulatory filings an investor can sometimes learn about a company through court records. Companies are often sued by groups of people through class action lawsuits. A common class action suit might claim that a corporation’s product has injured many people. Another might say that a company has discriminated against a specific group of people. A famous example would be Anderson vs. Pacific Gas & Electric, a class action suit in California made famous by the movie Erin Brockovich, which centered around an individual activist of the same name.
The records of such cases can be revealing. By viewing the available documents on line or at the court house where the case has been filed, socially responsible investors can learn a company’s defense to the claims.
Briefs filed by the company as a defendant or a plaintiff can be voluminous. They lay out the facts of a case and why the plaintiff or defendant’s argument should prevail. In doing so, they can include information about the company that would not have been part of an SEC filing. It might be revealed that the company president has a troublesome conflict of interest, for example.
Depositions, which are interviews conducted by one party in a lawsuit of the other before a trial begins, are sometimes included in court filings. They too can include information about corporate behavior that would not be included in regulatory filings, but were in response to a lawyer’s questions. Depositions, whether given by parties to the lawsuit or witnesses the parties plan to call during a trial, are typically done in a lawyer’s office and not in a courtroom.