Securities Litigation Reform Act

Securities Litigation Reform Act - Amends the Securities Exchange Act of 1934, with respect to class actions, to require a court-appointed class action steering committee, composed of class members, to direct counsel for the plaintiff class (plaintiff steering committee).

(Sec. 2) Prohibits the use of disgorgement funds resulting from actions brought by the Securities Exchange Commission (the Commission) to pay legal expenses incurred by private parties seeking distribution of such funds.

(Sec. 3) Declares that the portion of any final judgment or settlement awarded to class plaintiffs serving as the representative parties shall be equal (on a per share basis) to the portion of the final judgment awarded to all other members of the class.

Revises the guidelines for private class action suits to: (1) restrict to five the number of class actions filed by a named plaintiff during any three-year period; (2) subject a losing party litigant, if certain conditions apply, to liability for the prevailing party's legal fees; and (3) require the court to make a disqualifying conflict of interest determination with respect to a plaintiff's counsel who directly owns or has a beneficial interest in the securities that are the subject of the litigation.

Requires a court to require just and equitable security for the payment of awardable fees and expenses from the attorney for the plaintiff class, the plaintiff class, or both.

Sets forth disclosure guidelines for any proposed settlement agreement that is disseminated to the plaintiff class, including: (1) a statement about agreement or disagreement on the amount of recoverable damages per share and the likelihood of the plaintiff's prevailing; (2) the amount of legal costs and fees sought as part of the settlement; and (3) the identification of lawyers' representatives who will be available to answer questions from class members.

Revises the guidelines for private class action suits to: (1) mandate discharge of a defendant who settles before verdict or judgment from all claims for contribution by nonsettling persons; (2) provide for recovery of contribution by a person who becomes liable for damages from certain non-parties who would have been liable for the same damages, if joined in the original suit; and (3) grant defendants the right to submit to the jury written interrogatories on the issue of each defendant's state of mind (scienter) at the time the alleged violation occurred.

Prohibits brokers or dealers from soliciting or accepting referral fees for assisting an attorney in obtaining the representation of a customer in any private action.

(Sec. 4) Delineates the requirements for securities fraud actions, including: (1) explicit pleading and proof of scienter; (2) plaintiff's reliance on a material misstatement or omission that proximately caused the plaintiff's loss; and (3) limitations on damages.

(Sec. 5) Defines the circumstances ("safe harbor") in which a person shall not be held liable in a private action based on a fraudulent statement with respect to a forward-looking statement (projections or estimates of future events). Prescribes guidelines under which the court shall restrict discovery to the specific issue of the applicability of the "safe harbor."

Directs the Commission to adopt a regulatory framework regarding the making of forward-looking statements that will be deemed to preclude liability under this Act.

(Sec. 6) Amends the Racketeer Influenced and Corrupt Organizations statute to exclude from its purview an action involving fraud in the sale of securities.

(Sec. 7) Amends the Securities Exchange Act of 1934 to include within statutorily mandated audit requirements specified fraud detection and disclosure procedures to be followed by an independent public accountant.

Authorizes the Securities and Exchange Commission to impose civil penalties for willful violations of this Act by an independent public accountant.