What is a Class Action lawsuit?
When a significant number of people have been injured in a similar manner by the same company, the law may allow a representative group of injured persons to bring a lawsuit to recover damages for the entire group. This is called a class action.
One purpose of class actions is to address the scenario where a bad actor damages a large number of persons but in an individual dollar amount that does not make it financially feasible to file an individual lawsuit. Every lawsuit involves costs, such as filing fees, collecting documents, taking testimony, and preparing for trial. Economically, it does not make sense to file a lawsuit if your costs are greater than your potential recovery. The law does not want bad actors to escape responsibility simply because they spread out the injuries across a large number of people. Class actions seek to remedy this imbalance by sharing the costs of litigation among a large group of potential claimants.
Another purpose of class actions is to conserve judicial resources by allowing common factual questions and common legal issues (those that affect the entire group) to be answered at the same time. This can help prevent inconsistent jury verdicts and court rulings.
Can a Class Action help you?
No injury is too small. If you’ve been injured, you may not be alone. Even if other attorneys have turned down your case as too small, there is a possibility that you may be part of a much larger group of injured persons. Contact the experienced class action lawyers of Lewis Babcock to help you evaluate your potential claim.
Lewis Babcock has handled many consumer class actions, including suits against:
Lewis Babcock represented people who retired under the Teacher and Employee Retention Incentive plan (TERI) after the State of South Carolina unilaterally changed the terms of the plan and withheld retirement funds from the TERI participants’ paychecks. Ultimately, a total of over $35 million dollars was refunded to the class of TERI participants.
Other settlements have resulted in monetary payments, cessation of the illegal conduct, and other benefits. Based upon your individual circumstances and losses, we can advise on whether it is a better idea for you to get involved in a class action or to follow proper procedures to opt out and bring your own individual lawsuit. The larger your losses, the more important it is to consult with a knowledgeable attorney to decide if joining a class action is right for you.
Legal Requirements for Class Actions
Qualifying as a Class Action
There are certain court rules (federal or state, depending on the forum) that must be met in order for a legal dispute to be resolved through a class action. The first step is defining the class on whose behalf the lawsuit is filed. The class should be defined with sufficient definiteness such that the court can identify who in entitled to notice of the lawsuit, who is entitled to relief, and who will be bound by the final judgment.
Class certification will require the representative claimants to satisfy the following basic elements of a class action:
(1) Numerosity. There has to be a sufficient number of people affected by the violation such that it is more efficient or practical to join the cases together rather than try them separately in individual lawsuits.
(2) Commonality. Claims need to raise common legal or factual issues, making it efficient to deal with all claims together. The common questions need to be more significant than the individual variations among claimants.
(3) Typicality. The people named as plaintiffs and their representatives need to demonstrate that they have the same claims or defenses as the larger class of claimants.
(4) Adequacy of Representation. Both the named plaintiffs and their attorneys have fiduciary responsibilities to the absent class members (those unnamed in the complaint). As such, the individually named plaintiffs must provide fair and adequate representation and protect the interests of the class. This has two aspects: (1) the class lawyers must be qualified and experienced, and the (2) the named plaintiffs must not have interests contrary to those of the other class members. In certain instances, a plaintiff’s individual background may counsel against being named as a class representative. For example, someone with a history of fraud is not considered the right plaintiff in a class action involving consumer banking issues.
Next steps after a Class Action is filed:
Once the complaint is filed — starting the lawsuit — and the class is certified, the case could take more or less time to resolve than an individual lawsuit. The length of the lawsuit often depends on the defendant in the case, and a class action could settle in several months or go on for years. Most often, the class action ends with a settlement.
The court must approve settlement, and does so upon finding it fair and reasonable to the class. Attorneys’ fees are part of the court’s approval process, and those fees are typically a percentage of the funds paid to the class. You do not have to pay any money out of pocket in order to participate in a class action.
Contact our office for advice and support
We welcome your questions on class actions. The experienced attorneys at Lewis Babcock are prepared to advise you on whether your claim would be best handled as part of a class action. Contact us today about your potential claim.