We will probably all receive notification about a class action lawsuit in our lifetime. Almost everyone comes in contact with a defective product, fraudulent business, or another dishonest company at some point. When this occurs, you may have questions about the class action process and class action settlements. Some of the top things you need to know about class actions include:
1. They Allow the Courts to Deal with Many Cases at Once
Courts use class action lawsuits when there are cases where the plaintiffs accuse the same defendant of causing similar injuries or damages with the same mechanism. In some cases, it would take years to get through all the cases individually, but the court can hear the case of a class representative, make a decision, and apply it to all members of the class in a much shorter period.
2. You Have the Option to Opt In or Opt Out
If you receive a letter or see a television advertisement and realize you qualify as a class member in a class action, you have the choice to opt in or opt out. If they contacted you directly, you would likely have to take action to opt out. If you see an ad, you will most likely need to contact them to opt in. This choice is not always easy. If you opt in, you may receive a portion of the settlement if there is one. If the court rules in favor of the defense, though, you will lose the option of filing an individual suit.
3. The Payouts Are Often Small
In general, the payouts from class action settlements are small. Many of these cases only make financial sense to file as a class action. You would never recover enough compensation to pay your expenses if you filed as an individual because the damages were rather low. This makes them a good way to hold companies accountable “for the principle of it,” but it is usually not realistic to expect a large settlement from your class action claim.
4. There Can Be Two Dozen Class Members or a Few Thousand
The number of class members involved in a case varies drastically. The smallest have two to three dozen members, while some can include millions. The outcome is the same. The settlement or judge’s decision applies to the entire class, unlike in multidistrict litigation where the outcome only informs the individual outcomes of the cases involved. For example, if there is a settlement agreement that creates a fund of $100,000 for class members, each of the 1,000 class members would receive $100.
5. Only the Class Representative Participates in Settlement Negotiations
Many people find it strange that the only plaintiff who can participate in settlement negotiations in a class action is the class representative. During this process, the class representative serves on behalf of all class members. Their attorney will present all settlement offers to them for approval. If the class representative determines a settlement offer is fair, the judge must still approve the settlement. Often, there may also be public hearings on the matter. These additional requirements offer extra protections to ensure all class members receive a fair payout.
Call Us Today to Discuss Your Class Action Case
At Gacovino, Lake & Associates, P.C., our attorneys handle all types of class action, multidistrict litigation, and other types of mass torts. Call us today at 631-600-0000 to talk about your case, let us help you understand your options and the process, and explain what you can expect going forward.