Importance Steps You Should Take When Filing a Class-Action Lawsuit

What to Know About Filing a Class Action Lawsuit

Class action lawsuits represent a large group of people who have been hurt by the same defective product or negligent action. While personal injury claims represent one plaintiff, class action suits represent many plaintiffs.

Instead of filing separate personal injury claims, the injured parties ban together and sue the defendant as a class instead of as individuals.

Class action lawsuits may be brought against government entities, product manufacturers, hospitals, medical practitioners, employers, financial institutions and retail establishments.

The claims can involve defective products, deceptive advertising, medical negligence, unlawful employment practices, workplace discrimination, securities fraud and hourly wage law disputes.

How Do Class Action Cases Work?

One or more lead plaintiffs must agree to represent the class members. The case must then be certified by a judge. To achieve certification, the lead plaintiff must show that the claim against the defendant is justified.

The lead plaintiff must also demonstrate that everyone in the class has a similar complaint. The lawsuit must further be shown to effectively represent all class members.

Advantages Of Class Action Lawsuits

  • They give plaintiffs an opportunity to receive compensation without retaining a personal injury lawyer and incurring costly legal fees.
  • They can pressure the defendant to settle the case quickly if there are many plaintiffs with the same complaint.
  • They can compel the defendants to improve their products and services to avoid more lawsuits in the future.

Additionally, class action cases can help to set a precedent for future compensation claims. They reduce the potential for different courts to pay out different settlement amounts for identical complaints.

That, in turn, helps to ensure fair and consistent treatment for all plaintiffs adversely affected by the same defective product or negligent action.

Disadvantages of Class Action Suits

Class action cases may take years to resolve because of all the associated red tape. If you prefer fast cash, you might fare better by taking your case to a small claims court for resolution.

In Tennessee, for example, small claims court limits go up to $25,000 per claim. If you decide to file your own claim, you must first opt out of the class action lawsuit.

Although your share of a class action settlement probably won’t be groundbreaking, it does allow you to gain some measure of compensation for your injuries without having to retain your own attorney or defend your own interests in small claims court. It may not be much, but it’s better than nothing.

What’s Involved in Class Action Certification?

Most judges will certify a class action lawsuit that involves at least 40 plaintiffs. If there are 20 or fewer plaintiffs, a class action lawsuit is unlikely to obtain certification.

Additionally, the claimants represented by the action must meet all of the following criteria according to the Federal Rules of Civil Procedure:

  • The number of potential claimants is so high that it would be impractical to include all of them in one lawsuit.
  • The amount of potential compensation for each member is relatively small.
  • All complaints are based on the same issue or problem.
  • All class members have essentially the same claim against the same defendant.
  • The class representatives can provide all class members with fair and adequate protection.

How Are Class Members Notified?

Because most potential claimants will be unaware of a class action, a Notice of Class Action is sent to anyone who might be affected. Upon receipt of the Notice, you become part of the class bringing the lawsuit. A reasonable effort must be made to contact each class member and inform them of the action.

The court will ensure that a reasonable effort is made to notify all class members using “the most effective notification practicable.” The notice must “clearly and concisely state in plain, easily understood language” the nature of the claim and the specific allegations against the defendant.

You’ve Received a Notification. Now What?

Now, you wait. If the parties settle the case, you’ll receive your share of the compensation automatically if you haven’t opted out.

If you’ve opted out, you’ll receive no compensation when the case is settled. However, you’ll be free to file your own complaint against the defendant, even if the class action case is dismissed.

If you remain in a class action lawsuit without opting out, you will lose your right to sue the defendant as an individual, regardless of the outcome of the class action.

Any class member included in the class action may opt out of the class if they wish. However, they must follow a set procedure. To learn more about the opting out process, contact Members remain part of the class unless they take the required steps to opt out.

What If I’m Not Notified?

Search for the case online. There are usually dedicated websites that cover class action lawsuits and include the names of the representative attorneys. Call the law firm to inquire about the status of the case.

How Long Does It Take to Settle Class Action Lawsuits?

Some cases are settled within a few months. Others can drag on for years, especially if the defendants file an appeal. However, most class actions take two or three years to resolve.

If a class action suit involves many plaintiffs, the defendants might settle quickly to downplay negative publicity. At the same time, megalithic corporations can easily afford to stave off justice by keeping everyone tied up in court for the foreseeable future.

The Exxon Valdes oil spill case, for example, took 26 years before a settlement was finally reached in 2015.

How Much of a Settlement Can I Expect?

Most class action lawsuits are settled by the parties out of court.

The lawyers representing the case typically receive 25 to 33 percent of the total settlement amount to cover their legal costs.

The remaining compensation is then distributed among the class members. It could be cash, a refund, a free service or something else that the case representatives deem to have value. In some cases, your compensation might be in the form of coupons or product rebates.

If you or a loved one have been harmed by a defective product or an act of negligence, contact immediately for a no-cost consultation.

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