Question 1

Do I have a Class Action?

Accepted Answer

A class action is intended to improve court efficiency by allowing a large group of people with similar claims to join together in one lawsuit. One or more representatives of the harmed group go to court on behalf of everyone else who was similarly affected. If those representatives meet certain criteria, they are allowed to prove and settle not only their own claims, but the claims of everyone in the larger group as well. A potential class action lurks whenever a company's actions harm lots of people. Class actions have been brought against the manufacturers and distributors of products as diverse as employment matters, defective products and tobacco. Business practices that harm consumers, such as overcharging for banking services or using misleading information to sell products ("You're already a winner, send in your magazine subscription to collect your prize"), have spawned class actions. Shareholders can bring class actions against companies for poor management or misleading investment literature. Employees can sue employers collectively for discriminatory practices or for violating employment or benefit agreements. There are strict rules for class actions to assure that a few people can adequately represent the interests of many. Here are the basic elements: Adequate Number of People : The actions of the defendant have to affect so many people that it is more practical for a few representative plaintiffs to address the claims than for all the individual plaintiffs to join together in a regular lawsuit. If twenty people are adversely affected by an employer in his hiring practices, they can file their own lawsuits. But if hundreds or thousands have been harmed, a class action allows a few to represent the multitude. Common Claims : The claims must raise similar questions of law or fact so that it saves time to lump everybody together. If a hundred people all had the same problem with their employer from the same company, a class action may be the way to handle the complaint. Claims of Named Plaintiffs are Typical : The people bringing the lawsuit on behalf of others (the "named plaintiffs") must have the same claims and defenses as those they are representing. For example, in a race discrimination case a person who claims his employer discriminated against him because of his race doesn't work as a class action unless everyone in the class can represent that they were discriminated against because of their race. Fair and Adequate Representation : The plaintiffs and the class lawyers must be good caretakers for other people's claims. A lawyer who has made major mistakes in other class actions or a representative plaintiff who has lied under oath may not meet this criterion. If these criteria are met and all the class wants is an order telling the defendant to stop doing something - dumping waste into a river, for example - a judge will usually agree to "certify" the class. (Certification allows a few designated appointees to represent the other members of the class.) If the class also wants money, they have to prove that the claims and injuries are so similar that they can be well managed in one lawsuit. Mass tort cases, in which a lot of people have been physically injured in a disaster or by a dangerous product, are often denied class action status because the causes and extent of individual injuries vary so much from person to person. Types of Class Actions Class actions may involve a variety of legal claims, and have been used to bring: Employment Law Class Actions , like those involving discrimination, unpaid or improperly paid overtime and commissions, not being given breaks and time for meals, not being paid for preparing to work, or being forced to work off the clock; Consumer Protection Class Actions , like when a company uses unfair, deceptive or misleading business practices or advertising or breaching of a contract or warranty agreed to with their customers; Product Liability Class Actions , include when there are defects in the way a product is designed, manufactured or marketed Securities & Investment Fraud Class Actions , like if a group of investors have lost money as a result of stock fraud or a violation of securities laws; and Toxic Exposure Class Actions like cases where a large number of people have been exposed to a toxic chemical or substance, like asbestos, mercury or radiation. How Does a Class Action Work? Depending on the defendant's posturing, a class action may take many times longer or quite a bit shorter than individual cases. Some drag on for many years, while others settle in several months. The usual order of events is that after a complaint is filed, the parties do limited investigation into whether the action fits the class action requirements. The plaintiffs then ask the court for class certification. If the court says yes, there may be more investigation or the case may settle. In order to protect the interests of absent class members, any settlement or dismissal of a class action requires court approval. The judge presiding over the class action must approve the fairness and appropriateness of the proposed settlement of the claim. The judge, however, does not engage in the actual settlement negotiations. Once negotiations have been completed, and a settlement agreement has been reached and presented to the court, the judge determines whether the terms of the agreement are fair and in the best interests of the class members. The vast majority of class action cases are settled if they are certified or if the defendant believes they will be. The class members are notified of the proposed settlement and given an opportunity to join in or object to its terms. Some types of class actions require that you send in an "opt-in" form to join. For others, you're in if you do nothing. After the class members respond to the proposed settlement, a court determines whether the settlement is fair and reasonable. The main benefit of class actions is that they level the playing field when individuals join together to take on a big company.

Question 2

If you do have a class action, what are the steps that you should expect to follow?

Accepted Answer

As the person who brings the class action, the class representative , your role is to represent your interests and the interests of the class. Like with most other types of litigation, to be the plaintiff, the things you will need to do to actively participate in the litigation will be to: Confidentially discuss the basic facts of your case with an attorney to allow the attorney to make a preliminary determination whether your facts and circumstances amount to a class action. Provide all relevant documents and information to the attorneys , as needed, for the attorney to be able to organize the facts that you have conveyed and the documentary proof and to finalize the firm's decision as to whether there is a class action that we would like to pursue. Sign a retainer agreement retaining the law firm for your matter and agreeing to the terms of representation, including that the law firm pays all the costs and expenses for the litigation only to be repaid upon successful completion of the case and from the proceeds won in the case. No costs or expenses will be expected to be paid by you individually . Answer written questions where the opposing attorney will write and submit a list of questions that you will be expected to answer honestly. Answer questions orally at a deposition where you are asked questions by the opposing attorney so that they can understand your situation and the case in greater depth. Attend trial and be on the stand . In rare instances when a class action does not settle, it makes it to trial. If the case does make it to trial, you will be expected to be available to answer questions orally at trial. There may be additional obligations put on you depending on the case, and, if possible, we will inform you of them before your agreeing to be a class representative . Depending on the corporate defendant, a class action may take many times longer or be quite a bit shorter than a individual cases. Some drag on for many years, while other class actions settle in a relatively short amount of time. The usual order of events is that after a complaint is filed, the parties do limited investigation into whether the action fits the class action requirements. The plaintiffs then ask the court for class certification, a decision by the court whether the case may continue as a class action. The defendant generally opposes the request to try and stop the class from being certified. The vast majority of class action cases are settled if the court certifies the case as a class action or if the defendant believes it will be certified. The members of a class action are notified of the proposed settlement and given an opportunity to join in or object to its terms. Some types of class actions require that you send in an "opt-in" form to join. For others, you're in if you do nothing. After the class members respond to the proposed settlement, a court determines whether the settlement is fair and reasonable. The main benefit of class actions is that they level the playing field when individuals join together to take on a big company. As a class plaintiff, you get the same benefit as all of the class members, plus, at the courts discretion, you may get a type of "bonus" as a thank you for your efforts in standing up for the rights of others.

Question 3

What Goes Into Settling a Class Action?

Accepted Answer

In order to protect the interests of all members of the class action, any settlement of a class action requires court approval. The judge must approve the fairness and appropriateness of the proposed settlement. The judge, however, does not engage in the actual settlement negotiations. Once negotiations have been completed, and a settlement agreement has been reached and presented to the court, the judge determines whether the terms of the agreement are fair and in the best interests of the class members. In making this determination, the judge will consider certain factors including: Whether the case would ultimately succeed if it went on to litigation; The amount of money the members of the class could have recovered if litigation were successful compared to the amount of the settlement; Whether there has been adequate notice of the proposed settlement to all the class members; Whether there are any objections to the proposed settlement; The complexity of the litigation; The costs that would be required to proceed with litigation; The proposed plan to distribute the settlement; and The likelihood the proposed settlement plan will be successful. Notice of the proposed settlement must be given to the class members, who are then entitled to object to the settlement if they disagree with the terms. Some class actions settle within 1 year of being initiated, however, they may take longer. A settlement or judgment binds the class representatives and all other individuals who were included in the class, provided all of the requirements for maintaining the class action have been met. Attorneys representing class action plaintiffs are paid on a contingency basis, meaning they do not receive a fee unless the case is successful. Considering the complexities of class action litigation, and the enormous costs associated with prosecuting a class action, the lawyer often risks a lot of money and time in bringing such a claim. Generally, the attorney submits a fee petition to the court, and the court must then review and decide whether to approve the legal fee, which must be fair and equitable considering all of the facts and circumstances.

Question 4

What if I have received notice of a class action that is pending?

Accepted Answer

People involved a class action will generally receive a notice that they are a potential class member in a pending class action. These class members usually do not need to do anything to “join” the class. Sometimes, a notice may require a potential class member to file a claim form to “opt in” to the class. It is more likely, however, that you are automatically a member of the class unless you “opt out.” If you wish to exclude yourself from the class, the notice provides information on how you can opt out of the class action. People who are a member of the class will not incur any out-of-pocket legal fees or expenses by remaining in a class action. The attorney works on a contingency basis and is paid from the proceeds of any settlement or judgment should the class action prevail. You will share in any such settlement or judgment simply by participating in the class action, and you will also be bound by the results of the litigation. What if you do not receive notice of a class action? There are literally thousands of class actions pending in the United States against a variety of companies, but many potential class members are not aware that they may be entitled to money or some other type of compensation. It is quite possible that you may be an absent class member without ever receiving any type of notice. As a result, you may not be able to share in any recovery because the class administrator does not know that you exist. Many class actions are published in the legal notices section of the newspaper, or are broadcast on the radio and television or are available on the internet. It is important to recognize when a class action that affects you are proceeding so you do not fore go your fair share of a class action settlement or judgment in which you were entitled to participate.

Question 5

What does it mean to be the representative of a class action?

Accepted Answer

A class action starts with one or more people who represent an entire class of individuals who have similar complaints , involving similar facts and issues. The person or people who start a class action are known as the class representative . This person is named in the lawsuit, like Jane Smith v. Exxon , and sues on behalf of the other members of the class. The class representative may also be known as the named plaintiff or lead plaintiff . In some cases, there may be more than one class representative. The class representative, through his or her attorney, makes decisions on how to proceed with the case. As a class representative, you would have certain responsibilities for representing a class. The class representative’s claims must be typical of the entire class because he or she is proceeding on behalf of all others 'similarly situated' as well as on his or her own behalf. The court generally appoints the class representative and must determine that the class representative will adequately represent the interests of all class members. Serving as class representative does not involve a lot of time as the class representative's attorneys are responsible for handling the day-to-day litigation. Nevertheless, the class representative generally receives a larger portion of the settlement than other class members in return for acting in that capacity , but the amount is up to the discretion of the judge. The members of the class action are people who have a similar situation as the class representative. Members of the class do not need to be specifically identified by name, like Jane Smith was above, in order to be part of the litigation; they merely need to be identifiable. The class must be defined sufficiently enough so that the court is able to easily determine whether an individual qualifies as a member of the class.

Class Action Litigation

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