Elements of Class-Action Lawsuits

You’ve undoubtedly heard of class-action lawsuits. You may have even reaped the benefits of one without fully understanding what this type of legal action is or how it works. Despite the media coverage of class-action settlements regarding large companies, there are many common questions about these legal proceedings. How do class-action lawsuits work? What are some examples of class-action lawsuits? Where can I learn about active class-action lawsuits? 

This article will answer some of these common questions about class-action procedures. 

What Is a Class-Action Lawsuit?

A class-action lawsuit is a special kind of civil court procedure in which one or more plaintiffs file a lawsuit on behalf of a larger group, or “class.” In this type of lawsuit, at least one individual or business entity acts as a representative of the entire group. Plaintiffs can file class-action lawsuits in state courts and federal courts. 

Typically, the people or business entities involved in filing a class-action lawsuit have suffered some type of common injury as a result of the conduct of the defendant or defendants. In a class-action lawsuit, all class members share the commonality of experiencing the issues in dispute.

Class-Action Lawsuit vs. Mass Tort

Many people often confuse class-action lawsuits with mass torts. While both types of cases lead to similar outcomes, the difference is in how they are handled. In a mass tort, the group of injured plaintiffs is often smaller than that in a class-action lawsuit. Also, the court treats each plaintiff involved in a mass tort as an individual, which means the court requires the individual plaintiffs to ensure they are filing legitimate claims by proving certain facts, such as how the defendant injured them specifically.

Benefits of Participating in a Class-Action Lawsuit

When it comes to civil claims, the individual litigants could bring separate actions against the defendant, but in many cases, it’s more practical for all parties involved to combine the individual actions into a single lawsuit by employing the class-action device. Other benefits of using a class-action lawsuit instead of bringing separate actions include:

• The legal proceedings will be more expeditious and cost-effective.
• The litigants have a greater chance of successfully pursuing a claim as a group.
• Class-action lawsuits lower the cost of legal claims for each individual or legal entity.
• The court can focus its resources on the common issues within the lawsuit instead of managing multiple similar lawsuits on its docket.
• Members can choose to opt out of any eventual settlement and pursue an individual claim. 

Who Pays Legal Fees in a Class-Action Lawsuit?

The settlement agreement in a class-action lawsuit usually includes an award to the class counsel. This means that the settlement agreement allocates a specific dollar amount or a percentage of the total settlement to pay the plaintiffs’ legal fees. 

Where Can I Find Open Class-Action Lawsuits?

You can review a list of open class-action lawsuits on the Consumer Action website. 

What Are Some Examples of Class Settlements?

The U.S. Department of Justice website is an excellent source of information regarding past class-action settlements and lawsuits.

Elements of Class-Action Lawsuits (Rule 23)

The Federal Rules of Civil Procedure govern civil proceedings in U.S. district courts. Rule 23 states, in part, that for a group of individuals or entities to qualify as a class to file a lawsuit on a class basis, they must first meet certain legal requirements. Any party who seeks class certification must satisfy the following four requirements.

Numerosity

This element means that the class is so large that it is impractical to join all of its members under a lawsuit that a single individual initiates. Regardless of the actual number of people or entities affected, the essential element is that it would be impossible to add all of the plaintiffs to an existing lawsuit. Instead, the plaintiffs must first qualify as a class and then file a class-action lawsuit.

Commonality

To meet this requirement, there must be questions of law or fact common to the class. In other words, all of the class members must share common suffering from an action or inaction caused by a common set of facts; therefore, the court should decide these issues by applying similar legal standards. 

Typicality

This element means that the representative party or parties are making claims that are typical of the claims or defenses of the overall class. 

Adequacy of Representation

Finally, to meet this requirement, the representative party or parties must be able to provide adequate representation for the entire class and must fairly and adequately protect the interest of the class. To ensure this, there must be no conflicts of interest, and it is essential to secure competent legal counsel. 

How and Why the Time You Sue Matters

When it comes to participating in a class-action lawsuit, timing is vital. There are several deadlines to be aware of when you consider participating in an existing class-action lawsuit. It is essential to remember that these deadlines are firm; plaintiffs do not have additional time to participate if they miss a deadline.

Claim Form Deadline

Generally, to participate in a class-action lawsuit, you must file a claim with the settlement administrator. This is an individual who oversees the claim filing process and payouts to members of the class. 

The claim form deadline is the last day on which you can file a claim online or, if you’re filing via U.S. mail, the date by which your claim must be postmarked. 

Exclusion or Opt-Out Deadline

The exclusion deadline, also known as the opt-out deadline, is the final day by which a class member may exclude themselves from a class-action settlement. You may choose to exclude yourself if, for example, you do not agree to the terms of the proposed settlement. 

If you do choose to opt-out, you will not be bound by the terms of the settlement agreement. This means you will not receive a cash payment or other benefits from the class-action settlement, but you will still have the right to file your own individual lawsuit against the defendant or defendants.

Objection Deadline

If you participate in a class-action lawsuit but disagree with the final terms of the settlement or the settlement amount, you may choose to object. The objection deadline is the last day by which you must file your objection.

Final Approval Hearing

During the final approval hearing, the judge hears arguments from both the plaintiff’s side and the defendant’s side about the appropriateness of the settlement. 

Trust the Right Law Firm for Your Legal Services

If you believe you may qualify to join or initiate a class-action lawsuit, it’s important to speak with an attorney first. Contact McEldrew Purtell today for a free consultation.