Class Action

A class action is a lawsuit that is usually brought by one or more persons on behalf of a group of others, in a similar situation. Everyone is required to share similar legal issues and there must be enough individuals that it wouldn't make sense to bring separate lawsuits.

Requirements to Bring a Class Action

Additionally, the class must be certified by the court to bring an action. The court will consider the following before certification:

The plaintiffs will adequately represent the interests of the whole class, there must be no conflicts of interest, and they must be competent;
The claims of the representatives must be similar and represent the entire class; AND
The question of fact must come from one act or a pattern of conduct by the defendant.

How Does a Class Action Lawsuit Work?

Initially, a person or group of people will bring a putative class action lawsuit against the defendant. The court will then decide whether or not to certify the lawsuit as a class action. If it does so, the original group will represent the entire class action group, and it will move forward as a class action lawsuit.

If they refuse to certify the class, they will often give their reason why. Typically it is because they do not think the class is complete, meaning that there could be more potential plaintiffs to join the class.

Notice

Any person who may be affected by the class action lawsuit is entitled to receive notice of it being initiated. Included in the notice must be a description of the claim, and information that they can opt out of the class action if they wish to do so. If they do opt out, they must be aware that they will not be able to bring forth their own claim in the future.

Since many class actions are very large, notices of class actions can be put in newspapers, TV commercials, or mailing lists. Depending on the circumstances, it is possible for a possible class member (but did not join the class) can bring forward their suit if they simply had no idea that there was a class action. If you want to determine if you are able to bring your lawsuit, it's important to contact a lawyer as soon as you are aware of a class action.

What Will I Receive as a Member of a Class Action Lawsuit?

Depending on the lawsuit, class members may be entitled to a portion of the damages paid by the defendant. Since these lawsuits can involve a lot of people, the amount received may be negligible. Rebates, products, or services from the company are also commonly received by class action members. Attorneys fees are usually taken from the damages award, rather than received up front.

Class Action Fairness Act

The Class Action Fairness Act was enacted to curb any abuse of the suits frequently seen in state courts, as states seemed to be acting too favorably toward plaintiffs. Under the Act, if a class action has more than 100 plaintiffs, more than $5 million in question, and less than 2/3 of the plaintiffs live in the state where the action took place, then the defendant can choose to move the action to federal court. Defendants may also move it to federal court if any questions regarding federal law exist.

Settlement of a Class Action

Class action settlements are common. Usually, the two parties will hammer out a settlement and then present it to the court. If court approves the settlement, members of the suit can opt out of the settlement, and any member can object to the settlement with the court.

The court will decide if the settlement is fair, taking into consideration the injury suffered by the plaintiffs and the size of the class. If the settlement is low for a large class, that means each class member will get very little. Depending on the nature of the injury, the court may require that the settlement be larger so that each class member can get a fair portion.

What are Some Types of Class Action Lawsuits?

Some of the more common types of class action lawsuits include, but are not limited to:

Pattern of discrimination by a large employer that involves race, age, gender, or sexual orientation;
Employees who have been harmed by a corporation's unfair business practices;
Consumers affected by a defective product;
Patients harmed by unsafe drugs;
Consumers and merchants who have paid exorbitant prices for a product; and
Investors that were victimized by securities fraud.

Unless a member opts out of any of these class actions, they will all be bound by the decision of the court. Federal Rule of Civil Procedure 23 governs class actions under federal law.

Why are Class Action Lawsuits Used?

Class action lawsuits are meant to protect those injured by large corporations or entities. There are benefits for plaintiffs and for the corporations they are suing. For the plaintiffs:

All plaintiffs, including ones that cannot afford legal counsel, can find relief;
Members of the class do not need to come before the court, and instead can join the named plaintiff; and
Members of the class have a chance to opt in and out of the settlement.

For the corporations, the main benefit is that they can face one lawsuit instead of potentially thousands. This one lawsuit will also give them the opportunity to take time to collect evidence, negotiate a settlement, and address these issues with enough time instead of a rushed or hurried case.

Do Class Action Lawsuits Always Win?

Class action lawsuits do not always succeed. If the court disagrees with why the suit is being brought, or thinks the defendant is innocent, the case will be dismissed. If it is dismissed, the individual group members may not be able to file new or individual lawsuits for the same reason in the future. Often, the court will allow the plaintiffs to re-examine their claim and alter it as necessary in order to fit the requirements to continue forward as a class action lawsuit.

What is a Defective Products Class Action?

A defective products class action is a lawsuit based on a claim for a defective product that has harmed multiple individuals in the same or in a very similar manner. As an example, suppose a large awards show was being held in a particular city and throughout the show, thousands of attendees would be served a specific type of alcohol.

If it can be proven that every attendee who drank that specific type of alcohol suffered adverse effects because it contained poison, then all of those attendees may be able to certify themselves as a class. They may bring a defective products class action lawsuit against the manufacturer or distributor of that alcohol. In some states, retailers may be held liable too.

What is a Putative Class Action?

If an attorney is filing a class action lawsuit, they may not know all of the plaintiffs or potential plaintiffs before they file the initial complaint with the court. A good example of this is a plaintiff who has been injured by a product that was sold to more than one person. There may be other people who also purchased the same product and experienced the same injury who have not filed a lawsuit.

In a case like this, the attorney will file a putative class action. Putative means believed or claimed to be, so a putative class action is filed on behalf of all of the unknown plaintiffs by the initial plaintiff.

The initial plaintiff will usually ask to be the class representative and represent the interests of all plaintiffs, known and unknown at the time the lawsuit is filed. At this stage of the lawsuit, it is not considered a class action yet.

What Happens After The Putative Class Action is Filed?

After the initial putative class action complaint, or lawsuit, is filed with the court, the plaintiffs and defendants will then proceed to the discovery phase of litigation. During discovery, both the plaintiffs and defendants will ask one another questions, share documents, schedule and attend depositions, and speak with experts.

The goal of discovery is to identify and confirm the facts and evidence involved in the case to help win or settle the lawsuit. Discovery also allows the attorney or attorneys to gather enough information to support the certification of the class action lawsuit and identify the class of plaintiffs.

How Does a Class Go from Putative to Certified?

When either a plaintiff or defendant believes they have enough evidence to convert the putative class action to an actual class action lawsuit, they will ask the court to certify the class and have the lawsuit become a class action lawsuit represented by the initial plaintiff on behalf of the “class” of plaintiffs. To decide whether or not a class action should be certified, the judge will base their decision on:

The number of plaintiffs that would be in the class;
Whether the group of plaintiffs share the same injury or injuries;
Whether the individual plaintiffs have the same or substantially similar facts;
Whether the class representative would adequately represent the interest of all potential plaintiffs; and
Whether the defendant would be able to compensate the potential plaintiffs if the plaintiffs won their case.

If, after considering all of these factors, the judge believes there is a good reason for the lawsuit to be a class action, they will certify the class and the case will become a class action lawsuit.

How Does a Class Action Continue?

When the lawsuit officially becomes a class action, the class representative, who is often the original plaintiff in the putative class action, will represent the legal interests of any and all other plaintiffs who join the class.

Using the information and evidence from the discovery phase, the attorneys will make every effort to contact any and all potential plaintiffs about the class action lawsuit. This is usually done through the mail, TV and radio advertisements, or the Internet.

When they contact the plaintiffs, the plaintiffs will be given information about the lawsuit and will be invited to join the class of plaintiffs already involved in the lawsuit. If a person joins the class, the court will treat the class as a single plaintiff and the outcome of the case will apply to every plaintiff in the class, win or lose.

How Do Class Action Lawsuits And Mass Tort Claims Compare To Each Other?

Lawsuits involving more than one plaintiff against the same or a group of the same defendants are often joined together. This is done in an effort to reduce the number of lawsuits, which helps the court hear the cases without having multiple cases against the same defendants pending at the same time. While these types of lawsuits are called either class action or mass tort lawsuits, there are distinct differences between the two.

Class action and mass tort lawsuits share the following characteristics:

They involve more than one plaintiff;
The plaintiffs are suing the same defendants; and
The lawsuits are combined in order to reduce the number of cases that the court must hear.

The defining difference between the two would be the way that they are treated by the court, as well as the injury or injuries that the plaintiffs experienced. To reiterate, class action lawsuits involve multiple plaintiffs with the same injury, while mass tort lawsuits involve multiple plaintiffs with different injuries.

Class action lawsuits involve a variety of defendants, such as pharmaceutical companies who manufacture medication, or a cell phone company who overcharged its customers.

An example of this would be if a group of fifty people were all given the same medication that was manufactured by the same company, and all of those people experienced the same injury from the medication. A class action lawsuit may be brought against the drug manufacturer; the key is that all of the plaintiffs share a common characteristic which would be the same injury from the same medication.

The group of fifty people who were injured by the medication may join together in the lawsuit in order to file one lawsuit against the drug manufacturer, rather than all fifty people filing separately. A class representative would be selected, and the entire class of people would be treated as one plaintiff.

As was previously mentioned, class action lawsuits must meet specific criteria. Any person who may have experienced the same injury as the other people in the class will be notified, usually by mail, about:

The lawsuit;
How they can join the lawsuit; and
Their rights in the class action proceeding.

Mass tort lawsuits differ from class action lawsuits in that although the plaintiffs have all been injured by the same defendant or defendants, their injuries may not be the same. Each plaintiff still needs to prove their facts and injury or injuries caused by the defendant.

If the group of fifty people was all given the same medication that was made by the same company and all of them were injured by the medication, but the injuries were different, a mass tort lawsuit may be more appropriate than a class action. When the plaintiffs have different injuries, they cannot be grouped together in “classes” as they can in a class action lawsuit.

Unlike class action lawsuits in which the class of plaintiffs is treated as a single plaintiff, in mass tort lawsuits, each plaintiff is responsible for proving:

The facts of their case;
That their injuries are caused by the defendant or defendants; and
That they are entitled to receive compensation or damages for their injuries.

This differs from a class action lawsuit, in which the chosen representative will be responsible for proving the facts, injuries, and need for compensation for the entire class of people.

Should I Contact a Lawyer If I Received a Notice About Joining a Class Action?

Class action lawsuits are heavily regulated by law and are very complicated. If you believe you have a putative class action, your first step would be to find a local personal injury attorney. An attorney can tell you whether you have a putative class action or if there is already a class action lawsuit pending that you can join.

If you received a notice in the mail, or read or heard about a class action you believe you belong to, then you should contact a local class action attorney. The attorney can help you determine the best course of action for your situation.

Class action lawsuits are very complex, and it is important to find an attorney who can help you determine your best course of action, as well as represent your best interests in court. If you or a group of people have been similarly harmed by one entity, speak with a class action lawyer immediately.

Call our office today at 212-994-7777 or complete the convenient online contact form to set up a consultation.

What is a Class Action?