You have probably heard of class action lawsuits in the news, but you may not have a clear picture of that the term means. In a class action, a group of plaintiffs with the same or similar injuries, whose injuries have the same cause, sue the same defendant or defendants. A class action lawsuit is a way for a large number of people to sue one or a few defendants for the same reason without having to each pursue separate lawsuits.
One person, or a few people, bring the class action lawsuit on behalf of the larger group. The person who brings the action is called the class representative. The individuals in the larger group often join as the case goes along or may not even participate until after a settlement agreement is reached.
Why a Class Action?
Plaintiffs benefit by not having to seek individual attorneys and go through all the work and the entire process separately. The courts do not have to hear each case separately, and the defendants do not have to go through a separate process for each plaintiff. Plaintiffs also benefit by knowing they will get a share of the settlement or verdict instead of possibly losing out simply because the defendant has run out of money by the time the 500th lawsuit rolls around. In addition, many class actions involve claims that, while in the aggregate are large, are too small for any one claimant to pursue on his or her own.
A class action is not guaranteed to happen just because you decide it should. It must be certified by the court, meaning the court has to approve it. There are requirements to meet and the court must decide whether your case is appropriate for a class action. Those requirements must be met before your case will be considered. Then the court must decide if a class action will best serve the interests of justice for all sides involved – plaintiffs, defendants and the court system.
There could be hundreds or thousands of class members. In most cases they do not have to sign up, they are automatically included and must opt out if they do not want to be included. So, if you bring a class action for damages caused by a specific defendant’s action or failure to act, everyone who was injured by that action or failure to act becomes a class member and is eligible for a share in any resulting compensation. Class members do not need to participate in the process.
Those who qualify as class members may wish to participate. Then they need to hire an attorney to become a named party. This can be a good option for those who have large damages.
Opting out of the class action means giving up any proceeds from the class action lawsuit but retaining the right to sue individually.
When the lawsuit is settled or a verdict is award, the court decides how to divide it up. The attorneys are paid for their attorneys’ fees and the costs they have extended in preparing and/or trying the case. In dividing the recovery among the plaintiffs, plaintiffs who participated in the lawsuit, such as the class representative or named plaintiffs, generally receive a larger share based on their participation level and the rest is divided equally between class members.
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