What Is a Class Action Lawsuit?
You may have read about class action lawsuits in the news — some of the largest and longest running legal battles in the United States have been class action lawsuits launched by average citizens against companies or governments when individuals feel they have been harmed by a similar product or incident.
While the average person can’t typically afford to sue a large organization or company when they feel they have been injured or wronged in some way, a class action can be an effective means for a group of people — sometimes hundreds, even thousands of people with the same or similar issue — to come together to sue a larger entity.
A class action is a legal action that can be filed with a court system by more than one person against a defendant. It occurs in situations when a group of people have been affected in the same way and experienced some form of injury or damages — physical or financial — as a result of a something the defendant has done. Some of the largest companies in the world have been sued in this way by large groups of people whose individual claims would not have been enough to take on more powerful defendants. From tobacco companies to banks, medical device manufacturers to oil companies, individuals have successfully sued using class action claims.
How do class action lawsuits work?
A class action must be certified by a judge before it can proceed and can be filed in state or federal court. Typically, a group of plaintiffs will select a lead plaintiff to represent the group — that person, often represented by an attorney, must prove they have a valid claim against the defendant. Judges will dismiss frivolous lawsuits so a plaintiff class must build a solid case and have a large group of people behind them for a claim to be certified.
How to start a class action lawsuit?
It doesn’t cost anything to file a class action with a court. A class action can be started by one person or a small group of people and is filed on behalf of those who suffered the similar injury or financial harm. If you choose to hire a law firm to represent you, they take class action cases on the basis that they assume the risk of providing representation, but their fees will come out of whatever settlement is made. The financial risk of taking on the class action is absorbed by the law firm. The individual class members are not responsible for the legal fees or costs if the class action is not successful. Usually, a fee arrangement is arrived at between the representative plaintiff and the law firm which provides for fees to be paid only when the class action is resolved successfully by a settlement or judgment.
First, a class must be defined, and a representative plaintiff must be chosen. A Statement of Claim is then filed in court. For the claim to go ahead as a class action, a court must certify the case as a class action.
How to file a class action lawsuit?
Anyone can start a class action lawsuit, but certain requirements must be met. Those who want to commence an action should consider speaking to an attorney first to help determine if they have a good case. The document required to start the action is called a “class action complaint”.
Requirements for a Class Action Lawsuit
The Federal Rule of Civil Procedure, Rule 23(a) states that an action requires four conditions to qualify for class treatment:
- The class is so numerous that joinder of all members is impracticable;
- There are questions of law or fact common to the class;
- The claims or defenses of the representative parties are typical of the claims or defenses of the class, and
- The representative parties will fairly and adequately protect the interests of the class.
What is a class action settlement?
Most class actions are settled out of court and each class member receives an equal portion of the settlement. The settlement can be provided in the form of cash, a service in kind or some other benefit.
A judge will consider how many people were affected — if there is only a small group the judge might decide that the individuals would be best to seek independent lawsuits against the defendant rather than pursue a class action.
What is a settlement class member?
A settlement class member means each member of the Settlement Class who has not elected to be excluded from the Settlement Class. All class members are entitled to be notified of any proposed settlement agreement of the class action they are part of.
How long does a class action lawsuit take to settle?
Some class actions can take a few months while others can go on for two or three years, sometimes longer depending on the complexity of the issue involved. When a court’s ruling is appealed, it can further delay the process. If there are no appeals, class members can usually expect to receive payment in six months to a year after a settlement agreement is submitted for approval.
If you think you have been harmed in some way that others have also suffered, you may have the basis for a class action lawsuit. To find out whether you may have a case it’s best to speak with an attorney who has experience successfully bringing forward class actions before the courts.
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