-
What is a class action?
- What types of cases can be class actions?
- How does a case become a class action
lawsuit?
- How many people are needed for a
class action?
- How much do class action lawsuits cost?
- Why would I want my case to be a class
action lawsuit?
- Are class representatives
entitled to
any additional compensation?
- class action lawyers: How do I choose a class action
attorney?
Class Action FAQs: Frequently Asked Questions About Class Action Lawsuits
1. FAQ: What is a class action?
A class action is a type of lawsuit in which the claims and rights
of many people are decided in a single case. Specific plaintiffs
are named in the lawsuit to assert the claims of the entire class
so that everyone with the same claim or injury doesn't have to
file their own separate lawsuit. Also, because they allow people
whose damages are too small to warrant an individual lawsuit to
try their cases together, class actions can often be the only
practical way to stop illegal practices and recover ill-gotten
gains.
Class action suits have allowed individual people to stand up against the most powerful industries in the world and to hold them accountable for their actions.
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2. FAQ: What types of cases can be brought
as class actions?
The typical class action lawsuit involves a situation where a
large group of people is injured by the same conduct. There are
four primary types of class action lawsuits:
- Securities Class actions: Securities
class actions are typically brought on behalf of a group of
investors who have been injured as a result of a company's improper
conduct, such as misstating earnings, concealing or misrepresenting
risks, or otherwise engaging in activity detrimental to the
company.
- Product liability/Personal Injury
Class actions: Product liability and personal injury
class action lawsuits are generally brought when a defective
product, such as a drug with harmful side effects, or "mass
accident", such as a toxic spill harms many people.
- Consumer Class actions: Consumer
class actions are generally brought when consumers are injured
by a company's systematic and illegal practices. Examples include
illegal charges on bills, illegal penalties for late-payments,
and failure to comply with consumer protection laws.
- Employment Class actions: Employment
class action lawsuits are typically brought on behalf of employees
of a large company for claims ranging from systematic workplace
discrimination to unpaid overtime.
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3. FAQ: How does a case become a class
action?
A class action is generally initiated by one or more people who
feel that they, along with a group of other people, have been
wronged. A lawyer then files suit on behalf of the individual(s)
and the class. At the appropriate time, the lawyer files a motion
asking the court to formally recognize the case as a class action.
If the court grants that motion, the other people who were similarly
wronged are notified of the class action and are given an opportunity
to participate in the class action as a member of the "class."
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4. FAQ: How many people are needed
for a class action?
Although it sometimes helps if several people are named as plaintiffs
in the suit, a single person is generally enough to file a lawsuit
so long as the attorney for the class has a good faith belief
that a number of other people were injured in a similar way.
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5. FAQ: How much does a class action cost?
Generally, the lawyer pays for all the costs and, if the lawsuit
is successful, petitions the court to award attorney fees, which
are usuallypaid by the defendant.
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6. FAQ: Why would I want my case to become
a class action?
People have different reasons for taking part in class actions.
Many class members take pride in forcing a giant corporation that
is breaking the law to change its ways and in helping to recover
often millions of dollars for the class. Others bring class actions
to recover money that was illegally taken from them, recognizing
that they couldn't afford to pay a lawyer's hourly fees to bring
an individual suit and that their individual claim isn't large
enough to attract a lawyer who works on contingency.
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7. FAQ: Are class representatives
entitled to any additional compensation?
If a class action is successful in winning relief for the class,
most courts, understanding that class actions can be a powerful
tool for consumers' rights in society and are to be encouraged,
provide class representatives with "incentive awards."
Judges are typically given broad discretion in deciding whether
these awards are appropriate and in setting the amounts of the
awards, which can range from hundreds of dollars to over $50,000.
In deciding how much, if anything, to award to the class representatives,
courts look at factors such as the amount of involvement of the
class representative and the size of the recovery for the class.
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8. FAQ: How do I choose a class action
attorney?
There are many very good class action attorneys in the United
States. Because class action law is fairly specialized, you should
look for an attorney with significant class action experience.
Additionally, because there are many different types of class
actions, look for a lawyer who has specific experience in the
type of class action you wish to bring. In other words, an attorney
who regularly brings consumer class actions might not be the best
choice for a securities class action and vice-versa. Finally,
it is a good idea to ask any lawyer you're considering a lot of
questions before hiring him or her. For example, you might want
to find out if he or she or a subordinate will be the "lead
attorney" on your case. You should also ask how many cases
the firm is currently handling - is yours going to be one of 30
or one of 300? Make sure you understand what's expected of you
as the class representative, and always insist on a written representation
agreement.
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