What Is A Class Action Lawsuit?

If you have received a letter in the mail indicating that you may be eligible to take part in a class action lawsuit, you probably have some questions. Class action lawsuits can be complicated and you may not understand how you should proceed with the information in the letter. There are benefits and drawbacks to class action lawsuits, and it is always in your best interest to consider both before making a decision.

What Is a Class Action Lawsuit?

A class action lawsuit is a type of legal action in which one or a few people sue a defendant on behalf of a large group of people (“the class”). The subject of class action suits can vary greatly, but two things are almost always necessary for a class action:

• The issues that are being disputed are shared by all members of the class.
• There are too many possible plaintiffs to make it practical to bring them all before the court. 

Possible plaintiffs are contacted (via letter, card, or email) and they have the chance to be a part of the lawsuit and receive their share of damages awarded by the court, or opt out and not participate in the results of the suit. If the defendant in the lawsuit settles the case or loses in court, then everyone who is part of the class receives a percentage of the damages. Sometimes it is too difficult to find all of the victims who are entitled to a share of the financial recovery, so a fund is set up for others who can show that they were injured by the defendant.

What Are Some Types of Class Action Lawsuits?

A few examples of class actions are:

• Patients who were prescribed a medication with dangerous side effects that the maker was aware of but didn’t disclose
• People who purchased the same defective product who were victims of false advertising or manipulative business practices
• Employees of a company who were subjected to racial, age, or gender discrimination by their employer
• Home or business owners negatively affected by an environmental disaster like an oil spill
• Consumers who paid an inflated price for a product due to price-fixing by a group of corporations

These are only a few of the common types of class action lawsuits. There are many others that have been litigated and won by plaintiffs.

What Are the Benefits of Participating in a Class Action Lawsuit?

One of the benefits of class actions is their efficiency. They bring a large group of plaintiffs with claims together and present them to the court at one time, when it would be impractical to litigate their claims individually.

Class actions are often the only way that enables injured persons to remedy injustices committed by large corporations or institutions. Individually, filing a lawsuit can be costly and it may be greater than the value of the individual claim. With a class action lawsuit, the damages awarded to the class can be very large, getting the defendant's attention and giving them the incentive to make changes to their fraudulent conduct. If not for the class action format, they may never feel the need to correct their conduct.

Another benefit of the class action is that it ensures that all of the plaintiffs receive something for their injuries. If cases are brought individually, the defendant may become bankrupt at some point, and because payment by the defendant would be on a first-come, first-served basis, some victims would not receive any compensation.

What Are the Drawback of Participating in a Class Action Lawsuit?

There are drawbacks to class actions, too. Individual members of the class really have no control over how the case is handled and what settlement is reached. Also, because of the number of members in the class (even those who have not yet been identified) are entitled to their portion of the award, and because attorney fees come out of the award, each individual’s share may seem insignificant.

Should I Participate in a Class Action?

Ultimately, if you are a victim of a significant injury that is different, or more extensive than the injuries suffered by others, it may be better for you to pursue an individual case against the defendant. That will enable you and your attorney to have more control over your specific situation, and it may allow you to receive a larger settlement. Deciding whether or not to participate in a class action is something that you must discuss with an experienced class action attorney. Your individual case needs to be evaluated to decide the best way to proceed.

At Ross Feller Casey, we have experienced personal injury attorneys who are also knowledgeable in class action lawsuits. We always have the interest of our clients in mind when we advise on the best way to handle cases. If you think that you may have a case that could be a class action, or if you have been injured in some way due to the negligence of a corporation, please contact us and one of our qualified attorneys will assist you with how to proceed with your case.