What Is a Class Action Lawsuit?

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brown wooden smoking pipe on white surface

What Is a Class Action Lawsuit?

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Definition

A class action lawsuit is a legal action brought by a group of individuals, known as the class or class members, who have similar claims or grievances against a common defendant or defendants.

In a class action, one or a few individuals, known as the class representatives or named plaintiffs, bring the lawsuit on behalf of the entire class, which can consist of a large number of people who have suffered similar harm.

The purpose of a class action lawsuit is to efficiently and effectively resolve claims that involve a large number of individuals who have suffered a common injury or have been affected by the same wrongful actions. It allows individuals with relatively small claims or limited resources to collectively seek compensation or other forms of relief.

How Does a Class Action Lawsuit Work?

Class action lawsuits have a number of defining characteristics. Let's examine a few.

  • Commonality: The class members must have common legal issues, facts, or questions of law or fact that are central to the case. The claims must arise from the same event, practice, or conduct.

  • Certification: The court must certify the class, which means it determines that the lawsuit meets the requirements for a class action and that class treatment is the most efficient and fair way to handle the case.

  • Binding Effect: The judgment or settlement reached in a class action lawsuit is generally binding on all class members, including those who did not actively participate or were unaware of the lawsuit.

  • Efficient Resolution: Class actions promote efficiency in the legal system by consolidating similar claims into a single lawsuit. This allows for the more efficient use of court resources and can provide a resolution for a large number of claims in one proceeding.

  • Participants: Several parties are involved in a class action lawsuit. Here are the key participants.

  • Class Representative(s): Also known as named plaintiffs, they are individuals who bring the lawsuit on behalf of the entire class. They typically have experienced the same harm or injury as the other class members and represent their interests throughout the litigation process.

  • Class Members: They are the individuals who are affected by the alleged wrongdoing or harm and share similar claims or grievances against the defendant(s). Class members may number in the hundreds, thousands, or even more, depending on the size and scope of the class.

  • Defendants: The defendant(s) are the individuals, companies, organizations, or entities against whom the class action lawsuit is filed. They are accused of engaging in the wrongful conduct or causing harm to the class members. The defendants can be individuals, corporations, government entities, or other entities depending on the nature of the case.

  • Class Counsel: Attorneys who represent the class as a whole are known as class counsel. They are responsible for advocating for the interests of the class members, gathering evidence, presenting the case, negotiating settlements, and seeking relief on behalf of the entire class. Class counsel is typically appointed by the court or selected by the class representatives.

  • Judge: A judge presides over the class action lawsuit and ensures that the legal process is followed, rules on motions and procedural matters, and ultimately decides on the certification of the class, settlement approvals, and other important issues in the case.

  • Experts: In some class actions, expert witnesses may be involved to provide specialized knowledge or opinions on specific aspects of the case. These experts can be called upon to provide testimony and help support the claims of the class members.

It's important to note that the specific parties involved in a class action lawsuit may vary depending on the jurisdiction and the nature of the case. The court plays a crucial role in overseeing the proceedings and ensuring that the interests of all parties involved, including the class members, are fairly represented.

Examples

The 1998 Tobacco Master Settlement Agreement (MSA) is an example of a class action lawsuit. It was a landmark $206B settlement reached between the four largest tobacco companies in the United States (Philip Morris Inc., R.J. Reynolds Tobacco Company, Brown & Williamson Tobacco Corp., and Lorillard Tobacco Company) and the attorneys general of 46 states, the District of Columbia, and five territories.

The National Association of Attorneys General website has a section dedicated exclusively to the MSA. It proudly states:

"52 state and territory attorneys general signed the Master Settlement Agreement (MSA) with the four largest tobacco companies in the U.S. to settle dozens of state lawsuits brought to recover billions of dollars in health care costs associated with treating smoking-related illnesses."

Enron, WorldCom, and Fed-Phen are other examples of high-profile class action lawsuits. As with the tobacco case, these cases ended in a large settlement agreement.

How Do I Start a Class Action Lawsuit?

Starting a class action lawsuit involves careful planning, legal expertise, and the collaboration of individuals with similar claims. First, identify a legal issue affecting a group of people, such as consumer fraud or product liability. Research relevant laws and precedents to assess the viability of the case. Next, seek out experienced class action attorneys who specialize in the relevant area of law.

These attorneys will evaluate the case's merits, gather evidence, and draft a complaint outlining the allegations against the defendant(s). The complaint must then be filed with the appropriate court, along with any required documentation and filing fees.

Once the complaint is filed, the court will consider whether the case meets the requirements for class action certification, including numerosity, commonality, typicality, and adequacy of representation. If the class is certified, notice must be provided to potential class members, informing them of their right to opt out or participate in the lawsuit.

The case will then proceed through discovery, pretrial proceedings, and potentially trial or settlement negotiations. Throughout the process, effective communication and collaboration among plaintiffs, attorneys, and the court are essential for a successful outcome.

Finding a Class Action Lawyer

Finding a class action lawyer who is experienced and capable of handling your case effectively is essential. Here are some steps you can take to find a class action lawyer:

  • Research Online: Start by searching online for law firms or attorneys that specialize in class action lawsuits and have a strong track record of success in handling similar cases.

  • Check Legal Directories: Use online legal directories, like this one!

  • Ask for Referrals: Reach out to friends, family members, or colleagues who may have experience with class action lawsuits or know someone who does.

  • Consult with Bar Associations: Contact your state or local bar association for referrals to qualified class action lawyers in your area.

  • Attend Legal Seminars or Events: Consider attending legal seminars, conferences, or events related to class action litigation.

For more on this step, don't miss our step-by-step guide on how to hire a lawyer!

Conclusion

Class action lawsuits can cover a wide range of legal issues, such as consumer protection, product liability, securities fraud, employment discrimination, environmental harm, and more. They serve as an important mechanism for holding defendants accountable for widespread wrongdoing and providing compensation or other relief to affected individuals as a group.

If you think you might need to hire a lawyer and don't know how, we've got you.

As a reminder, this is intended for information purposes only and is not legal or financial advice.