A Primer on Class Actions

November 01, 2012 (Press-News.org) The class action. It is a legal construct, invented years ago, to make it possible for many people who are all dealing with the same issue to join in litigation, thus making it less expensive and hopefully less stressful for themselves. Famous class actions -- like the case against Pacific Gas & Electric chronicled in the movie "Erin Brokovich," as well as the 125,000 plaintiffs who banded together to sue Wyeth Pharmaceuticals for damages caused by the popular diet drug Fen-Phen -- have shined light on this area of the law and proven to the public that single plaintiffs united with a common cause can have long-lasting effects on the world around us. This article will provide an overview of the class action process.

What Is a Class Action?

A class action lawsuit is defined in Black's Law Dictionary as: "a lawsuit in which the court authorizes a single person or a small group of people to represent the interests of a larger group." In layman's terms, a named plaintiff stands as a figurehead to fight for the entire group of those harmed by the actions of the defendant(s).

Class actions are brought for a number of different reasons, including (but not limited to):
- Defective products -- pharmaceuticals, children's toys, medical devices, and vehicle components
- Toxic exposure -- spills of hazardous materials, carcinogens like asbestos, "popcorn lung," and harmful chemicals like BPA
- Mass injuries -- Resulting from airplane, commuter train, cruise ship, public transportation, or ferry crashes
- Unfair employment practices -- nonpayment of overtime compensation, racial discrimination, sexual harassment, or failure to pay minimum wage
- Financial misbehavior -- improper loans or mortgages, "robo-signing" by mortgage lenders, and "ponzi" schemes

While there are many different types of class actions, they all involve a common thread -- some form of harm suffered by a large group of people who believe that their injuries were the result of the actions (or inactions) of the defendants.

Class actions are similar in nature to so-called "Multi-District Litigation" claims (sometimes called "Bellweather cases"). MDL cases involve the consolidation of numerous suits already pending in federal district courts around the country. They are similar to class actions in that they also serve to combine the claims of several different plaintiffs into a single case. Unlike MDL cases, however, class actions are brought in just one court from the very beginning.

Why a Class Action?

Class actions commonly arise from situations where it is impracticable for each individual plaintiff to file a lawsuit of their own. Oftentimes, these cases involve an amount of monetary damages small enough that the recovery of them is not financially feasible for the numerous small lawsuits that would each involve attorney fees, court costs, and related expenses like expert witnesses, exhibit preparation and incidentals.

Class actions are beneficial for many clients because they are able to proceed with minimum effort on behalf of the named plaintiff and even less effort on the part of the remaining members of the action. The plaintiff's attorneys on the other hand, have a difficult road ahead of them. It takes lawyers with a special skill set to handle class actions, and not all attorneys are qualified to tackle these large, time-consuming and tedious cases.

Putting Potential Class Members on Notice

Another way in which personal injury class actions are different from regular lawsuits is in the way that potential plaintiffs are notified. In most standard cases -- those involving only a few parties -- each party must be served notice of the legal action in person or through the mail in order to participate in or be bound by the terms of a lawsuit. That type of service is not realistic or practical in class action cases.

Instead, most class action participants are included by default. This means that a case will be brought on behalf of all people who suffered a particular type of harm. Then, once notice of the suit has been given, usually by publication in a newspaper, in a radio ad or with a television commercial, individual members will have the opportunity to "opt out" of the litigation by responding to the notification.

Resolving the Case

After a class action has been filed and all parties have been notified about the proceeding, the case proceeds much like a smaller lawsuit, with both sides having the opportunity to prove their arguments by calling witnesses, offering evidence, and having experts testify. It sometimes works out that the case ends up getting settled before trial. Whether the verdict is reached by a judge or jury, or if the case settles out of court, any recovery that is granted to the plaintiffs must then be distributed to both the named and unnamed plaintiffs. This can take anywhere from weeks to years.

While it is true that class action lawsuits do not always result in the distribution of substantial or life-changing financial rewards to victims, they can have a long-lasting effect on the well-being of consumers and on the world around us. Simply dismissing class action lawsuits is usually the wrong step to take. Through class action lawsuits, it is possible to take a stand against the largest corporations in the world and hold them accountable for their negligent actions against consumers.

Article provided by Domengeaux, Wright, Roy & Edwards, L.L.C.
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