Class Action FAQ

1. What is a class action?
   A class action is a legal procedure allowing one person to sue as a plaintiff on behalf of all persons likely to have experienced the same injury or damage. Class actions are often brought against corporations, such as telephone companies and credit card companies, banks, etc… when they overcharge or otherwise mistreat many customers in the same way. Class actions can also be brought against manufacturers of defective products and against a company or its officers on behalf of a class of shareholders in the company. Class action litigation is a way for consumers to effectively challenge powerful interests by allowing a large number of plaintiffs with the same complaint to bring an action jointly against a common defendant.


2. What types of cases can be brought as class actions?
   Class action law has evolved drastically from the 1960’s and is now used to seek financial damages and other relief arising from securities law violations, consumer fraud, human and civil rights violations, employee benefits disputes, and environmental and mass torts.


3. How does a case become a class action?
   There are four requirements for a case to qualify as a class action:
   1. There must be multiple plaintiffs
   2. The plaintiffs must all have a common complaint against the defendant
   3. The complaint must arise out of the same, specific set of circumstances
   4. It must be possible for one or a few of the plaintiffs to effectively represent the entire class of plaintiffs in the proceedings


4. How much does a class action cost?
   Class actions are taken on a contingency basis meaning that the attorneys are only paid if they win the case. The plaintiff's attorneys are usually paid in accordance with an order from the court before which the case is pending. The judge responsible for the class action reviews a “fee petition” made by the attorneys. This petition describes the work the attorneys have done on behalf of the class in detail. After consideration, the court enters an order fixing the amount of the fees to be paid to the attorneys from the judgment or settlement fund. The amount of the fees awarded is based upon a number of factors, including the quality of the work, the difficulty of the case, the nature of the result, the amount of time spent on the case, and the risks involved. The fee amount can vary greatly within a wide range depending on the factors the court takes into account and the weight it attaches to each of them.