A class action lawsuit is a legal argument filed by multiple people against one defendant.
They are used in situations where many people have suffered similar consequences as a result of the defendant’s negligence.
They are used when individual claims against a defendant would be too small to be worthwhile.
They are commonly filed against financial institutions, government organizations, employers, retailers, and manufacturers.
They tend to center around issues of negligence, false advertising, discrimination, civil rights, unlawful practice, or defective products.
How many people are needed?
Generally speaking, you need around a dozen people to have suffered similar consequences at the hand of one defendant. This does not mean that you must all file together.
One person can file a class action lawsuit, making reference to others that have been affected. A judge will then use their judgment to decide whether it can proceed as a class action lawsuit.
What are the Four Prerequisites?
These are 4 conditions that you need to satisfy in order to successfully file a class action lawsuit.
- There must be so many complainants (plaintiffs) that it would be impractical to file separate lawsuits, or to join individual cases into one.
- The legal issues and the facts must be shared by each of the plaintiffs.
- At least one of the plaintiffs scenario’s represents the rest of the defenses of the class.
- That singular plaintiff is happy to fairly represent the interests of the class (they are known as the lead plaintiff).
How do you do it?
Your first step is to hire an attorney. Some will specialize in filing class action lawsuits, and these people would be a good choice to go for. Experience in class action lawsuits gives you a better chance of winning the case.
You will then work with your attorney to prepare and file a complaint. This is a formal, written statement of your case. It needs to identify the wrongdoings of the defendant and how harm has been caused as a result. The complaint must describe the damages sustained by the plaintiffs.
It must then be certified by a judge. This means that they decide whether it can proceed as a class action lawsuit. This is where the 4 prerequisites come into play, as all must be satisfied for a judge to certify the class action case.
The court will then appoint a class counsel. This means that you must prove your attorney is the best suited to your case. There are a few factors to consider, detailed below.
You will then need to give all plaintiffs notice of the lawsuit once it has been certified. It is the lead plaintiff’s responsibility to notify all other plaintiffs, individually as far as possible. This allows everyone to either join or opt out of the lawsuit.
What do you need to prove to a judge?
You should prove that your lawyer has experience in similar class action cases, and familiarity with the law that applies to your situation. They should prove they’ve done work to prepare the case and find potential plaintiffs for the class action lawsuit.
Another factor to evidence to the judge that this is the correct attorney is the resources they have available. They should also be able to prove that they have the ability to represent all of the plaintiffs equitably.
Why would you file a class action lawsuit instead of an individual lawsuit?
As mentioned above, if you would win negligible damages as an individual, filing a class action lawsuit is advised.
If the defendant is a large company they are likely to have a team of highly qualified lawyers. This means that they are much more likely to win in a case against just you.
Can you be prevented from starting a class action lawsuit?
Yes. Some companies will get their employees to sign arbitration clauses, preventing them from being involved in a class action lawsuit.
What are the benefits of a class action lawsuit?
If your payout would be small as an individual, participating in a class action lawsuit can boost this. This is because the attorney fees are shared between a larger number of people, meaning that the individual cost is lesser.
A class action lawsuit helps to reduce the number of cases travelling through the court. This is because many individual cases are merged into one group case. This can help the legal process proceed faster and in a more orderly manner.
It ensures that all plaintiffs suffering from the same issues will receive equitable and consistent damages. This may not necessarily be the case if each plaintiff filed a separate case against the defendant.
The sheer volume of plaintiffs involved prompts the defendant to settle, meaning that they may receive more in damages than they would otherwise have.
What are the negatives of a class action lawsuit?
The attorney fees could potentially be high, and may mean that the plaintiffs receive a much smaller payout.
The class action lawsuit process is much more complex than the individual complaint procedure. This could mean that the case takes longer to progress through court and to reach a settlement.
If your attorney is sub-par, this can impact all of the plaintiffs involved in the case. If they do not do a good job of your case, everyone can suffer as a result.
There is no guarantee of a cash reimbursement at the end of the legal process. Plaintiffs are as likely to end up with rebates or coupons as they are cash.
If you are not the lead plaintiff in the case, you hand over all control to the lead plaintiff and their lawyer.
By filing a class action lawsuit, or by participating in one, you waive your right to sue the defendant as an individual in the future.
There are many pros and cons to consider when filing a class action lawsuit.
You should seek legal advice and think carefully before you file any kind of complaint.
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