After the presiding judge reviews the settlement offer in a class-action lawsuit and determines that it is fair and adequate compensation, the lead plaintiff, depending on their participation in the class action lawsuit, receives their percentage. Since the lawyers typically work on a contingency basis, they would also receive a percentage for their legal fees and related costs. To ensure fairness, the court usually restricts the lawyers’ payment to a reasonable amount. Finally, the rest of the settlement money in a class-action lawsuit is divided among the class members.
Class Action Lawsuit Definition
A class-action lawsuit is civil litigation by multiple people against entities and large corporations. In a class-action lawsuit, plaintiffs who have been harmed by the same liable party file a unified lawsuit to recover damages for their injuries, loss, or psychological distress. By using their strength in numbers, they stand a chance of winning a case that otherwise would not have gone anywhere if pursued independently. While the rules governing class actions vary state to state and even court to court, there are some common themes that apply to class action lawsuits throughout the country.
Benefits of Joining a Class Action Lawsuit
Class actions make the process of seeking damages easier, making it more efficient than if the individual plaintiffs went to trial, according to the Legal Information Institute (LII). The Balance Small Business website lists the following as more benefits of joining a class action.
- You pay nothing out of pocket: the lawyers typically cover the cost of the litigation and do not charge any legal fees until they win the case and collect the settlement. When this happens, they spread the cost of the lawsuit among the plaintiffs and deduct the total from the settlement amount.
- You do not feel any stress: in every class action lawsuit, there is a lead plaintiff or lead plaintiffs who serve as the face and voice of the group and represent the interest of the whole group. Due to their active participation, the rest of the members play a passive role and simply await judgment.
- You get justice for your injuries: it is no secret that the severity of your injuries plays a significant role in personal injury lawsuits. And while it is unfair, many people have seen lawyers reject their cases because their injuries were minor. But in class actions, due to the strength in numbers, you can still hold the negligent party accountable and receive compensation.
- Justice is attainable: since it helps to reduce the number of cases clogging the court system. All it requires is one lawsuit, one court, and one single decision for all. Also, class action lawsuits motivate the defendants and insurers to settle due to the number of plaintiffs. It is much harder to use defense tactics against several people claiming similar damages.
Reasons for Smaller Settlements in Class Action Lawsuits
There are legitimate reasons for class members receiving smaller payouts. A few of these include:
- The severity of injuries: one advantage of joining a class action lawsuit is that it allows plaintiffs to seek damages for minor injuries that would not warrant a lawsuit by themselves. In cases like this, the liable parties would still settle for their negligence, but the payout would be relatively small.
- Cost of the litigation: class action lawsuits can be very expensive, especially when going up against entities that have a lot of money to throw into their defense. Since most personal injury law firms operate on a contingency basis, the law firm bears every cost until the case is settled.
- Legal roadblocks: any issue with the case that cannot be solved can affect the settlement amount. Also, if the defendant has an airtight case, the plaintiffs’ legal team may have no choice but to concede to avoid losing outrightly.
How to Ensure That You Are Fairly Compensated
In class action lawsuits, before the case can be closed, the court holds a fairness hearing to ensure that the class members agree with everything thus far. If you have any objections about the proposed settlement, you must notify the court of your objections at the hearing. Per the laws regulating these lawsuits, the presiding judge cannot approve the settlement until they are convinced that each plaintiff is being treated fairly.
Consult with Morris Bart, LLC
If you would like to join a class action lawsuit or have concerns about an ongoing one, you may need the legal counsel of a lawyer from the Morris Bart law firm. We are a personal injury law firm on a mission of fighting for those who are wrongfully hurt due to the negligence of others. If you would like to discuss your case, take advantage of our free consultation and call us at (800) 537-8185.