CLASS ACTION FAQ

What is a Class Action?

In a class action, one or more persons called “class representatives,” sue on behalf themselves and many others with similar legal claims, the so-called “class.” Because class representatives are specifically identified in the Complaint, they are sometimes also called the “named plaintiffs.” Congress created the class action device to aggregate many similar claims by trying them in a single court proceeding. This litigation device is especially useful for consumer fraud, because often the injury is small – maybe a few dollars for a retail product – such that it would not make economic sense for a single individual to sue the company that defrauded him or her. Similarly situated consumers who have become the victims of fraud, for example buying a product that doesn’t work, can join forces to file a lawsuit against the company engaging in fraudulent or misleading practices, seeking refunds and a permanent court order prohibiting the defendant’s conduct. You may have a claim which can be pursued as a class action if a company has wrongfully taken money from you and others in the same way.

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What does it mean to be a Class Representative?

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A class representative plays a vital role in representing similarly injured but unnamed class members, ensuring their interests are protected and pursued by volunteering to take a stand against fraud. As a class representative, you’ll be kept informed about significant developments in the case and will work with attorneys to make important strategic decisions regarding the conduct and disposition of the litigation. The imposition on your personal time is relatively minimal and spaced out, and may typically include providing information to your attorneys to assist them in drafting the initial Complaint (for example, during a telephone call of perhaps 30 minutes); reviewing portions of the Complaint relating to your experience before filing; receiving documents and status updates; working with your attorneys to sign statements, gather documents, or answer questions relating to the case; attending a settlement conference; giving a deposition (this usually occurs 12-18 months or even more into the litigation), in which the defendant’s attorney will ask you questions, for example in a false advertising case, about your purchases and experiences with the product; and testifying at trial, if necessary–although very few class action cases ever go to trial. Your attorneys will guide you through every step. Overall, a class representative’s involvement is not usually very burdensome.

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As a class representative, you have a fiduciary duty to protect the interests of the class, including making appropriate settlement decisions that will most beneficial to all class members. Eventually a time will come in the lawsuit in which the attorneys will formally ask the court to give the case class action treatment, called “certification.” During this state, the court will make a final determination if the named plaintiff may indeed represent the class, considering requirements set forth in the federal rules, like whether the named plaintiff has claims typical of the rest of the class, and can adequately represent all the other members of the class.

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What compensation may a Class Representative receive?

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A class action ends favorably with either a judgment after trial or, more typically, a settlement in which the defendant agrees to give the class relief to settle the claims of every class member who does not “opt out.” In such a case, the class representative is entitled to the same relief as every other class member, for example, a refund for the falsely-advertised product. In addition, when a class action is successful, class representatives typically receive “service” or “incentive” awards, which exist to incentivize individuals to volunteer to be class representatives and thereby fulfill the important social goal of combating fraud and other unlawful behavior, and to compensate them for the time and effort spent in the case. Although in settlements defendants usually agree to incentive awards, the award and amount is always ultimately up to the court. In consumer fraud class actions, these awards may vary from hundreds, to many thousands of dollars.

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Is there anything that would preclude me from volunteering as a Class Representative?

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Typically, a felony conviction will preclude someone from being a class representative, as this goes to credibility and undermines the adequacy of the person to represent absent class members. Past, pending, or anticipated bankruptcies may also present certain challenges..