Four Things You Didn’t Know About Class Action Law Suits

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It seems like every time you pick up a newspaper, you read about more class actions going through arbitration or commercial litigation. Some commercial giant violated the trust of their clients, or harmed the public, and just like the tiny villagers who took down Gulliver in the novel Gulliver’s Travels, the wronged public have banded together to take down the giant. Class actions play a very valuable role in keeping corporations accountable for their actions, but you should understand what exactly you’re getting yourself into before you go down the class actions path. You probably aren’t going to make yourself rich through class actions. But your voice will be heard and you will make a difference.

If you’re interested in class actions, stay tuned for our list of things you probably didn’t know about them.

Four Things You Didn’t Know About Class Action Law Suits

  1. Power Comes Through Numbers

    When a commercial giant like ATandT or Groupon does something you don’t agree with, you don’t hold a ton of power on your own. There are only so much “Can I speak to your manager and their manager?” you can do before you realize you’re just going in circles. However, when you have a hundred or two other clients who all have the same complaint against the organization, it’s hard to ignore. Because of all the moving pieces and the number of plaintiffs involved in it, class actions are fairly complex commercial disputes that most often end in mediation and a settlement rather than going to trial.

    One few recent class action that you might be aware of is ATandT. ATandT customers were being charged per minute that they used their cell phones, but customers were getting unsolicited automated calls from ATandT that they were being charged for. ATandT and their class action plaintiffs reached a settlement of $45 million over it, and the calls stopped. Another example of a class action is when KIA and Hyundai were sued for inflating the claims of fuel economy on their new vehicles. Once again, the case was settled out of court for $395 million.

  2. Winning a Class Action Lawsuit Won’t Make You Rich

    While the great number of plaintiffs in a class action is what makes it successful, it’s a double edged sword: the final check you’re cut isn’t going to make you rich. The law firm or separate lawyers who facilitate the class action lawsuit take somewhere in the neighborhood of 40 to 60% off the top of the settlement, and the remainder is either split equally between plaintiffs, or divided based on damage done. The 2013 Target data breach class action stands to pay out each plaintiff around .25, unless the person has documentation of financial loss as a result of the breach. In our Hyundai class action example, each plaintiff in the case was awarded $353, and Kia owners received $667, since the Kia case is split less ways.

  3. You Could Be Part of a Class Action Without Realizing it

    Maybe you purchased a Groupon deal five years ago, and never used it. Eventually it expired, and you lost the money. The vendor you purchased the Groupon to never received your business or saw a red cent for your money. Groupon just pocketed your money and went on their jolly way. If this is you, you might not realize that you are part of a class action lawsuit!

    Class action lawsuits strive to contact all of the impacted people of their case, through mail, email, ads in the news paper, or in-store signage. However, if those efforts don’t manage to reach your eyes, you might want to check it out for yourself. You can visit to get a list of current class action lawsuits and their settlements. If you find one that relates to you, you’ll find a website set up for details and updates about the case, and how to get involved.

  4. Understand What You’re Agreeing to When You’re in a Class Action

    When you agree to be part of a class action lawsuit, you could get some easy money without a lot of effort, however, by accepting the settlement, you’re waiving your right to sue separately.

Do you have any other questions about class action lawsuits? Please share in the comment section!

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