Class Action Settlement Amounts
What is a Class Action Lawsuit?
A class action lawsuit is a civil action filed on behalf of a large group of people. The lawsuit is usually against companies who have in some way injured a large group.
Consumers can file against a company who made illegal claims in order to sell their products. An example is a drug company making false claims about their product when advertising on TV, radio, internet or in magazines. The corporation may say a weight loss drug is safe and guarantees a consumer will lose 40 pounds in the first month or get your money back. A reasonable person would know losing 40 pounds in a month is unrealistic and unhealthy, but the temptation for weight loss is too great and consumer’s buyout the product from stores. After one month is up, consumers haven’t lost more than 10 pounds, but are losing hair at alarming rates. Hair loss wasn’t one of the side effects listed on the bottle or website. The corporation refuses to refund any money and consumers are looking for answers. Filing a class action lawsuit against the corporation is their best answer.
Employees of a company may also file a class action suit against their employer. The most common reason for employees to file against an employer would be illegal hiring and promotion policies. For example, several Latino men have worked at a local factory for the last nine years and never received a raise or any type of promotion. These workers are very qualified at the plant and hold several certifications in order to legally perform their job. However, the lead spot for plant manager is open and three quarters of the Latino workers are qualified to interview for the job. The owner puts an ad in the paper and online for a plant manager and it even stated “No experience or certifications necessary, will train”. Hiring within makes sense because there’s no need to train, the current men have all the necessary requirements and it would be better for production. When this is addressed to the owner by several workers he said, he “would never promote any Mexican worker and could never have a Mexican man running the business”. A week later he hires a white man, 22 years old who has never worked in a plant before. These workers have a good class action discrimination lawsuit on their hands.
In a class action lawsuit, damages are divided into punitive and compensatory damages. Compensatory damages are for any direct damage to the victims, such as pain and suffering. Punitive damages are normally higher then compensatory damages and are for the actual illegal act and disregard for public health and/or safety. Basically it’s a way for the court to additionally punish the company.
Keep in mind when a person joins a class action suit, they must sign a legal document stating they can never sue the company as an individual for the same reason as the class action suit. Attorneys get paid only if they win and after they win the case, working on a contingency basis. If the plaintiffs lose the case the lawyers will not get paid. Depending on what state the case is filed in will determine the amount of money the lawyers will take off the final judgment when winning a case, this varies from 30 to 50 percent of the total award.