What happens when hundreds or thousands of people are injured by or suffer damages because of the same thing, like a prescription drug or car problems? Instead of hundreds or thousands of lawsuits, there may be only one.
Taking the Lead
A class action lawsuit is when one (or sometimes a few people) file a single lawsuit on behalf of a larger group of people (called the "class') who have the same or similar legal claim. Who speaks for the class? The lead plaintiff, sometimes called the "named plaintiff," or "class representative."
The lead plaintiff starts the ball rolling. For example, just days after Apple released its new phone, Kevin McCaffrey and Linda Wrinn filed a class action lawsuit claiming the new phone is defective. Apparently, the new phone drops calls and has reception problems when it's held the wrong way.
A lead plaintiff may "take over" other suits, too. For example, since the Gulf oil spill in April 2010, BP investors have filed a few class actions claiming the company misrepresented safety and other issues, causing investors to lose millions of dollars when its stock value plummeted. In late June 2010, Thomas DiNapoli, the trustee of New York's multi-billion dollar public employee pension fund, filed a class action lawsuit against BP. It's anticipated that several, if not all, investor-related class action lawsuits against BP will be consolidated into one suit. DiNapoli has asked the court to make him lead plaintiff in all suits.
A lead plaintiff has a big job. And like any job, it has some benefits and disadvantages, For example:
- Even though the lead plaintiff starts the case and hires the attorneys, she doesn't have to pay attorney's fees or legal expenses. Class action attorneys take cases on contingent fee agreements and take their fees and pay expenses when they win or settle the case
- A lead plaintiff usually works very closely with the attorneys handling the case and participates a great deal in the court process. So, he usually has a big time commitment to the case, as opposed to class members who essentially do nothing during the case
- Only the lead plaintiff can agree to or reject a settlement offer. The vast majority of class actions are settled before trial, so this is an important role. He has the job of making sure any settlement is fair to everyone in the class. Other class members can only take it or leave it (called "opt out") if a settlement is approved
- Typically, if the class wins or the case is settled, the lead plaintiff is paid first after the attorneys get their fees and expenses. It's not uncommon for lead plaintiffs to get paid a little extra than other class members as compensation for their work
In most class actions, you don't have to do anything to join the suit. At the beginning of the case, the attorneys find out everyone who, for example, owns stock in BP or bought a new Apple phone. Everyone in the class will get notice - usually by a post card in the mail - that they're part of the lawsuit. They're given a chance to "opt out" of the suit, too, meaning they're free to file their own lawsuits.
If you think you've been overlooked in a class action, the best thing to do is check the legal notices in your local newspaper. You can also run a search online. Usually you'll find a website dedicated to the class action, or at the very least, you'll find the name of the attorneys in charge of the suit. You can then request to be added to the suit.
Questions for Your Attorney
- Is there any reason why I would opt-out of a class action lawsuit?
- Can I hire you to start a class action and not be lead plaintiff?
- Can any attorney start a class action? Can you start a class action if the company I want to sue has its headquarters in another state?