Questions About Class Actions
Question: What is a class
Answer: A class
action is a legal procedure used to prosecute a lawsuit
efficiently in which a large number of people have been
injured by a common act or set of actions. The class process is
used, for example, in cases alleging or concerning price-fixing
fraudulent stock manipulation (securities), oil spills
tort), product defects and false advertising (consumer), and employment
disputes such as the failure to pay overtime (employment). In a class case, one
or two named plaintiffs stand in for the entire group of similarly
aggrieved persons during the course of the litigation.
When a class action settles, the judge presiding over the case
must approve the fairness and propriety of the settlement.
Potential class members usually have the option of, after receiving
notice, excluding themselves from a class or class settlement, and
pursuing the case on their own. This is referred to as Opt-Out Class Action
Litigation. The class procedure also allows individuals and
small businesses to collectively prosecute meritorious cases that
would have been too expensive and insufficient to litigate
Question: What kinds of cases
are litigated as class actions?
Answer: Class action
law is used to seek money damages and other relief
arising out of antitrust and securities law violations, consumer
fraud, insurance fraud, human and civil rights violations, employee
benefits and employment disputes, and environmental and mass
torts. Berger & Montague has been instrumental in the use and
development of the class action device in all of these
Question: If I choose to be involved in a class action, is there risk or
expense for me?
Answer: In most cases
you need to take no steps of your own to join a class action.
Indeed, usually only those who wish to exclude
themselves from a class need to do anything. By
participating in a class case, you accomplish several objectives.
You may receive compensation for a wrong, injury, or loss you have
sustained, i.e., compensation that may
not have been available to you in any other forum. As a member of a
class of similarly harmed persons, you help to demonstrate to the
court that the alleged harm done was substantial and affected a
large number of people, increasing both the likelihood of a
recovery and its size.
Moreover, with rare exceptions in a handful of states, the only
cost to you will be drawn from any settlement or judgment upon
successful resolution of the matter. In class actions, Berger &
Montague usually works on a contingency fee basis and
is paid upon a successful resolution of the matter. Generally,
the attorneys advance the expenses and costs of prosecuting class
Question: How are attorneys paid in
class action cases?
Answer: The plaintiff's attorneys are usually paid pursuant
to an order from the court overseeing the case. The judge
responsible for the class action reviews a submission made by the
attorneys, called a "fee petition." This petition sets forth in
detail the work the attorneys have done on behalf of the class.
After consideration, the court enters an order fixing the amount of
the fees to be paid to the attorneys from the case's judgment or
settlement fund. The amount of the fees awarded is based on a
number of factors, including the quality of the work, the
difficulty of the case, the nature of the result, the amount of
time spent on the case, and the risks involved. As a percentage of
the gross settlement or recovery, the fee amount can vary greatly
within a wide range depending on the factors the court takes into
account and the weight it attaches to each of them.