Class Action Resource Center
CLASS ACTIONS: FAQs
What Is a Class Action?
A civil lawsuit brought by a person or a few people on behalf of a larger group, or class of people, who it is alleged suffered injuries common with the plaintiff. The larger group is referred to as the class, while the plaintiff who brough the suit if referred to as the lead plaintiff or class representative.
How Many People Does it Take to Have a Class Action?
While there is no set number, and classes have been certifed with fewer, the general concensous is that forty members will suffice to meet the numerosity requirement.
How Long Does a Class Action Take?
Every case is different depending of the facts and some class actions may settle in a few months, while others may linger on in the federal court system for years or even decades. However, as a general rule it usally takes between two and three years.
Do I Have to Participate in a Class Action?
No. If the case is certified as a class action, a court ordered notice will be send to all class members. You can do nothing and stay in the case or you can opt-out and no further be a part of the class action. You can opt-out and do nothing, or if you have large enough losses to justify it, bring an individual action against the defendant. Also, if you opt-opt you will not particicipate in any settlement or receive any money as a result of a settlement of the class action.
What Is a "Putatve" Class Action?
Putative" means "assumed to exist." When a class action is first filed it is sometimes referred to as a putative class action where there has been no order by the judge officially certifying the case as a class action.
What is the Class Action Fairness Act?
The Class Action Fairness Act (CAFA) became a law when signed by President George W. Bush on February 18, 2005.
Under CAFA, federal courts now have exclusive jurisdiction in all class actions where the amount in controversy exceeds five million dollars. Under CAFA, if a class action is filed in state court and the total damages will likely exceed five million dolllars, the defendant has the right to ask that the case be transferred to federal court.
What is a common fund?
A common fund is a pool of money created to compensate class members. It may be established through settlement, judgement or court order. Class members are usually required to file claims in writting to receive thier portion of the common fund.
What Is the Difference in a Class Action and a Mass Tort?
The primary difference is that a mass tort is filed only on behalf of a single individual, while a class action is filed on behalf and could effect thousands of people.
Are There Any States That Do Not Allow Class Actions?
Yes, one. Virginia has a ban on all class actions. Virginia residents have no choice but to file a class action in federal court.
Can You Dismiss a Class Action at Anytime?
A case that has has been certified as a class or proposed to be certified for settlement purposes may not be voluntarily dismissed without court order. A case yet to be certfied may, with a couple exceptions, be voluntarily dismissed.
What Is a Representative Plaintiff?
A class action may also be referred to as a representative action. A representative plaintiff is just another term for lead plaintiff or the named plaintiff.
What Are Sub-Classes?
When appropriate, Federal Rules of Civil Procedure allow for the creation of sub-classes. Sub-classes may be appropriate when certain members of the class want different kinds of relief, such as damages for one group or injunctive for another group. Sub-classes can also be created to deal with state laws that apply substantially different requirements to different groups of class members.
How do I Submit a Claim?
Class action settlements that offer compensation usually require Class Members to submit Claim Forms. Claim Forms are normally mailed directly to Class Members but in some cases Class Members must contact the Settlement Administrator to get a Claim Form or file a claim on a settlement website.
What Do I Do if I Receive a Class Action Notice?
The first thing to do if you receive a class action notice is to read the notice very carefully. Notices are sent at various times in a class action lawsuit. The first notice is sent at the time the lawsuit is certified as a class action. In most cases you will be automatically included in the class if you fit within the description of the class and if you do nothing when you receive the notice. You have essentially 3 possible options when you receive a class action notice: (1) Participate as a class member; (2) Not participate in the lawsuit at all (Opt out); or (3) Participate as a named plaintiff in the lawsuit.
How Do I Opt-Out?
If you do not want to participate in the lawsuit as a member of a class, you will need to opt out of the class. The notice you receive will explain how to do that. There will also be a cut-off date, and you must send your notice to opt out of the class by the date specified or you will be included in the class and lose any rights to file a lawsuit on your own. However, timely opting out means that you can sue the defendant on your own, instead of being part of a class. In deciding whether to opt out and pursue the defendant on your own, there are many factors to consider, like the potential cost of litigation and whether your damages are different than the rest of the class.
How do I get paid in a class action settlement?
All Participating Class Members who submit valid and timely Claim Forms as described in the Notice of Class Action Settlement are entitled to receive settlement payments. If you return the Claim Form, but it is defective, you will be mailed a cure letter by the Claims Administrator within a certain time.
What Is a Cy Pres Award?
Cy pres awards are funds given to charitable organizations in cases in which there is still money remaining in the settlement fund, even after all class members have been paid or the amount of the fund is too small to justify a distribution directly to class members.
What is a securities class action?
A securities class action, or securities fraud class action, is a lawsuit filed by investors who bought or sold a company's securities within a specific period of time, referred to as a “class period," and suffered economic injury as a result of violations of the securities laws.
What Are the Requirements for a Class Action Notice?
Class action notice is required to be given to all persons who would be affected by the court’s decision. Although it usually is not possible to give every such individual personal notice, all persons who might be affected are entitled to the best notice possible.
What Are the Responsibilities of a Class Representative?
Class representatives represent the interests of all class members who have been affected by the conduct challenged in a lawsuit. They owe a fiduciary duty to the class and cannot put their own interests ahead of those of the other class members.
Will I incur any costs if I Join a Class Action??
No. The lead plaintiff in a class action might incur some out-of-pocket expenses, although these are typically reimbursed. Class members, however, incur no costs. At most, they sacrifice a small portion of their award to finance the attorneys that helped them win the case.
Class Action and Complex Litigation Resources
- Manual for Complex Litigation, Fourth
- Settling Securities Class Actions
- Stanford Securities Class Action Clearinghouse
- Class Action: An Overview
- Class-Action Fairness Act
- Federal Rule of Civil Procedure 23
- Resource-Guide-for-Managing-Complex-Litigation.pdf
- Class Actions and Mass Torts Regional - American Bar Association
- Litigation Section - American Bar Association
LEGAL GUIDES
Class Actions
· Important Things for Consumers and Shareholders to Know About Class Action Lawsuits
· What is a Lead Plaintiff in a Class Action Lawsuit?
· How do I get paid in a class action settlement?
· What to Do if You Receive a Class Action Notice?
· Requirements for a class action notice
· Will joining a class action cost you anything?
· How to Submit a Claim for a Class Action Settlement?
· How Many Plaintiffs Do You Need For a Class Action Lawsuit?
· Cy Pres Awards in Class Action Settlements Coupon Settlements Remain Acceptable Means to Resolve Class Litigation Even After Passage of CAFA
· What Is a Shareholder Derivative Action?
· Class-action vs. Derivative Shareholder Lawsuits
Corporate Formation
• What is Corporate Takeover Litigation
• The Advantages and Disadvantages of Forming an LLC
• Benefits to Company Owners By Using An LLC To Purchase A Home
• Step-By-Step Guide to Forming An LLC In Tennesseee
Shareholder Rights
• What are shareholder appraisal rights?
• Shareholder Voting Rights
• What Is a Special Litigation Committee?
• What Is a Demand for Inspection of Books and Records Under Delaware Law?
Mass Torts
• What Is a Mass Tort?
FEDERAL COURTS
History of the Federal Judiciary
U.S. Supreme Court U.S. Courts of Appeals
DISTRICT COURTS
U.S. District and Bankruptcy Courts Map
U.S. Supreme Court U.S. Courts of Appeals
- First Circuit
- Second Circuit
- Third Circuit
- Fourth Circuit
- Fifth Circuit
- Sixth Circuit
- Seventh Circuit
- Eighth Circuit
- Ninth Circuit
- Tenth Circuit
- Eleventh Circuit
- District of Columbia Circuit
- Federal Circuit
DISTRICT COURTS
U.S. District and Bankruptcy Courts Map
STATUTES, RULES & PROCEDURES
Introduction To The Federal Court System
Federal Rules of Civil Procedure
Federal Rules of Evidence
Rules of Appellate Procedure
Supreme Court Rules and Guidance
Judicial Panel on Multidistrict Litigation
28 U.S.C. § 1407
28 U.S.C. § 2112
Panel Rules
• Panel Rules effective October 4, 2016
• General Order Amending Panel Rules effective July 6, 2011
• Summary of Panel Rules
ADDITIONAL RESOURCES
FEDERAL LAW OTHER FEDERAL COURTS & ORGINIZATIONS
- U.S. Probation and Pretrial Services
- Federal Defender Organizations
- Department of Justice
- Federal Legal Aid
- Federal Judicial Center
- Integrated Database - Federal Judicial Center
- Federal Court Finder
- Cornerstone Research
- Securities Class Action Clearinghouse
- Law Info
- American Bar Association
- Class Action Blog
- Manual for Complex Litigation, Fourth
- Settling Securities Class Actions
- Stanford Securities Class Action Clearinghouse
- Class Action: An Overview
- Class-Action Fairness Act
- Federal Rule of Civil Procedure 23
- Managing Class Action Litigation: A Pocket Guide for Judges (3rd ed.) (Federal Judicial Center, 2010)
- Class Actions 101: A Focus on Class Action Practice (3d ed. 2014) (A. McGuinness & D. Karon), Annual Institute on Class Actions Syllabus
- Class Action Fairness Act of 2005 (CAFA)
- Judges’ Class Action Notice and Claims Process Checklist and Plain Language Guide (FJC 2010)
- ClassActionBlawg (Paul Karlsgodt)