It might have happened to you a few times in past years: You received an email or mail notice inviting you to join a class-action lawsuit, or notifying you that you\u2019ve been automatically included. But being part of such a lawsuit might be intimidating, especially if you need to opt in, and would mean surrendering the option to sue individually.<\/p>\n
In most cases, there\u2019s little downside to joining these lawsuits, which combine many legal claims \u2014 often thousands \u2014 into one claim against a single defendant, reducing fees for each claimant and potentially earning a much larger payout.<\/p>\n
And there have been many opportunities to do so. Following a series of large opioid settlements, 2022 had the most billion-dollar class-action settlements in U.S. history apart from the tobacco settlements decades ago, according to\u00a0a report\u00a0from the national law firm Duane Morris. The stakes are high for class-action lawsuits at this level, as they set standards for corporate responsibility in areas such as data privacy, employee discrimination, securities fraud and civil rights.<\/p>\n
But in cases where you suffered significant harm, suing individually could secure a bigger payout.<\/p>\n
Also see:<\/strong> Judge refuses to dismiss Facebook shareholder suit over data privacy breaches<\/p>\n In many cases, class-action lawsuits offer such a minor payout to each victim that participation is a matter of principle, not reward. But even if you receive only $10 to $20 as compensation, joining a collective lawsuit can help other customers or employees get justice, and may deter a company from harmful practices in the future.<\/p>\n \u201cIt\u2019s really a trial by proxy,\u201d says attorney Russell T. Abney, who defends victims of dangerous drugs and defective medical devices at the law firm Watts Guerra. \u201cThe beauty of the class action,\u201d he says, is that it adds up individual cases to a number that\u2019s high enough to go up against a large company.<\/p>\n In most cases, Abney says, plaintiffs of class-action lawsuits pay legal fees on contingency, which means they don\u2019t pay anything unless they win the case. Lawyers taking on these lawsuits will usually receive payment as a percentage of the settlement won from the company.<\/p>\n If you\u2019re part of the \u201cclass\u201d of a lawsuit \u2014 that is, if you were affected by the certain event or purchase described \u2014 you\u2019ll often be automatically included in the lawsuit. And for certain cases, such as those relating to wage violations or defective products, you may have to opt in.<\/p>\n Read<\/strong>: Wells Fargo settles shareholder lawsuit for $1 billion: report<\/p>\n If you feel strongly about the outcome of a class-action lawsuit, you can also participate as a class representative, sometimes called a lead plaintiff. In some cases, becoming a class representative could lead to a bigger payout \u2014 but that isn\u2019t always the case.<\/p>\n Even though the class representative is the case\u2019s headline, \u201cThat person isn\u2019t necessarily going to get any kind of windfall,\u201d says Jennifer A. Riley, a partner at Duane Morris and vice chair of the firm\u2019s workplace class-action group. She notes that some courts in some jurisdictions would be able to grant a service award to plaintiffs representing the case, which are often between $2,500 and $7,500, but other courts have found these awards inappropriate. And it\u2019s difficult to discern upfront whether such a service award would be granted.<\/p>\n Class-action lawsuits can also take anywhere from a few months to several years, which can be an excessive commitment for many. The Exxon See<\/strong>: Kia and Hyundai settlement: See if you qualify for the $200 million payout<\/p>\n If you plan to make a case of your own, it makes sense to opt out of, or not participate in, a class-action lawsuit.<\/p>\n \u201cIf you have your own lawsuit, the value of your claim might be much, much higher as an individual than it would have been as a class member,\u201d says Gerald L. Maatman Jr., a partner at Duane Morris and the chair of the law firm\u2019s workplace class-action group. \u201cYou\u2019re trying to decide, \u2018If I opt out, am I going to do that much better than I\u2019d do in a class action?\u2019 And in certain circumstances, an individual would do better. They\u2019d get the money quicker, and they\u2019d get more money.\u201d<\/p>\nWhy you should join (or not opt out)<\/strong><\/h2>\n
Class representatives don\u2019t always get a larger payout<\/strong><\/h2>\n
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\n Valdez oil spill, for example, took 17 years to reach a class-action settlement.<\/p>\nWhen to opt out (or not join)<\/strong><\/h2>\n