What type of cases are appropriate for class actions?
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UPDATED: Feb 28, 2011
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A class action is a lawsuit in which a large number of people with similar legal claims join together in a group (called a class) to sue someone. The defendant in a class action lawsuit is typically a company or organization. Class actions commonly occur after a product has injured many people, or a group of people has suffered discrimination at the hands of an organization.
A class action lawsuit is often used to seek monetary damages and other relief resulting from other violations of anti-trust laws such as price-fixing conspiracies and monopolization cases. Securities law violations, such as market manipulation, may also result in a class action lawsuit. Consumer fraud and employee benefits disputes are also common reasons for class actions, as well as environmental, toxic, and other mass torts including oil spills, defective products, or defective drug and medical devices.
Some examples of expensive and high-profile class action lawsuits include:
- Nortel Networks: securities sraud; settled for $2.4 billion (2006)
- AOL Time Warner: securities fraud; settled for $2.5 billion (2005)
- Cendant: securities fraud; settled for $3.1 billion (2000)
- Tyco International: making false and misleading public statements; settled for $3.2 billion (2007)
- Breast Implant Litigation (Corning, Baxter, Bristol-Meyers Squibb/MEC, 3M): patients claimed they suffered autoimmune disease from silicon implants; settled for $3.4 billion (1994)
- Exxon: oil spill affecting thousands of people and 1,300 miles of coastline; settled for $500 Million–reduced from $5 billion (2001)
- World Com: fraud; settled for $6.2 billion (2005)
- Enron: fraud; settled for $7.2 billion (2006)
- Dukes vs. Wal-Mart Stores: sexual discrimination; still pending, seeking $11 billion in damages for all female employees hired since 1998 (filed 2000)
In a class action lawsuit, the attorneys representing the lead plaintiffs may serve as “private attorneys’ general” to assist in the enforcement of federal and state laws by representing large numbers of injured persons. If you are thinking of entering into a class action lawsuit, consult with an attorney for advice or to take further action.