Glossary of Class-Action Terms
Class actions are the best remedy consumers have to hold corporations accountable for widespread misconduct. It is only through class-action lawsuits that the litigation playing field can be leveled. Individual claimants cannot afford the money or time to hold businesses accountable. Class-action litigation combines individual claims into one large claim which can match the resources of most defendants.
With the help of an experienced class-action law firm such as Hagens Berman, a class-action lawsuit means defendants have to confront legal arguments that simply would not be available in individual claims. Moreover, the possibility of a large judgment deters corporations from wrongful conducts. Large settlements and awards force the corporations to correct their wrong.
Here are some of the legal terms that are common to class-action lawsuits. Many of these terms are defined in Rule 23 of the Federal Rules of Civil Procedure, which codifies federal class-action law.
An appeal is the process to seek and obtain a review and reversal by a court of a lower court's decision.
Absent Class Member
Most members of the class rely on the class representative and the law firm handling the case for that representative. Some claimants may take an active part in the case by contacting the law firm and being ready to testify. Most class members, known as absent class members, are silent. They are entitled to benefits if the law firm wins or settles the case but they do not actively take part in the case.
Case name assigned, i.e. John Doe v. XYZ Inc.
The judicial process whereby a court examines whether a case shall be permitted to proceed as a class action is called certification. The judge assigned to the class-action complaint must first decide whether the case is a proper class-action lawsuit. There are many prerequisites that the judge will review before issuing a certification order. These prerequisites are aimed at reviewing the balance between filing individual claims and a class claim. For example, class claims have questions of law or fact that are common to all class members.
Before certifying a class-action lawsuit, the trial judge will hold a hearing. At the hearing, attorneys for the class representative(s) and the defendants make arguments and sometimes present witnesses to help the judge make an informed decision.
A large group of individuals who has suffered a similar loss or experience, bringing a legal action as one party with one or more representatives.
The lawyers or law firms that are appointed by the court to advocate for the class representative and all the members of the class.
Class Representative aka Representative Plaintiff
This is essentially the lead plaintiff in the case. Often a wronged or injured plaintiff will contact a law firm about a case. The law firm will review whether a class-action lawsuit is logical. The law firm will then represent the class representative who speaks for all the members of the class.
Clear Sailing Agreement
This agreement covers the class counsel's request for legal fees. In this type of agreement, the defendant agrees to the legal fees demanded by the class counsel.
Common Fund Class
The fund which receives the money from the defendants after a verdict or settlement, and is then used to pay class members, the legal fees and the court expenses.
Any formal legal document that sets out the facts and legal reasons that the filing party or parties believes are sufficient to support a claim against the party or parties against whom the claim is brought. The initial document filed with the court.
A fee charged for a lawyer’s services only if the lawsuit is successful or settled. Hagens Berman operates on a contingency fee, meaning plaintiffs in class-action lawsuits do not pay for representation by the firm. When the suit is finalized and a settlement has been reached, only then does our legal team receive payment, calculated as a percentage of the overall recovery.
In some cases, the judge reverses his/her decision to certify the class. Decertification usually occurs as the case progresses, and it becomes clear that common questions of law or fact do not exist, or that other reasons suggest that the original certification decision was incorrect.
Declaratory Judgment Class
In this type of class action, the purpose of the litigation is to determine the rights and duties of the parties.
The exclusion request is the formal request from a class member to be removed from the class. Some class actions allow a class member to opt out of the class. This may be because the class member thinks he/she can get a better result on his/her own or because the class member doesn't want to be involved.
Many class-action lawsuits are settled. Because there are often thousands or even millions of class members, the trial judge can hold a fairness hearing to determine if the settlement is fair.
Injunctive Relief Class
This is a type of a class-action lawsuit where the primary focus is to correct misconduct. Injunctive relief means that the class is asking that the judge issue an order against a company, public official or other defendants, that misconduct be stopped.
Usually, any decisions by the trial judge cannot be appealed to a higher court until after the there is a verdict. Some special decisions can be appealed before the case reaches a conclusion. Certification of the class is one of these special decisions that can be appealed. Appeal of special decisions is called an interlocutory appeal.
The attorney or law firm approved by the trial court to represent the class representative. Lead counsel firms, such as Hagens Berman, handle all aspects of the class-action litigation and are selected for their merits to lead a class-action lawsuit based on their success record and/or expertise in the type of case at hand.
A lawyer or firm that is neutral. The lawyer/firm acts as an intermediary between the opposing legal firms and the court. A liaison counsel is sometimes used in complex litigation.
Rule 23 requires that after a class has been certified that all members of the class be given notice of the class-action lawsuit. Notices are given when possible through direct mail. Otherwise they are given through other publication techniques such television, radio, newspaper ads and the Internet. The notice should describe the action, the class claim, the class itself, that class members can enter an appearance through a lawyer, and that members can request exclusion and the binding nature of class judgments.
One of the Rule 23 prerequisites for class-action certification is that ”One or more members of a class may sue or be sued as representative parties on behalf of all members only if the class is so numerous that joinder of all members is impracticable.” Numerosity is shorthand for a finding that this prerequisite has been met.
Similar to an exclusion request, it is the act of one class member electing not to be part of the class-action lawsuit.
Someone who objects/opposes a class-action settlement proposal.
One of the methods in which notice is given to members of a class after the class has been certified. Publication normally refers to notice in a newspaper, television advertisement or radio advertisement.
The team of lawyers handling the case for the plaintiffs. Lead counsel is the head of this committee.