CLASS ACTION FAQs
What is a class action?
A class action is a lawsuit brought by an individual or entity on behalf of a class of other people who are similarly situated. When many people have similar complaints, in order to save the court time by bringing all of the concerns in one lawsuit rather than bringing many different cases, a lawsuit could be brought as a class action.
Do I need to get other members of the class agree to participate in the class action before I bring a class action lawsuit?
Generally, no. A class action lawsuit can be initiated by a single plaintiff if the wrongful conduct that is alleged to have harmed the plaintiff was also done to others. Often times, the plaintiff bringing the class action will not know the identity of other class members when the case is initiated. For instance, in a securities fraud case, it is unlikely that the investor who initiates the lawsuit will know the identities of the other people who invested in the same securities. Nonetheless, the plaintiff can still represent them. At some point during the litigation, if the court agrees that the case is an appropriate class action and certifies the lawsuit as a class action and the plaintiff as a class representative, the defendants will be required to provide the identity of the putative class members and notices will be sent to them notifying them of the action.
What is a lead plaintiff?
A lead plaintiff in a class action is the party that is appointed by the court to represent the class in the lawsuit. In a federal securities fraud lawsuit, the court usually appoints the class member with the largest financial interest in the recovery sought by the class to serve as the lead plaintiff. Courts may appoint individuals, groups of individuals, institutional investors, groups of institutions, or combinations of both as lead plaintiff, depending on the circumstances of each case. The lead plaintiff selects legal counsel to represent both the lead plaintiff and the class. Upon court approval, this counsel becomes lead counsel or class counsel in the case.
What do I do if I want to bring a class action but I cannot afford to hire an attorney?
Attorneys for plaintiffs in a class action will generally agree to work on a contingency fee basis – that is, you will not pay them on an hourly basis for the time they put into the case, but instead they will only be paid if the lawsuit settles of if they win at trial. If attorneys for plaintiffs are successful in obtaining a recovery for the class, the plaintiffs’ attorneys will request the payment of attorneys’ fees and reimbursement of expenses from the court. If attorneys for plaintiffs are not successful in obtaining a recovery for the class, they will receive nothing.
What is the class period?
The class period is a specific time period during which the unlawful conduct is alleged to have occurred. If you purchased the securities of a company during a class period, you are automatically a class member, regardless of whether you specifically retained a law firm to prosecute any claims on your behalf. Although the initial complaint will specify a certain class period, the class period may be expanded to encompass a longer period of time.
How long does it take to resolve a class action?
The time to prosecute a class action lawsuit can vary based on the unique facts, parties, and jurisdiction of a particular case. It is not unusual for a class action to take three years or more to complete.