Class Action Litigation
- A lawsuit is filed as a class action because the members of the class are
so numerous that joinder of all members is impracticable. An individual
is often at a great disadvantage when in dispute with a large corporation.
An individual's time and resources are limited, and the amount by which he or she
has been damaged may not justify the expenditure necessary to get compensated.
The purpose of class action lawsuits is to give the average person the ability
to take on even the largest corporate or private entities and have a chance
of redressing the wrong done by these entities. It is important to remember
that even though the actual damage or cost to the individual class member may
be small, when the same damage is suffered by thousands of other similarly
situated individuals, the illicit gain to the corporate entity can be huge.
The class action allows many average individuals who have been hurt
in a similar way to join together in pursuit of a recovery to redress the
damage they have suffered.
- For a lawsuit to proceed as a certified class action, several requirements
must be met. First is Numerosity - There have to be enough people to justify
bringing the suit as a class. Class actions have been brought with as few
as 20 or 30 people and as many as millions. Second is Commonality -
litigants must be able to demonstrate to the court that there are questions of
law or facts common to the class, that is, similar misconduct has occurred
and harmed members of the proposed class in a similar way. The next
requirement is Typicality - litigants must show that each person in the
proposed class is making allegations typical to those made by the other proposed
class members. The final requirement is Adequacy - It must be shown that
proposed class representatives will fairly and adequately protect the
interests of the class. The legal counsel representing the case
must be adequate, and there can be no conflicts of interest in representing
class members. The plaintiffs also have to show it makes sense to proceed
as a class. The most common way to demonstrate that a class
action is the superior avenue is to show that common questions predominate
over individual questions. If there are a lot of individualized issues among
disgruntled policyholders, a class action may not be
the best way to proceed.
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