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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