For individuals and businesses with a legitimate claim against another entity, one of the primary considerations that arises is whether to pursue a class-action claim or proceed with an individual lawsuit.
This is no simple question to answer, and the determination will depend on many factors specific to you and your case. However, there is tremendous value in considering some of the benefits and drawbacks of petitioning for a class-action designation in your case.
What is a class-action claim?
A class-action claim is a lawsuit in which a defendant’s action harmed a significant number of people or businesses. Those harmed by the defendant join all their cases together into one single class action against the defendant.
Benefits of class actions
Joining multiple claims in a class action has multiple benefits. The first benefit is efficiency. Rather than bogging down the courts with many similar cases, all of the same cases can be brought through the system in one unified process, which can be much faster.
Second, class-action claims are more practical for smaller cases. When someone has a smaller value case, it often doesn’t pay to bring a lawsuit. The cost and time of litigation makes it not worth it. However, with a class-action claim, all of these smaller claims join together, minimizing the cost for each party, so smaller value claims have a chance.
A good example of this is a recent class-action claim against Pagliacci Pizza. According to the Seattle Times online, the case involved more than 1,000 delivery drivers who have worked for the pizza chain. The individual claims were small, involving wage and hour, tip sharing and other employment issues that might not have made for a strong case. But joined together in a class action, these claims are powerful, bringing in $3.75 million for those harmed by the pizza chain.
Third, there is a greater chance in a class-action claim for every negatively impacted plaintiff to obtain compensation. In individual suits, the first ones to file a claim will generally be the first ones to obtain compensation, while those coming in later might be denied compensation due to lack of funds from the defendant. A class action allows everyone to obtain some compensation.
Drawbacks to class actions
There are also some important drawbacks to a class-action claim. First, you lose some degree of control over the process and the legal approach. An individual lawsuit allows you to work with your lawyer to determine the arguments and approach to win your case. In a class-action claim, there are representatives who will make those decisions on behalf of the entire class.
Similar to the first point, a class action could weaken your case. The representative plaintiffs and their attorneys might not bring a case as good as your individual case. If this happens, it could leave you with a losing case and no recourse for compensation.
How should you make this decision?
There are many factors involved with determining whether to pursue a class action. For example, if you have a quality, high-value case and there aren’t any other similar cases filed yet, an individual lawsuit might be better for you. Conversely, a low-value case with a lot of other similarly situated plaintiffs might be better for a class action.
The good news is that you do not have to make this determination on your own. An experienced litigation attorney who has handled both individual lawsuits and class actions can help you determine the best course of action.