How does a Class Action Lawsuit Work ?

One of the most well know class actions lawsuits in history is the case of Erin Brockovich and Pacific Gas and Electric.  She found out that many of the people of Hinkley, California were suffering from cancer due to chemicals that had been in the water supply.  The company was proven to have known that these chemicals were hazardous and not only did nothing to rectify the situation, but tried to cover it up.  Most of the people did not have the money to bring their own cases to court individually, and in fact none of them even knew why they were all getting sick.  Erin Brockovich became the lead plaintiff acting on behalf of all of the residents.  They simply needed the money to pay for their medical bills.

In this case as in many class actions cases, the attorneys are not paid unless a settlement is reached.  In cases where they do reach settlements they typically make thirty to fifty percent of the final amount that is awarded.  The award are divided, into compensatory damages and punitive damages.  The compensatory damages go to pay for the medical bills and the pain, and the compensatory damages are the fees that are the penalty, or the punishment that is given to the company that is involved.  In this way, many people have the opportunity to seek restitution for the pain and the suffering that they are exposed to.  And justice is served.

When members come together for a class action suit, they are usually required to sign contracts stating that in agreeing to be part of the suit, they will not then sue the company individually.  Some of these cases do go to trial, while other cases are settled outside the courtroom, when the cost and the publicity surrounding the trial would mean that the company may have to shut down.  These cases can always be appealed and may take years to be resolved, but it is a case of many people coming together to protect themselves and to make sure that justice is brought to those who did them harm.

This entry was posted on Tuesday, March 9th, 2010 at 2:58 pm and is filed under Class Action Information. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.


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