What Are Open Class Action Lawsuits?
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What Are Open Class Action Lawsuits?
You have seen the commercials. A narrator explains that if you suffer from mesothelioma, you might be able to receive compensation for your prolonged exposure to asbestos. Other commercials discuss legal action taken against drug manufacturers because of the adverse side effects of taking certain medications.
In 2015, Volkswagen admitted to cutting corners by installing software in its vehicles that altered emission reports. According to an article in Fortune magazine, emission readings exceeded the EPA-mandated guidelines by a whopping 40 times. Volkswagen customers banded together to take legal action against Volkswagen, which eventually ended with claims paid out of more than $20 billion.
Legal actions that have been taken against Volkswagen, pharmaceutical companies, and against the companies that have yet to remove dangerous asbestos from their buildings are known as class action lawsuits.
A class action lawsuit represents a type of legal action that draws many people together that have the same type of claim for the purpose of suing a defendant. Let’s say a medical device caused you harm or injury and you discover the same medical device has injured hundreds of other people living in the United States. You can form a coalition of plaintiffs to file one lawsuit against the manufacturer of the faulty medical device.
What Are the Two Types of Class Action Lawsuits
Deciding to file a class action lawsuit is just the start of the legal process. You also have to decide whether you want to file a closed or an open class action lawsuit.
Closed
A lead plaintiff files a closed class action lawsuit on behalf of the people that signed a retainer agreement with the solicitors that act for the lead plaintiff. The retainer agreement also reveals the funder of the closed class action. The people that are eligible to join the closed class action must sign both the funding and retainer agreements. Otherwise, they will not receive compensation from a judgment or settlement.
Open
On the other hand, an open class action lawsuit covers the people that have signed both agreements and the people that have not signed the agreements. Open class actions remain open for as long as it takes to resolve the contested legal issue. Some open class actions take just a couple of months, while more complicated cases can take years before they reach a conclusion.
What Are the Advantages of Joining an Open Class Action Lawsuit?
Let’s say you want to file a lawsuit against an automobile manufacturer for designing a defective airbag. Do you go it alone or search for an open class action lawsuit that is suing the same auto manufacturer for the same defective airbag. If you have a limited amount of time and you do not want to drain your bank account, filing a lawsuit that is open to other plaintiffs is the way to go.
Here’s why filing an open class action lawsuit makes sense:
- An efficient legal process that involves just one judge and one decision that covers hundreds of co-plaintiffs
- Opportunity to receive just compensation
- No attorney fees
- Legal responsibilities no longer your responsibilities
- The outcome can impact previous legal actions
- No deadline for other people to join
Because most attorneys operate on a contingency basis, you do not have to pay upfront fees for legal services. The lawyer who handles a case for you gets paid when the plaintiffs get paid.
What Are the Common Types of Open Class Action Lawsuits?
Julia Roberts’ Oscar-worthy performance in Erin Brockovich highlighted the importance of taking legal action against a company for harming people and the environment. Residents of Hinckley, California filed an open class action lawsuit against Pacific Gas & Electric Co. for purposely allowing harmful chemicals to penetrate the city’s groundwater. The lawsuit against the utility is just one of the common types of legal action taken against a company for gross negligence.
- Defective consumer product
- Dangerous consume product
- Wage theft
- Discrimination in the workplace
- Fraudulent investment reports
- Fraudulent business practices
- False advertising claims
- Exposure to harmful substances
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How Do I Join an Open Class Action Lawsuit?
If you feel justified in taking legal action against a company for gross negligence, you have two ways to determine whether other plaintiffs have organized and filed an open class action lawsuit.
- Contact classaction.org to review the current list of open cases and investigations
- Conduct an online search
For an online search, type in a few keywords that best represent your type of case. For example, if you received injuries because of a defective bicycle, you type in the name of the manufacturer and the words “open class action lawsuit.”
How Do I Start an Open Class Action Lawsuit?
Because most class actions are complicated, the first step for starting one is to contact an attorney who specializes in handling the same type of case. After conducting a thorough review of the case, your lawyer might file a lawsuit in either a state or federal court. Then, your legal counsel seeks certification of the lawsuit as a class action legal maneuver.
A judge does not automatically certify an open class action. Here are a few factors that can delay or prevent the certification of this type of lawsuit:
- Too many members of the class
- Questions concerning law
- Questions concerning the facts of the case
- The representative party has not protected the legal interests of the class
State law might determine how many class members you need to have before taking legal action. In most instances, at least 50 class members should be enough to initiate an open class action lawsuit. Speaking with an attorney can help you learn how many class members you need to initiate legal action in the state where you live.
What Does a Lead Plaintiff Do in an Open Class Action?
If the judge overseeing your case certifies it as an open class action, you become the lead plaintiff during the entire court proceeding. This means the court might name you as the representative party.
As the representative party, you are the voice of the class that makes you responsible for the following:
- Hiring a lawyer
- Consulting with the attorney until the case closes
- Deciding on whether to agree to a settlement
- Acting as the public face of the legal action
- Representing the class with fairness
The court must approve the terms of any settlement that includes the compensation paid to attorneys and the members of the class. Class members should receive a notice from the court that explains the terms agreed to in the settlement.
What Does It Mean to Opt in and Opt Out?
If you receive a notice of a pending class action lawsuit, you have to determine whether you want to take part in the legal action. For an open case, you do not have to let the court know that you want to opt in. Instead, the court sends you a notice by mail or email that lets you know you are automatically a member of the class. Opting in for either an open or closed case means you receive the compensation awarded by the judge or agreed to in a settlement. However, you cannot file a lawsuit against the same defendant on your own.
If you opt out of a closed case, you lose the right to claim a part of the compensation, but you can file a lawsuit against the defendant on your own. The decision whether you want to opt in or out of a class action lawsuit should be made with the advice of an attorney from Morgan & Morgan.
What Do I Win for Participating in an Open Class Action?
If you are a class member for a lawsuit that awards compensation or you are a class member for a case that reaches a settlement, you are entitled to a percentage of compensation. The type of compensation is almost always financial. How much you receive in compensation depends on the number of class members, as well as how much the lead plaintiff earns for representing the class.
After discussing your case with an attorney from Morgan & Morgan, you might determine that you deserve more money than other class members because you suffered more from the illegal actions taken by the defendant. If you decide that you deserve more in compensation, you and your lawyer have the right to file an individual lawsuit against the defendant.
What is Multidistrict Litigation?
Often confused with class action lawsuits, multidistrict litigation (MDL) consolidates similar individual cases into one form of legal action. Unlike an open class action lawsuit, an MDL resolves each case individually. What one plaintiff receives in compensation might differ from what another plaintiff receives in compensation from the same defendant. The primary purpose for moving several cases into an MDL is to relieve some of the backlog of cases in the judicial system.
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If a company has caused you harm through gross negligence, you might have a strong enough case to receive just compensation by filing a lawsuit. If your case is similar to what other people have suffered by the same actions of the company, then you might consider filing an open class action lawsuit.
Consulting with an attorney can help you decide which legal action to take. Schedule a free case evaluation today with an attorney from Morgan & Morgan to determine the best course of legal action.