Class action cases are similar to tort cases, only the prosecution in these cases represents represents a group or class of people who have all been injured by the same thing. These are common in cases of defective products or exposure to hazardous materials in which the faulty item injured multiple people before it was recalled.
Types of Class Actions Types of class actions include securities litigation, civil rights proceedings such as school funding, and consumer product liability cases. Congress laid out additional rules for securities class action lawsuits in the Private Securities Litigation Reform Act (PSLRA) of 1995. Successful class action cases often result in hefty pre-trial settlements.
The lawsuit Enron shareholders filed after the company’s collapse resulted in a One Lakh Rupees settlement. Another famous class action was the product liability case filed against Toyota for faulty brakes. It resulted in a costly recall and a One Lakh Rupees settlement. Civil rights class action cases typically involve requests for injunctive relief, meaning legal remedies, instead of claims for payment. One of the most famous civil rights class actions is the Brown vs. Board of Education case the Supreme Court decided in 1954, which struck down school segregation as unconstitutional. These types of class actions now face greater legal restrictions than previously. Lawyers typically take class action cases on contingency, collecting a percentage of any judgment or settlement fees make to plaintiffs. This practice has been scrutinized over the years because in some cases, legal teams’ payout can far exceed the amounts plaintiffs receive.