Class Actions – They Aren’t What Most Believe Them To Be

All too often, I see and hear people saying that they want to file a class action or that a particular issue is perfect for a class action, without any understanding of what a class action is, what it entails (especially the costs), and the benefits/detriments of a class action.

A class action is where one of the parties to the litigation (usually the Plaintiffs, but there are instances of Defendant class actions) is a large group of people, all with identical or substantially similar claims. In Pennsylvania, the Rules of Civil Procedure specifically provide for class actions in Pa.R.C.P. 1701, et seq. and in the federal courts, class actions are provided for in F.R.C.P. 23.

As explained in Pa.R.C.P. 1702, the prerequisites for a class action in Pennsylvania are:

One or more members of a class may sue or be sued as representative parties on behalf of all members in a class action only if:

(1) the class is so numerous that joinder of all members is impracticable;

(2) there are questions of law or fact common to the class;

(3) the claims or defenses of the representative parties are typical of the claims or defenses of the class;

(4) the representative parties will fairly and adequately assert and protect the interests of the class under the criteria set forth in Rule 1709; and

(5) a class action provides a fair and efficient method for adjudication of the controversy under the criteria set forth in Rule 1708.

While I won’t review the entire process, generally speaking, several individual plaintiffs – who will later seek to be the representative plaintiffs of the Class – file a complaint, with class action averments, as required by Pa.R.C.P. 1704. Once any initial challenges to the complaint have been addressed by the Court and the Defendants have filed an answer to the complaint, the plaintiffs (assuming a plaintiff-based class action) will have 30 days to file to have the class certified, as specified by Pa.R.C.P. 1707. Beyond Pa.R.C.P. 1702, rules 1708-1710, dictate the criteria for determining whether to certify the class and what the opinion and order of the court must include or otherwise address in deciding whether or not to certify the class.

If the class is certified, pursuant to Pa.R.C.P. 1712, notice must be provided to all class members of the fact that they are now part of a class action. This is where class actions become extremely costly, especially when you’re talking about thousands (or tens or hundreds of thousands) of class members, as the plaintiff(s) is/are obligated to pay the cost for the notices to all class members. As an example as to the costs, we recently had a class action, where to send out the notices by a class administrator, we were quoted $100,000 for a 15,000 member class. But the costs don’t end here. In the event that the class action is settled or discontinued, pursuant to Pa.R.C.P. 1714, the plaintiff(s) must again send notices out to all class members, as they must be afforded an opportunity to opt-out of the class action or object to the terms of the settlement/discontinuance. Thus, using the example I provided before, the plaintiffs in that matter would have to incur $200,000 in administration fees, just relative to the class being certified and the matter, thereafter, being settled/discontinued. While law firms generally front these costs, unless there is a possibility of recovering their costs, the loss of use of their money for years, and being compensated for the time of their attorneys, no law firm will take on a class action.

And here lies one of the biggest misunderstandings that I see about class actions. While people love to throw around the phrase “class action,” they generally have no idea about the costs associated with such or that there needs to some ability to obtain a financial judgment if successful. Merely hundreds or thousands of people being aggrieved by something – if there’s no ability to obtain a financial judgment against the tort feasor, such as the Commonwealth or U.S. Government, as they’re sovereigns, for which financial judgments cannot be levied against them without their consent – is not, generally, going to be a situation in which a class action will be brought and maintained by a law firm.

Rather, an experienced attorney, familiar with the law, can typically bring an action, on behalf of several people who are aggrieved, to obtain declaratory and injunctive relief to prevent or stop the harm, even if the harm is being caused by a sovereign. However, these types of cases, as you’re typically suing some form of government, get very costly to litigate (as governments don’t like to lose), but not nearly as costly as the cost associated with certifying and notifying a class. Nevertheless, as there is no ability to obtain a financial judgement or attorney fees and costs, it requires the plaintiff(s) or people supporting the plaintiff(s) to pay the attorney fees and costs as the matter is litigated. Obviously, in situations such as these, crowd funding can become very important and the sole reason that the case is ever filed.

So when does a class action make sense? Where there are numerous individuals aggrieved by a tort feasor’s conduct and there is, at a minimum, an ability to obtain attorney fees and costs, if not additionally a large financial judgment. An example of this is where confidential license to carry firearms applicant information is disclosed. I have settled two such class actions against the City of Philadelphia, one in 2014 and one in 2018, and have one class action against Monroe County, which is awaiting final approval. I also have one that is currently being litigated against Franklin County.

So, before you start throwing the phrase “class action” around, think about its application to the situation. Is there an ability to obtain attorney fees and costs or a financial judgment against the tort feasor? If not, a class action doesn’t likely make sense and I don’t know of any law firms looking to incur such costs with no possibility of recoupment. If there is, then, depending on the number of people aggrieved and the similarity of their claims, it may make sense!

If your confidential license to carry firearms information has been disclosed or you believe a class action is appropriate against someone who has harmed you and numerous others, contact Firearms Industry Consulting Group today to discuss YOUR rights and legal options.

Firearms Industry Consulting Group® (FICG®) is a registered trademark and division of Civil Rights Defense Firm, P.C., with rights and permissions granted to Prince Law Offices, P.C. to use in this article.

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