Class Actions
We have a tremendous amount of experience in complex class action work. We have represented our clients in class action matters in the Counties of Los Angeles, Orange, Riverside, San Bernardino and San Diego. Class actions can involve novel issues, operational issues, issues pertaining to widely used contract clauses or operations policies, consumer fraud, and employment law, especially issues related to wage and hour law compliance. Our litigation team has experience in all of these areas.
Nature of Actions
Class actions and representative actions permit persons to sue on behalf of others where this is shown to be necessary and superior to separate lawsuits by or against members of the group individually.
Disadvantages for Plaintiff’s Attorneys
The costs of managing an active class action with many class members are immense. Usually, the class representative is unable to advance the full costs, so the plaintiff’s lawyer may have to make a sizeable cash outlay to keep the case going. Moreover, there is usually no way to collect fees or costs unless there is a recovery or settlement. Thus, plaintiff’s lawyer may face a risk of financial ruin if the case is lost. Class actions tend to drag on and few go to trial. If the action is unsuccessful, the plaintiff may be exposed to a substantial cost bill, especially if defendant has “fronted” costs of notice or other required communications with class members. Court approval is required for dismissal of a class action, even if the attorney is dismissing only one party or one cause of action. As a result, plaintiff’s attorney may be unable to get rid of a class action that turns out to be less desirable than originally anticipated. If a settlement is negotiated, notice to the class members and court approval is required, including on the question of legal fees to class counsel. The judge may question the reasonableness of a large fee award where the class members receive only minimal amounts. “Professional objectors” may challenge the fee award or terms of the settlement, which may lead to years of appeals even after the trial judge has approved the settlement. Conflicts of interest may arise where a lump-sum settlement must be divided among class members. Class counsel also run a risk of malpractice liability if they fail to assert causes of action available to members of the class.
Prerequisite Conditions
Under California law,a party seeking class certification must establish three things:
- The existence of an ascertainable and sufficiently numerous class,
- A well-defined community of interest, and
- Substantial benefits from certification that render proceeding as a class superior to the alternatives.
Ascertainable Class
Ascertainability is a due process requirement that ensures notice can be given to putative class members who will be bound by the judgment and as to whom it will have res judicata effect. The determination is made by examining the class definition, the size of the class and the means available to identify class members. By contrast, the class is not ascertainable when the proposed class definition is so broad that it is impossible to distinguish those class members who have viable claims from those who do not. The class members must be “readily identifiable without unreasonable time and expense.”
Community of interest
The “community of interest” requirement embodies three separate factors:
- Predominant common questions of law or fact
- Class representatives whose claims or defenses are typical of the class; and
- Class representatives and class counsel who can adequately represent the class.
Manageability
The proponent of class certification must demonstrate that the proposed class action is manageable. This requires the trial court to carefully weigh the respective benefits and burdens of a class action, and to permit its maintenance only where substantial benefits will be accrued by both litigants and the courts alike.