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Types of Class Actions are Varied and Diverse

By Alan Haburchak

Republish: EasyPublish™ Published: 14Apr2008 Word count: 735 Viewed: 341 time(s) Get Free Content For Your Site

In 2006, the Class Action Fairness Act of 2005 (CAFA) became law. The primary purposes of the Act was to assure fair and prompt recoveries of legitimate claims, to establish more liberal procedural requirements and to set forth new standards for class action settlements. In general, the class action rule is in effect to improve the legal system's effectiveness by permitting large groups of people with similar claims to join together into a single lawsuit.

These large groups can be comprised of consumers, small businesses or injured people. One or more of the affected then represents the harmed group in court, and if those representatives meet specific criteria, they are granted permission to prove and settle not only their own claims, but also the claims of each individual of the larger affected group as well.

Antitrust Claims

Antitrust actions are typically brought when consumers suffer financial losses because products and services are illegally overpriced. This overpricing can occur due to companies fixing prices at artificial levels to secure higher profits and/or to force out competition, forming agreements that allocate markets or customers among competitors to eliminate or reduce competition and through bid rigging.

Consumer Actions

Consumer class actions are generally brought when consumers are injured by a company's systematic and illegal practices. Examples include illegal charges on bills, illegal penalties for late-payments, and failure to comply with consumer protection laws.

Consumer Product Claims

Legal actions are often brought about because of defective products that cause harm or injury to large numbers of individuals due to faulty labeling, design defects or defective manufacturing. It is the responsibility of the manufacturer, designer, distributor, or retailer to ensure that the product does not cause harm and they can be held liable.

Breach of Warranty

Warranties on personal items, appliances, automotives and many other consumer products exist to protect consumers regardless of whether the product specifically states the coverage. When this assurance is false or the quality is misstated class action lawsuits are often brought against the liable party.

Employment Claims

Employment class action lawsuits are typically brought on behalf of employees of a large company for claims ranging from systematic workplace discrimination, illegal hiring and promotion practices, wrongful termination policies and practices, unpaid unemployment benefits and unpaid overtime.

Employee Benefits

These class actions by employees of a single employer generally address violations of Employee Retirement Income Security Act (ERISA) and involve discriminatory practices or violations in employers plan design. In some cases company health plan benefit payments violate discrimination laws.

Insurance Claims

Insurance companies that misrepresent policies, do not pay valid claims, deny coverage to classes of individuals, fail to make prompt investigations or payments are all vulnerable to class action lawsuits.

Medical Devices

Medical devices that malfunction cause serious injury or death and the manufacturers of these devices are liable to the group of people and their families who suffer because of the defect of the device.

Product Liability/Personal Injury

Product liability and personal injury class action lawsuits are generally brought when a defective product, unreasonably dangerous product, unsafe environments or negligent practices kill or seriously harm and injure people.

Pharmaceutical Litigation

Pharmaceutical liability claims of prescription and over-the-counter medications are brought when drugs that are intended to help people causes side effects, injuries, serious harm or sometimes death in a large group of people. This can occur because clinical trials were not large enough to determine increased risks, when drugs are prescribed to the wrong patients or when drugs are regularly co-prescribed with other drugs and cause adverse reactions.

Securities Class Actions

Securities class actions are typically brought on behalf of a group of investors who have been injured as a result of a company's improper conduct, such as misstating earnings, concealing or misrepresenting risks, or otherwise engaging in activity detrimental to the company. Other securities actions are brought as direct result of a financial advisor or broker's, or group of advisors, repeated misrepresentation, negligence, dishonesty or fraud.

In addition to these industry class actions there are many other potential class actions that can be entered into the legal system if a large group of people have suffered or been harmed by the same person, company or entity in the same manner. A law firm that handles these types of cases can provide the guidance necessary to proceed with a class action lawsuit. Most fees are paid by the class action settlement.

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