Main Menu ${}${SEMFirmNameAlt}
Call Us Toll Free at 800-259-1005

How are class action settlements distributed?

The resolution of a class action lawsuit in Lake Charles can be a tedious process no matter what your level of involvement in the case may be. Hopefully, however, after all is said and done, a favorable ruling is issued and a settlement is awarded. Once that happens, it inevitable question then becomes “Now what?”

Your main interest then becomes what portion of that settlement you may be entitled to. As a class action lawsuit can potentially involve hundreds of plaintiffs, finding an answer to that question may not be easy. Thus, the decision of how to disperse the proceeds of a class action award is usually left to the court that issued the ruling.

It should be remembered, however, that any legal fees and courts costs must be paid from the settlement amount. Therefore, before you or any of the other class members can receive any funds, those expenses must be settled. In some cases, these costs reduce the settlement amount by as much 30-40 percent.

In many cases, it may be determined that all class members are awarded an equal dollar amount or an equal percentage of the remaining settlement. However, such an agreement may not equitably represent yours or others’ roles in the case. This is why the plaintiffs (or the court) will often create a custom “plan of distribution” instead.

A good example of this may be the settlement related to the Class Action Blitz v. AgFeed Industries, Inc., which was recently detailed by PR Newswire. In this case, the Securities and Exchange Commission (which was the plaintiff in a related action) developed a distribution plan that was subsequently approved by the court. As the case involved securities fraud, the plan allowed all common stock holders to recover amounts equal to the losses they suffered. 

No Comments

Leave a comment
Comment Information

Lundy Lundy Soileau & South, LLP

Main Office: 501 Broad Street Lake Charles, LA 70601 | Phone: 337-439-0707

Mailing Address: PO Box 3010 Lake Charles, LA 70602 | Fax: 337.439.1029