You might have read recently concerning the 'class action lawsuit' being brought against an important telecommunications company in Australia. It is claimed that nearly 18,000 of that company's customers (and also some dealers) have joined the lawsuit, which arises from allegations of poor network performance.
One of many problems facing an aggrieved customer, is the economics of bringing legal action. Also, the financial loss arising from a slow or unreliable network is often difficult to quantify in dollar terms. If the impact is too serious, affected customers may vote making use of their feet Credit Suisse Group AG Class Action Lawsuit, but changing networks is normally inconvenient, and terminating the initial service may involve a penalty cost... inadequate to justify the legal fees to take the situation to court, but certainly enough to make disgruntled customers see red. Although modern consumer legislation encourages large utility companies to meet minimum standards of customer support, the practical the truth is that individual consumers remain relatively powerless.
This really is where the best to create a class action serves an invaluable role, by allowing the claims of numerous affected customers to be consolidated into one lawsuit, reducing the legal costs payable by each individual class member, and also avoiding the impact of numerous similar claims clogging up the court system. This notion of group litigation isn't a contemporary development, and actually was very common in the 13th and 14th centuries in medieval England.
However, to be involved in a class action, each participating member must contribute financially, or enter into a litigation funding agreement. Although the result may exceed financial contributions, that's not guaranteed. If the lawsuit is unsuccessful, the contributions is going to be lost and there's a threat of members needing to contribute additional sums towards any adverse costs order - that's, where in actuality the class action fails, and the plaintiff (the person representing the class members) is ordered to meet a number of the defendant's legal costs.
Once a class member has signed up to be involved in a class action, they might have very little say in the decisions made on their behalf. Although class members can decide not to accept the class settlement, that option is, for many individuals, a Hobson's choice... the member who opts out will then have to pursue his / her claim independently.
Another recent class action lawsuit, commenced in July 2009, was brought against one of Australia's largest banks with respect to individual investors who lost money after an economic broking company collapsed. Those investors allege the bank was partially or wholly responsible for their losses. A youthful, threatened action, also against exactly the same bank but involving an alternative representative, led to a settlement for approximately 2,000 investors, but other investors are continuing their group action contrary to the bank.
Further class actions, also arising from the broking company's collapse, have now been commenced against a bank in Queensland, Australia, and contrary to the manager of two franchise stores associated with this bank.
These lawsuits illustrate the advantages and disadvantages of class action proceedings. In many cases, the sheer weight of numbers encourages a negotiated settlement, while the defendants in these cases will also be anxious to prevent unrecoverable legal costs and the damage to their reputations from prolonged publicity. Although negotiated outcomes may be much less compared to the sums claimed, for several members the settlement will represent an outcome that could not otherwise be afforded. Also, as is the case with court proceedings generally, lengthy delays are nearly inevitable unless an early on settlement is reached.
In the initial case, relating to the telecommunications company, it's alleged by some customers that call reception issues led to the increasing loss of work opportunities, while affected business customers say they've suffered reduced trading as a consequence of poor network performance. Now, exactly the same company has been embroiled in a brand new situation where it's alleged that personal information all the way to 4 million customers was able to be improperly accessed by individuals beyond your company. Customers suffering from this privacy breach may be able to interact another class action against the company, or most of the claims may be combined in a single action.
In any event, the company's woes appear likely to be front page news for quite a while yet.
If you're asked to become listed on a class action, consider obtaining legal advice about alternative options to deal with your specific loss or problem, and to get independent advice concerning the merits of the proposed class action lawsuit.
Note: This short article is primarily about class actions in Australia. The typical principles may be relevant to some other jurisdictions, but you will see significant differences in the applicable rules and procedures.
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