Lawsuit Season
As a warning for consumers who may be unwittingly named as plaintiffs in class actions next year, Citizens Against Lawsuit Abuse has rung the opening bell on “lawsuit season,” that time of year when greedy lawyers lick their chops over all the products that don’t work just right and all the ignored warning labels that were piled up under the Christmas tree.
Every year we see lawsuits over absurd things such as the size of packages that products come in. We want consumers to be on the alert that their names might be used without their permission by class action lawyers looking for a quick buck.
The problem is that the lawyers who file these class actions typically walk away with millions of dollars in fees, while consumers,supposedly the victims,”win” a few bucks, a coupon or nothing at all.
These naughty lawyers get nice settlements. But consumers get the legal equivalent of a lump of coal. And too often, judges let the lawyers get away with it.
A few examples from recent legal infamy:
– Ford Motor Co. just ended years of litigation over the safety of its SUVs. Per the settlement agreement, the vast majority of the plaintiffs will get a $300 to $500 coupon to go toward a new Ford, while their attorneys are slated to get $25 million in fees and court costs.
– Another lawsuit over the price cardholders of Visa, MasterCard and Diners Club cards were charged for overseas transactions is coming to a conclusion. Plaintiffs will be given three options for payout: a $25 dollar gift card, a payout based on the number of days spent overseas or a payout based on actual or estimated foreign transactions each year. Plaintiffs’ attorneys have requested 27.5% of the estimated $313 million expected to remain in the settlement fund after administrative costs, plus additional expenses up to $5 million.
– In a settlement of a class-action against Blockbuster regarding late fees, plaintiffs’ attorneys received $9.25 million while each class-action member received two coupons for movie rentals and one $1 off coupon.
– A class action against Carnival Cruise Lines for the alleged inflation of port charges awarded former passengers with coupons worth $25 to $55 to be used for a future cruise, or redeemed for cash at 15% to 20% of face value. The lawyers got $5 million in fees.
The only thing consumers can do to prevent themselves from being accomplices to this kind of shakedown is to take action to support class action reforms.
This is a system that has clearly veered off its intended course. Lawyers’ fees should be tied to whether consumers and plaintiffs actually benefit from the litigation. Otherwise, these suits will continue to be a tool of extortion that makes lawyers rich at our expense.
Maryann Maloney
Executive Director,
Orange County Citizens
Against Lawsuit Abuse
