Class Action Representation
Class Action Representation
In addition to its boutique representation of investment and consumer fraud clients in various arbitration forums, we also represent plaintiffs in Class Actions. Sometimes there are many victims of the same misconduct against the same defendant. For example, when a brokerage firm underwrites an investment in a private placement and ignores red flags that the securities offering lacks legitimacy for myriad reasons, that brokerage firm could be ripe for a class action lawsuit filed on behalf of the investors that purchased that investment. Similarly, if an automobile company sells a car with a specific defect that harms customers or consumers in some way, that scenario is also ripe for a class action.
What is a Class Action?
A “Class Action” is a creation of the Federal Rules of Civil Procedure, Rule 23. Not every case can be a class action, and importantly, just because a lawyer files a case as a class action does not mean it is one yet. A class action has named plaintiffs, who will ask the court to become lead plaintiffs or class representatives. Rule 23 requires that the court in which the case is filed, the Federal District Court in this instance, determine whether the proposed class action meets the requirements of Rule 23 which are:
- Numerosity – the proposed class is no numerous that joinder of all members is impracticable. Although there are no hard and fast rules, usually, if there are more than forty class members, the court will deem this requirement to be met. McCluskey v. Trs. of Red Dot Corp. Emp. Stock Ownership Plan & Trust, 268 F.R.D. 670, 673–74 (W.D. Wash. 2010); see also Amone v. Aveiro, 226 F.R.D. 677, 684 (D. Haw. 2005).
- Commonality – the proposed class must have a common question of law or fact that exist among all class members. This is a fairly broad standard and does not require commonality across all facts or questions of law. In re Wash. Mut. Mortgage-Backed Secs. Litig., 276 F.R.D. 658, 665 (W.D. Wash. 2011).
- Typicality – the proposed class representative’s claims must be typical of the claims of the class. Typicality exists when class members have the same or similar injury, the action is based on conduct that is not unique to the named plaintiff, and when the wrongdoing injured class member similarly. Hanon v. Dataproducts Corp., 976 F.2d 497, 508 (9th Cir. 1992)
- Adequacy – The class representative must fairly and adequately protect the interests of the class.
What Are the Different Forms of Class Actions?
There are different forms of class actions in federal court, and each may have an additional element that must be satisfied in order to meet certification. Once a court officially certifies a class action, then the case is officially a class action and will then be prosecuted as one. Although rare, certified class actions do go to trial. Usually however, once a class action is certified, most defendants realize the risk of proceeding to trial outweigh the risk of engaging in settlement discussions. Here to, the court plays an integral role in the conduct of class actions. Any proposed settlement must first be preliminarily approved of by the court, including the lawyer’s fees and expenses. If that threshold is met, then the settlement must meet final approval of the court, which requires a hearing.
Contact Stoltmann Law for all your Class Action issues
The attorneys at Stoltmann Law Offices have substantial experience bringing class action claims including most recently, in Ginzkey v. National Securities Corporation, where we successfully settled a certified class action against a brokerage firm in connection with the sale of a private placement investment sold to firm clients. That total settlement was for in excess of $10 million in total value to the class, which included both cash and two years of commission-free financial advisory services for the class.
Class actions are not the only way to pursue claims against corporations in a group settling. More and more, corporations are using both class action waivers and binding arbitration clauses in their contracts with clients. In these circumstances, we bring group-arbitration claims, which are not class-actions technically, but rather are a group of plaintiffs similarly situated against the same defendant or defendants. Depending on the forum, bringing group claims is quite simple. In arbitration before FINRA, for example, there is a joinder rule which specifically allows for “group claims.” Some arbitration forums, like JAMS, do not specifically allow for this sort of consolidation, so in those circumstances, we simply give the corporations what they want: we will file dozens of individual claims under forum consumer rules, which require them to pay the arbitrators for their time. This can be a massive expense and lead to positive outcomes for our clients.
Class or group representation requires an experienced and unique skill set. The attorneys at Stoltmann Law Offices have been prosecuting class actions and group arbitration claims for their clients since 2005.
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Since its inception in March 2005, Stoltmann Law Offices, P.C. has dedicated its practice to representing investors in lawsuits and arbitration claims against brokers, financial advisors, investment advisors, and the companies they work for. Our Chicago investment fraud attorneys offer their clients a combined 35 years of experience fighting for investor rights from offices in Chicago, Illinois and suburban Barrington, Illinois and Downers Grove, Illinois.
The attorneys at Stoltmann Law Offices have dedicated their life’s work to representing investors who have been cheated or defrauded by those professionals they trusted with their hard-earned money and retirement savings, recovering in excess of $50 million for investors over the years.