Class Action Lawsuits

There have been a number of notable developments in California law concerning class action lawsuits in recent years. In January, the California Supreme Court declined a challenge by the plaintiff’s lawyers to force the state to allow class action lawsuits in negligence cases. Now, there are new efforts to limit the ability of class action litigation in negligence lawsuits. In particular, the court has instructed the courts to exclude any facts that support the claim that a class action has been harmed.

There were also several important developments in California law regarding class actions in the first half of 2021 affecting personal injury lawsuits.

The California Supreme Court recently ruled that it was unenforceable for a personal injury lawsuit that involved an off-campus drinking establishment to recover damages from the owner of the establishment if that establishment was not a franchise operation. The court insisted that there must be some relationship between the connection between the negligent acts and the harms alleged by the class.

The ruling on the franchise issue may have a broader impact on class action lawsuits in California.

The majority of plaintiffs’ attorneys feel that they will lose much of their litigation strength as a result of this decision. Some plaintiffs’ attorneys believe that they can still recover most of their potential class action settlement per person, however. These lawsuits are largely a question of foreseeing what will happen in the future and analyzing current laws to see how they will apply to a class action settlement per person basis.

Another limitation on recovery is found in the rules governing mandatory mediation.

Mediation involves a third party mediator, and mandatory mediation normally authorizes such negotiations. However, the class action lawsuit must involve an individual plaintiff, and mandatory mediation usually does not authorize class action lawsuit checks to be arranged between the parties. As a result, mandatory mediation usually results in very small settlement amounts, which do not provide any kind of expectation of gain. Again, as the class action lawsuit is a class action suit, each individual plaintiff may recover damages that pertain to the members of the class represented by each of the individual plaintiffs.

There is one exception to this general rule:

If all of the individual plaintiffs are willing to pursue their claims through arbitration, mandatory mediation may result in class action settlement checks that are much larger than those available through mandatory mediation. However, the majority of plaintiffs will never need to pursue arbitration as a means of recovering damages. There are a number of reasons for this. First, such lawsuits are extremely expensive because they involve expert witnesses, complex legal documents, and often significant financial data that may not always be easily reproducing. Second, it is not uncommon for the costs of such lawsuits to far exceed the cost of the actual litigation.

One of the most successful uses of class action lawsuit funding is the success obtained through the use of a “class action lawsuit loan.”

Such loans generally carry interest at variable rates and terms that keep the costs of litigation at the acceptable level. California civil law is complex, but the ability to research and file class action lawsuits is easy with the Internet. Indeed, many law firms now offer web-based litigation funding, so if you have a California civil lawsuit pending, I recommend that you use the Internet to explore your options.

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