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Press Release

    The Trial Lawyer Class Action Scam

    08/16/2000

    The Trial Lawyer Class Action Scam

    Trial Lawyers are Making Millions of Dollars

    While Consumers Get Coupons!

    If you won a dollar in a lawsuit and your lawyer got paid almost $1 million, that wouldn't be fair. Yet, that's exactly what's happening with state class action lawsuits.

    A class action lawsuit allows similarly situated people to go to court as a group. For instance, assume the electric company wrongfully charged several customers an extra $500. Customers could sue as a "class," rather than each one of them suing the electric company on their own.

    The initial purpose of class action lawsuits was to save time, allow a court to more efficiently handle multiple similar disputes, and provide access to the courts for people who have suffered losses.

    The Problem

    Like a school of sharks worked into a feeding frenzy, trial lawyers are using state class action lawsuits to get rich on the backs of their clients.

    Here are a few examples:

    In one class action suit involving a bank, trial lawyers made $8.5 million, while the class of people they supposedly represented actually had to pay $91.13!

    In another case, lawyers received $5.8 million while the class of people they represented received a $13 rebate on a new $250 computer monitor.

    In a class action against a cereal manufacturer over food additives, even though no one was injured at all, the lawyers representing the class received $2 million, while the class members received a coupon for a box of cereal.

    Class action filings increased by more than 1, 000 percent in state courts over the past ten years. Because of their size, class action cases can reap huge fees for trial lawyers, which is a major factor for the increase of these cases over the past ten years.

    How can this be happening?

    State courts many times do not enforce the rules that govern class actions. Specifically, they allow class actions to go forward and eventually settle even though the class members may have been better off bringing their own lawsuits or no lawsuit at all.

    Finding a Solution

    Congress is working on new legislation that would give back our legal system to decent, honest Americans with real grievances. The legislation would make it easier for a federal judge to rule on whether specific circumstances warrant class action. Federal judges are better equipped to handle complex class actions and more consistently decide when they should be allowed. And federal courts are better equipped to try big lawsuits that involve hundreds or thousands of people, from many different states.