The Average Payout For A Class Action: Detailed Analysis

Being part of a class action settlement means being involved in a high-profile case that could result in a huge payout but years of court battles.

A large settlement amount, which may be worth millions of dollars, is paid to each class member when a case is won. However, that settlement can be impacted by various factors which can lessen or heighten your overall compensation.

Let’s look at some examples of a class action settlement and the factors that will impact the compensation.

What Is a Class Action Settlement?

A class action is different from other cases as it usually involves a large group of individuals – also known as members – seeking compensation after being negatively affected by an organization’s negligence. It could be a large company or a Government department.

Most common class actions include:

  • Unlawful employment practices and laws
  • Environmental and financial negligence
  • Defective products or services
  • False advertising
  • Discrimination & civil rights

Here are some examples of a class action settlement:

class action lawsuit rcmp

Sulphur Trioxide Chemical Release

On Aug. 9, 2004, in Salaberry-de-Valleyfield, Zinc électrolytique du Canada ltée released sulphur trioxide chemicals exposing people within the area. A $1.6 million settlement was reached between the company and lead plaintiff Jean-Luc Génier, as he was living in the area and was exposed to the chemicals.

The Canadian BSC Transvaginal Mesh Case

Women who were injured by the transvaginal mesh implant (which was created to treat Stress Urinary Incontinence (SUI) and Pelvic Organ Prolapse) offered by Boston Scientific Corporation were compensated for their pay and suffering.

The ReproMed Fertility Case

In May 2018, the ReproMed fertility clinic suffered a malfunction when it’s cryogenic storage tank damaged its stored embryos, sperm and eggs. Those that had eggs at the facility were eligible for compensation from the class action settlement, with the rumoured payment stated to be $1.5 million per claim.

There are, of course, some out-there class action lawsuits that have taken place:

  • A $5 million lawsuit was filed against coffee-chain Starbucks for putting too much ice in their cold drinks. The case was thrown out, as you can ask for less ice.
  • Robert Bratton filed a lawsuit against Hershey, the chocolate conglomerate, stating that it intentionally sells partially full candies packages, namely Reese’s Pieces and Whoppers.
  • A group filed against energy drink company Red Bull because their drinks didn’t energize them. They felt that the company’s slogan “Red Bull gives you wings” was misleading. It was settled out of court as the company paid $640,000.

As you can see, there is a wide range of different types of class action lawsuits available. All of them have an impact on how much you can make.

What is the Average Settlement Per Person?

Unfortunately, there is no average set amount that you’ll receive as part of a class action lawsuit due to several factors that impact the case. The following factors have to be considered before you can estimate roughly how much you will earn from it.

  • The type of lawsuit it is – there are various degrees of class action lawsuits – as stated above – so it varies in terms of how much the payout will be. Environmental disasters might pay out more due to the economic and social aspects, while discrimination might be way less.
  • The number of people involved in the case itself – the more members involved in the class action, the less likely you will receive a large fund as it will be divided throughout the group.
  • The amount of money that you win – obviously, the higher the compensation rate for the group, the more you’ll likely make. In some cases, you could be rewarded with thousands of dollars, while in others, you might get as low as a few bucks.
  • The degree to which you were affected by the case – you will be compensated by the court depending on the severity of the impact, either financially, physically, mentally or emotionally. For example, in the RCMP class action lawsuit in Canada, those sexually abused by superiors can receive up to $225,000, while derogatory claims can get as low as $50,000.
  • The lawyer fee – the lawyer who runs the class action, will take some of the compensation as they lead the case. It can either be a certain percentage of the overall payout or taken from each individual member.

The most important thing is to have a thorough understanding of what a class action is and the factors that can impact their compensation. This way, you’ll know what to expect if you are ever involved in one.

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