Class Action FAQs

What is a class?

In a class action, one person (or a small group of people) files a lawsuit on behalf of a larger group of people. The “larger group” or the Class, – is the group of people the lawsuit represents. When a lawsuit is filed, it will define the proposed class. 

What is class certification?

Although a lawsuit may be filed and proposed as a class action, it doesn’t officially become a class action until the judge in the case issues a ruling known as class certification. In granting class certification, the judge is giving the go-ahead for the case to proceed as a class action.

What is discovery?

Discovery is the pre-trial phase of a lawsuit. During discovery, attorneys representing the class members will request that the company being sued turn over all documents relating to the allegations contained in the lawsuit. This includes both written documents and electronic communications, including company e-mails. These documents may then be submitted to the court as evidence to prove or defend against claims made in the lawsuit.

What happens if you lose a class action?

Keep in mind that, in most cases, you are not the one who actually filed the lawsuit; so, technically, you can’t lose a class action.

If the case, however, is dismissed or a jury rules in favor of the defendant, both the person who filed the suit and the class members will not be entitled to any settlement money.

How do class action lawyers get paid?

If a class action is successful, the attorneys representing the class members usually receive a percentage of the amount that is recovered by the lawsuit or a fixed amount that is separate from the settlement fund.

The judge presiding over the class action must review the attorneys’ request for fees to make sure it is reasonable.

Who is the lead plaintiff?

The person or persons filing the suit will be referred to as the lead or named plaintiff(s). He, she, or they may also be known as the class representative. These people will work closely with the attorneys representing the class and will have control over the lawsuit and the direction it will take. The lead plaintiff(s) may need to appear in court in the same way someone who filed an individual lawsuit would.

Is a class action considered to be a civil lawsuit?

Yes, a class action is a type of civil lawsuit. A civil lawsuit (also known as a civil action) is a case involving a legal dispute between two or more parties.

What is a putative class action?

The word “putative” means “assumed to exist.” When a class action is filed, it may be referred to as a putative class action. This is because the case does not officially receive class action status until the judge presiding over the suit grants class certification.

What is the Class Action Fairness Act?

The Class Action Fairness Act was signed into law on February 18, 2005 by President George W. Bush.

The Act grants federal courts exclusive jurisdiction over class actions when the amount in controversy exceeds $5 million.

Under the Class Action Fairness Act, if a class action is filed in a state court and the total damages in the case will likely be greater than $5 million, the company being sued can request to have the class action transferred to a federal court. Corporate lobbying groups strongly supported the law, which was enacted to combat perceived abuses in the class action litigation process.

What is a common fund?

A common fund is a pool of money created to provide compensation to class members. A common fund may be established because of a settlement or a court’s ruling in favor of the class members. Each class member may be required to file a claim either in writing or online to receive compensation from the common fund.

What happens to leftover settlement money?

In most cases, one of three things will happen. It will be returned to the company being sued, distributed to remaining class members or donated as a “cy pres” award. Under the “cy pres” legal doctrine, once a settlement deadline closes, any leftover money is to be distributed to “the next best use.” This may include a charity or non-profit organization whose mission aligns with the subject matter of the case. For instance, in a case involving unpaid overtime, the remaining funds may be dedicated to an organization that helps further workers’ rights.

What is this lawsuit about?

The case titled Evans v. Paypal seeks to have PayPal return funds that it seized from an immense number of user accounts based on alleged violations of its Acceptable Use Policy. PayPal claims that the money taken is meant to compensate it for loses or damages in having to “investigate” activity that it deemed to be violative. The case seeks to hold PayPal’s feet to the fire and determine that its policy is arbitrary and illegal.

How do I become a member of the class or get compensation?

Before anyone can become a member of the class or “join” the class action lawsuit, the court must first certify the case as a class. There are several factors that a court will use to determine if a case is appropriate to be made into a class, which can be found under the Federal Rules of Civil Procedure, section 23(a). Assuming that the court certifies the case as a class, then nothing else will need to be done. If you fit the criteria of a defined class member, you will be automatically joined into the class.  You will have the option to “opt out” or not join if you wish.

Where can I find more information about this case?

A copy of the filing can be found at www.paypalclassaction.net.  One can also sign up for a “PACER” account, which will allow anyone to view or download documents that have been filed in the case.  Anyone can sign up for a PACER account by visiting www.pacer.org. Note that there is a fee to download documents from PACER.

I want to talk to someone about my potential claim.

Please visit the intake section of the website and fill out the online form. You may not hear back from anyone immediately, however, we are keeping records of all interested parties who have had similar issues with PayPal. Please do not be discouraged if you don’t hear back from someone right away. There have been thousands of people from all over the world who have reached out to tell us their stories in dealing with PayPal. Rest assured, we want to hear from everyone.

Do I need my own attorney?

The short answer is no. If the class is certified by the court, then you will be automatically added to the class. However, anyone is free to seek their own independent representation to discuss their unique circumstances or matter.