How Are the Settlement Proceeds Divided in a Class Action Lawsuit?

When you decide to join a class action lawsuit, it’s only natural to want to know how money your case is worth. Since there are numerous plaintiffs, it can be hard to determine how much of the settlement proceeds will be allocated to you.

Here, we’ll discuss how settlement proceeds are divided in a class action lawsuit and what factors determine how much you’ll receive. 

Any Class Action Settlement Must Be Approved by the Judge

In any class action lawsuit, the terms of the settlement need to be reviewed and approved by the judge to ensure fairness.

The judge will also have to approve your attorney’s contingency fee. In an ordinary personal injury case, your attorney can charge whatever percentage is outlined in their standard fee agreement. Usually, their fee ranges anywhere from 30% to 40%. 

With class action lawsuits, the judge usually limits the attorneys’ fees to somewhere around 25%.

The Lead Plaintiffs Typically Receive the Most Money in a Class Action Lawsuit

The lead plaintiffs typically get more money from the settlement than the other victims in a class action lawsuit.

The reason for this is that the lead plaintiffs are chosen based on the severity of their injuries and the amount of their damages. Additionally, they are generally more involved in the lawsuit, meeting with the attorneys, helping with discovery, and taking part in settlement negotiations, mediation, and court hearings.

class action settlement

How Much Do Plaintiffs Get From a Class Action Lawsuit?

As with other personal injury cases, the attorneys are paid first, before any of the plaintiffs. These settlement proceeds will also be used to cover any costs associated with the case.

Whatever is left will be divided amongst the entire class, starting with the lead plaintiffs. Lead plaintiffs receive more money because they have the most serious injuries and the highest damages. A plaintiff’s share depends on many elements, including:

  • The total number of class members participating in the lawsuit
  • How many plaintiffs suffered injuries
  • How many lead plaintiffs there are

Some Class Members Only Receive a Nominal Amount

In addition to the class members who joined the class action lawsuit and actively participated, there are other less involved plaintiffs. These are people who didn’t suffer any serious injuries or evidence supporting their claim, like receipts for the dangerous product or medication.

These class members would only receive nominal damages. Sometimes, their share of the settlement proceeds is less than $10. 

How Is a Class Action Settlement Paid Out?

With smaller settlements, plaintiffs receive money once in a lump sum. In contrast, the money from larger settlements is usually paid out over time. This is known as a structured settlement.

Contact Our Office Today

If you’ve been injured by a dangerous drug or other product, there’s a good chance you’ll be entitled to damages. If you end up joining a class action lawsuit, it can be hard to figure out how much money you’ll receive. 

What you can do is call and speak with one of our team at Rueb Stoller Daniel. While they can’t say exactly what your case is worth, they’ll be able to give you a ballpark figure. They’ll also update you throughout the case and keep you apprised of any settlement offers.

You can call our office today at 1-866-CALL-RSD and schedule your free, initial consultation today.