Do you get less money in a class action lawsuit?
Asked by: Deborah O'Keefe | Last update: August 27, 2025Score: 4.8/5 (62 votes)
Class action lawsuit settlements are not divided evenly. Some plaintiffs will be awarded a larger percent while others receive smaller settlements. There are legitimate reasons for class members receiving smaller payouts.
How much do you typically get from a class action lawsuit?
There is no standard average settlement amount because it depends on numerous factors, including the specifics of the case and the number of claimants involved. Numerous factors affect settlement amounts, from the type of employment law violations in question to the harm suffered.
Is it worth being part of a class action lawsuit?
And since class action cases may take years, even to obtain a court-approved settlement, “sometimes it's easier to settle an individual case than the entire case,” Feldman says. However, if an eligible member does not plan on filing an independent lawsuit, there's no obvious downside to being a member, he says.
Does everyone get the same amount in a class action lawsuit?
A lead plaintiff's award in a class-action lawsuit isn't universal or fixed. Instead, a lead plaintiff's compensation depends on several factors, including the specific case details, the class size, and the court presiding over the case.
Why do class actions pay so little?
Potentially Lower Individual Compensation
Despite their collective strength, class action settlements may result in lower compensation for individual class members. The total settlement or verdict amount is typically divided among all class members, which can result in relatively small individual payouts.
Get free money from class-action lawsuits
How much do lawyers take in a class action lawsuit?
The courts often determine how much lawyers will get in fees from a successful class action lawsuit. This figure is usually around 25% to 35% of the total settlement amount awarded to the class of plaintiffs. However, the fees can be higher if the case is unusually complex.
Do you have to pay taxes on a class action?
Oftentimes, the nature of a class action suit determines if the lawsuit settlement can be taxable. Lawsuit settlement proceeds are taxable in situations where the lawsuit is not involved with physical harm, discrimination of any kind, loss of income, or devaluation of an investment.
What are the risks of joining a class action lawsuit?
Joining a class action lawsuit can reduce individual control over case decisions and may result in smaller compensation than an individual suit. Additionally, class actions are often lengthy, with potential restrictions on pursuing future individual claims for the same issue.
How long does it take to get paid from a class action lawsuit?
In some instances, it'll only take weeks or months to receive a payment. This is especially true if the case is settled and approved by a court before going to trial. If a case goes to trial, it can take weeks, months, or even years before participants receive a payment.
What determines amount of money in a lawsuit?
Unfortunately, the law does not provide a specific method or formula for determining the amount you're owed. Instead, personal injury damages are based on a combination actual expenses and compensation for pain and suffering. There are many factors to be considered when determining the amount you are owed.
Who benefits most from a class action lawsuit?
Depending on their participation in the class action lawsuit, the lead plaintiff receives their percentage first. Since the lawyers typically work on a contingency basis, they would also receive a percentage for their legal fees and related costs.
What is the highest paying class action lawsuit?
The Biggest Lawsuit Ever: The Tobacco Settlement — $206 Billion. The Tobacco Master Settlement Agreement was filed in 1998 against the four largest tobacco companies in the United States and remains the largest lawsuit in history in terms of dollars involved.
What's the difference between a regular lawsuit and a class action lawsuit?
It involves one person that, for example, is suing their employer on behalf of them-self only. A class action, on the other hand, is a group of employees that have banded together to sue their employer. A class action could be anywhere from 30 or 40 employees to thousands of employees.
How much is a typical lawsuit?
The Average Cost of a Lawsuit
On average, a lawsuit costs approximately $10,000 for a simple suit. However, numerous factors can influence the cost of your lawsuit.
Should I cash a class action settlement check?
People have mixed feelings about class-action suits, and whether you cash class-action refund checks is up to you. Generally, if you get one, you probably paid a lot more in wrongful fees than you're getting back in the settlement. If you don't cash the check, the money may go back to the company.
Is it worth joining a class action lawsuit?
Reasons to Join Class Action Lawsuits
If your damages are relatively small, pursuing an individual lawsuit may not be cost-effective. Civil lawsuits involving multiple plaintiffs often have access to greater resources for investigations, evidence gathering and legal expertise, which can strengthen your case.
Why are class action payouts so low?
If a large number of claims are filed, the amount each claimant receives will be reduced proportionally. When asking a judge to approve a class action settlement, Class Counsel often calculates an estimated range of payments that Class Members can expect to receive.
What happens if you lose a class action lawsuit?
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.
Who pays for a class action lawsuit?
When plaintiffs win a class action lawsuit, or when they secure a settlement with the defendant, legal fees and court costs are typically included in their award. This award is known as the “common fund,” from which these legal fees, as well as recovery for Class Members, is paid.
Will my employer know if I join a class action lawsuit?
Reduce Employer Retaliation
In a class action lawsuit, only the lead plaintiffs are named in the lawsuit. As a result, other employees can join the class action without the same attention they would receive if they filed individual claims.
How long does a class action lawsuit take?
Some class action lawsuits can take as little as a few months and as long as several years. These kinds of cases can typically take around two or three years to be resolved, while others can take even longer. When court rulings are appealed, the process gets further prolonged.
Can a company fire you for joining a class action lawsuit?
No, it is illegal to terminate someone's employment for participating in a class action suit. Federal law protects you against retaliation by your employer.
Can the IRS take money from a lawsuit settlement?
The IRS can only pursue those portions of the settlement not intended as reimbursement for property loss or physical injury. So, while this may not always happen, it is possible that the IRS might take at least some of your personal injury settlement.
What happens if I do nothing in a class action lawsuit?
You usually have the right to “opt out” of class actions or proposed settlements in California. The opt-out procedure will be explained in the legal notice sent by the court. By opting out, you retain the right to file an individual lawsuit. If you do nothing, you will be bound by any settlement or verdict.
Can a settlement check be direct deposited?
Once your attorney receives your settlement check, direct deposit is an option, but that doesn't mean you'll see the cash in your account right away. However, you can still get cash to pay for medical bills and living expenses. You can receive a portion of future settlement proceeds via pre-settlement funding.