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Heartland Security Breach Class Action: Victims $1925, Lawyers $600,000
Fluffeh writes "Back in 2007, Heartland had a security breach that resulted in a 130 million credit card details being lifted. A class action suit followed and many thought it would send a direct message to business to ensure proper security measures protecting their clients and customers. With the Heartland case now over and settlements paid out and divided up, the final breakdown is as follows: Class members: $1925 (11 cases out of 290 filed were 'valid'). Lawyers for the plaintiff class action: $606,192. Non-Profits: around $1,000,000 (The Court ruled a minimum of $1 million in payouts). Heartland also paid its own lawyers around $2 million. Eric Goldman (Law Professor) has additional commentary on his Law Blog: 'The opinion indicates Heartland spent $1.5M to advertise the settlement. Thus, it appears they spent over $130,000 to generate each legitimate claim. Surprisingly, the court blithely treats the $1.5M expenditure as a cost of doing business, but I can't wrap my head around it. What an obscene waste of money! Add in the $270k spent on claims administration, and it appears that the parties spent $160k per legitimate claimant. The court isn't bothered by the $270k expenses either, even though that cost about $1k per tendered claim (remember, there were 290 total claims).'"
Or are you going to whine about the lack of a free market legal system?
This lady opted out of a class action and took Honda to small claims court and won.
http://www.insurancejournal.com/news/west/2012/02/03/234115.htm
I love Jesus, except for his foreign policy.
That might be the most idiotic thing I have ever read. What constitutes justice about paying money to a infinitesimal minority of the total affected people? What is justified about paying lawyers a salary for this boondoggle? You're trying to imply there was nothing better that could have been done with millions of dollars?
The courts shouldn't care about costs. Right. That's a pretty stupid attitude.
HBI's Law: Frequency of calling others Nazis is directly correlated with the likelihood of the accuser being Communist.
The time has come for the legal profession to become fully accountable to the public like the rest of the white collar professions. Lawyers should not sit on the Bar associations; businessmen, doctors, engineers, etc. should be the ones judging the professional conduct of lawyers. Lawyers have little to no education in these matters but deem themselves fit to judge every facet of how we do our work. Why is it then so outrageous to think that similarly intelligent and educated people from different fields should be the ones judging their ethics, billing practices, etc.?
The point of class action lawsuits is not to give a return for the victims, it's to punish people and companies that do a very small amount of harm to a lot of people. There's no point in suing over damages of $10, and little point over $100 unless you can do it in the small claims court and you're unemployed. Even asking a lawyer if it's worth going to court will probably cost more than you'll get back. If someone does something that causes damages worth $10 each to a million people though, that can be quite profitable if none of them is going to sue to recover their loss. If they did all go through the small claims courts, then this would be quite an effective DDoS on the legal system, so it's far from ideal. The class action suit is meant to cost the company enough to discourage this behaviour. If spending about $5m and a load of bad publicity costs more than properly securing your server, then it sounds like it worked just fine in this instance.
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If the point of the trial is to determine guilt and punishment, that should be a job for criminal court. Civil courts exist to compensate those harmed, not just their lawyers.
I'd like to see reform of the system to dictate a maximum payout to plaintiff's lawyers of less than 25% of the amount awarded to plaintiffs.
"Discourage litigation. Persuade your neighbors to compromise whenever you can. Point out to them how the nominal winner is often a real loser -- in fees, expenses, and waste of time. As a peacemaker the lawyer has a superior opportunity of being a good man. There will still be business enough."
--Abraham Lincoln