Class Action Suit Goodies Await Tech Users

jfruh writes "Did you buy an Acer laptop with Vista and less than 1 GB of RAM? The company has a thumb drive it would like to send you. Did you get an unwanted text from Papa John's? The company would like to make it up with you with $50 worth of free pizza. These and other little rewards are available as a result of class action lawsuits that have wound their ways through the court systems and now, years later, are paying off for very large groups of tech users." I wonder how many USB drives the lawyers took as their share.

Comments

Paying off for whom?

[SirGarlon]

It sounds more like these settlements are paying off for the defendants. Papa John's pulled off an especially neat trick there, getting the court to accept pizza the customers don't want in lieu of statutory damages.

Re:Paying off for whom?

[CastrTroy]

Them and the lawyers who brought the case to the court. In most of these class action lawsuits, the lawyers "fighting for the little guy" end up getting huge amounts of money. Sure they have to pay their own bills, but it often goes a lot further than that. There shouldn't be any options to give out free stuff in these class action suits. The payouts should be cash only. $50 worth of pizza doesn't cost Poppa John's $50.

Missing the point

[KingSkippus]

The point of a class action lawsuit isn't, unfortunately, to compensate the members of the class. The point of a class action lawsuit is that there are too many people who suffered minor damages to really be able to logistically handle that.

The primary point of a class action lawsuit isn't to "fight for the little guy," it is to punish companies that do wrong. If lawyers end up making $2 billion off a lawsuit, well, that's $2 billion out of the company's coffers. And before you go spouting off about how ultimately they pass that cost on to customers, maybe they do, but if so, that puts them at a disadvantage compared to other companies. Or put another way, if Domino's is giving their customers good quality pizza while Papa John's is skimping because they are trying to pass a $2 billion lawsuit judgment on to their customers, they'll lose market share. But I digress...

Anyway, I don't necessarily agree that the lawyers should make so much off of a class action lawsuit, although they really should make a lot, since they're handling the details of compensation which costs a lot more than most people think. What I'd like to see is some kind of public fund set up for money like this to go into, such as to build parks or something, so that the end effect of punishing the companies is maintained but the incredible amount of time, effort, and money that goes towards mailing a few people checks for a buck or two isn't wasted. At least that way, you also avoid the problem that class action payouts usually aren't that high since most eligible claimants won't bother to jump through the hoops to get their judgment.

Re:Missing the point

[pepty]

The primary point of a class action lawsuit isn't to "fight for the little guy," it is to punish companies that do wrong. If lawyers end up making $2 billion off a lawsuit, well, that's $2 billion out of the company's coffers.

No.

Punitive damages do that. Compensatory damages are intended to make the plaintiffs "whole". The jury or judge will make it clear which damages are intended to do what. Remember, class actions aren't just for pizzas, they're also for injuries and death caused by negligence.

Either way, I think there should be parity in awards to the attorneys and the plaintiffs in a class action suit, both in time and monetary value. If the class is paid in coupons, the attorneys are paid in coupons.

The attorneys are free to sell the coupons for cash.

If the plaintiffs are paid cash over a period of time - say a trust has been established that pays medical bills- the attorneys should be paid incrementally as the trust is used up. The attorneys certainly have the option to sell that revenue stream for an immediate payment - they'll probably get 50-70 cents on the dollar.

The point is that class action attorneys should have their interests tightly aligned with those of the class, otherwise they will cut deals that benefit only themselves. The best and simplest way to do that is to reward them as a percentage of the net present value of the market value (not face value) of the plaintiff's share of the award.

Re:Reminder

[Anonymous Coward]

The best part is that by accepting your cheap plastic kazoo you're also signing away any other legal recourse you may have had..

That's fine. It's a choice you make when you join a class action. It's a form of recourse where you give up most of your claim for reparation in exchange for someone else to represent you at their own risk. It's your own responsibility to choose which of your options is the most appropriate.

In this case, pursuing an individual dispute against Papa John would be questionable. What's the chance of winning? Do I really deserve a large payout just for receiving an unwanted SMS? If I don't win, what would it set me back? Would it be worth the time and expense even if I did win? What I really want is just for them to stop sending SMSs to me, and if somebody else can potentially profit from representing me in a class action then so be it. They're putting in all the effort and accepting all the risk; I stop getting SMSed - I say they've earned what they got.

Re:not to be a buzzkill but this isnt free.

[Anonymous Coward]

Product paid for by future cuts = free product now and none of my business later when the company cuts quality or raises prices to compensate.

A free pizza from Papa Johns today that will result in higher prices tomorrow means I buy Little Caesars tomorrow.
A "windfall" ACER USB drive in my hand today that raises Acer prices across means I buy a Dell PC instead.

It's called the free market. You're free to charge whatever you want, and I'm free to buy from someone else.

Re:not to be a buzzkill but this isnt free.

[Antipater]

If the penalty is reflected in the price of next year's line of Acer laptops, then more people will buy from Toshiba instead. "Passing it on to the consumers" only works when the entire market is passing it on, not just one company.