6 ms·

Suppose the settlement was $6B and 60k members are in the class. That's $100k per worker. However, the lawyers usually get 1/3, so $2B for the lawyers and $67

by fsk 13y ago

Suppose the settlement was $6B and 60k members are in the class. That's $100k per worker. However, the lawyers usually get 1/3, so $2B for the lawyers and $67k per worker. That's the offensive part about class action lawsuits like this. The lawyers MAKE A FORTUNE. The class victims get a decent check, but nothing great, and probably less than they lost due to the crime.

harryh 13y ago
The lawyers also do all the work and take on all the risk.
- deleted 13y ago
  [deleted]
- toomuchtodo 13y ago
  Upvoted, because as much as I hate your answer, you're right.
- Stratoscope 13y ago
  > The lawyers also do all the work and take on all the risk. Except for being the ones who were actually harmed in the matter. Edit: Despite my snarky reply, I'm with toomuchtodo - I upvoted your post even if I felt annoyed by it at first, because you make a very good and valid point and it gave me food for thought. Why was I annoyed by your post, then? Probably my Borland check. It must have been about 20 years ago, but there was some class action suit on Borland stock. I was in the class and from the numbers they sent out, it looked like I might actually get some real money out of it, at least a thousand bucks or so. Then my check came. $17. I pored through the documents to see what had gone wrong, and I found it: there was a limited settlement fund, I think around $12 million, only a tiny fraction of the hundreds of millions that the original class action notification had talked about. Out of the $12 million settlement fund, the lawyers got $7.5 million. I'm going to quit software development and get into that business.
  - DannyBee 13y ago
    Do it. Honestly. I would love to see one complainer here take on the task of dealing with a large class action lawsuit, and see what it's really like. People think startup life of "80 hour weeks" is bad. Try a large lawsuit sometime ;) Not that i think they aren't overpaid, or sometimes reach settlements that don't benefit anyone but lawyers, but that's a different problem, and in fact, why a lot of countries really don't do class action lawsuits like the US. The problem is people want the result they want, without having to do any of the work. If you want that result, you should be the lead plaintiff. Or opt out and sue yourself.
  - harryh 13y ago
    It sounds like you didn't make much money because your side (mostly) lost the lawsuit. If the lawyers had taken nothing from the pot you would have made $45 instead which also wouldn't have been very exciting. Honestly I bet the lawyers weren't happy with the result either and their part of the settlement mostly just covered their costs.
  - tomp 13y ago
    > Except for being the ones who were actually harmed in the matter. What did the engineers risk with this lawsuit? Nothing. What did the law firm risk? Getting paid peanuts for hundreds of hours they spend on the case if they lose.
    - DannyBee 13y ago
      hundreds is certainly an underestimate. Lawsuits like this have massive amounts of discovery to go through.
    - conanbatt 13y ago
      The engineers lose the capacity to get compensation for what was done to them. If they lose the lawsuit by bad lawyers, they wont get a penny. The fact that there is risk upfront doesnt make any payoff reasonable. Otherwise, you wouldnt find layers keeping 99% abusive. The biggest question for me is, with so much money ats take, why dont several lawfirms compete to each other for a lower cut? at 2 billion profits potential profit, why dont they offer a lower comission to get the client?
vqc 13y ago
The response to your point is usually that no one plaintiff would have the resources to pursue their claims on their own. The expected value of bringing this kind of claim against a defendant, much less these defendants, is probably not that positive if you were to go about it on your own. At least this way you get $67k. What is a better alternative? (Other than preventing stuff like this in the first place.)
- argumentum 13y ago
  Crowdsourcing? What do you estimate as total legal expenditures if a top-notch legal firm were hired just for their hourly rates? Divide that by 60k.
  - harryh 13y ago
    How many of those 60k do you think would have been willing to put up thousands (or tens of thousands) of dollars in advance with no guarantee that they would win? I'm one of those people and I certainly wouldn't have.
  - vqc 13y ago
    I'd guesstimate in the low to mid 8 digits. Apple apparently paid its lawyers more than $60M to beat Samsung. Ubuntu managed to raise $13M from 28 thousand people. The other argument in favor of class action contingency structure is the alignment of interest between plaintiffs and attorneys. Although as already pointed out in other parts of this thread, perhaps the incentives begin to mis-align when settlements reach a certain size?
jessriedel 13y ago
Are you just unhappy that someone is profiting off this, or that the plaintiffs aren't making enough money? If the former, then you probably need to re-think what would happen if the system was set up a different way (i.e. something other than a order-unity fraction of the total amount). The defendants in a case like this are always going to willing to pay a significant fraction (e.g. 20%) of the potential settlement in lawyer fees in order to fight the suit. If the plaintiffs can't spend a similar amount, they will be at a serious disadvantage in court. These fees are merely a symptom of the (alleged) problem that court outcomes depend so much on lawyer fees. If you want to fix the problem, you need to change the court process; attempts to limit class-action fees will just aid the large corporations. If the latter, then you just want the court to pay out more money to the plaintiffs. But remember: having the plaintiff lawyer fees directly proportional to the settlement is an excellent motivation for the lawyers to win the biggest settlement they can for their class-action clients.
- jcampbell1 13y ago
  This case will probably be fine. However, there are tons of cases where the lawyers get 100% of the cash settlement. The lawyers have to show a benefit for the class, and it can be as small as getting the company to promise to stop doing whatever was a problem and hiring one outside firm to verify compliance. Then then lawyers can get a settlement of $500/hour for all the time they spent on the case with an inflated number of hours. I have seen cases where the lawyers on both sides are basically conspiring against the class, and the judge is okay with it because he wants to get back to the golf course. The plaintiff's laywers basically say, "hey you agree to the smallest thing the judge will accept as a benefit to the class, and you don't bitch about paying us $500/hr. Deal?"
  - vqc 13y ago
    Were these cases in state or federal court?
- fsk 13y ago
  Basically, it can be summarized as: Problem: The legal system is expensive and inefficient. If a lot of people are wronged by the same defendant, it is impractical for them to pursue their claim. Solution: Let's have class action lawsuits where the lawyers make a fortune! In this example, the defendants get a decent bonus check. I'm really offended by "class action" lawsuits where the lawyers make millions and the victims get a coupon for $10 off their next purchase. Also, in this case, THE LAWYERS WERE TAKING NO RISK. There already was a ton of evidence from the justice department case. What actually happens is several groups of lawyers rush to file, each with a different lead plaintiff, and then the judge picks which group of lawyers get the big cash windfall.

by fsk 13y ago

harryh 13y ago

The lawyers also do all the work and take on all the risk.

deleted 13y ago
[deleted]
toomuchtodo 13y ago
Upvoted, because as much as I hate your answer, you're right.
Stratoscope 13y ago
> The lawyers also do all the work and take on all the risk. Except for being the ones who were actually harmed in the matter. Edit: Despite my snarky reply, I'm with toomuchtodo - I upvoted your post even if I felt annoyed by it at first, because you make a very good and valid point and it gave me food for thought. Why was I annoyed by your post, then? Probably my Borland check. It must have been about 20 years ago, but there was some class action suit on Borland stock. I was in the class and from the numbers they sent out, it looked like I might actually get some real money out of it, at least a thousand bucks or so. Then my check came. $17. I pored through the documents to see what had gone wrong, and I found it: there was a limited settlement fund, I think around $12 million, only a tiny fraction of the hundreds of millions that the original class action notification had talked about. Out of the $12 million settlement fund, the lawyers got $7.5 million. I'm going to quit software development and get into that business.
- DannyBee 13y ago
  Do it. Honestly. I would love to see one complainer here take on the task of dealing with a large class action lawsuit, and see what it's really like. People think startup life of "80 hour weeks" is bad. Try a large lawsuit sometime ;) Not that i think they aren't overpaid, or sometimes reach settlements that don't benefit anyone but lawyers, but that's a different problem, and in fact, why a lot of countries really don't do class action lawsuits like the US. The problem is people want the result they want, without having to do any of the work. If you want that result, you should be the lead plaintiff. Or opt out and sue yourself.
- harryh 13y ago
  It sounds like you didn't make much money because your side (mostly) lost the lawsuit. If the lawyers had taken nothing from the pot you would have made $45 instead which also wouldn't have been very exciting. Honestly I bet the lawyers weren't happy with the result either and their part of the settlement mostly just covered their costs.
- tomp 13y ago
  > Except for being the ones who were actually harmed in the matter. What did the engineers risk with this lawsuit? Nothing. What did the law firm risk? Getting paid peanuts for hundreds of hours they spend on the case if they lose.
  - DannyBee 13y ago
    hundreds is certainly an underestimate. Lawsuits like this have massive amounts of discovery to go through.
  - conanbatt 13y ago
    The engineers lose the capacity to get compensation for what was done to them. If they lose the lawsuit by bad lawyers, they wont get a penny. The fact that there is risk upfront doesnt make any payoff reasonable. Otherwise, you wouldnt find layers keeping 99% abusive. The biggest question for me is, with so much money ats take, why dont several lawfirms compete to each other for a lower cut? at 2 billion profits potential profit, why dont they offer a lower comission to get the client?

vqc 13y ago

The response to your point is usually that no one plaintiff would have the resources to pursue their claims on their own. The expected value of bringing this kind of claim against a defendant, much less these defendants, is probably not that positive if you were to go about it on your own. At least this way you get $67k. What is a better alternative? (Other than preventing stuff like this in the first place.)

argumentum 13y ago
Crowdsourcing? What do you estimate as total legal expenditures if a top-notch legal firm were hired just for their hourly rates? Divide that by 60k.
- harryh 13y ago
  How many of those 60k do you think would have been willing to put up thousands (or tens of thousands) of dollars in advance with no guarantee that they would win? I'm one of those people and I certainly wouldn't have.
- vqc 13y ago
  I'd guesstimate in the low to mid 8 digits. Apple apparently paid its lawyers more than $60M to beat Samsung. Ubuntu managed to raise $13M from 28 thousand people. The other argument in favor of class action contingency structure is the alignment of interest between plaintiffs and attorneys. Although as already pointed out in other parts of this thread, perhaps the incentives begin to mis-align when settlements reach a certain size?

jessriedel 13y ago

Are you just unhappy that someone is profiting off this, or that the plaintiffs aren't making enough money? If the former, then you probably need to re-think what would happen if the system was set up a different way (i.e. something other than a order-unity fraction of the total amount). The defendants in a case like this are always going to willing to pay a significant fraction (e.g. 20%) of the potential settlement in lawyer fees in order to fight the suit. If the plaintiffs can't spend a similar amount, they will be at a serious disadvantage in court. These fees are merely a symptom of the (alleged) problem that court outcomes depend so much on lawyer fees. If you want to fix the problem, you need to change the court process; attempts to limit class-action fees will just aid the large corporations. If the latter, then you just want the court to pay out more money to the plaintiffs. But remember: having the plaintiff lawyer fees directly proportional to the settlement is an excellent motivation for the lawyers to win the biggest settlement they can for their class-action clients.

jcampbell1 13y ago
This case will probably be fine. However, there are tons of cases where the lawyers get 100% of the cash settlement. The lawyers have to show a benefit for the class, and it can be as small as getting the company to promise to stop doing whatever was a problem and hiring one outside firm to verify compliance. Then then lawyers can get a settlement of $500/hour for all the time they spent on the case with an inflated number of hours. I have seen cases where the lawyers on both sides are basically conspiring against the class, and the judge is okay with it because he wants to get back to the golf course. The plaintiff's laywers basically say, "hey you agree to the smallest thing the judge will accept as a benefit to the class, and you don't bitch about paying us $500/hr. Deal?"
- vqc 13y ago
  Were these cases in state or federal court?
fsk 13y ago
Basically, it can be summarized as: Problem: The legal system is expensive and inefficient. If a lot of people are wronged by the same defendant, it is impractical for them to pursue their claim. Solution: Let's have class action lawsuits where the lawyers make a fortune! In this example, the defendants get a decent bonus check. I'm really offended by "class action" lawsuits where the lawyers make millions and the victims get a coupon for $10 off their next purchase. Also, in this case, THE LAWYERS WERE TAKING NO RISK. There already was a ton of evidence from the justice department case. What actually happens is several groups of lawyers rush to file, each with a different lead plaintiff, and then the judge picks which group of lawyers get the big cash windfall.