Consumer class action lawsuits, like those involving GM vehicles recalled due to a defective ignition switch, are significant actions. In the GM example, the class action litigation may provide financial remedy to millions of consumers who were unfairly sold a defective and potentially deadly automobile.That’s a major benefit of class action lawsuits: they can efficiently deliver justice to a large group of people who suffered similar harm. Litigation may be cost and time prohibitive for individuals to pursue on their own. A class action lawsuit, therefore, is an equitable solution.

Class action lawsuits do have their detractors. But a recent study suggests that critics of this legal right are wrong.

The Center for Justice & Democracy at New York Law School recently released the findings of a study titled, “First Class Relief: How Class Actions Benefit Those Who Are Injured, Defrauded And Violated.” The work reviewed more than 150 class action lawsuits since 2005 that were tried and settled.

Class Action Lawsuit Matters

Included in the litigation were matters of:

  • Financial discrimination against minorities
  • Workplace racial discrimination
  • Antitrust lawsuits on behalf of small businesses
  • Patients’ rights

According to the study’s author, not only did the class action lawsuits bring financial restitution to the injured parties, they also helped end the bad practices of large corporations. For example, the survey included a case with financial settlements for families denied coverage by an insurance company for autism therapy, and another with over $300 million in financial compensation to small businesses from airfreight carriers over price fixing allegations. Both lawsuits also brought an end to the wrongful corporate conduct.

Many opponents of class action litigation say such lawsuits drive up consumer costs. This is also a commonly used argument in favor of limiting medical malpractice lawsuits. The RAND Corporation released a study that factually disputes this notion.

Those in favor of restricting the rights of medical malpractice victims insist that lawsuits against doctors who make mistakes only raise the cost of healthcare. They say the threat of litigation forces doctors to perform unnecessary, costly tests.

However, this new study looked at three states – Texas, South Carolina, and Georgia – that passed restrictions on medical malpractice lawsuits. Researchers examined the records of 4 million emergency room Medicare patients in these states from 1997 to 2011, and found no discernible decrease in healthcare costs or tests administered.

Individuals harmed by wrongful corporate conduct or by preventable medical errors deserve the legal right to pursue compensation for their injuries. Attorneys experienced in conducting class action litigation and medical malpractice lawsuits protect this right.

The choice of a lawyer is an important decision that should not be based solely on advertising.