What is the purpose of a class action lawsuit?
A small number of consumers may file a class action lawsuit, representing all consumers that were victimized by the same abusive practices. Each class member may have suffered limited losses and the cost of individual lawsuits would be far greater than the value of each claim. The total economic damages, however, can be significant, in the billions of dollars. The wrongdoer would have the incentive to continue its fraudulent conduct but for a class action. Thus, class action lawsuits provide a powerful and effective means for consumers to compel a corporation to acknowledge its legal responsibilities and provide just compensation to the class members.
