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If you've bought anything in the last decade or paid for a service, there's a decent chance you've received at least one class-action settlement notice - an email or a postcard saying you are entitled to money. NPR's Kenny Malone, from our Planet Money podcast, wondered why this seems to be happening more and more.
KENNY MALONE, BYLINE: Two months ago, I got an email that I thought was spam. Can you see this?
MARIA GLOVER: Yes, I can.
MALONE: I shared it with Maria Glover, professor of law at Georgetown.
GLOVER: Yeah, so the first thing at your disposal is the case name.
MALONE: Rivali v. Shutterfly. Shutterfly is a company that lets me put pictures of my kids on mugs and other stuff, and surprise - Maria explains someone sued them on my and lots of other people's behalf. That suit accuses Shutterfly of showing artificially high prices to then offer apparent discounts. Shutterfly says they were essentially accused of offering discounts too often and denies the allegations. Whichever, a settlement had been reached.
GLOVER: You've received a voucher, which suggests to me that you've received some sort of ability to use Shutterfly again.
MALONE: Yes. As opposed to a cash settlement, this was just a voucher settlement. Why would anyone ever claim any of these? Is there some moral obligation to do this?
GLOVER: So the reality is, for things like consumer protection, class action lawsuits, aggregate litigation - that is the regulation.
MALONE: Class actions, Maria explains, are a way of holding companies accountable, and as a society, we are filing more than ever, according to Northwestern law professor Jerry Maatman. Every morning and every night, Jerry gets an email alert.
JERRY MAATMAN: From every single court in the United States that will show if a class action is filed...
MALONE: (Laughter).
MAATMAN: ...What sort of case it is, against what company it was filed.
MALONE: Jerry's seeing double the number of class actions from a decade ago. It's simply a more lucrative business than ever, and he tracks the numbers because he also defends companies from class actions. He's very carefully studied factors that do and do not get people to claim their settlement money.
MAATMAN: I have my own internal, over the years, kind of measure of that. I call it the tank-of-gas rule.
MALONE: As in, people will claim a settlement if the amount is more than a tank of gas. Otherwise...
MAATMAN: I don't want to be bothered. I would rather watch TV, read the newspaper or go out for a walk.
MALONE: Wait a second - does that mean that in your position, you are actively thinking about trying to negotiate the settlement down to something below a tank of gas?
MAATMAN: All the time.
MALONE: Really?
MAATMAN: All the time.
MALONE: When a class action is settled - and most of them are - a lawyer like Jerry is pushing for things that will help his company. The other attorneys are pushing back, trying to get things that are good for the class. But I asked Jerry to take his company defense hat off for a second and tell me what advice he'd give when someone gets a claim notice in the mail. And he says, just don't put off the decision.
GLOVER: If you were my brother, sister or son or daughter, and I say, you get it in the mail - touch it once. Deal with it once. Fill it out the day you get it. Turn it around and send it in if you're really interested in participating.
MALONE: He says at the very least, read the bold-scripted parts of the notice. Make note of the return date. And do not miss the deadline.
Kenny Malone, NPR News.
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