Labor/Employment Class Actions Are Most Common, With Over 50% Of Class Actions Settling Before Certification.
Carlton Fields has put out some annual class action surveys with respect to spending and trends by American companies for the last 8 years. Its 2019 (eighth annual) survey is out. We provide a summary of what was reported through a survey of almost 400 companies:
- The surveyed companies spent $2.46 billion on class actions, the largest amount since the 2008 recession;
- 75% of class actions centered in these areas –labor/employment, consumer fraud, product liability, and antitrust;
- Labor/employment class actions were the most common ones encountered;
- Most of the companies, although expecting some actions in this area, had data breach action plans—but many of the companies were concerned with the impact of California’s Consumer Privacy Act;
- One-fourth of the class action cases were viewed as “bet the company” or high-risk cases;
- Over 50% of the class action cases settled before class certification motions, although a lot of the companies did fight for quite a while;
- Arbitration clauses are being increasingly used by companies in this area; and
- 95% of the surveyed companies say they rely on a small group of outside counsel with respect to handling class action cases, rather than gravitating to large firms.