Representative action encompasses two forms of legal actions: class action and derivative action. In a class action, individuals with similar claims against a defendant can unite to initiate a lawsuit. On the other hand, in a derivative action, a shareholder can file a lawsuit on behalf of a corporation if the corporation’s management has neglected to address any wrongdoing. These types of actions enable individuals to join forces and pursue justice in a more streamlined and impactful manner.
A representative action is a legal proceeding where one or more individuals represent a larger group of people with similar claims or grievances. There are two types of representative actions: class actions and derivative actions.
A class action is a lawsuit filed by one or more individuals on behalf of a larger group of people who have similar claims against a defendant. For example, a class action may be filed against a company that sold a defective product causing harm to many consumers.
A derivative action is a lawsuit filed by a shareholder on behalf of a corporation against its officers or directors for breaching their fiduciary duties. For instance, a shareholder may file a derivative action against a company’s CEO for misusing company funds.
Both class actions and derivative actions allow individuals to combine their resources and share the costs of litigation, making it easier for them to pursue their claims. They also provide a means for individuals to hold corporations and their officers accountable for their actions.
For example, a group of employees may file a class action against their employer for violating labor laws, such as failing to pay overtime or providing an unsafe working environment. In a derivative action, a shareholder may file a lawsuit against a company’s board of directors for approving a merger that was not in the best interests of the company.
A representative action, also known as a class action, is a legal proceeding where one or more individuals (representatives) file a lawsuit on behalf of a larger group of people (class) who have similar claims or grievances against a defendant.
Typically, the representative action can be filed by any individual who has suffered harm or injury that is common to a larger group of people. However, the specific requirements for filing a representative action may vary depending on the jurisdiction and the nature of the claim.
Representative actions are commonly used in cases involving consumer protection, product liability, employment discrimination, securities fraud, and other situations where a large number of individuals have been affected by the same issue.
Filing a representative action allows individuals with similar claims to join forces, increasing their chances of success. It also promotes efficiency by consolidating multiple claims into a single lawsuit, saving time and resources for both the plaintiffs and the court.
In some jurisdictions, individuals who are part of a representative action may have the option to opt out if they prefer to pursue their own individual claims. However, this may depend on the specific rules and procedures governing representative actions in that jurisdiction.
If the representative action is successful, damages awarded are typically distributed among the members of the class based on the extent of their individual harm or injury. The court may determine the distribution method or approve a settlement agreement proposed by the parties involved.
In some cases, there may be opportunities for individuals who missed the initial filing of a representative action to join later on. This is often referred to as “opting in” and may have specific deadlines and requirements that need to be met.
The duration of a representative action can vary significantly depending on the complexity of the case, the number of class members involved, and other factors. It can take several months to several years to reach a resolution, including potential appeals.
While representative actions can be an effective way to seek justice for a large group of individuals, there are risks involved. If the representative action is unsuccessful, the plaintiffs may not receive any compensation, and they may also be responsible for covering legal costs.
You can stay informed about ongoing representative actions by regularly checking legal news, consulting with attorneys specializing in the relevant area of law, or contacting consumer protection organisations that may have information on ongoing cases.
This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.
This glossary post was last updated: 17th April 2024.
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