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September
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Claims-Made Settlements Are More Common Than You Think
In the American judicial system, class action settlements are allocated among claimants in a variety of ways...
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In the American judicial system, class action settlements are allocated among claimants in a variety of ways...
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Class action litigation creates uncertainty and financial risk for companies. To deal with the ins and outs of litigation...
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[vc_row triangle_shape="no"][vc_column width="2/3"][vc_column_text]By Eric J. Troutman, Squire Patton Boggs (US) LLP As we recently reported on TCPAWorld.com, the Sixth Circuit Court of Appeals has now entered into the fray and held that the TCPA’s ATDS definition applies to dialers that call (or text) from a list of numbers automatically, at least when the dialer is being used in automatic fashion. Previously the Sixth Circuit was an “undecided” jurisdiction. We’ve also seen similar big developments at the district court level in the Fourth and Eighth Circuit Court of Appeals footprint recently. So how big–and bad–are these changes for TCPA defendants? Let’s look at the visualizations. The original heatmap we prepared as part of the Squire Patton Boggs 2019 TCPA Year End Review, shows much of the country still undecided. This map was prepared in February, 2020 – just five months ago. You’ll notice the Sixth Circuit was leaning red at the time but the Second Circuit was yellow: FEBRUARY, 2020 [/vc_column_text][vc_single_image image="4576" img_size="full"...
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[vc_row triangle_shape="no"][vc_column][vc_column_text] Third-party litigation funding (“TPLF”) is a budding industry reshaping commercial litigation in the United States and abroad. Domestically, high-stakes antitrust, securities, intellectual property, business-contract, and other large-damages lawsuits almost certainly mean a protracted and costly litigation process, often to the point where the risk cannot be justified. This situation deters would-be plaintiffs from the commitment and prevents them from realizing the upside. While the opportunity cost can be substantial, many businesses can neither endure the uncertainty nor the possible exposure. TPLF enables plaintiffs to take on well-funded defendants who may contest the lawsuit with seemingly inexhaustible resources. In turn, plaintiffs incur additional, unplanned expenses that strain corporate budgets. Ultimately, the only feasible way to litigate such a matter is to hedge the risk. Partnering with a litigation funder to shift the risk, namely the burden of legal fees and expenses, allows corporate plaintiffs to focus capital on core business avenues,...
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[vc_row triangle_shape="no"][vc_column][vc_column_text] In federal antitrust and securities class actions, large corporate claimants have the option to seek recovery as part of a class or pursue damages individually, via direct action. The decision is not straightforward; an array of variables complicate this risk-reward enigma. In-house legal departments consider to what degree pursuing direct action will be a costly, time-consuming, and distracting pursuit in view of the company’s financial health and risk appetite, and of course, to what potential benefit. While daunting, declining to opt-out can mean leaving money on the table, particularly because risk transfer solutions are available to opt-out plaintiffs with meritorious claims. Risk transfer solutions like asset monetization can change the equation, offering companies the chance to monetize latent assets while taking no downside financial risk. Weighing the Opt-Out Decision For corporate victims with large individual damages, participating as a member of a class is often suboptimal due to procedural complexities and the...
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CASI is unlike traditional insurance products in that each policy is tailored to the specific class action settlement circumstances and financial needs of the business. CASI is purchased to transfer the settlement risk in existing class action litigation and coverage is available for the full spectrum of class cases. ...
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CASI is unlike traditional insurance products in that each policy is tailored to the specific class action settlement circumstances and financial needs of the business. CASI is purchased to transfer the settlement risk in existing class action litigation and coverage is available for the full spectrum of class cases. ...
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Seth Hopson, the former General Counsel of North American Power and Gas, discusses his experience with class action litigation and the benefits of class action settlement risk transfer. Can you tell us about your role within the company? I was the General Counsel of a retail energy company serving 300,000+ retail and small commercial customers in the New England, Midwest and Southern regions of the United States. As such, I was responsible for all litigation and risk management on the legal and regulatory side of the business. How frequently was your organization impacted by litigation? During the seven years from the inception of the business until the sale of the business, we went to trial once and were also involved in a multi-state class action litigation covering a potential customer class of over 700,000 current and former retail residential customers. That matter included allegations that the company breached our terms of service...
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[vc_row triangle_shape="no"][vc_column][vc_column_text] In this interview, Paul Karlsgodt, Chair of Baker Hostetler’s Class Action Practice Group, discusses the benefits of working with Risk Settlements and the value of settlement risk transfer solutions. Tell us about your practice and your department. I lead a nationwide practice of approximately 30 litigators who specialize in consumer class action defense. How frequently do you handle class action cases? 95% of my practice is dedicated to defending class actions. I lead between one and two dozen active class actions pending at any given time. What types? These days, most of my work is in the area of data security and privacy, but I also handle class actions involving consumer insurance coverage, pricing, and miscellaneous alleged violations of consumer protection laws. Have you had any recent noteworthy victories? My most noteworthy recent victories have been in the area of data security class actions. In particular, we have been successful in getting an...
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Unfortunately, class action settlements tend to be another step down the road of financial uncertainty and unpredictability. In the class action context, when resolving a case using a claims-made settlement, the financial payout varies significantly, which can adversely impact liquidity, enterprise value, cash flow and assets. Additionally, when settlements go viral, companies face extreme losses which could exceed reserves and available cash on hand. So what causes cases to go viral and create unmitigated financial risk for settling companies? The answer is simple and also multifaceted: the internet. Digital communications and the thirst for relevant news content have completely changed how consumers gain awareness of class actions and how they file claims for settlement benefits. As a result of these changes, the ability to reach potential class members as well as those intent on abusing the system to receive free cash has created a fundamentally different risk paradigm for those looking...
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