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Do I Pay the Attorneys as a Member of a Class Action?

How are lawyer fees and litigation costs settled in a New Jersey mass torts claim?

If you are considering joining a class action lawsuit in New Jersey, you may have questions about who will pay the legal costs—as the last thing a plaintiff wants is an unexpected bill.

Will you be on the hook for attorneys’ fees or other court costs? Does joining a class action lawsuit cost money?

“In terms of class actions, there’s typically not a plaintiff that comes to you; you have a class representative,” says Esther Berezofsky, a class action/mass torts attorney in Cherry Hill. “We explain to class representatives that the fees are contingent on the success of the case. That’s true with mass torts as well.”

Class Action Lawsuits are Typically Contingency Fee Cases

In the vast majority of mass tort claims, attorneys are paid on a contingency fee basis. As explained by the American Bar Association (ABA), a contingency fee arrangement is one in which lawyers are only paid if they obtain successful results. In other words, they are paid based on the recovery—or lack thereof. With a contingency fee lawsuit, a class action lawyer will receive a pre-set percentage of the total recovery. In most cases, lawyers who work on contingency receive somewhere between 25 percent and 35 percent—though it may be higher in some especially complex cases. If the class action lawsuit is not successful, meaning no money is recovered, the individual plaintiffs will not be required to pay attorney fees.

Fees Must Be Approved By the Court

If a mass tort attorney files a class action lawsuit and a proposed settlement is reached or a judgement is entered, attorney fees and court costs must be addressed before the class action case will be finalized. Under the New Jersey Rules of Professional Conduct, all lawyers have an ethical obligation to ensure that their fees are fair and reasonable. Notably, the proposed attorneys’ fee and any related legal fees must be approved by the court. Courts have the authority to reject the proposed class action attorneys’ fees if they are deemed to be unfair. The most common reason why this occurs is if the court determines that the settlement or judgement includes attorneys’ fees that are disproportionate when compared to the benefits recovered by the class members.

Before Joining a Class Action, Be Sure You Understand the Full Implications

Prior to signing up for a mass tort lawsuit in New Jersey, it is important to consider the implications.

“Class actions are essential to being able to bring claims where there’s widespread damages in small amounts—which make the recourse of claims too costly to litigate on an individual basis,” says Berezofsky.

Although joining a class action will almost certainly not cost you any money up front, it will require you to give up your right to bring an individual claim against the defendant. In certain cases, it may be inadvisable to sign up for this type of lawsuit.

In a major case, it is always recommended that plaintiffs reach out to a law firm and seek legal advice from an experienced New Jersey attorney. Many provide free consultations. For more information on this area of law, see our overview of class action and mass torts.

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