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Class Action Settlement Rant

By WinPimp2K in Op-Ed
Fri Jun 15, 2001 at 09:14:45 AM EST
Tags: Culture (all tags)

I get really steamed when a lawyer brings a class action suit against a corporation with deep pockets and then reaches a settlement with the corporation that involves rebate coupons for the plaintiffs and millions for the lawyer.

Of course, I do have a solution to propose.

The main thing I would do to correct this situation is to remove the lawyer's ability to settle. If a lawyer brings a class action lawsuit, he can only settle for those people in the class that agree to the proposed settlement:
  1. In writing
  2. Notarized - and dated after the settlement is proposed
  3. With the specific terms of the agreement - no "Power of Attorney"
Lets just apply this to a recent class action settlement involving Blockbuster Video (a company I loathe - but that is irrelevant here - I don't do business with them). The heroic lawyer settled the class action suit with the evil corporate villian with some free movie rentals (supposedly worth about 18 bucks per person)for the plaintiffs and a very hefty cash payment(based in theory on a percentage of the total damages Blockbuster did) to the lawyer. So how many notarized agreements to the proposed settlement will the lawyer be able to produce for the court? Oh, Let's say he manages one thousand agreements. Blockbuster mails the coupons to the addresses on the agreements and cuts the lawyer a check for say six grand (33% of the $18,000)

But wait, the lawyer knows that millions of people were hurt by Blockbuster - and besides, six grand won't even cover his photocopy expenses. Well then, he shouldn't settle, but take the case to court and let the judge decide. If the judge agrees that Blockbuster did bad things to millions of people, then the heroic lawyer gets his millions of dollars in legal fees - after all he did actually prove his case in court.

Now this does not address the problem of the corporate lawyers fighting a delaying action, so how should that be handled? One thought is that since these cases tend to be the sort of thing that would be handled by a small claims court on an individual basis is to allow the judge to treat the entire case in the same manner..


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Class action lawsuits for small individual damages
o should not be allowed at all 9%
o allowed but with a very strict cap on legal fees 52%
o are just fine the way they are 7%
o none of the above 30%

Votes: 42
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Class Action Settlement Rant | 44 comments (42 topical, 2 editorial, 0 hidden)
coupons (4.00 / 2) (#1)
by garlic on Thu Jun 14, 2001 at 04:23:23 PM EST

I always hate those coupons! Here's a coupon for the next time you come in and spend more money with us! We're sorry we screwed you.

If i'm part of a class that is getting screwed by some corporation, I want monetary compensation, not some coupon that requires me to give the corporation more money.

I'm completely unfamiliar with how a class action suit can start. Does it require someone to complain to a lawyer, or can the lawyer spot the suit on his own and sue? If I had a complaint against blockbuster that was really worth sueing them over, I'd be pretty pissed if all I got was $18 dollars worth of coupons while the lawyer made a million or two.

HUSI challenge: post 4 troll diaries on husi without being outed as a Kuron, or having the diaries deleted or moved by admins.

it requires an aggrieved party, iirc (5.00 / 1) (#3)
by Delirium on Thu Jun 14, 2001 at 04:28:04 PM EST

I'm not a laywer, but as I understand it class action suits first have to start as individual suits by an aggrieved party, which can then ask the court to grant their suit class-action status (based on evidence that many other people are in similar situations to that of the plaintiff). So a lawyer who spots something on his own would have to find at least one actual person who was willing to bring the suit.

And yes, I agree that coupons are a poor substitute for monetary damages. In class-action suit settlements they should push for monetary damages; the problem of course is that the lawyer will get money either way, and it's much easier to convince the company to make a large settlement if you allow them to pay most of it out in coupons than if you force them to pay it in cash.

[ Parent ]

A very good point (4.00 / 1) (#17)
by WinPimp2K on Thu Jun 14, 2001 at 06:09:24 PM EST

But all you need to do is check any big city newspaper and you will find the advertisements from attorneys looking for aggrieved parties. Remember that lawyers often hear people say:
"It's not the money, it's the principle!"
If the shysters look long enough, they are sure to find such a patsy. I don't know enough about the law to know if it is possible for the lawyer to share his fee with the patsy or not.

[ Parent ]
good points are hard to find, i guess (1.00 / 1) (#25)
by eLuddite on Thu Jun 14, 2001 at 09:08:09 PM EST

If the shysters look long enough,

Yeah, well, the function of a "shyster" in a class action is considerable more valuable and important to society than someone who does this for a living:

Why the nick? Well, the stereotypical pimp makes his living off his "ladies", but isn't known for his high opinion of them as human beings. I make my living developing apps that run on MS operating systems - My opinion of MSFT as a corporate entity...
Oooh, apps.

Dude, catch a clue. I knew there was an op-ed category, but I never imagined the existence of a google is too hard for geeks to use category. While it's certainly true that coupon settlements can be unfair, they are not necessarily unfair in all circumstances. Similiarly, while there may be a shortage of ethics in pimps, there's considerably more to go around in lawyers.

-1, ill informed and underwhelmed by fact.

God hates human rights.
[ Parent ]

What is your point? (none / 0) (#31)
by WinPimp2K on Fri Jun 15, 2001 at 02:01:06 AM EST

Can you provide some examples of coupon settlements in class actions that you would consider fair? and what was the lawyers fee?

Is it your contention that that all (or at least the vast majority of)lawyers who become involved in (small individual damage) class actions are honorable, altruistic officers of the court who purely by happenstance become aware of some behavior by a corporation that causes relatively minor damage to a large number of people? If so, how do you explain the rather large legal fees they receive in the settlement (once again, settlement, not the judge's (or jury's) decision)

I did label this puppy a rant, but I'm ranting about how a particular type of class action lawsuit is generally settled rather than tried. All I'm asking is that such class actions must be decided by the judge and/or jury.

As to shyster's and patsies, I did clearly say that if the attorney looks long enough he will find a genuinely angry person who wants to strike back at those who done them wrong (these are the ones acting on principle). It would take a genuinely stupid lawyer to suggest some sort of additional compensation (sharing the legal fees). Of course, stupid people and lawyers are mutually exclusive sets. And no lawyer has ever been so arrogant as to consider themselves above the law.

But how about losing the personal attacks? Yep, I develop apps. What do you do? Pretend I heard your answer. Now pretend I've made an insulting comment about it. Still with me? Ok, now pretend I've called your ethics into question. Of course, if you are either Stephen Wasinger or Gregory D. Hanley you have my immediate apologies.

[ Parent ]

Do you read the links? (none / 0) (#36)
by eLuddite on Fri Jun 15, 2001 at 09:38:14 AM EST

You clearly did not.

Is it your contention that that all (or at least the vast majority of)lawyers who become involved in (small individual damage) class actions are honorable, altruistic officers of the court who purely by happenstance become aware of some behavior by a corporation that causes relatively minor damage to a large number of people?

You persist in begrudging class action attorneys and their fees without any substance or evidence whatsoever. Nothing in your article indicates (a) that you've read the links; (b) have an understanding of class action as a positive agent of social litigation; (c) understand the legal process and practice of class action, including but not limited to its provisions for class exemptions; (d) have a shred of evidence of wrong doing. What part of your article is privvy to the details of a settlement, much less its honest appraisal? The part about you preferring $20 over a coupon??? The part about lawyers doing dick all to deserve their fees??? Is that what justice comes down to then -- an ignorant rant???

What does all this add up to? Yep, you're ignorant of class action. Moreover, having not bothered to make the effort of following the rather informative links I provided for your personal edification, you've compounded your ignorance with an intransigent show of stupidity. Why did you reply? There's no defense for wilful ignorance.

If so, how do you explain the rather large legal fees they receive in the settlement (once again, settlement, not the judge's (or jury's) decision)

How do you explain your annoying tendency to generalize an ignorance for the details of even *one* specific example of complex litigation into a blanket indictment of complex litigation? Nota bene: "I disagree with a settlement" or "I disagree with a judgement" are short sentence fragments not unlike "I ate green eggs and ham".

Why do you think settlements are necessarily bad? They are preferred in the theory of any court and, arguably, depending on a variety of factors that cannot be understood without regard to the specific circumstances of individual cases, can serve the class' interests better than a decision. The simple fact of the matter is that decisions are informed by laws whose tenor or letter may or may not have caught up with a particular class injustice.

You have an interesting theory of dispute settlement, matched only by an ability to gainsay class action lawyers and their understanding of legal issues.

More importantly, and you miss this point with a vengeance, class action settlements must be reviewed and approved by the court. There are rules of civil procedure requiring elements for certification.

[i]t is, ultimately, in the settlement terms that the class representatives' judgment and the adequacy of their representation is either vindicated or found wanting. If the terms themselves are fair, reasonable, and adequate, the district court may fairly assume that they were negotiated by competent and adequate counsel; in such cases, whether another team of negotiators might have accomplished a better settlement is a matter equally comprised of conjecture and irrelevance.
There's much, much more where that came from had you bothered to follow the informative links I gave you. In short, there are standards for reviewing settlements that go beyond your inattention to detail and your inability to measure justice except according to the visible presence of an extra $20 in your wallet. The simple fact of the matter is that, without putting corporate america out of business, class action is considerably more effective than an insignificant dribble of small claims action.

Do mistakes happen? Certainly they happen; and despite the lack of any justification in your article and comments, there's an element in humanity that warrants your criticism. There is also means and precedent for litigating unfair settlements whenever a corporate presence feels it is in their best interests to be punished twice.

But how about losing the personal attacks?

What personal attack? I've doing nothing more than point out a rather evident weakness in your ad hominem attacks on lawyers as a group. The weakness is this: winpimp2k may have demonstrated an ignorant foolishness, but surely that doesnt mean all geeks are idiots as a rule, does it?

Again, your unfair categorization of class action on the basis of a coupon outrage that is uninformed by any detail or knowledge is an indefensible J O K E.

God hates human rights.
[ Parent ]

I only skimmed them (none / 0) (#42)
by WinPimp2K on Fri Jun 15, 2001 at 05:44:11 PM EST

  • A rather garish website "classactionlitigation.com" - A dotcom website devoted to class action litigation? Why isn't it a dot org? Could it be a primarily (gasp) commercial enterprise? a cheap shot I know, but Dude, lighten up
  • A .edu website advising graduating law students on why they shouldn't consider class action litigation as their own personal get rich quick scheme. This is of course the sort of prudent advice that I would expect from any reputable organization - regardless of what sort of graduates they are advising
  • findlaw.com - the section on ethics, presumably so that I may discover (just below the link on "find a lawyer") that legal professionals are more ethical than a lowly app developer.
But did you even read my article and comments? You persist in claiming I have attacked:
  • lawyers as a group: The closest I came to attacking lawyers as a group was when I replied to gbroiles and referred to an out of context quote from Shakespeare (which I identified first as being taken out of context), and followed it up with an example of the sort of "lawyer joke" that results from a perceived shortage of ethics or morals on the part of lawyers.
  • class action litigation in general: I've (once again) been ranting over one very specific application of class action litigation. Your quote referring to the required review of the settlement by the court refers to a district court. Would that be a federal district court? The Blockbuster case I used was a Michigan state suit - I live in Texas, but was aware of it because one of those apps (a non-MS one too) I developed is a Point-Of-Sale system for video stores (and no it isn't the one Blockbuster uses).
As to the personal attacks, well I had my little feelings hurt by the implication that I suffered from a shortage of ethics you believe endemic to pimps, that developing applications is somehow a less noble calling than representing multitudes of faceless nameless people in class action litigation, that google is too hard to use (I tend to use Altavista because that is what I started out using) and most importantly that I suffer from Clue Deficiency Syndrome. (It was Colonel Mustard, in the library, with a gun)

And for something completely different, I will admit that your sig is amusing.
Of course, I would rather be literally fed than federally led.

[ Parent ]

ok, i apologize for undue vehemence (none / 0) (#43)
by eLuddite on Fri Jun 15, 2001 at 08:30:17 PM EST

Your quote referring to the required review of the settlement by the court refers to a district court. Would that be a federal district court?

Yes but state courts do the same. The reason why you see more settlements than you should is because state judges certify frivolous classes, forcing the defendant to settle even if they have done nothing illegal according to the letter of the law. Because a class can have thousands of plaintiffs, the defendent either settles or risks a verdict that will force them into bankruptcy.

All this begs a few questions. First, why certify less than compelling classes? Because its wrong to exploit lapses and loopholes in the law in order to take advantage of people. Nor is there a shortage of unethical commercial practices that also happen to be legal.

Second, why coupons? Because when coupon settlements happen, (1) the defendant shouldnt be unduly punished for the class' apparent determination to ignore such simple consumer advice as caveat emptor; (2) the defendant will likely win so the class is advised to take what they can get and not to push their luck.

Finally, are class action litigators excessively venal? That depends on your politics. Class action is a tool for egalitarian balance in an overtly corporate culture. It instills a fear for the consumer in corporate America, or for the electorate in government, and they can fund a law practice's future pro bono and community work. However, as the edu link points out, this is often wishful thinking.

And some young lawyers may look at the large class action awards and to the large attorney's fees that they generate as a way to fund other aspects of the legal profession such as pro bono legal work and social litigation.


An understanding of the method and its history may prove that these large awards of attorney's fees are used to pay large bank loans and the losses incurred on cases that do not settle and do not return favorable jury awards. The seemingly large windfalls may not be available to subsidize other legal work.

God hates human rights.
[ Parent ]

Interesting effects (4.00 / 2) (#2)
by Delirium on Thu Jun 14, 2001 at 04:24:07 PM EST

Hmm, this proposal would have some interesting effects - since it's nearly impossible to get any significant percentage of people to return anything at all, much less notarized, it'd have the primary effect of rendering settlements a non-option (since the plaintiff would get virtually nothing, making the case not really worth bringing). So that'd force cases to either not be brought at all, or to be fought in court, which could have some positive benefits. For the companies, it'd have the positive benefit of discouraging borderline cases, as lawyers would only bring cases they were pretty sure they could win - this would save the companies from having to pay out the millions they currently do in settlements (they often settle not because they think they will lose, but because they think paying out a settlement and getting it over with is better than risking huge market losses due to the negative publicity of a continuing class-action suit).

since the plaintiff would get virtually nothing... (4.00 / 1) (#20)
by WinPimp2K on Thu Jun 14, 2001 at 06:37:25 PM EST

That was exactly my point. These are cases where the plaintiff (even if there is an in-court victory) will get virtually nothing. But the lawyer who brings the case will no longer have an incentive to bring a case simply to shake a corporation down for whatever he can get in a settlement.

As to the "negative publicity of a continuing class-action suit", why should it be continuing? Without the option of a settlement, the way to get it over with is to get it before a judge.

[ Parent ]

the thing i don't understand (4.00 / 2) (#4)
by cory on Thu Jun 14, 2001 at 04:36:06 PM EST

Typically, when a lawyer represents a plaintiff in a civil suit and damages are awarded, the money goes to the plaintiff, out of which he pays the attorney. So how is it that, in class action lawsuits, that step is completely skipped? Shouldn't it be that those who sign on to the class action get paid, then those individuals are responsible for paying the attorney their share of her fees?


Because the suit is settled (none / 0) (#18)
by WinPimp2K on Thu Jun 14, 2001 at 06:24:54 PM EST

That means that it isn't decided by a judge, just that the corporation pays the attorney suing them (on behalf of people who don't even know about the lawsuit) to go away.

[ Parent ]
From what I've seen, (3.00 / 2) (#6)
by error 404 on Thu Jun 14, 2001 at 04:45:46 PM EST

(and I rented a movie earlier this week and read as much as I could stand of the settlement document on the receipt) the settlement involves coupons that are functionaly similar to the ones Blockbuster mails out and includes in newspapers on a regular basis.

But this batch has a cut going to the lawyers.

Electrical banana is bound to be the very next phase
- Donovan

This is sort of interesting... (3.00 / 1) (#7)
by elenchos on Thu Jun 14, 2001 at 04:52:14 PM EST

...but is it anywhere within the range of changes that are even being discussed for tort reform? Is it even on the wish list of anyone with the power to get this change passed into law?

Or do we add this to the ever longer list of interesting but impractical ideas for some future changes that could only be made after a massive political shift in the nation?

If it belongs to the second category, that's fine, but you should say so very clearly, so that we understand from the beginning whether or not we are discussing something realistic or hypothetical. It is as if you launched into a discussion of improvements to desktop PCs, but neglected to mention that you were junking the whole x86 architechture and imagining some completely new and better way of doing things that sacrificed all backward compatibility. Nothing wrong with thinking about stuff like that. I mean, it would be a nightmare to think we would be stuck with x86 backward compatibility forever, wouldn't it? But you wouldn't be worrying too much about the details of implementing and shipping it in time for Christmas.

So if someone who knows could tell me which category this was in, I would be much more interested in the discussion.

The Brain, within its Groove
Runs evenly -- and true --
But let a Splinter swerve --
'Twere easier for You --
--Emily Dickinson, #556

Well, I did say it was a rant... (none / 0) (#12)
by WinPimp2K on Thu Jun 14, 2001 at 05:27:52 PM EST

My fix probably isn't even on a wish list anywhere. I just threw it out to see where things might go.

[ Parent ]
IMHO (4.00 / 1) (#8)
by jd on Thu Jun 14, 2001 at 04:57:34 PM EST

The problem has little to do with lawyers (who are just a product of the legal system), or with out-of-court settlements (which are also just a product of the legal system).

The real problem is, surprisingly enough, the legal system.

Of course, a major overhaul of the entire legal profession is about as likely to happen as a snow-storm in the Bahamas on midsummer. However, I don't care, and I'll throw out a few thoughts on what I would like to see.

First, there are just too many laws, many of which overlap, and which are simply too vague to be useful. Which results in a HUGE overwhelming mass of case law, which turns what -should- be a fairly simple case of examining the facts and reaching a conclusion into a dangerous, but very very profitable (for the lawyers) form of roulette. With no possibility of either side really winning, in the end.

So, my first dream would be to see all the laws straightened-out and arranged in a simple, logical heirarchy.

My second dream would then be to see the idea of "plaintiffs" and "defendents" thrown out, altogether. Such concepts create an unbalanced, twisted perspective on things. You have two sides, arguing an issue. Nobody should need to care who said what first. The issue doesn't change, or go away.

Lastly, I'd much rather see courts work in an investigative way, rather than an interrogative one. Establish the facts FIRST, and THEN work on who did what. Not the other way round.

Give the lawyers coupons. (5.00 / 11) (#9)
by gbroiles on Thu Jun 14, 2001 at 05:00:42 PM EST

By way of background, I'm an attorney, though I haven't worked on any class-action suits from either defense or plaintiff sides.

I think this "coupon" stuff is a load of horseshit. People who have been injured deserve compensation in cold, hard cash. If I'm hurt as an individual, it's not acceptable for a company to pay me with coupons - if I win a lawsuit against them, they have to pay me with dollars, not Big Macs. I'm sure not going to take 60,000 Big Macs or contact lenses or movie rentals as a pretrial settlement, either. In many cases, class actions happen because people have been defrauded by a company, and the fraud was only exposed because of the suit.

If some company's been ripping me off for years, I don't want to buy anything from them ever again, so a coupon is doubly insulting - it's useless anywhere else, and it ignores the fact that I've (probably) got no interest in dealing with low-integrity assholes in the future.

The worst example of this I've read about has been with automotive defect legislation - in one case, GM was selling pickup trucks with fuel tanks located outside of the frame rails, where they were vulnerable to damage and fire or explosion as a result of a relatively low-speed impact. What did people whose families were put at risk, for years, by General Motors, get as compensation? A $500 coupon, so they could buy another $15,000 - $30,000 truck from the people who didn't mind exposing them to a significant safety hazard in the first place.

The answer is easy - pay the lawyers in the same way that plaintiffs are paid. If the lawyers think that Blockbuster coupons are a nice thing to get, let them collect their fee that way. If the lawyers want to get a big pile of "$500 off a $15000 truck" coupons, great. But the attorneys I know like to get paid in old-fashioned money they can spend however they please, that doesn't expire or force them to patronize a certain business. Lawyers want - and get - cash, and the plaintiffs should, too. This coupon stuff is a disgrace and an embarassment.

I don't think much f the coupons either... (none / 0) (#15)
by WinPimp2K on Thu Jun 14, 2001 at 05:40:39 PM EST

That would work too, but the problem is that these suits are always settled and so the lawyer sets his (or her) own terms for payment. And his "clients" are notified by the defendant who must then take action to receive those freaking coupons

These cases (where the individual damages are piddling), are prime examples of the sort of thing that make everyone quote Shakespeare out of context ("Kill all the lawyers") and make lawyer jokes:

What do you call 10,000 lawyers buried to their chins in manure?
A shortage of manure.

[ Parent ]

Truck design & gas tanks. (none / 0) (#39)
by bgarcia on Fri Jun 15, 2001 at 11:43:27 AM EST

GM was selling pickup trucks with fuel tanks located outside of the frame rails, where they were vulnerable to damage and fire or explosion as a result of a relatively low-speed impact.
I remember reading about all the trouble the NBC news division (was it NBC?) got into when they faked a recreation of such an accident. Apparently, they had an ill-fitting gas cap, and they used model rockets to ignite the fuel that spilled out as a result of the collision.

For the longest time, this is just how trucks were made. Indeed, there are still trucks being designed today that still have fuel tanks outside of the frame rails. Look at any medium size delivery truck or semi.

So if this is really such a dangerous design, then why hasn't the government made such a design illegal?

I suspect that the answer is that this design is not that dangerous, and gas tanks are designed to hold up very well when damaged.

[ Parent ]

Who cares about the size of the award? (4.66 / 3) (#10)
by golek on Thu Jun 14, 2001 at 05:06:50 PM EST

The important thing is that Blockbuster might be inclined to change their asinine late fee policy.

I used to rent movies at a local Blockbuster location, that was until they charged me for a 5 day rental for returning a couple of movies after 12 noon on the day they were due back. What did I do? I went to the store and told the manager, in a loud voice so the other customers could hear, that if they didn't take off that late charge I was going to close my account. The manager said that there was nothing he could do, so I promptly closed my account and haven't set foot in a Blockbuster store since. Apparently, they valued the $6 they stuck me for more than they valued my long term business. As to these stupid coupons, they can take their coupons and stick them up their a@#%!!!

You think that's bad? (3.00 / 1) (#11)
by ODiV on Thu Jun 14, 2001 at 05:24:17 PM EST

Try owing them some late fees for a couple of months.

I owed them $10 and came home to find threatening letters talking about collection agents. Sheesh.

Friend of mine owed them $5 and forgot about it. He moved and was later found and harrassed by a collection agent.

[ odiv.net ]
[ Parent ]
library police (none / 0) (#14)
by garlic on Thu Jun 14, 2001 at 05:34:49 PM EST

I got that same note saying "you owe us $5 dollars. If you don't pay us immediately, we will sick a collection agency on you."

What's worse is that I got one from the public library saying the same thing.

HUSI challenge: post 4 troll diaries on husi without being outed as a Kuron, or having the diaries deleted or moved by admins.
[ Parent ]

I'll deal you one better... (none / 0) (#22)
by cei on Thu Jun 14, 2001 at 06:52:54 PM EST

A friend of mine (no this isn't an uban legend, I actually know the person in question) received a late charge from Blockbuster for zero dollars. They threatened to send it to a collection agency. He promptly wrote them a check for zero dollars and zero cents and happily mailed it back to them.

[ Parent ]
Makes sense (3.50 / 2) (#23)
by Tatarigami on Thu Jun 14, 2001 at 07:38:51 PM EST

Friend of mine owed them $5 and forgot about it. He moved and was later found and harrassed by a collection agent.

(Disclaimer: IANAA -- I Am Not An American. The laws in my country may be significantly different to yours)

From a business point of view this makes sense. The company who say you owe them money don't employ a collection agency, they sell the debt to the collection agency, who then claim to be working on behalf of the company to sound more legitimate. The collection agency doesn't care about the size of the debt because as well as that figure, they are also legally entitled to charge you whatever it costs them to recover the debt.

Owe them five bucks? Well, collecting that five bucks might cost them as much as... oh, whatever your TV is worth. Or your car.

This is the point at which I think our national laws may diverge, but in this country it's legal for a collection agent to break into your place of residence and start carrying out whatever items of value he finds there -- whether they belong to you or not -- in order to recover the debt plus the cost of collection. Along with your debt, the agency bought a legal right to harrass and even steal from you. Think someone like that is going to worry over whether you owe $5 or $500?

[ Parent ]
RE: Makes Sense (3.00 / 1) (#27)
by AriT93 on Thu Jun 14, 2001 at 10:30:12 PM EST

yeesh!! Not the case here. Even in cases of purchased debt. The agency can only collect the amount of the original bill. In most cases these lots are bought extremely cheap, .01 -.05 to the dollar. There are several respected software packages out there as well to score the debts and credit reports in order to determine which are most likely to pay. NAREX is the only one that i can think of off hand. Most of the agencies put these accounts into a database and use a predictive dialer to call. The 'dogs' can stay there for a long time as they fill the pool and keep collectors dialing.

[ Parent ]
Simple question.... (none / 0) (#32)
by squigly on Fri Jun 15, 2001 at 07:01:06 AM EST

Do they accept coupons? Actually, looking at The detnews report, it appears that they wouldn't for anything other than a highly specific example.

[ Parent ]
Late fees. (3.00 / 1) (#33)
by sakico on Fri Jun 15, 2001 at 07:07:52 AM EST

Just a random tidbit that you may be interested in - Over half of Blockbuster's revenue (as a chain) come from late fees.

Perhaps more interesting, some 70% of my local library's funds come from their late fees. Only about 15% comes from various governments.

Is it that hard to return the things on time?

[ Parent ]

Blockbuster crossed the line (4.00 / 2) (#37)
by golek on Fri Jun 15, 2001 at 09:51:15 AM EST

I don't have a problem with late fees in general. What I have a problem with is late fee policies like Blockbuster's. First, they advertise 5-day (120 hours) rental and when you rent a movie, at say 8:00 pm, they tell you what day it's due back. Then you go to the video store after work (5:00 pm) on the day they told you it was due. Guess what? You get charged for an additional 5 day rental; you're late because the movie was due back at 12 noon even though you had the movie for less than 5 days (112 hours). What was really sleazy about it was that they put this late policy into effect quietly, without advising their customers of the change, so as to maximize the late fees they could collect.

Actually, I think Blockbuster should be free to enact any kind of policy they want as long as they inform their customers of the policy and there is no fraud involved. Likewise, I, as a customer, am free not to give them my business. Blockbuster didn't inform their customers and they falsely advertise a 5-day rental.

Libraries are different, because they don't charge rental fees and their late fee policies are not designed to trick the patrons.

[ Parent ]

minor issue with this. (none / 0) (#41)
by coffee17 on Fri Jun 15, 2001 at 04:05:17 PM EST

Is that blockbuster used to have only one day rentals instead of the two day rentals. I *think* that the movies which are now 5 day rentals used to be 3 day rentals, however I'm not sure. I actually thought it was a good thing; for the new releases, you didn't have to return it by midnight the next day, you actually got an additional 12 hours. However, apparently a lot of people were mislead (my housemate was (she was an author of one of the "for dummies" books)), which is hard to see, as the cases clearly said when it was due, and they even ran commercials stating that you got an extra 12 hours, not an extra day. Well, the commercials people aren't expected to know, but it said the return time on the damn box. Now, I pretty much hate blockbuster, but I must admit that I think that anyone who couldn't figure out BB's policy (again, it was printed on the boxes, in multiple colors (which probably helps attract the eyes; it wasn't in fine print)), earned themselves those latefees.


[ Parent ]

Blockbuster sucks (none / 0) (#40)
by coffee17 on Fri Jun 15, 2001 at 02:37:30 PM EST

for so many reasons. First of all, they edit movies without posting on the case that it was edited. Prime example being Dead Alive. They cut out the pudding scene for Eris' sake... WTF is so bad about a zombie eating its (obviously) fake ear that it can't be shown? And this isn't just a local thing, but a company policy.

Next is the prices (I hear that's changed recently). I can rent from a mom&pop place for about $2 for a couple of nights instead of $4 for a couple of nights.

Last of all, and this is a local thing, is that the blockbuster nearest me changed it's policies such that backpacks must go behind the counter. When I tried explaining to the manager that I keep my money, ID, and credit cards in my backpack and there was no way in hell that I was going to put that back there for some minimum wage cash jockey to watch over while they weren't demanding women to leave their purses behind, he turned a blind eye, so I also relatively loudly closed my account there and then.


[ Parent ]

Great... (none / 0) (#44)
by golek on Sat Jun 16, 2001 at 09:53:35 AM EST

...so I also relatively loudly closed my account there and then.

Good for you! If more people would do that they would change their tune.

[ Parent ]

U.S. House of Representatives hearing (4.00 / 2) (#13)
by PopeFelix on Thu Jun 14, 2001 at 05:30:31 PM EST

On March 5, 1998, the Subcommittee on Courts and Intellectual Property of the Judiciary Committee of the U.S. House of Representatives held a hearing on this issue.

Here is the record of that hearing. One of the more interesting suggestions I read in this, made by the Hon. James P. Moran, Representative from Virginia, was that if a case such as this is an interstate matter (like Blockbuster), the matter should be handled in Federal court, rather than State court. Often, lawyers in these suits will seek a particular state in which to pursue the matter, in the hopes of landing a favorable judge. I would think, or at least I would hope that a Federal judge would be a little bit less disposed to allow the sorts of settlements mentioned above.

Post No Bills

Gee... (none / 0) (#19)
by WinPimp2K on Thu Jun 14, 2001 at 06:30:37 PM EST

That was more than three years ago. Of course, the states will see it as a power grab by the Feds so one might expect relatively little to happen in that regards.

[ Parent ]
Why this is sick... (4.71 / 7) (#21)
by psctsh on Thu Jun 14, 2001 at 06:40:42 PM EST

I'd first like to say that I'd never heard of this practice going on, and I'm horrified that anyone would get stuck with a settlement of this nature. I think several posters missed the point by thinking of it as a "darn I get no cash, bastard lawyer does" open-and-shut case.

The main problem I see with this practice is one of PR. By settling with rebates, the major corporations are devaluating the plaintiff's position; they're essentially telling the public that the problem wasn't with a product or business practice, rather the problem was that people wanted free stuff. In the public's eye, this just becomes another frivolous lawsuit by greedy lowlifes, when in fact the plaintiffs most likely don't want to deal with said company ever again.

Also, I feel another issue here is with profits. As winpimp2k said, companies are still making a profit even with the coupons.

So I guess I'm trying to say that the issue isn't that people want their money, but rather that this practice helps to save the defendant's image while tarnishing the plaintiff's.

Lawyer database (3.33 / 3) (#24)
by Eloquence on Thu Jun 14, 2001 at 08:09:01 PM EST

How many class action lawyers are there? I think it might be a good idea to keep a public database of them and their track record. Of course, there's a slander lawsuit waiting for you, so it might be necessary to do it in a decentralized, Gnutella-esque fashion.
Copyright law is bad: infoAnarchy Pleasure is good: Origins of Violence
spread the word!
Here's how it should happen (none / 0) (#26)
by kmon on Thu Jun 14, 2001 at 09:09:56 PM EST

In a regular case, the lawyer gets a certain percentage of the award (for the sake of discussion lets say 50%), and the plaintiff gets the rest. I like to think (in that case) that the lawyer is getting a fair compensation for helping a person out.

In the case of a class action lawsuit, I believe the lawyer should recieve a percentage of the per capita payout to the plaintiff. That way, if every plaintiff gets $18, the lawyer should get a certain percentage, say $6. This way, the lawyer will have more incentive to bring the case to trial, and to win the bigger verdicts (if the company actually did something wrong). After all, its alot easier for a sleaze bag to extract a few grand from a company in a settlement than it is to actually go to trial.
ad hoc, ad hominem, ad infinitum!
That's silly (none / 0) (#38)
by Ken Arromdee on Fri Jun 15, 2001 at 10:41:48 AM EST

It allows a company to defraud people of a lot of money as long as it does it by nickeling and diming all the customers instead of doing all the harm to one customer. If a company does a million dollars of damage one buck at a time, no lawyer would take that case for a fee of fifty cents.

[ Parent ]
Lawmaking needs an overhaul (4.00 / 1) (#28)
by jesterzog on Thu Jun 14, 2001 at 10:56:12 PM EST

One of the reasons that lawyers [can] charge so much is because, like most expensive professions, it's hard to become a lawyer. It takes a lot of work studying a lot of documents and spending time knowing how to find what and developing arguments based on it and countering other arguments with other documents, and so on and so on.

This is what lawyers spend a lot of time doing. And it takes a lot of practice and a lot of qualifications and a lot of knowledge and a lot of effort and a lot of experience to do it well, which is why lawyers charge big money.

That said, I think the greater problem is that the lawmaking and legal systems need an overhaul. When new legislation comes in, it frequently overlays old legislation. When new contexts for documents are created, they are frequently copied and pasted and changed with slightly different definitions.

All of this leads to a massive web of documents and legislation, much of which is redundent and all of which is very difficult to follow and understand. This is where lawyers come in.

The job of a lawyer is to take this web of rules and legislation and understand it, at least to a point where they can use it in favour of their client. (Whether a defendant, the state, or some other entity.) Similarly, other lawyers take other parts of this massive tangled web and use it to counter the first lawyer.

I'm not sure if it's realistic, but IMHO the legal system could benefit a lot if it used some of the concepts and research that has come from computer science and related areas.

Consider what it would be like if lawmakers focused primarily on abstraction and collecting documents together into one general document, then specifying some parameters on the front page.

The amount of legislation would be greatly reduced. It would be much easier to read, easier to follow, more understandable, and more accessible to people who aren't lawyers.

Maybe the world wouldn't even need lawyers - or at least not expensive lawyers.

jesterzog Fight the light

Appears this doesnt apply to the death sentence .. (none / 0) (#34)
by Highlander on Fri Jun 15, 2001 at 08:50:59 AM EST

You don't need experience as a lawyer to defend someone against the death sentence.

Moderation in moderation is a good thing.
[ Parent ]
Why they Give out coupons.... (5.00 / 4) (#29)
by Elkor on Thu Jun 14, 2001 at 11:25:55 PM EST

The reason why they give out coupons is because it is "free" money to them.

A coupon has no effective cost to them (other than the paper) since you are renting a product from them. They get it back to rent to someone else. Each coupon that is redeamed can probably be deducted from the profits as a "loss."

Also, even though they issue $30 million (or whatever) in coupons, not everyone who gets a coupon will use it. So, though they "awarded" $30m in "damages" the effective cost to them is $10 million. Plus, they avoid the check fees associated with printing out and hving 10 million $3 checks cashed.

And, those people that DO use the coupon will probably continue to rent videos from them after they use the coupon.

The lawyers like the coupons because it makes it easier for them to settle the cases. Companies are more willing to issue the coupons than give out straight cash.

The judicial system likes the coupons because it makes it easier to award the damages, and since the two parties are more likely to settle out of court, reducing the burden on them.

That is why THEY like it. But, it seems that nobody has bothered asking the plaintiffs if this is acceptable to them....and while I am sure there is a reason why we should like it, I can't say that I know what it is.

"I won't tell you how to love God if you don't tell me how to love myself."
-Margo Eve
Solution (4.00 / 1) (#30)
by www.sorehands.com on Fri Jun 15, 2001 at 12:50:52 AM EST

The class action attorneys will only get a percentage of cash that they recover.

Or if the class action attorney gets coupons for a settlement, they get coupons for their fees.

Mattel, SLAPP terrorists intent on destroying free speech.

Companies Reasons for Settling (none / 0) (#35)
by Merk00 on Fri Jun 15, 2001 at 09:02:37 AM EST

In most cases that are settled for coupons, the amount of damage done is very minor. The main reason that companies will settle cases such as these is because they want to avoid the negative publicity and keep customers. Most of the times in cases settled for coupons, the company did not violate the law. They may have acted unethically (I'm assuming that the class action suited result from late fees at Blockbuster which are devious but not illegal as they do tell you about them ahead of time), but most of the time they did not act illegally. The coupons also provide a cheap way for the company to avoid the negative publicity while appeasing customers. If this were a major issue such as a health problem, no one would ever settle for coupons. Unfortunately with today's legal system, it's very easy to abuse the class action lawsuit system to try and get something simply because you didn't understand the terms you were getting into.

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Class Action Settlement Rant | 44 comments (42 topical, 2 editorial, 0 hidden)
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