141–150 of 279 posts
In the EU you cannot bind consumers by such arbitration clauses: http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A3... Consumers can usually sue corporations at a court in their own jurisdiction. Many European countries also allow class action law suits. Yet, we have few law suits against corporations. There are other reasons for this: - consumers are not awarded punitive damages, - court fees are higher (u…
Earlier quoted context omitted.
> Class actions are an ideal instrument for redress of harm where the harm to any individual is small, but the harm is widespread, meaning that a company is cheating or hurting many people but it's not worth any one individual's effort or expense to sue them. If you think of litigation in economic-theoretic terms, yes, that's the purpose of class actions. But while you're in that head space, you also need to consider…
Is this related to the transactional principal-agent problem in things like real estate, where the incentives of the agents are to close transactions as quickly as possible, since optimizing for the quantity of transactions handled is wildly more lucrative than optimizing for the outcome of any one transaction?
Class action lawsuits are a crappy solution, but often better than the alternative, which is often nothing.
(In some cases, mass direct-action lawsuits are superior, but coordinating those also has substantially increased overhead, and they gave some of the same settlement incentives; OTOH, because they are positive approval rather than opt out, it's less likely that a small-fraction settlement gets approved.
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Right, but if we take his statement at face value, and a significant portion of the money changing hands in a class action is going towards lawyers, it's at the very least a massively inefficient system.
Good question. Lets take lawyers a side. How much would you pay to somebody to ensure that a big evil corporation is not cheating their ~10M customers by $10/year (100M/year in total)? $10M? $50M?
This doesn't mean it's the ideal solution to widespread consumer harm, but it's a tool we have at our disposal NOW instead of hypothetical legislation or regulation we might have at some point in the future...
Class actions can be effective where the class members are relatively large, sophisticated entities. E.g. the data-breach class action brought by banks that is mentioned in the article. But in the consumer-protection space, we should consider alternatives. Where the class members are individual consumers, litigation ends up being lawyer-driven. Cases settle for pennies on the dollar of potential damages, and end up s…
>Where the class members are individual consumers, litigation ends up being lawyer-driven. Cases settle for pennies on the dollar of potential damages, and end up serving neither to compensate consumers nor really to deter illegal conduct. You're completely misunderstanding the purpose of class actions, and are using an oft-repeated error. The article itself explains the value of class actions. Class actions are an i…
A just resolution would be for each customer to get $120/year they were with Comcast PLUS Comcast should have some penalty for their fraud.
Instead what happens is Comcast agrees to a "huge" $30 million fine that works out to $12/customer per year if everyone opts in to the lawsuit and the lawyers take 50% for their efforts, so the lawyers get $15 million, the customers who sign up get $12 back and the ones who miss the memo get $0.
The customers don't have any recourse to say "no, that's a shitty settlement, we want 100% of what we're owed not 10% of it" or "hey, 50% is too much for the lawyers, I'd rather take $0 than the shitty deal we were offered".
A just system would make the corporation pay the lawyer fees (as part of their punishment for doing illegal things) and the customers/victims would be made 100% whole.
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It's not an argument from authority. It's an attempt to sidestep the breaking things down into basic parts for non-technical discussion, by pointing out that the person you responded to is capable of having a technical discussion on the subject. You make some statements here that are arguable - for example, that 'class actions are an ideal instrument for redress of harm where the harm to any individual is small, but…
Yes, I noted that regulation or legislation is better, but we don't have them now. Under the current system, class actions are valuable instruments for consumers. No one, myself included, is saying class actions should be "the final method", just that it's wrong to argue against them when they are currently generally the only method available to consumers for certain kinds of harm. I'd be the first to support robust…
Class actions are a poor substitute for good regulation. They are the bare minimum, or somewhat less than the bare minimum.
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>Where the class members are individual consumers, litigation ends up being lawyer-driven. Cases settle for pennies on the dollar of potential damages, and end up serving neither to compensate consumers nor really to deter illegal conduct. You're completely misunderstanding the purpose of class actions, and are using an oft-repeated error. The article itself explains the value of class actions. Class actions are an i…
Everyone in my family growing up was a lawyer, and the saying I always heard was "in class action lawsuits only the lawyers are getting rich". I've also heard this from many other lawyers outside my family. So it's at least a widely held belief.
Earlier quoted context omitted.
Is this related to the transactional principal-agent problem in things like real estate, where the incentives of the agents are to close transactions as quickly as possible, since optimizing for the quantity of transactions handled is wildly more lucrative than optimizing for the outcome of any one transaction?
It's more a manifestation of thst problem than merely related. Class action lawsuits are a crappy solution, but often better than the alternative, which is often nothing. (In some cases, mass direct-action lawsuits are superior, but coordinating those also has substantially increased overhead, and they gave some of the same settlement incentives; OTOH, because they are positive approval rather than opt out, it's less…
In the EU you cannot bind consumers by such arbitration clauses: http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A3... Consumers can usually sue corporations at a court in their own jurisdiction. Many European countries also allow class action law suits. Yet, we have few law suits against corporations. There are other reasons for this: - consumers are not awarded punitive damages, - court fees are higher (u…
Earlier quoted context omitted.
Is this related to the transactional principal-agent problem in things like real estate, where the incentives of the agents are to close transactions as quickly as possible, since optimizing for the quantity of transactions handled is wildly more lucrative than optimizing for the outcome of any one transaction?
It's more a manifestation of thst problem than merely related. Class action lawsuits are a crappy solution, but often better than the alternative, which is often nothing. (In some cases, mass direct-action lawsuits are superior, but coordinating those also has substantially increased overhead, and they gave some of the same settlement incentives; OTOH, because they are positive approval rather than opt out, it's less…
Earlier quoted context omitted.
The EU system seems to be very anti-consumer. Or is that what your summary statement is intended to elicit? (tough to tell, as it could mean either/or is the better system)
No, it's anti lawyer. Consumers are doing fine. Consumer watchdogs have actual teeth and when companies are found to have misbehaved the penalties can be quite severe. The difference is that consumers don't usually get rich from suing companies, we don't have a 'legal lottery' for every little thing that spoils your day and that you feel grieved about. That higher barrier keeps the courts free for stuff that is impor…
By what measure?