Class Actions

Class actions are lawsuits filed by an individual on behalf of a group. If the lawsuit succeeds, the members of the class share in whatever award of money the court makes. You need to be part of the class and apply to receive money. The class is usually based on having had some type of experience during a specific time period. 

For Indigenous communities class actions allow communities to seek compensation for harm caused by government action. This could be a government practice that discriminates against Indigenous communities. It could be a practice that resulted in abuse and loss of language or culture. It could also be something that the government did not do.

In many cases these actions are settled instead of being decided by a court. The court needs to approve any settlement of a class action. The settlement must be reasonable and fair. It must be in the best interests of all class members, not just those who took the case to court. 

When lawyers are asking the court to approve a settlement, members of the class are notified and can object. Class members are told how the money will be divided between class members and the amount of legal fees that will be subtracted from the settlement.

Lawyers take class action cases to court.  Individuals and organizations hire lawyers for their cases. When they hire lawyers, they agree on the fee the lawyer will charge. It is common for lawyers in these cases to charge what is called a contingency fee. This means the people do not need to pay any costs while the case is ongoing. If there is a settlement the lawyers will get a percentage of the amount. This allows people without access to large amounts of money to still take their case to court.

Some settlements involve large amounts of money – typically many millions of dollars. Even a small percent of the settlement means the lawyers will often receive millions of dollars. When a notice is sent to class members about a settlement, the notice usually includes the amount of the legal fees that will be charged. 

As part of approving a settlement, courts will look at these agreements to see if they are reasonable. They will consider if the fee is reasonable based on:

• the amount of work that was done
• how likely it was the claim would succeed
• the amount of the settlement. 

Based on these factors courts have reduced lawyers’ fees in some cases. In one case a legal fee of $11.5 million (20% of the settlement) was reduced to $3 million. 

The court appoints someone to oversee the distribution of the funds. This will usually be a professional organization like a trust or accounting company. The amount available to distribute will be the settlement amount minus any legal fees.

The company must follow the distribution plan approved by the court. The money goes to individual members of the class, not their representatives such as a First Nation Council.

There will be an application process to confirm you are a member of the class. There will also be deadlines for applying to share in the funds.