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Joining a class action lawsuit offers a way to stand up to corporations and seek fair compensation for the harm you’ve suffered. But sometimes, class action payouts go far beyond a symbolic check. Some plaintiffs have pocketed thousands and even millions of dollars in damages.
So what determines how much each person gets in a class action lawsuit, and why do some people walk away with life-changing sums while others end up with a little more than a coupon?
In this guide, we’ll explain why pinpointing the biggest class action payout per person isn’t as simple as it sounds. We’ll also unpack the key factors that shape individual compensation and highlight some of the highest-paying class action lawsuits in the United States.
Why is it hard to determine the biggest individual class action payout?
Figuring out which class action lawsuit delivered the biggest payout per person can be challenging for several reasons, including:
- Lack of a universal database: There’s no single source that tracks every class action and its payout details, although you may find lists of active or recently settled cases.
- Limited payout information: Settlement agreements typically reveal the total settlement amount, but they don’t show the exact figures each person receives. Individual payouts are usually determined only after all valid claims have been processed, which can take months or even years after the settlement is reached.
- Non-cash settlements: Not every class action payout involves money. Some settlement agreements provide vouchers, rebates, or gift cards instead, making it hard to calculate their real value per person.
- Confidentiality: While most class actions are public, details about individual payouts may be kept confidential at the request of the parties involved.
What factors determine individual class action lawsuit payouts?
There’s no universal formula for pinpointing how much each person gets from a class action lawsuit. The payout can vary wildly depending on several key factors, such as:
- Total settlement/verdict amount
- Size of the class
- Number of lead plaintiffs
- Degree of damage
- Type of case
- Attorney fees and costs
Total settlement/verdict amount
This is the total amount the defendant has to pay to resolve a class action lawsuit, whether through a settlement or a court verdict. That money is used to cover everything from the compensation for class members to legal fees and administrative costs of the case.
While it may seem logical that a larger pool of money means bigger individual checks, that’s not always the case. Even if the total payout seems huge, the actual share each person receives depends on how many people are eligible to claim and what portion goes to the lawyers.
Size of the class
The size of the class refers to the number of people eligible to receive compensation from a class action lawsuit. When the court certifies the class, it decides whether enough people share the same issue for the case to move forward as a class action, but it doesn’t lock in an exact number. For example, a class might include everyone who bought a certain product within a set time period.
Since joining a class action is usually automatic, no one knows exactly how big the group is until people start filing claims for their share of the total payout. However, the general rule is pretty simple: the larger the class, the smaller the individual payouts. This is because the total settlement fund must be divided among all class members who submit a valid claim by a certain deadline.
Number of lead plaintiffs
Lead plaintiffs, or class representatives, are individuals who start the class action lawsuit and stay actively involved throughout the legal process. They work with attorneys, attend court hearings, and appear for court depositions.
Because of the extra time and effort they put in, lead plaintiffs usually receive incentive awards, which are paid out of the total settlement fund. This means that the more lead plaintiffs there are, the less money is left to be shared among the rest of the class.
Degree of damage
In many cases, class members who’ve suffered greater harm than others receive a larger share of the total payout. This system is called a tiered payout and is often used in medical class actions, but can also be applied in cases involving consumer fraud, data breaches, and privacy violations.
For example, in the MGM Resorts data breach settlement, class members received specific cash payments depending on the type of personal information that was compromised:
- Social security or military identification numbers: $75
- Passport or driver’s license numbers: $50
- Names, addresses, or dates of birth: $20
On top of the cash payments, class members who could show proof of financial loss due to the breach could claim up to $15,000 in reimbursement, plus a year of free financial account monitoring and fraud coverage provided by the defendant.
In medical or injury-related cases, tiered payments are rarely this clear-cut. Judges often need to examine each class member’s medical records and the level of harm to determine fair and proportionate compensation.
Type of case
The type of class action lawsuit doesn’t directly affect the payout amount, but certain categories of cases naturally lead to smaller or larger individual checks.
For example, consumer fraud cases usually involve a huge number of people, so the settlement fund has to stretch farther, resulting in smaller payouts per person.
On the other hand, personal injury or medical-related class action lawsuits usually include a small group of people who’ve suffered more serious harm, often with hefty medical expenses and lasting health consequences. As a result, the individual payouts from these cases tend to be much higher.
Attorney fees and costs
Class action lawsuits can’t move forward without lawyers, and most of them work on a contingency basis, meaning they get paid only if they win the case. Their legal fees come directly out of the total settlement fund and usually range from 25% and 35%, depending on the complexity and length of the case.
So when you hear about a multimillion-dollar class action settlement, keep in mind that not all of that money goes to the plaintiffs. A significant portion is used to cover legal fees and administrative costs, which can greatly reduce the amount available for class members.
What are the largest class action settlement payouts per person in U.S. history?
Here’s a look at some of the most famous class action lawsuits that resulted in (or were reported to include) substantial individual payouts:
How does Settlemate help you claim your class action payouts?
No matter how big or small your payout may be, that money is yours and is meant to compensate you for the harm you’ve experienced. However, you won’t see a cent unless you actually claim your share.
The problem is, you may not realize that you’re eligible for a claim. Even if you do, the process of filing a claim can feel confusing or simply not worth it, especially for smaller payouts. But skip a few of those “not worth it” claims, and you could be leaving hundreds or even thousands of dollars on the table over time.
That’s where Settlemate comes in. It simplifies your path toward payout and ensures you don’t have to deal with complicated paperwork to get your money back. Below are some of Settlemate’s key features:
- Automatic scanning: Settlemate scans your emails and past purchases (with your permission) to automatically detect class action settlements you qualify for.
- Payout estimates: Settlemate lets you see how much each claim could be worth before you file.
- Pre-filled forms: Whenever possible, Settlemate fills out the claim forms for you and lets you submit them in minutes, directly from the app.
- Real-time notifications: Stay updated on new settlements, filing deadlines, and the status of your claims.
- Proof guidance: If a claim requires proof, Settlemate tells you exactly what to provide and how.
Get started with Settlemate today by downloading the app from the App Store or Google Play and creating your account.
Not sure if the app’s right for you? You may change your mind after reading about Settlemate’s generous refund policy. You’ll qualify for a full refund if your one-year subscription ends up costing more than the amount you recover through the app.
Frequently asked questions
Got more questions about class action lawsuits and their payouts? We’ve answered some of the most frequent ones:
What is the average class action lawsuit payout per person?
The average individual payout typically falls between $20 and $100, though it can be lower or higher depending on several factors, like the total settlement amount, the number of class members, and the severity of damages.
Do I pay taxes on individual class action payouts?
The taxation of class action payouts depends on the type of compensation you receive. Payouts related to physical injuries or illnesses are generally tax-free, while those related to employment disputes, emotional distress, or punitive damage are not.
Should I join a class action lawsuit?
Joining a class action lawsuit does come with certain trade-offs. For example, you won’t have much control over how the case is handled. But in most cases, the benefits outweigh the risks. You’ll be holding companies that harmed you accountable, potentially recover money for the harm you suffered, and save time and costs compared to filing an individual lawsuit.
