If you are involved in a class action in Charleston, then you will quickly find that one of the main advantages to this litigation method is the support you have from fellow class members. However, that advantage can easily turn to the point of contention when it comes to distributing the settlement that comes from such an action. All too often, class members fall victim to the proverbial “Goldilocks Syndrome,” claiming their portion of the award is too small while pointing out that those of others are too big. Given your stake in your class action, you will want to know the exact details of the settlement distribution.
It is important to remember that class action settlements are divided out according to a “plan of distribution.” That plan is developed by the judge who heard your case. As you review the plan of distribution, you may see funds allocated out as “Cy Pres Awards,” and immediately question what these are. A Cy Pres award is a portion of a class action settlement that is given to a charitable organization. Only unclaimed settlement funds are used for these awards. The designation “cy pres” comes from the French term “cy pres comme possible,” which when translated means “as close as possible.” The justification for using funds from a class action settlement is to allocate them “as close as possible” to the intention of the litigation.
For example, say that your class action was against a pharmaceutical company that allowed a defective drug to get to the market. If there are funds leftover after you and all other class participants and representatives (and attorneys) are paid, the court may choose to give them to a charitable organization that supports drug research, this helping further the objective of your lawsuit.