Jewish World Review July 31, 2003 / 2 Menachem-Av, 5763
Class action lawyers get huge fees while their clients get squat
Remember Jim and Tammy Bakker, the crooked televangelist and his teary-eyed wife? He served four and a half years for scamming his flock out of millions so he could bank roll a lavish lifestyle. So what happened to his over 150,000 victims, some of whom gave up their life savings?
Well, good news: Last week they finally settled their class action lawsuit with Bakker's accountants and now they can anxiously await that check in the mail-a whopping payout of $6.47 each.
What really gets me? The lawyers who sued try to keep the $1.2 million settlement for themselves, saying it should be used to cover their costs. This reflects a much bigger problem class action lawyers getting huge fees while their clients get squat.
In a case against Blockbuster Video, the consumers got discount coupons, the lawyers 9.25 million. Crayola settled a case about asbestos in crayons. The consumers got 75-cent coupons, the lawyers $600,000. In an Alabama case, class members actually had to pay almost $100 each to cover attorney's fees, even though they won the case.
The victims often get almost nothing. The company loses lots of money. The lawyers walk away with the cash. Now if the class members get discount coupons, give the lawyers more of the same. They can give them away when Christmas rolls around.
Furthermore, with class members living all over the country, the plaintiff's lawyers get to pick the most favorable state and sometimes even county in the nation to bring the case.
Congress is finally moving to deal with these inequities. Look, I understand you have to provide an incentive for lawyers to take these cases, but the system is broke, so are many of the victims. That is unless that coupon really made the difference.
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