The Economic Approach to Determining Reasonable Amounts
In many lawsuits, the amount for damages in a settlement are agreed upon between the two parties and paid according to the agreement. The court does not necessarily have to approve the amount or arrangements.
In a class-action suit, however, the court must approve the settlement because most members of the class are unavailable to participate in the action. The court acts on their behalf to make sure the amount and arrangements are fair to all parties, that counsel for the class did their job properly. How is this accomplished?
Attorneys for the class and for the defendant will argue for higher, and lower settlements, but the court’s responsibility is to have enough evidence and research to approve a “reasonable” settlement and will often look to experts for guidance.
Because so many class-action lawsuits involve products related to safety, the automotive industry is commonly involved in them, and locating an expert who has the industry knowledge and financial expertise is crucial for many cases.
Some of the most famous auto-related class action settlements have been:
The Chevrolet Corvair case involving rear suspension and steering column safety defects, the Toyota unintended acceleration case, the Volkswagen emissions case, General Motors and “switchgate”, and possibly the most notorious was the Ford Pinto gas tank case.
Recently for some car manufacturers the Takata airbag settlement was finalized and several experts participated in the process to assist the court in reviewing the amount and arrangements, including Mr. Kirk Kleckner.
Mr. Kleckner has the experience in both damages valuation and the automotive industry to participate effectively as an expert witness and has been qualified by courts to do so on many occasions including the above-mentioned Toyota unintended acceleration case. His experience, effectiveness and credentials as well as a CFO of a $500 million dealership group position him as the ideal individual to value class-action settlements.
Please reach out to Mr. Kirk Kleckner if you are involved in a situation where a class-action suit is involved by calling 612-294-8730 and his office can arrange a confidential consultation at your convenience.