What Is A Class Action Administrator?

Effectively notifying class members is one of the most influential factors in determining class participation rates. Therefore, class action attorneys should consult with class action administrators, such as Simpluris, about the technical aspects, feasibility, efficacy, and efficiency of various forms of notice to class action members. Additionally, involving a class action administrator early in the process before filing avoids delays, costly revisions, and court rejection at various steps in class action litigation. This is due in large part to its ability to create a notice plan that reaches the maximum class members and fulfills due process requirements in a cost-efficient manner. Simpluris does just that. It provides expert assistance to counsel drafting proposed class action notices and uses industry-leading technology that effectively reaches class members, protecting their privacy, informing them about their legal rights and options, and allowing them time to easily respond.   

Once the court issues its order notice plan approval, the class action administrator effectuates the order, immediately notifying class members. But often, members' contact information is not readily available. Locating class members can be a difficult task when they have moved, or inaccurate addresses have been provided, or when email addresses result in a bounce-back as no longer valid. This problem obviously becomes more acute when the defendant, the usual possessor of class members’ contact information, does not possess the necessary data or knowledge, or even an identification, of class action members, such as in consumer cases. Simpluris overcomes these obstacles through its technological savvy. Using innovative ways to reach class members, Simpluris will execute a cost-effective and higher response settlement program. Its goal is to identify and designate newer or confirmed addresses that may exist for class members. This very detailed and highly specialized process of mailing and address configuration is yet another value-added-offering of Simpluris, and a part of its ongoing devotion to complete and holistic accuracy. 

When a class action is initially filed the plaintiffs are deemed the ‘representatives’ for a future, to be designated later, class of members. Theses ‘members’ usually have no prior knowledge of the lawsuit until the settlement administration notice experts contact them. Once notices are issued to thousands of members, an administrator can expect to field just as many inquiries. Who answers their queries? No law office can, or usually wants to, handle the sheer volume of calls from these just newly notified class action members. So, when choosing a class action administrator an attorney must ensure that it is capable of responding to the probable deluge of telephone and/or email inquiries. With any large administrative function involving tens of thousands of people one size cannot fit all. Simpluris routinely creates a call center on 24 hours’ notice and has pre-arranged auto-scaled preparation for overflow coverage.

The digital age requires instant, usable dedicated class action case websites in class action settlement administration. It is an essential element, saving countless hours of phone calls, letters, emails, and other unnecessary correspondence for class members, class action administrators, and counsel. Simpluris’ unique self-service platform allows class members to obtain necessary information any time of day, from anywhere in the world on all devices. Simpluris’ website is designed with the most simplistic and friendly user experience possible.

Once a case receives class certification, the case will either settle or go to trial. Cases are settled when counsel for each party has agreed to settle to avoid the costs and risks of trial and to resolve all claims of people who qualify as class members. A class action administrator, such as Simpluris, handles the settlement administration portion of the case. In all settlement cases, there is compensation available to the class members because a settlement has been reached. Compensation types vary from case to case but typically include monetary compensation or a gift card. 

The first stage of a settlement case is preliminary approval by the court. This occurs when a judge grants preliminary approval of a proposed settlement. Once a case has received preliminary approval, a class action administrator, such as Simpluris, will start the settlement administration process and begin the notice to the class members. This includes sending out the notice and response form to the class members. The notice informs class members of the proposed settlement, what their legal rights are, and instructions on how to exercise their legal rights. The notices will also include the applicable response forms and associated deadlines to submit the response forms. Once class members receive the notice packet, they will call Simpluris with questions and return their response forms for processing. 

Once the response deadline has passed, the case will go to final approval. At final approval, the court takes a much closer look and issues a definitive decision as to whether the proposed settlement is fair, reasonable and adequate. The judge will sign the final approval order, making the settlement final. At this point, the class action administrator distributes funds to the eligible class members. Simpluris also provides timely and essential financial settlement fund management services, including specific financial institution investing when applicable and captures and securely stores all Federal and State W-2 and 1099 data, as well as Qualified Settlement Fund (QSF) annual reporting and tax filings. Disbursements are commonly a one-time payment, but in some cases, there can be multiple disbursements. Settlement checks are void after a certain number of days. The timeframe is case-specific, but typically 90 days. Upon expiration of the check cashing timeframe, the class action administrator completes the distribution of residual funds and closes the QSF.

There are three main funding types generally utilized in settlement funds administration. The first is a QSF trust created under applicable state law by an order of a governmental authority pursuant to 26 CFR § 1.468B-1 to resolve tort or other legal claims. For class actions, the governmental authority would be the court. Using this settlement vehicle permits the recipient to defer taxes until receiving a distribution, while the defendant receives an immediate tax deduction. The second is Specialized Distribution Funds are for special large-scale payouts not mandated by QSF law. For instance, in a mass tort case or payouts on large insurance claims when the policy limits are tendered by the carrier, Simpluris would receive the funds, proportionalize the claims as instructed by the underlying agreement, and proceed with our standard claims administration functions. The third is a Third Party Tax Payout Funds. Sometimes an employer discovers their own wage violations and wishes to remediate the prospective claims even before the workers are aware or bring a lawsuit. Simpluris calculates the appropriate disbursement for each recipient and the appropriate tax payments. Simpluris would also prepare all appropriate tax filings, including W2, 592-B, 1099, and W9s.

Simpluris is a class action administrator with decades of experience, a team of experts, and industry-leading technology to develop, execute, and administer class action litigation from start to finish. Simpluris offers a suite of technology-based value-added service offerings for pre-settlement consultation, complete notice services, extensive call center capabilities, response processing, and distribution services.