Matthew Potter, Senior Strategic Advisor at JND Legal Administration
Class action claim filing rate is the rate at which noticed class members complete all steps required to submit a claim to receive compensation from a settlement. This article outlines factors to consider as you develop the terms of your settlement, and specifically the claims process class members will need to follow, to maximize class participation and optimize filing rate.
While these factors influence claim filing rates for all class action settlements, individual factors may affect each case differently depending on litigation type (e.g., antitrust, employment, consumer protection, etc.), case profile and class demographics. With that in mind, it is always advisable to consult on case strategy with an administrator experienced in the settlement claim filing process.
Factors are listed in four categories: 1) Perceived Benefit, 2) Notice Form Layout, Design and Media, 3) Claim Form Design and Filing Process and 4) Reminder Notices.
1. PERCEIVED BENEFIT
The single most influential factor affecting claims filing rate is compensation value, meaning the amount of compensation available to the individual class member. If the settlement fund is small relative to the class size and amounts to a nominal compensation for the class member, your claims filing rate is going to be low. Other factors listed below will prove less important in such a scenario.
Remember that from the moment a legal notice is received to the moment the class member decides whether to file a claim, she is asking herself, “Is this worth my time?” The effort required to review the notice, procure any additional information requested and submit a claim should be offset by the perceived benefit of filing. In some cases, the form of redress (e.g., check, direct deposit, prepaid card, PayPal, etc.) may impact the class member’s decision to file.
In settlements where an exact amount or range cannot be calculated for the individual class member until the claim filing deadline has passed and all claims are filed, or where the amount cannot be calculated until after the class member provides additional information specific to her claim, perceived benefit plays a significant role in claims filing rate. If the information provided for calculating redress is insufficient or difficult to comprehend, one of two things will likely occur:
Neither of these outcomes is desirable. Always provide class members with as much information as possible about their benefit on the notice and claim form and make it expressly clear what form(s) of payment will be made available.
2. NOTICE FORM LAYOUT, DESIGN AND MEDIA
Class action settlement notices contain a lot of information, including the benefits of the settlement, a summary of the class member’s legal rights and the process class members need to follow to file a claim for a benefit under the settlement. What information is included, how that information is presented and how the notice is disseminated all impact the claims filing rate.
3. CLAIM FORM DESIGN AND FILING PROCESS
The claim form is used to capture all claimant information required for inclusion in the class action and to facilitate benefits calculation. Many of the same considerations for notice forms are applicable to claim form design. An optimal claim form design is clear and concise.
4. REMINDER NOTICES
We live in the Information Age. Mail can be misplaced. Emails can go unopened or worse, never land in the inbox. Ads can go unnoticed. While not required as a part of the notice in most settlements, issuing a reminder or multiple reminders to class members can be an effective strategy for increasing the number of claims filed. There are many ways to accomplish this. Mailing a postcard as a reminder or sending a follow-up email 30-60 days (about two months) before the claim filing deadline are prime examples of this. Digital advertising and retargeting can also be used to remind class members to file later in the claim filing period.
As in marketing and sales, multiple touchpoints are often needed to motivate the desired action. A well-timed and properly executed reminder grabs the attention of the class member, highlights the filing deadline and outlines the action(s) the class member needs to take to file a claim. Further, this additional touchpoint can instill trust by assuring the class member that she is the intended recipient of the notice and that she likely has a direct and personal interest in the settlement.
From beginning to end, and at every touchpoint in between, the content and delivery of communications with class members must be timely, informative, unambiguous and practical. As there will never be a one-size-fits-all settlement strategy, it is important to consider each of the factors detailed above as it relates to your case. Further, these factors hold greater potential to drive claims filing rates when considered holistically and designed to work in tandem. Seek an administrator with a demonstrated breadth of experience in how these and other factors affect class action settlements to advise on best practices given the particulars of your case.
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