The Federal Trade Commission has issued a staff report on class-action notices, redress methods, claims rates, and check-cashing rates based on the agency's survey of the results in 149 consumer class actions. The FTC has put together this home page on the report, which contains links to related information.
Consistent with other data and anecdotal reports, the FTC staff report finds that claiming rates in consumer class actions are generally quite low. But check cashing rates — that is, how often consumers cash checks received as relief in class actions — generally are quite high. These two things — (1) low claiming rates and (2) high check-cashing rates — tell us that, whenever possible, class-action settlements should provide class members relief without requiring them to file claims. That is, so-called "claims-made" settlements should be avoided where possible. Put differently, class members want their relief, but a whole bunch of rigmarole suppresses class-member recovery.
On October 29, 2019, the FTC will hold a public workshop in Washington, DC on improving class action settlement notices for consumers. The workshop is free and open to the public. Seating is first-come, first-served. The workshop is at the Constitution Center, 400 7th St., SW, Washington, DC, and will be webcast live. The October 29 workshop is intended to support the agency's continuing examination of the issues addressed in the staff report.
The FTC is asking for written comments on the report. Comments may be submitted electronically at Regulations.gov, or in paper form on these topics or other related topics through November 22, 2019. Paper comments may be mailed to FTC, Office of the Secretary, 600 Pennsylvania Avenue N.W., Suite CC-5610 (Annex B), Washington, DC 20580, or delivered to FTC, Office of the Secretary, 400 7th Street SW, 5th Floor, Suite 5610 (Annex B), Washington, DC 20024. Commenters should write “Class Action Notices, Project No. P024210” on the comment so that it will be identified with the workshop.
