Damage averaging and the formation of class action suits
AbstractWithin a class action suit, similarly injured individuals can collectively obtain compensation through the justice system. Damage averaging occurs when the compensation awarded by the court to individual members is partly or completely determined by the average damage of the class. The key role of damage averaging in influencing the identity of the individual that will initiate the class action suit is illustrated in a waiting game. If there is complete averaging, the individual with the lowest damage will initiate the class action suit, while if there is less damage averaging, other individuals may do so. GrÃ¢ce au recours collectif, des individus ayant subi des dommages d'ampleur diffÃ©rente mais de mÃªme nature peuvent obtenir compensation en cour. Il est possible que le montant accordÃ© Ã un individu par la cour ne soit pas strictement une compensation pour les dommages qu'il a subis, mais qu'il rÃ©flÃ¨te aussi, en partie, la moyenne des dommages subis par tous les participants au recours collectif. Envisageant la formation d'un recours collectif comme un jeu d'attente, nous montrons que l'usage de la moyenne des dommages par la cour est un dÃ©terminant important de l'identitÃ© de celui qui initiera le recours collectif. Si seule la moyenne des dommages est utilisÃ©e par la cour dans l'Ã©tablissement des compensations, alors l'individu ayant subi les plus petits dommages initiera le recours collectif. Si la cour utilise Ã©galement les dommages individuels dans l'Ã©tablissement des compensations, alors d'autres individus pourraient vouloir l'initier.
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Bibliographic InfoArticle provided by Elsevier in its journal International Review of Law and Economics.
Volume (Year): 23 (2003)
Issue (Month): 1 (March)
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Other versions of this item:
- Nicolas Marceau & Steeve Mongrain, 2001. "Damage Averaging and the Formation of Class Action Suits," Cahiers de recherche CREFE / CREFE Working Papers 139, CREFE, Université du Québec à Montréal.
- K41 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Litigation Process
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- Deffains, Bruno & Langlais, Eric, 2007. "Informational externalities and informational sharing in class action suits," MPRA Paper 4846, University Library of Munich, Germany.
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