Small Business to SCOTUS: We Can’t Have Real Penalties for Theoretical Injuries

Date: November 10, 2015

www.NFIB.com
Contact:
Kelly Klass 609-713-4243 or
[email protected]
Follow NFIB Legal Center on Twitter @NFIBLegal
Follow
NFIB on Twitter
@NFIB

National Federation of Independent
Business (NFIB) challenges class-action cases that use statistical models to
assume more victims than may actually exist

Washington, D.C. (November 10, 2015) – In a case being heard this morning by the US
Supreme Court, the National Federation
of Independent Business (NFIB)
says that
plaintiff’s
lawyers should have to prove that everyone included in a class-action lawsuit has
suffered the same injury. 

“Courts
cannot rely on statistical models because they are, by definition,
assumptions.  There’s no justice in a
system in which the injuries are theoretical but the penalties are real,” said Karen Harned, Executive Director of the
NFIB Small Business Legal Center
, which filed a brief in
Tyson Inc. v.
Bouaphakeo. 

At issue in the case is whether a class action lawsuit can be certified
if liability and damages are calculated based on a sample size of those
claiming injury. 
In this case, employees alleged that they had not been compensated
for overtime and they sued on behalf of themselves and every other employee who
might have been short-changed.  When the
plaintiffs’ attorneys were unable to point to solid evidence showing the hours
that the vast majority of other employees had worked, they submitted
statistical assumptions averaging the number of overtime worked. 

“Statistical
model trials inevitably award damages to some individuals who haven’t been
injured, which may deny just compensation to those who have suffered an injury
that exceeds the model’s estimate,” she continued.  “The Supreme Court has emphasized rigorous
analysis before certifying class action lawsuits on multiple occasions and we
are urging them to do the same when hearing this case.”    

According to NFIB research, small business owners hit with lawsuits pay
an average settlement cost of 10 percent of their salary.  In fact, being dragged into court is one of
the things that small business owners fear most.

“Class action lawsuits can be catastrophic to small employers, so it’s essential
that the federal courts strictly enforce rules that limit these class action
lawsuits.”  

###

Subscribe For Free News And Tips

Enter your email to get FREE small business insights. Learn more

Get to know NFIB

NFIB is a member-driven organization advocating on behalf of small and independent businesses nationwide.

Learn More

Or call us today
1-800-634-2669

© 2001 - 2024 National Federation of Independent Business. All Rights Reserved. Terms and Conditions | Privacy