WASHINGTON (Legal Newsline)
— The Federal Trade Commission (FTC) announced Nov. 14 it plans to study
the effectiveness of various class action settlement notice programs.
To do so, the agency has orders out to eight claims administrators, mandating they
provide information on procedures they use to notify class members about
settlements and the response rate for various methods of notification.
These orders come as part of
the FTC’s Class Action Fairness Project, an attempt to ensure class action settlements
in consumer protection and competition matters provide consumers with the
appropriate benefits. The FTC monitors class actions and amicus briefs,
coordinates with state, federal and private groups on important class action
cases and monitors legislation involving class action rule changes.
The FTC noted its
project includes two proposed studies. The Notice Study will look at consumer
perception and understanding of class action notices. The Deciding Factors
Study examines the elements that go into a consumer’s decision to participate in
a class action lawsuit and settlement.
The FTC voted 3-0 to issue
orders to file a special report.