What the Equifax data breach class action suit revealed about class action suits

The class action lawsuit against Equifax for its customer data security breach is “the largest and most comprehensive recovery in a data breach case in U.S. history,” as proclaimed by the Eleventh Circuit, which oversaw the case.

After Equifax revealed its data privacy breach in 2017, over 300 separate class action lawsuits were filed against the company. These cases were consolidated in the Northern District of Georgia, where Plaintiffs and Equifax ultimately reached a settlement.

The data breach compromised their name, birthdate, and Social Security number for over 147 million people. The effects of such a breach are far-reaching and severe. So, it’s shocking, and a bit unsettling, that according to court filings, participation in the suit was called “unprecedented” due to the claim rate exceeding 10 percent of the class. The Equifax filings revealed that the participation rate for similar class action suits are less than two percent.

Another striking aspect of class action suits is the compensation lawyers receive. In the Equifax data breach suit, attorneys walked away with a staggering $77.5 million in fees, which were approved by the court as a “reasonable”. Unlike claimants, who often must provide proof of eligibility, lawyers’ fees in common fund settlements don’t require the same level of justification. The settlement ruling stated that the “majority of common fund fee awards fall between 20% to 30% of the fund.” It was noted that 25% is used as “a ‘bench mark’ percentage fee award.”