Outrun Change

We need to learn quickly to keep up with the massive change around us so we don't get run over. We need to outrun change.

Here is a class-action showing how such things are settled but this time actually put a few dollars in the pocket of the class members

You can carry around hundreds upon hundreds of books inside that little device. Image courtesy of Adobe Stock.

You can carry around hundreds upon hundreds of books inside that little device. Image courtesy of Adobe Stock.

I have long been amused by the way class-action lawsuits are settled. The members of the group receive very little and often it is a credit for your next purchase of the same item. At the same time, the attorneys involved get a huge payout.

One settlement I recall gave members of the class a coupon worth a few hundred dollars off their next purchase of a brand-new automobile. Since very few people will run right out and buy a new car that means very few of those coupons will ever be redeemed. In the meantime the attorney lucky enough to claim credit for the lawsuit walks off with millions upon millions of dollars.

An entertaining illustration of the dynamics is visible this week. Heat Street on June 21 explains Apple’s E-Books Lawsuit Yields Minuscule “Credits” for Readers, $50 Million for Lawyers.

Apple settled up a class-action lawsuit claiming the company hurt consumers when they agreed with five major publishers on setting prices. By the way, since Apple and other sellers have changed the approach I have noticed e-book prices have shot up.

Back to the settlement.

To avoid a trial which could have resulted in $850M of penalties (amount is according to the article), Apple settled for $450M.

Here’s how that is broken out:

  • $400M to consumers
  • $30M to the attorneys managing the lawsuit
  • $20M to the 33 states whose AGs got involved

So the attorneys running the case will probably realize a few thousand dollars per hour for their efforts.

The 33 states, who suffered no harm of any sort from the pricing of e-books get to divvy up $20M for the small number of hours of work by the staff of the AGs offices.

A bunch of customers of Amazon, Barnes & Noble, and Kobo get a gift card.

Settlement terms are $6.93 for each NYT book purchased and $1.57 for any other e-book.

Full disclosure: I received credit of $15.43 into my Amazon account. That shows what you probably already knew, that I read a lot of e-books.

More full disclosure: the author of the above story received $17.27 in credits at Amazon.

The difference in this case, compared to most class action settlements I recall having read about, is that the members of the class will actually get something of value that they will actually use. The similarity to other cases is that a few attorneys walk away with a huge payday.

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