Class action & settlement glossary
130 plain-English definitions of the words on settlement notices, claim forms, court pages, unclaimed-property sites and refund rules — so you know exactly what you're reading before you file.
A
- Adequacy of representationAdequacy of representation means the named plaintiffs and class counsel can fairly protect the whole class, without conflicts of interest.
- Administration costsAdministration costs are what it costs to notify the class, process claims and pay people. They are often paid out of the settlement fund.
- Arbitration clauseAn arbitration clause is a contract term that sends disputes to a private arbitrator instead of a court, often paired with a ban on class actions.
- AttestationAn attestation is your signed statement on a claim form that your answers are true, usually made under penalty of perjury.
- Attorney general settlementA deal between a state attorney general and a company that resolves the state's claims. Money may fund penalties, restitution or programs, not always checks for you.
- Attorneys' feesAttorneys' fees are the court-approved payment to the lawyers who brought a class action, taken from the settlement or paid separately by the company.
- Automatic renewal lawLaws that require clear terms, your consent and easy cancellation when a subscription renews automatically. States and a federal online-sales law set the rules.
B
- Bankruptcy unclaimed fundsBankruptcy unclaimed funds are payments from a bankruptcy case that were never collected and are held by the federal court for the person owed.
- BIPAIllinois' Biometric Information Privacy Act, a 2008 law that lets people sue companies that collect fingerprints, face scans or voiceprints without written consent.
C
- California Invasion of Privacy Act (CIPA)A 1967 California law against wiretapping and secretly recording private communications. People can sue for $5,000 per violation, which fuels website-tracking cases.
- CCPA and CPRACalifornia's privacy law. It gives residents rights over their data, expanded by the CPRA in 2023, and lets them sue after certain data breaches.
- ChargebackA chargeback is when your card issuer reverses a charge after you dispute it, pulling the money back from the merchant.
- Claim auditA claim audit is a check by the administrator that claims are real and eligible, which may include asking you for documents after you file.
- Claim deadlineThe claim deadline is the last day to submit a claim form for a class action settlement. Miss it and you usually cannot be paid.
- Claim farmA claim farm is an informal term for an operation that files large numbers of fake or duplicate claims to collect settlement money.
- Claim formA claim form is the form you submit, online or by mail, to ask for your share of a class action settlement.
- Claim ID (notice ID)A Claim ID, also called a notice ID or unique ID, is the code on your settlement notice that links your claim to the class list.
- Claims rateThe claims rate is the share of eligible class members who file a claim. It is usually low, which affects how much each person gets.
- Claims-made settlementA claims-made settlement pays only people who file approved claims, so the company's cost depends on how many claims come in.
- Class actionA class action is one lawsuit brought by a few people on behalf of a larger group that was harmed in the same way by the same company.
- Class Action Fairness Act (CAFA)The Class Action Fairness Act (CAFA) is a 2005 federal law that lets larger class actions be heard in federal court and adds checks on class settlements.
- Class action waiverA class action waiver is a contract clause in which you agree to bring claims only on your own, not as part of a class action.
- Class certificationClass certification is the judge's ruling that a lawsuit can go forward as a class action on behalf of a defined group of people.
- Class counselClass counsel are the lawyers a court appoints to represent the whole class in a class action, not just the named plaintiffs.
- Class definitionA class definition is the written description of who is in a class action, usually by what they bought or used, where, and when.
- Class memberA class member is anyone who fits the description of the group covered by a class action and has not opted out.
- Class noticeClass notice is the official message telling people they may be part of a class action, what it means for them and what they can do.
- Class periodThe class period is the range of dates during which you had to buy, use or be affected by something to be included in a class action.
- Common fund doctrineThe common fund doctrine lets a lawyer who creates a pot of money for a group be paid from that pot, so no one benefits without sharing the cost.
- CommonalityCommonality means the class members' claims share a common question that a court can answer for all of them at once.
- ComplaintA complaint is the document that starts a lawsuit by saying who is suing, who is being sued, what happened and what relief is being asked for.
- Consent decreeA consent decree is a settlement that a judge signs and enforces as a court order, so the company must follow its terms or answer to the court.
- Consolidated complaintA consolidated complaint is a single combined complaint that brings together the claims from several related lawsuits over the same conduct.
- COPPAA federal law that makes websites and apps get a parent's consent before collecting personal information from children under 13. The FTC enforces it.
- Coupon settlementA coupon settlement pays class members with coupons, vouchers or discounts on the defendant's products instead of cash.
- Credit freezeA free tool that locks your credit reports so lenders cannot open new credit in your name until you lift it. It lasts until you remove it and does not affect your score.
- Credit monitoringA service that watches your credit reports and alerts you to changes such as new accounts. It warns you after something happens but cannot stop fraud.
- Cy presCy pres is a way of giving settlement money to a charity whose work relates to the case when paying individual class members is not practical.
D
- Data breachA data breach is when personal information, like a Social Security number or login, is accessed or exposed without permission.
- Deficiency noticeA deficiency notice is a message from the administrator saying your claim is incomplete or cannot be approved yet, and how to fix it.
- Denied boarding compensationDenied boarding compensation is the payment an airline owes you when it bumps you from an oversold flight against your will.
- DiscoveryDiscovery is the stage of a lawsuit where each side must share documents, data and sworn answers with the other before any trial or settlement.
- Documented lossA documented loss is money you lost or spent because of the issue in a case, backed up by records such as receipts or statements.
- Dormancy periodA dormancy period is how long an account, refund or payment must sit untouched before it counts as abandoned and goes to the state.
- DOT automatic refund ruleThe DOT automatic refund rule requires airlines to refund your fare when they cancel or significantly change a flight and you do not accept the alternative.
- Duplicate claimA duplicate claim is a second claim filed by the same person or household in one settlement. Administrators usually pay only once.
E
- Effective dateThe effective date is when a class settlement becomes final, usually after final approval and the end of any appeals, so payments can begin.
- EscheatmentThe legal process of turning abandoned or unclaimed property over to a state, which holds it for the owner until it is claimed.
- EU261EU261 is the EU's air passenger rights law. It sets cash compensation of €250, €400 or €600 for long delays, cancellations and denied boarding.
- Extraordinary circumstancesUnder EU and UK flight rules, extraordinary circumstances are events outside an airline's control that excuse it from paying delay or cancellation compensation.
F
- Fake check scamA fake check scam sends you a bad check, then asks you to send some of the money back before the bank finds out the check is fake.
- False advertisingAds or labels that are false or misleading in a way that matters to buyers. The FTC and states enforce the rules, and consumers usually sue under state laws.
- Final approvalFinal approval is the judge's order finding a class settlement fair, reasonable and adequate, which clears the way for payments once any appeals end.
- Final approval hearingThe final approval hearing, also called a fairness hearing, is the court date when a judge decides whether to approve a class settlement.
- Finder feeA finder fee is what a private finder or locator charges to find unclaimed property and help you claim it, usually a percentage of what is recovered.
- Form 1099-MISCForm 1099-MISC is an IRS form a business sends to report certain payments to you, such as prizes, awards and other taxable damages.
- Form W-9Form W-9 is the IRS form you give a payer so it has your correct taxpayer ID to report payments to you, including some settlement payments.
- Fraud alertA free flag on your credit file that tells lenders to verify your identity before opening credit. An initial alert lasts a year and you place it with one bureau.
- FTC refundMoney the Federal Trade Commission sends back to people harmed by a company, usually from a case the FTC won or settled. You never have to pay to receive it.
H
- HIPAAA 1996 federal law that protects health records held by doctors, insurers and their vendors, gives you access rights, and requires notice after certain breaches.
- HolderA holder is the bank, insurer, employer, retailer or agency that holds money owed to someone else and must report it to the state if it goes unclaimed.
I
- Identity restorationHands-on help from a caseworker to undo identity theft damage by disputing fraud, writing to creditors and fixing your records. Breach settlements often include it.
- Injunctive reliefInjunctive relief is a court order, often part of a settlement, that makes a company change a practice or stop doing something instead of paying money.
J
- JudgmentA judgment is the court's final decision in a case, and in a class settlement it binds the class and starts the clock for any appeal.
- Junk feesMandatory charges added to an advertised price, like service or resort fees. The FTC now requires ticket and short-term lodging sellers to show the total price.
L
- Lemon lawState laws that give buyers of defective new vehicles a refund or replacement when the maker cannot fix a serious problem after a set number of repair tries.
- LodestarThe lodestar is a way to set lawyers' fees by multiplying the hours they reasonably spent by a reasonable hourly rate, sometimes adjusted by a multiplier.
- Long-form noticeA long-form notice is the full, detailed version of a class action notice, covering the settlement terms, your options, deadlines and how to claim.
- Lookalike settlement siteA lookalike settlement site is a fake website that copies an official class action settlement page to collect fees or personal data.
- Lost time paymentA lost time payment compensates you for hours spent dealing with the problem in a case, often at a set hourly rate up to a cap.
M
- Mass arbitrationMass arbitration is when many people with the same complaint each file their own arbitration demand against one company at the same time.
- Mass tortA mass tort is a set of many separate injury or damage lawsuits against the same company, often coordinated together, rather than one class action.
- MediationMediation is a private negotiation in which a neutral person, the mediator, helps both sides try to reach a settlement without a trial.
- MissingMoney.comMissingMoney.com is a free multi-state unclaimed property search sponsored by NAUPA that links you to each state's official claim process.
- Montreal ConventionThe Montreal Convention is a treaty that sets airline liability for injuries, lost or damaged bags and delays on international flights.
- Motion to dismissA motion to dismiss asks a court to end a lawsuit, or part of one, early, arguing the complaint is legally insufficient even if its facts were true.
- Multidistrict litigation (MDL)Multidistrict litigation (MDL) groups related federal lawsuits from different courts before one judge, who handles shared pretrial work such as discovery.
N
- Named plaintiff (class representative)A named plaintiff, or class representative, is the person whose name is on a class action and who sues on behalf of everyone in the class.
- NAUPANAUPA is the national association of state unclaimed property programs. It sponsors MissingMoney.com and helps states return lost money to owners.
- Net settlement fundThe net settlement fund is the money left for class members after fees, costs, service awards and administration expenses come out of the total fund.
- NumerosityNumerosity is the Rule 23 test that a class be so large that bringing every member into one lawsuit would be impractical.
O
- ObjectionAn objection is a written statement filed with the court by a class member who thinks a class settlement, or the lawyers' fee request, is unfair.
- Opt-out (request for exclusion)An opt-out, or request for exclusion, is a class member's written choice to leave a class action, keeping the right to sue alone but giving up any payment.
- Out-of-pocket lossesOut-of-pocket losses are money you actually spent because of the problem in a case and that no one paid back, such as fees or repair bills.
- Overdraft and NSF feesBank fees for payments that exceed your balance: an overdraft fee when the bank pays anyway, an NSF fee when it declines. Some are challenged in class actions.
P
- Payment electionA payment election is the choice you make on a claim form about how you want your settlement money, such as check, PayPal or direct deposit.
- Personally identifiable information (PII)Information that can identify a specific person, alone or combined with other details, such as a Social Security number, a fingerprint, or a name plus a birth date.
- Predominance and superiorityPredominance and superiority are Rule 23(b)(3) tests: shared questions must outweigh individual ones, and a class action must be the better way to proceed.
- Preliminary approvalPreliminary approval is the judge's first sign-off on a class settlement, which lets notice go out to the class and the claims period begin.
- Price adjustmentA price adjustment is a refund of the difference when a store lowers the price of something you already bought, usually within a set window.
- Pro rata paymentPro rata means in proportion: in a class settlement, each valid claim gets a share of the money, so payments rise or fall with the number of claims.
- Product recallAn action to remove or fix an unsafe or defective product, usually with a repair, replacement or refund. A recall is not the same as a class action settlement.
- Proof of purchaseProof of purchase is a record showing you bought a product or service, such as a receipt, order email or card statement, that some claims require.
- Protected health information (PHI)Health information that identifies you and is held by a doctor, hospital, insurer or their vendors. HIPAA protects it, and a breach of it can lead to a class action.
R
- Reasonable documentationReasonable documentation is the proof a settlement asks for, such as receipts or statements, that a typical person could actually provide.
- Recovery scamA recovery scam targets people who already lost money, offering to get it back for an upfront fee, then taking the fee and vanishing.
- Release of claimsA release of claims is the promise class members make, by staying in a settlement, not to sue the company again over the issues the deal covers.
- Residual fundsResidual funds are the money left in a class settlement after the first round of payments, from uncashed checks, unclaimed shares or rejected claims.
- RestitutionRestitution is money a company must give back because it was taken or earned unfairly, such as a refund of what customers paid.
- ReversionA reversion clause lets unclaimed or unspent settlement money go back to the company that agreed to pay it, instead of staying with the class.
- Rule 23Rule 23 is the federal court rule that says when a lawsuit can be a class action and how a class settlement gets approved.
S
- Second distributionA second distribution is an extra round of payments to class members when money is left in a settlement fund after the first payments go out.
- Service award (incentive award)A service award is a court-approved payment to the named plaintiff in a class action for their time and effort, on top of what other class members get.
- Settlement administratorA settlement administrator is the neutral company a court approves to send notice, process claims and pay out a class action settlement.
- Settlement appealA settlement appeal asks a higher court to review a judge's ruling on a class settlement, most often an objector's challenge to final approval.
- Settlement fundA settlement fund is the pool of money a company agrees to pay to settle a class action, from which class payments and most costs are covered.
- Settlement scamA settlement scam is a fake email, text, call, website or check that uses a real or invented class action to steal your money or personal information.
- Settlement taxesSettlement taxes are the federal income tax rules for money you receive from a class action. Whether a payment is taxable depends on what it replaces.
- Settlement tiersSettlement tiers are different payment levels in one settlement, based on things like proof of loss, type of harm or where you live.
- Settlement websiteThe settlement website is the official site for one settlement, run by the administrator, with the notice, claim form, deadlines and updates.
- Slack fillThe empty space inside a package. It is a legal problem when a box is made to look fuller than it is for no good reason, such as protecting the product.
- SmishingSmishing is phishing by text message: a scam text that tries to get you to click a link, reply or share personal or payment information.
- StandingStanding is a person's legal right to bring a case. In federal court it means a real injury, caused by the defendant, that a court order could fix.
- Statute of limitationsA statute of limitations is the legal deadline for filing a lawsuit, set by law and counted from when the claim arose.
- Statutory damagesStatutory damages are fixed dollar amounts set by a law for each violation, so you can recover without proving how much you lost.
- SubclassA subclass is a smaller group inside a class action that has its own representative because its members' claims or interests differ from the rest.
T
- Telephone Consumer Protection Act (TCPA)A federal law limiting robocalls, autodialed calls and telemarketing; it lets people sue for $500 per violation, or up to $1,500 if the violation was willful.
- The "do nothing" optionThe "do nothing" option means ignoring a class action notice: you stay in the class, give up the covered claims and get paid only if payment is automatic.
- TollingTolling pauses the clock on a statute of limitations, so time spent waiting on a class action doesn't count against your own deadline.
- Tracking pixelA small piece of code on a website or in an email that reports your visits and clicks to the site's owner or an outside company, often for advertising.
- Treasury HuntTreasury Hunt was the US Treasury's search tool for matured savings bonds and other unredeemed securities. It has been offline since September 30, 2025.
- TypicalityTypicality means the named plaintiff's claim is like the claims of the rest of the class, not unusual or in conflict with theirs.
U
- UDAP lawsState laws that ban unfair or deceptive business practices. Every state has one, many let consumers sue, and they power many consumer class actions.
- UK261UK261 is the UK's version of the EU flight compensation rules. It pays £220, £350 or £520 for long delays, cancellations and denied boarding.
- Uncashed settlement checksUncashed settlement checks are payments never deposited before they expire. The money may be reissued, redistributed or redirected.
- Unclaimed life insuranceUnclaimed life insurance is a death benefit never paid because the beneficiary did not know about the policy or the insurer could not find them.
- Unclaimed propertyMoney or assets a business holds for an owner it lost touch with, such as old bank accounts, uncashed checks or insurance proceeds. States hold it until you claim it.
- Unclaimed tax refundAn unclaimed tax refund is money the government owes you from overpaid taxes that you never filed for or never received.
V
- Video Privacy Protection Act (VPPA)A 1988 federal law that bars video providers from sharing what you watch without your written consent, with a $2,500 minimum award for violations.
- Virtual card paymentA virtual card payment is a digital prepaid card, sent by email or text, that holds your settlement money and works online like a debit card.
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