Across the U.S., class action lawsuits continued to generate "gargantuan" payouts worth tens of billions of dollars from businesses in 2024, and California's courts remain "ground zero" for trial lawyers' continued targeting of employers and other businesses, encouraged by "extraordinary and record-setting" fees, a new report tracking nationwide class action activity has found.
In the Golden State, nearly 9,500 employers were hit with legal actions in 2024 under California's controversial Private Attorney General Act alone, as so-called PAGA filings continue to ride permissive court rulings on their meteoric rise in the state courts.
And those employer-specific claims amount to but a fraction of the collective legal actions launched against businesses in California and elsewhere in the U.S. last year.
Those findings were among the trends and data from 2024 discussed in the 2025 edition of the annual Class Action Review published by the corporate law firm of Duane Morris and class action defense attorneys Gerald Maatman and Jennifer Riley, who served as editors for the report.
According to the report, class action settlements nationally totaled more than $40 billion for the third year in a row. In all, the report said class action lawsuits in the U.S. generated settlements worth a combined estimated total of $42 billion in 2024.
That figure was down from 2023, when class action litigation generated settlements totaling$51.4 billion, which in turn was down from the $66 billion estimated to have been paid by companies sued in U.S. courts in 2022.
"Combined, the past three years of $159.4 billion reflect use of the class action mechanism to redistribute wealth at an unprecedented level," the report's authors said.
The most costly settlement of 2024 was worth $10.3 billion, according to the report, under a deal overseen by a South Carolina federal judge to end claims stemming from the use of so-called "forever chemicals," formally known as polyfluoroalkyl substances (PFAS) in firefighting foams.
The report noted that litigation over alleged harm from PFAS has stood as one of the primary drivers of the surge in class action settlement activity nationally.
The report pointed out that in 2024, six states enacted regulations concerning disclosure and levels of PFAS, common chemicals which are found in a wide range of consumer, commercial and industrial products.
The surge of concern of PFAS has then inspired a blitz of lawsuits across the country from trial lawyers pushing claims over the amount of PFAS in drinking water, flooring, food additives, firefighting foam, and a host of other products and goods.
"Given the settlement numbers to date, companies can expect PFAS to generate more filings in the coming year as plaintiffs seek a share of the PFAS treasure chest and their targets, in turn, seek to pass costs down the chain," the Duane Morris report said.
After the South Carolina PFAS firefighting foam settlement, the next four largest settlements listed in the report included:
- $4 billion pledged as part of a global settlement to end more than 450 lawsuits from victims of the 2023 Maui wildfires in Hawaii;
- $2.8 billion to settle antitrust litigation against health insurer Blue Cross Blue Shield, pending in Alabama federal court;
- $2.78 billion in federal court in Northern California to resolve litigation from former college athletes who claimed they were wrongly blocked by the NCAA under amateurism rules from getting paid for the use of their name and likeness; and
- $2.2 billion to be paid by the makers of the Zantac heartburn medication to resolve state court cases claiming the drug allegedly caused cancer.
The Top 20 class action settlements included deals worth $375 million to $1.5 billion, Duane Morris reported.
According to the report, the settlements worth hundreds of millions of dollars or more arose from 16 major areas of class action law classified by the report's authors, including:
- Product liability class actions: $23.4 billion, down from $25.82 billion in 2023;
- Antitrust class actions: $8.412 billion, down from $11.14 billion;
- Securities Fraud class actions: $2.55 billion, down from $5.4 billion;
- Consumer Fraud class actions: $2.44 billion, down from $3.29 billion;
- Privacy class actions: $2.01 billion, up from $1.32 billion;
- Wage and Hour class/collective actions: $614.55 million, down from $742.5 million;
- Data Breach class actions: $593.2 million, up from $515.75 million;
- ERISA class actions: $413.3 million, down from $580.5 million;
- Discrimination class actions: $356.8 million, down from $762.2 million;
- Government Enforcement litigation: $335.9 million, down from $263.58 million;
- Civil Rights class actions: $313.8 million, down from $643.15 million;
- Labor class actions: $237 million, up from $139.67 million;
- BIPA class actions: $206.85 million, up from $147.86 million;
- TCPA class actions: $84.73 million, down from $103.45 million;
- FCRA class actions: $42.43 million, down from $100.15 million; and
- EEOC Enforcement litigation: $25.95 million, down from $61.63 million in 2023.
"Particularly when viewed in conjunction with the settlement values observed in 2022 and 2023, the settlement numbers in 2024 confirm that we have entered and are operating in a new era of enhanced class action risks," the report authors said. "Corporations should expect these numbers to continue to incentivize the plaintiffs’ class action bar to be equally if not more aggressive with their case filings and settlement positions in 2025."
ATTORNEYS' TAKE
The report authors noted the settlements have particularly benefited one group:
Plaintiffs' lawyers who file the lawsuits.
According to the report, attorneys raked in billions of dollars in attorney fees in 2024.
Typically, attorneys bringing successful class action lawsuits can expect to claim about one-third of any settlement amount, though the amount can vary as low as 10-15% to as much as half, depending on the size of the claim and a judge's valuation of their work, relative to the amount received.
According to the report, the Top 5 largest attorney fee collections were:
- $2.13 billion to lawyers leading National Prescription Opiate Litigation in Ohio federal court;
- $840 million to attorneys leading PFAS litigation vs manufacturer 3M in South Carolina;
- $540 million to lawyers leading litigation vs 3M over the alleged ineffectiveness of military combat ear plugs in Florida federal court;
- $503 million to attorneys leading a class action in Kansas federal court vs Syngenta over varieties of corn that were disallowed in China, prompting lawsuits from farmers; and
- $345 million to attorneys leading a class action in Delaware state court vs. billionaire Elon Musk over his compensation as CEO of Tesla.
The remaining Top 25 payouts to plaintiffs' lawyers in 2024 ranged from $16.7 million to as much as $266.7 million, according to the report.
"Numbers like this explain at least in part why we are continuing to see the plaintiffs’ class action bar grow in numbers and expand its reach as lawyers clamor to identify the next 'tort of the day,'" the report authors said.
CALIFORNIA 'GROUND ZERO'
While the report authors noted other states, including Illinois, have played large roles, California's famously lawsuit-friendly courts and legal system have also led the charge in the sustained strength of class action litigation across the U.S.
California's contributions have been particularly felt in the sustained targeting of legal actions against employers under the state's controversial PAGA law.
For decades, the PAGA law has empowered workers to sue their employers for big money on behalf of their coworkers for often small or merely technical violations of California labor law, stepping into court in place of California state labor officials. Before enactment of the PAGA law, only California state officials were empowered to bring enforcement actions on behalf of entire workforces.
Employers targeted by such actions could be forced to pay penalties, the bulk of which would to the state of California. But under PAGA, employers could also be made to pay another large chunk to cover the fee demands of the lawyers who sued them.
This has generated a cottage industry of plaintiffs' lawyers who critics say use PAGA lawsuits to rake in fees, while generating significantly less benefits for workers.
Published reports indicated the lawsuits may have done little more than to generate big - and relatively easy - paydays for lawyers.
A report authored by former top California state labor officials for the firm of Baker & Welsh showed PAGA lawsuits have forced California employers to pay more than $10 billion to end PAGA lawsuits since 2013.
Attorneys received the largest portion of the settlements, once the state took its share of the penalties, the report indicated.
According to the Duane Morris report, PAGA legal actions soared again in 2024, as employers were hit with 9,464 PAGA notices last year. That marked a 22% increase vs. 2023 and "a whopping 85,936% increase over the 11 PAGA notices filed in 2006," the report's authors said.
And that sustained activity came despite reforms enacted in 2024, which business groups had hoped would at least ebb some of the PAGA actions by rewriting the PAGA statute to end the law's so-called "lawsuit-first approach" and enhance the ability of employers to avoid the claims altogether, particularly for costly claims based on relatively minor or technical alleged violations of state labor law.
But PAGA lawsuits continue to be enabled by California state courts, regardless of reforms or even rulings from the U.S. Supreme Court.
Rulings from California's Supreme Court and state appeals courts have particularly cemented the ability of plaintiffs to use PAGA claims to sidestep employer arbitration agreements. While the U.S. Supreme Court has ruled those arbitration agreements can be used by employers to thwart individual lawsuits accusing companies of violating labor laws, California courts have declared that, under PAGA, plaintiffs can move forward with their lawsuits in court as a "representative" of their fellow unnamed coworkers, even if arbitration clauses may disallow their individual claims in court.
In a growing number of instances, the Duane Morris report authors noted that PAGA plaintiffs are dispensing with individual claims altogether and instead pressing entirely "representative" claims, using so-called "'headless' PAGA claims."
"We expect parties to heavily litigate this line of reasoning in 2025," the Duane Morris report said.
"Given the technical requirements of California wage & hour law, coupled with the potentially crushing statutory penalties available to successful plaintiffs, employers should anticipate continued growth of PAGA lawsuits in 2025," they said.