Updated: November 2018

Consumer Action uses cy pres funds effectively to benefit absent class members through education and advocacy

Cy pres awards to non-profit organizations are an effective use of residual damages from class action lawsuits. Despite attempts to alert all individuals in the class that they are eligible to claim restitution, typically some members of the plaintiff class cannot be located to receive their share of monetary damages. The funds left unclaimed by class member victims can be put to effective use when awarded to selected organizations that undertake and agree to provide indirect benefits for class members.

In cases where the plaintiffs are victims of deceptive or predatory business practices in the areas of credit, banking, privacy, insurance, healthcare and utilities, Consumer Action has been selected by plaintiff and defense attorneys and approved by courts to receive cy pres awards. It has used these funds to inform and protect consumers in subject areas addressed in the underlying litigation.

Because cy pres awards are targeted to provide real and substantial benefits to consumers in their purchases of goods and services, such awards have enabled Consumer Action to educate consumers about financial services, insurance products, loans and mortgages, telecommunications services and protecting themselves from frauds and scams. These awards also allow us to investigate, document and publicize abuses and to pursue vital consumer education and protection projects that are not funded through traditional grantmaking entities.

With a long and successful record of consumer education, advocacy and research, Consumer Action is very well qualified to achieve the consumer protection goals of the court.

  • Consumer Action’s nationwide network of nearly 7,000 community-based organizations enables us to reach millions of consumers—in their own languages and in their own communities.
  • Low overhead and efficient administration of funds means more of every cy pres award received is used to achieve the goals of the court.
  • Free education and assistance is delivered efficiently in a variety of formats—in person, by phone, in print, electronically, and via the media. Cy pres funding has allowed us to create, translate, print, post and distribute multilingual consumer education materials, train-the-trainer curricula and other resources designed for use by community-based organizations who counsel and serve vulnerable, underrepresented and limited-English-speaking consumers. With cy pres funding, we publish two, free informative monthly e-newsletters, SCAM GRAM and INSIDER, as well as the free paper-based quarterly Consumer Action News, which covers a range of compelling consumer issues. Click here to read our newsletters.
  • Cy pres funding continues to support our free national hotline service, which provides consumers with an easily accessible information hub where they can receive one-on-one assistance, request educational materials and get referrals to complaint-handling agencies. Our multilingual staff members handle approximately 500 contacts, via phone (415-777-9635) and messages submitted on our website, each month in English, the two major Chinese dialects (Cantonese and Mandarin) and Spanish.
  • Consumer Action’s one-of-a-kind complaint-handling database provides the means to identify consumers willing to talk to the media, legislators and the legal community. Attorneys have cited Consumer Action’s hotline complaints across a broad range of industries to support their arguments in individual and class action lawsuits.
  • We also use cy pres funding to ensure that our online Consumer Services Guide is updated frequently. This free, searchable directory of resources allows individuals to find government agencies and non-profit community organizations that can help them with consumer problems and questions. Click here to view the Consumer Services Guide.
  • In Washington, DC, Consumer Action works closely in coalition with other important national groups, many of which are also recipients of cy pres awards. This coordination enhances our ability to achieve stronger and better protections for consumers.

Click here for a list of cases in which Consumer Action has received cy pres awards.

If you would like to know more about how Consumer Action would be able to use a cy pres award in a specific case, please contact Executive Director Ken McEldowney by phone (415-777-9648) or .(JavaScript must be enabled to view this email address).

 

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