The use of AI in class action litigation

You have likely read a lot about organizations adopting artificial intelligence or AI and Generative AI or GenAI. It’s an increasingly popular and creative subdivision, to supplement or supplant existing business processes and your organization may well be part of this trend. AI has captured imaginations across all industries, and while the legal industry is historically slow to adopt new technology, it is fair to say the industry is catching up. But just as corporate legal departments and outside counsel can benefit from using AI and GenAI, so too can the plaintiffs’ bar. These tools can streamline the time-consuming stages of litigation. AI can enhance the discovery process, ease the burden associated with collecting and analyzing large data sets, improve legal research, and optimize the drafting and reviewing of contracts and other legal documents.

According to a recent review of the 2023 class action landscape conducted by Duane Morris, the technology will allow the plaintiffs’ bar to file more lawsuits with fewer lawyers in less time. Algorithms and machine learning facilitate identifying potential class members, revealing commonly held grievances, and collecting evidence via public records, social media, and other sources at speeds that leave teams of human researchers far behind.

Even non-attorney claims aggregators are poised to get in on the action; Consider ClaimClam, a service that “finds you class action settlements and files claims for you, so you can get your portion of the settlement fund.” The Brooklyn-based company employs AI to go beyond identifying potential classes a person can join and “files claims, manage[s] claims, advocate[s] for more claims, collect[s] disbursements, and pay[s] you what you’re owed from naughty corporations.” In return for this service, the company takes 15% of any settlement award.

Courts and their claims administrators have scrutinized such services, rejecting claims submitted by ClaimClam for lacking vital identifying information in a class action in the wake of Facebook’s Cambridge Analytica dispute and similarly rejecting approximately 30,000 ClaimClam claims in a nearly $255 million settlement against JUUL Labs. The fact remains that attorneys must stay abreast of emerging AI technologies for the benefits it offers, but also to be prepared to challenge its use by opposing counsel or third parties when appropriate.

Attendant to this concern is the fact that the class action landscape is changing. Again according to a Duane Morris, the threat of class actions is no longer constrained to products and pharmaceutical liability. A new source of sizable class actions has come in the form of cybersecurity and data breach issues. Combined with increased government enforcement, corporations were the subject of $113 billion in settlements in 2022 and 2023, exceeding expectations and setting records in the process.

The broadening landscape for potential class actions, two straight years of record-setting penalties, and technology potentially making enormous class actions easier to pursue than ever before demands that corporations shore up their data privacy and cybersecurity practices and controls.

We offer a range of services including data privacy gap assessments, policy and procedure drafting and review, in addition to privacy and incident response training and table top exercises to ensure key stakeholders are prepared to handle an incident. Please contact Spencer Pollock at spollock@mcdonaldhopkins.com for more information about our data privacy and cybersecurity counseling services.

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