Class Action Settlements Exceed $40 Billion for Third Year in a Row

Class action settlements hit $42 billion in 2024, exceeded only by 2023 and 2022 totals, according to analysis by Duane Morris.
By: | January 13, 2025
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Class action lawsuit settlements hit record levels for the third consecutive year in 2024, with emerging trends like PFAS-related claims and reverse discrimination suits likely to shape the litigation landscape, according to a review by Duane Morris LLP.

“With a robust pro-plaintiff litigation environment, it is clear that class action litigation represents an increased financial risk for companies,” said Duane Morris partner Gerald L. Maatman Jr., co-author of the review and chair of the firm’s class action defense practice team. “Plus, we are seeing the class action landscape as increasingly plaintiff-friendly in key areas, including data privacy and data breaches, and diversity and ESG initiatives.”

In 2024, class action settlements totaled $42 billion, solidifying a trend of massive payouts, according to the report. While significant, this figure actually represents a slight decline from the previous two years. In 2023, class action settlements totaled $51.4 billion, while 2022 saw an even more remarkable $66 billion in settlements.

“Combined, the class action settlement total for the past three years of $159.4 billion reflects use of the class action mechanism to redistribute wealth at an unprecedented level,” the report stated.

In 2024, parties agreed to resolve 10 class actions for $1 billion or more, the report found. The number of billion-dollar settlements in 2024 surpassed the number in 2023 (9), falling short only of the number of billion-dollar settlements in 2022 (15).

In 2024, rich settlement numbers spanned nearly every area of class action litigation, Duane Morris found. The cumulative value of the 10 highest settlements in each of the five largest areas of class action litigation last year were:

  • Products liability class actions: $23.40 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 $5.40 billion).
  • Consumer fraud class actions: $2.44 billion (down from $3.29 billion).
  • Privacy class actions: $2.01 billion (up from $1.32 billion).

Among 10 class action trends detailed in the report, Duane Morris highlighted four key areas of concern:

PFAS Litigation

The legal landscape in 2024 saw a significant surge in PFAS-related class actions, with these “forever chemicals” inspiring some of the most attention-grabbing headlines across the industry, the report noted.

PFAS litigation generated the largest class action settlement of the year, 3M Co.’s offer of $10.3 billion to settle PFAS claims of public water systems across the U.S. This record-breaking case resulted in an unprecedented attorneys’ fee award of nearly $1 billion. Such staggering figures are likely to fuel a continued wave of PFAS class actions, as plaintiffs target more companies with claims related to products or packaging containing these chemicals, according to the report.

Reverse Discrimination Claims

The aftermath of the U.S. Supreme Court’s 2023 decision in Students for Fair Admission, which struck down affirmative action in college admissions, has sparked a flood of claims targeting diversity, equity, and inclusion programs, per the report. Over the past year, headlines were replete with cases of employees and applicants accusing employers of prioritizing diversity over merit and improperly using protected characteristics in decision-making processes.

A rare class action trial in California, Palmer, et al. v. Cognizant Technology Solutions Corp., resulted in a jury finding a technology firm liable for engaging in a pattern of intentional discrimination against Caucasian and non-Indian employees in its termination and deployment decisions. The legal community is now closely watching a pending Supreme Court decision that could resolve a federal circuit split over whether members of a majority group alleging “reverse discrimination” must meet a higher burden of proof, potentially opening the courthouse doors to more such claims, the report stated.

Data Privacy and Breach Claims

Data breach litigation reached new heights in 2024, with more class actions filed than in any previous year. The number of class action filings reached 1,488 in 2024, more than double 604 filings in 2022, reflecting the growing concern over data security and privacy.

Despite this surge, courts issued only five class certification decisions in 2024, suggesting that many motions are still in the pipeline or that plaintiffs are opting to settle their claims before reaching this crucial juncture, according to Duane Morris. The continued willingness of defendants to settle is likely to fuel further growth in this area.

As technology continues to permeate daily life, the focus of privacy claims has shifted, according to the report. While biometric information privacy claims have plateaued, new theories inspired by internet use have gained traction. Lawsuits alleging improper sharing of users’ private information through website activity tracking tools, such as tracking pixels, have become increasingly common across various industries.

Although some of these cases have been dismissed early, others have resulted in sizable settlements, signaling continued investment in this area by the plaintiffs’ bar, the report noted.

In addition, in the absence of a federal comprehensive privacy law, there are currently 19 states that have passed comprehensive privacy laws.

California’s Unique Class Action Environment

The Golden State continues to be at the forefront of class action litigation, with the California Private Attorneys General Act (PAGA) playing a pivotal role in shaping the legal landscape, according to the report. Recent statistics reveal a staggering growth in PAGA notices, highlighting California’s distinctive position in the realm of employment law.

In 2024, plaintiffs filed a record 9,464 PAGA notices, a 22% increase from the previous year. This surge becomes even more notable when compared to a mere 11 notices filed in 2006, representing an astronomical 85,936% increase over an 18-year period, the report noted. These figures underscore the growing popularity of PAGA as a legal tool for employees seeking to address workplace violations.

Despite the passage of PAGA reform legislation in 2024, the impact on curbing the influx of cases appears minimal. The new law has seemingly done little to dampen the enthusiasm for PAGA claims, which continue to serve as a viable workaround to workplace arbitration agreements, the report stated.

Obtain the full Duane Morris report here. &

The R&I Editorial Team can be reached at [email protected].

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