Should You Participate in a Class Action Against Equifax?

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If your personal information is among the 143 million credit files compromised in the Equifax cyberattack, you might be wondering if you have any recourse against the company.

As it turns out, you probably do. Since the Equifax breach—which involved the theft of names, birth dates, addresses, credit card numbers, and full Social Security numbers—more than 50 class-action suits have reportedly been filed against the credit bureau.

The lawsuits are coming about, coincidentally, just as a Consumer Financial Protection Bureau rule restoring consumers’ right to sue financial companies may be in danger of being eliminated by Congress.  

Equifax, under pressure from consumer groups, said last week that it would not prevent consumers from filing class-action lawsuits in connection with the data breach. The company said that its typical binding arbitration clause in its contracts with customers would not be applied to those affected by the data breach or to those who sign up for free credit monitoring because of the breach.

All this may have you wondering whether you should join a class-action suit.

Joining a Class Action Has Risks

Class-action lawsuits are usually initiated by lawyers on behalf of consumers who they say have been similarly harmed by a company because of fraud or other unlawful conduct.

But joining a class action can come with some risks. If you’ve suffered serious financial, physical, or other harm and you participate in a class-action lawsuit, you give up your right to sue a company on your own.

A proposed class-action lawsuit filed against Equifax in the U.S. District Court in Oregon on Sept. 7 accuses the company of negligence by failing to take appropriate measures to protect consumer data. The suit estimates billions of dollars in losses.

Still, the complaint acknowledges that the loss to any individual is likely to be small. The lawsuit says that the loss of one of the two lead plaintiffs named in the complaint amounts to just $19.95—the amount he paid for a third-party credit monitoring service after the breach was announced, according to the complaint.

Class-Action Basics

Lawyers turn to class actions because the cost of suing companies on behalf of just one consumer often is impractical, especially if the financial loss to that individual is small.

“Class actions can sometimes be the only effective way for wronged consumers to hold the…

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