How Class Action Lawsuits and Mass

A partner at Keating Muething & Klekamp PLL, in Ohio, Bethany Palmer Recht represents trustees of qualified settlement funds and settlement trusts. Formerly serving as an attorney for DLA Piper, LLP, Bethany Recht also represents different entities operating in the mass tort space.

Mass torts are similar to class action lawsuits in that they both consist of plaintiffs who share the same grievance with a defendant. The plaintiffs involved in either type of litigation allege that their common defendant caused harm in some way and seek compensation for these damages.

Despite these similarities, however, mass torts and class actions are handled differently and are two distinct types of litigation. With a mass tort, the group of injured plaintiffs is often smaller than in a class action suit. These plaintiffs are each treated as individuals, but they are connected in some way, such as all being from the same geographic area. Since plaintiffs are seen as individuals, they each must prove how the defendant allegedly injured them.

In class action suits, on the other hand, an individual known as a class representative represents the entire group of plaintiffs. The group is seen as a single entity and not as individuals belonging to a group. When a class action is filed, all individuals in the class must be notified. This gives them the opportunity to find their own counsel or opt out of litigation entirely.

Tax Implications for Qualified Settlement Funds

 Bethany Palmer Recht has served as an attorney for more than 15 years. She began her career at Weil, Gotshal & Manges, LLP, and now serves as a partner at Keating Muething & Klekamp PLL, as well as chair of the firm’s diversity committee. At this firm, Bethany Recht represents trustees of both settlement trusts and qualified settlement funds (QSFs).

A QSF, also known as a Section 468B trust, is a trust set up for settlement proceeds. Its purpose is providing funds deposited into the trust to various claimants according to an agreement set up via court order or among the parties involved. Once the funds have all been distributed, the QSF no longer exists, since it’s only a temporary trust.

While QSFs receive special treatment when it comes to taxes, they are not wholly exempt from taxation. Typically, a QSF is viewed as a distinct tax-paying entity and required to make annual tax filings and tax payments. State taxation varies based on the location of the QSF, but federal tax for a QSF’s income is 35 percent.

In addition, QSFs must adhere to different tax liabilities depending on how they operate and how they are set up based on legal documents. In the event the fund pays wages to a beneficiary, it is viewed as an employer and must pay taxes accordingly. For distributions that are not regarded as wages, the QSF has additional tax implications, like reporting the amount of these distributions on its annual tax forms.

Having an Article Published in a Scholarly or Professional Publication

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A partner and accomplished attorney at Keating, Muething, and Klekamp, PPL, Bethany Palmer Recht has nearly 15 years of experience practicing at firms in California, Massachusetts, and Ohio. Experienced in insurance coverage and mass tort settlement trusts, Bethany Recht is the co-author of the article, “Breaking Up Is Hard to Do,” which appeared in the January 2009 issue of Los Angeles Lawyer.

Publishing a scholarly article is extremely helpful for a young lawyer’s career. Listed below are three tips to follow to get your work published.

1. Be mindful of publishing timelines. Though law reviews accept submissions at any time, most seriously consider them at two main times: during the month of March and from late August until early September. Consider creating a timeline for yourself so your article can be completed in time for these two submission periods.

2. Choose the right topic. Focus on subjects you are passionate about that are relevant to your practice area. This builds your credibility as an author and motivates you in your research. Consider also how many articles have been written about your chosen subject, as your article is more likely to be published if it is on a relatively new and unknown topic. Don’t forgot to consider your employer when choosing a topic; avoid anything that may seem controversial or offensive to your clients and colleagues. Many employers have policies in place dealing with employee authorship, and some may have clearance procedures or internal review requirements.

3. Stay on track and do your research. Keep a writing schedule and seek opinions from your colleagues, family, friends, or even former law professors. Also, make sure you read up on the different requirements for submissions to journals and submit to several for the best chance at publication. If your article is repeatedly rejected for publication, let it sit for a while and come back to it to reassess and make appropriate changes.

Mass Torts - A Legal Remedy for Error, Injury, or Negligence

Bethany Palmer Recht serves as partner of the law firm of Keating Muething & Klekamp in Cincinnati, Ohio, where she consults with clients on managing settlement trusts. Bethany Recht’s other responsibilities involve handling awards from mass tort actions. 

In a mass tort lawsuit, a group of persons who have all been affected by the same mistake on the part of a company - such as in product liability cases - seek legal redress. It is similar to a class action lawsuit, but in a mass tort each plaintiff receives a separate trial. 

Many events can be the subject of a mass tort. Apartment fires, air crashes, plant explosions, anti-trust actions, and pharmaceutical errors are all frequently litigated. Other reasons range from bodily injury to negligence on the part of the federal government. 

Mass torts are expensive to take to trial. Law firms must be well-capitalized to handle large outlays for gathering evidence, finding expert witnesses, court costs, and travel expenses. Partly because of these expenses, law firms often settle the plaintiff’s claims before trial.