Customers who bought a Sole Treadmill between 2017 and 2022 (2015 and 2022 in Minnesota and Ohio) received a $100 gift card. Many class members also received cash payments, as outlined below. According to the lawsuit, the company exaggerated horsepower capability and “deceitfully ‘out-spec’d’ its competition with false and misleading horsepower ratings intended to lure consumers into purchasing its treadmills and paying an inflated price based on the horsepower misrepresentations.”
Deceptive marketing tactics are very common in class action lawsuits. The AWL settlement is a good example. Around 2010, payday loan company American Web Loan expanded into the mortgage loan business. Hidden fees and empty promises are common in short-term payday loans. These customers basically expect to be deceived, and the loans aren’t closely regulated. But lawyers and lawmakers review mortgage documents with a fine-tooth comb.
Class Action Payments
Generally, not all class members get an equal share of a settlement. Usually, these lawsuits have Class 1, Class 2, and Class 3 members. They might be called Class A, B, and C, or something else, but the idea is the same.
Usually, Class 1 members are named plaintiffs. These individuals had the most to lose. They not only got flimflammed by the company. They also reached out to lawyers, spent time in meetings and court hearings, and may have even paid some litigation expenses, all with no guarantee of any return. Since Class 1 members took the most risk and did most of the heavy lifting, they clearly deserve a bigger piece of the pie.
Class 2 members have compelling evidence of damages. That evidence, at a minimum, usually includes a proof of purchase. A credit card statement is evidence of purchase, but not proof of purchase.
Additionally, in deceptive marketing class actions like the Sole Treadmill settlement, Class 2 members usually have evidence that they considered less-expensive models but decided to buy the Sole Treadmill. That evidence might be a Google Maps entry on their phones or witness statements.
These class members usually get more money than Class 3 members. So, if you have such evidence, you should give it to the lawyer or the claims administrator.
Basically, Class 3 is everyone else. The Sole Treadmills in their dens might have been purchased or stolen. Put another way, Class 2 members might be able to win an individual lawsuit. Class 3 members have no chance of winning such a claim. So, these individuals get some money, but not nearly as much as everyone else.
The Settlement Process
We’ve extensively blogged on the settlement process. Class action mediation has a couple of unique features.
Generally, mediation is a one-day affair. The parties reach an agreement during that one negotiation session or they don’t. Class action mediation is often ongoing. Typically, judges require parties to keep negotiating until they agree. Class action trials are logistical nightmares.
Timing matters. If the parties reach an agreement before the judge closes the class, the settlement funds might not adequately compensate all class members. That’s another reason class action settlement negotiations tend to drag on.
