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Simple English definitions for legal terms
representative action
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A quick definition of representative action:
Representative action refers to two types of legal actions: class action and derivative action. In a class action, a group of people with similar claims against a defendant can join together to file a lawsuit. In a derivative action, a shareholder can sue on behalf of a corporation when the corporation's management has failed to take action against wrongdoing. These types of actions allow individuals to band together and seek justice in a more efficient and effective manner.
A more thorough explanation:
A representative action is a legal proceeding in which one or more individuals represent a larger group of people who have similar claims or grievances. There are two types of representative actions:
- Class Action: A lawsuit filed by one or more individuals on behalf of a larger group of people who have similar claims against a defendant. For example, a class action may be filed against a company for selling a defective product that caused harm to many consumers.
- Derivative Action: A lawsuit filed by a shareholder on behalf of a corporation against its officers or directors for breaching their fiduciary duties. For example, a shareholder may file a derivative action against a company's CEO for misusing company funds.
Both class actions and derivative actions allow individuals to pool their resources and share the costs of litigation, making it easier for them to pursue their claims. They also provide a way for individuals to hold corporations and their officers accountable for their actions.
For example, a group of employees may file a class action against their employer for violating labor laws, such as failing to pay overtime or providing a safe working environment. In a derivative action, a shareholder may file a lawsuit against a company's board of directors for approving a merger that was not in the best interests of the company.