When companies break the rules, there are two main ways to go after them: join a class action or file your own lawsuit.
Both aim for the same goal: holding the company accountable and compensating those affected.
However, the differences between a class action vs. an individual lawsuit are still significant, especially when it comes to payout, control, and timing.
This article breaks down all the key differences, so you can choose the path that makes sense for your situation.
Key takeaways
- Class actions and individual lawsuits serve different purposes
Class actions are designed for widespread harm that affects many people in the same way, while individual lawsuits are better suited for harm that is specific, severe, or unique to one person. - Control over the case differs significantly
In an individual lawsuit, the plaintiff controls major decisions such as legal strategy, settlement, and whether to go to trial. In a class action, those decisions are handled by class counsel and overseen by the court, with most class members having little direct involvement. - Large settlements don’t equal large individual payouts
Class action settlements can reach billions of dollars in total, but that money is split among all eligible class members and reduced by legal and administrative costs. Individual lawsuits usually result in higher compensation when damages are substantial, but they also carry more responsibility. - Class actions are lower effort but take longer
Class actions typically involve no upfront legal costs and minimal participation from individuals, but they often take years due to certification, notice requirements, and court approvals. Individual lawsuits may resolve faster, especially since most settle before trial, but require more time and personal involvement. - Most class action money goes unclaimed without help
Only a small percentage of eligible class members ever submit claims, leaving billions of dollars uncollected each year. Settlemate helps close that gap by automatically finding settlements you qualify for, filing claims on your behalf, and tracking payouts so small amounts can add up over time.
What is a class action lawsuit?
A class action lawsuit is a legal case in which one or a few people file a lawsuit on behalf of a larger group that was harmed in the same way by the same company or entity. Instead of thousands of similar cases moving through the courts separately, they’re combined into one.
The court treats the group as a single “class.” So, if the case settles or ends in a judgment, the outcome applies to everyone in that class, unless someone formally opts out.
What is an individual lawsuit?
An individual lawsuit is a legal case filed by a single person seeking compensation for harm or damages they personally suffered. The claim is based on that person’s specific facts, losses, and legal rights.
Any outcome—whether a settlement or court judgment—applies only to that plaintiff.
Class action vs. individual lawsuit: 7 key differences
While the definitions provide a general understanding, they only hint at how class action and individual lawsuits differ in practice. The following breakdown looks more closely at seven key differences.
1. Class action vs. individual lawsuit: Number of plaintiffs
In an individual lawsuit, there is one plaintiff who files the claim, brings the evidence, and seeks compensation for their own harm. The case rises or falls entirely on that single person’s facts and damages.
A class action, by contrast, is built around a group.
One or a few people—called lead plaintiffs—file the lawsuit on behalf of a much larger group of individuals who were harmed in the same way by the same defendant.
These individuals are known as class members, and they usually have no direct involvement once the case begins.
Importantly, the size of a class is not random.
Before a case can proceed, a court must certify the class under Rule 23 of the Federal Rules of Civil Procedure. This requires, among other things, that:
- The class is large enough to make individual cases impractical
- The claims share common legal and factual issues
- The named plaintiffs adequately represent the interests of everyone else
While class actions can include thousands or even millions of eligible people, participation is much smaller in practice.
Studies show that only about 9% of eligible class members typically submit a claim, even when notice is provided directly.
So while class actions involve many people on paper, the number of individuals who actively claim compensation is often a small fraction of the total class.
2. Class action vs. individual lawsuit: Control over the case
In an individual lawsuit, control rests with the person bringing the claim. The lawsuit exists to resolve that individual’s dispute, so decisions flow through the plaintiff and their lawyer.
In practical terms, control in an individual lawsuit includes:
- Whether to file the case in the first place
- What legal strategy to pursue and how aggressively to pursue it
- Whether to accept a settlement offer or continue negotiating
- Whether to proceed to trial or resolve the case beforehand
While a lawyer provides guidance and executes the strategy, the final authority stays with the plaintiff. Any settlement or judgment applies only to that person, and no outside approvals are required beyond the court’s standard role.
In a class action, control is structured very differently.
Once a case is certified, individual class members give up direct control over how the lawsuit is run.
Decision-making is divided among three parties:
- Class counsel: The lawyer or law firm appointed to represent the entire class controls litigation strategy and settlement negotiations.
- Named plaintiff(s): The individual who brings the lawsuit on behalf of the class serves as its formal representative, but has limited influence over day-to-day decisions.
- The court: This supervising authority must approve major actions such as class certification, settlements, attorney fees, and the adequacy of representation.
Most class members have no ability to influence strategy or settlement terms. Their primary choices are whether to remain in the class or opt out before key deadlines.
3. Class action vs. individual lawsuit: Payout and compensation
Class actions are designed to make large-scale wrongdoing financially actionable.
By combining thousands—or even millions—of small, similar claims into a single case, they create enough economic weight to challenge major companies.
That’s why aggregated settlements often make headlines, with the total class action settlements surpassing $79 billion in 2025.
But those headline numbers don’t translate directly to individual payouts.
The total settlement is distributed across all eligible class members, usually through equal payments or court-approved formulas. Portions of the settlement are also allocated to:
- Lawyer fees
- Litigation expenses
- Administrative costs related to processing claims and providing notice
- Service awards for the lead plaintiffs
As a result, individual class members often receive relatively small amounts, especially in cases with large classes. In an individual lawsuit, individual compensation is often significantly larger.
That’s because the plaintiff pursues recovery solely for their own damages and keeps any settlement or judgment they receive, minus lawyer fees and case-related expenses.
Typical outcomes vary widely, but many cases fall into predictable ranges:
- $10,000 to $25,000 for minor injury claims
- $25,000 to $100,000 for moderate injury cases
Across a broad mix of cases, a frequently cited median settlement is around $55,000.
There are also individual verdicts and settlements in the hundreds of millions, but these are extreme outliers tied to catastrophic injuries.
For example, one plaintiff was awarded $411 million after suffering severe brain and spinal injuries when struck by scaffolding at an oil refinery, and another received $831 million after a motorcycle accident left him permanently disabled.
Cases like these involve profound, life-altering harm and aren’t representative of typical individual lawsuits.
4. Class action vs. individual lawsuit: Legal costs and attorney fees
In class actions, legal costs are designed to be shared and managed collectively.
Lawyers typically work on a contingency basis, meaning class members don’t pay anything upfront.
Court fees, expert costs, and other litigation expenses are spread across the entire class, making it possible to pursue claims that would be too small to justify an individual lawsuit.
If the case succeeds, lawyer fees and expenses are paid out of the settlement and must be reviewed and approved by the court.
This structure makes class actions safer and more accessible for individuals because the financial risk is low, and courts actively monitor lawyer fees to ensure they are reasonable and aligned with the interests of the class.
In an individual lawsuit, costs are more concentrated.
While many lawyers also work on contingency, all fees and expenses are tied to a single plaintiff’s recovery.
In some cases, plaintiffs may be responsible for upfront costs such as filing fees or expert evaluations, and prolonged litigation can increase expenses relative to the value of the claim.
As a result, individual lawsuits carry greater financial risk, particularly when damages are modest or the case becomes contested.
5. Class action vs. individual lawsuit: Speed and duration
Class actions tend to move slowly. While they are designed to promote efficiency at a system level, the process itself is complex and heavily regulated. That’s why most class actions take two to three years to resolve, and some last much longer.
Common factors that extend the timeline include:
- Class certification, which requires the court to conduct a detailed analysis before the case can proceed
- Notice and opt-out periods, during which eligible class members must be informed and given time to respond
- Court approvals, including review of settlements, lawyer fees, and adequacy of representation
- Case management challenges, especially when the class is large or geographically dispersed
- Appeals and extended discovery, which can add years to more complex cases
Because these steps are mandatory, even straightforward class actions rarely resolve quickly.
As for individual lawsuits, they generally move faster, though timelines still vary.
A key reason is that most cases never go to trial. Plus, without the need for certification, class-wide notice, or judicial supervision of settlements, individual cases face fewer procedural delays.
That said, duration still depends on factors such as:
- The complexity of the claims
- The defendant’s willingness to settle
- Court scheduling
While some cases resolve in months, others can take years if heavily contested.
6. Class action vs. individual lawsuit: Risk and exposure
Both class actions and individual lawsuits carry non-financial risks that affect control, outcomes, and a person’s ability to pursue future claims.
In a class action, individual exposure is limited, but the tradeoff is shared risk tied to the group outcome, including:
- Binding outcomes: If the named plaintiff loses, all class members are generally bound by that result and can’t bring the same claim again.
- Limited participation: Many class members are bound by a judgment or settlement without actively participating, or even realizing the case existed.
- Misaligned incentives: Because individual stakes are often small, class members may have little ability or incentive to monitor whether class counsel’s decisions fully align with their interests.
In an individual lawsuit, exposure is narrower but more personal.
The risks tend to fall directly on the plaintiff:
- Personal responsibility: The plaintiff bears full responsibility for pursuing the claim, responding to litigation demands, and seeing the case through.
- Emotional and time commitment: Individual cases often require sustained involvement, including discovery, depositions, and decision-making.
- Outcome isolation: A loss affects only the plaintiff, so there’s no shared buffer or collective leverage to absorb that result.
7. Class action vs. individual lawsuit: Types of cases typically pursued
For class actions, the defining feature is dispersed harm—each person’s loss may be relatively small, but the total impact is substantial.
Below is an overview of the most common types of cases brought as class actions:
Individual lawsuits can involve many of these same subject areas, but they are typically used when the harm is specific, severe, or unique rather than shared evenly across a group.
Common examples include:
- Personal injury cases, such as car accidents or workplace injuries, where damages depend on the individual’s physical harm and recovery
- Medical malpractice claims, involving misdiagnosis, surgical errors, or negligent care that affects one patient differently than others
- Product liability cases with serious injuries, where a defective product causes significant physical harm to a single user
Making class actions worth it
Class action lawsuits often result in smaller individual payouts, but they also include lower costs, less risk, and less effort. Plus, while a single payment may be modest, multiple payouts can add up over time, if you actually claim them.
That’s where most people lose out.
Billions of dollars in class action settlements go unclaimed every year simply because people don’t know they’re eligible, miss deadlines, or don’t want to deal with the paperwork.
Using a tool that tracks and files these claims for you changes that equation.
Instead of relying on memory, emails you never read, or legal notices you don’t recognize, claims happen in the background, with Settlemate doing all the work.
Settlemate is an app that helps you find and claim money you’re legally owed from class action settlements, product recalls, and other refund opportunities automatically, by:
Scanning your email and purchase history to identify settlements you qualify for
- Matching you with open class actions in real time
- Auto-filling and submitting claim forms, with no lawyers required
- Tracking claim status, deadlines, and payout updates in one place
- Sending alerts when new settlements become available
The result is simple: less effort on your end, fewer missed claims, and more payouts collected over time.
Download Settlemate on the App Store or Google Play and start claiming what you’re owed.
