How a pro rata share is worked out
A settlement sets aside a fund. Lawyers' fees, which courts often set at a quarter to a third of the fund, and the cost of running the settlement come out first. What's left is divided among everyone whose claim is valid.
Say $1,000,000 is left to pay claims. If 20,000 people file, each gets $50. If 100,000 file, each gets $10. That's why a notice can only estimate the amount: it isn't known until the claim deadline passes and every claim is checked.
Why the estimate changes
- How many people file. Usually few do: a2019 Federal Trade Commission study of consumer class actions found a median claims rate of 9% where people had to file.
- Caps. Many settlements cap the total paid for one kind of claim, so payments shrink if claims pass the cap.
- Leftover money. Some settlements raise every payment if money is left, up to a maximum.
Flat payments versus pro rata
Some settlements promise a fixed amount, like $60. Others say "estimated $75, may be larger or smaller": that's pro rata in practice. Across today's open settlements that publish one, the median smallest payment is $50.
ClaimWell shows the amounts each settlement publishes, never a promise of what you'll get. See open settlements.