What is a cy pres award in a class action settlement?
A cy pres award is a legal term used in a class action settlement. It refers to a distribution of settlement funds to organizations that are related to the purpose of the lawsuit without actually being named plaintiffs. In New York, a cy pres award can be used to distribute a portion of a settlement when class members can no longer be identified or it is impractical to distribute the funds to them. For example, a class of people may successfully sue a business for false advertising. The court may award a settlement that was intended to reimburse the class members. However, due to the passage of time, it is impossible to locate and identify all the members of the class. In this situation, a cy pres award may be used to distribute the settlement funds to a charity that focused on consumer protection or a similar issue to benefit the public at large. Cy pres awards may also be used when there is not enough money from the settlement to fully reimburse the class members. In these cases, a portion of the settlement funds can be distributed to a charity to fulfill the original legal goals. In general, cy pres awards are meant to benefit society when the original class members cannot be identified or fully compensated. These awards are a way to ensure that the outcome of the legal action still serves the public interest.
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