Claire Van der Zant, Director of Strategic Partnerships, Shieldpay, chaired a session at the Global Class Actions Symposium 2023 focused on payments for claimants.
Claire was joined on stage by Polly Blenkin, Senior Partner at Milberg London LLP, and Clinton Smith, Co-founder and CIO of Case Pilots, bringing together key voices from across the class actions ecosystem.
The recording of the panel is also now available to rewatch on YouTube.
Day 1 of the Global Class Actions Symposium spoke through the lifecycle of a class action, leading to our panel session in the afternoon which completed the series and focused on the final piece of the class-actions jigsaw: payments.
Claire started the conversation by setting the scene. Payments is the more "practical" end of litigation, which she explained is the most exciting part because it is the "culmination of all the work that [litigators] do getting justice into the hands of people who really need it the most".
A core focus of the conversation was around debunking the myth that payments are “the easy part”. Claire was quick to say that they can be, but it hinges on being organised, structured, and well-planned. Quoting an earlier panel session that day and a comment from Chris Ford of Blackhawk Network, Claire emphasised that for this to be true, we need to "collaborate early and collaborate often".
The first order of business was discussing "when".
Clinton suggested that payments need to be considered right from the point of administration planning, with a focus on the need to include this in the budgeting. The payments provider needs to be there for this. Clinton re-enforced the point that they aren't just providers, but specialists. With the right partner, the payments team is able to support in the decision making around the most effective and appropriate payment method to use to get the monies into the hands of the claimants, depending on the demographic of the class.
Polly agreed with this point, saying that, "someone in the room needs to understand how you can practically pay your clients", especially on the point of budgeting and negotiating costs. There needs to be robust analysis and calculations to justify costs and how much you can recover from defendants.
Claire added that while payments are at the very end of the process, there is high potential that as cases evolve over the course of the legal action, the payments partner needs to be involved early to course correct throughout and be prepared for quick, efficient and secure distribution of funds when the settlement lands.
Having settled several substantial GLOs recently, Claire asked Polly to reflect on her experience working on cases with classes made up of tens of thousands of claimants. With these being some of the first the Milberg London team had managed, there were a few unexpected challenges during the payout process.
Opt-in: Historical data
A key learning from the experience was to be more proactive with data cleansing.
Polly explained that law firms need to have expert data talent to manage the vast amounts of data being collected. There is data coming in from public data bases, the clients themselves, and other sources as you on-board individuals. However, it can be years from the point of on-boarding to payment; there needs to be active management of the data - updating the historical data and reconciling information - to ensure that it not only being is kept up to date, but it is also being reviewed and cleared out to ensure the data points being held are relevant.
Opt-out: Urgent data processing
On this point of data cleansing, Clinton gave the Opt-out action perspective. He agreed that data cleansing is a big challenge, but conversely it is because of tight timelines. The highest volume of on-boarding is post-settlement, right before distribution. The difficulty is undergoing the process of data collection, verification, valuation and payment for tens, if not hundreds of thousands of class members within a very short period to get the funds distributed within the legal settlement timelines. There is greater urgency for these payments.
One of the greatest barriers legal teams will come up against is disbelief. Claire brought up the point that in our experience in the UK, we have a sceptical market. She commented that it was interesting to hear that it is also a challenge in the US and something that we all need to work together on changing perception.Even in a mature market with decades of experience there is still a lack of awareness and trust.
The word “scam” is often conflated with settlement and payout communications. While it is positive that consumers are highly alert to fraud, there is still a piece of work to do to educate the public around digital payments, in Claire’s words: “We need to educate that there are better [payment] methods than cheques and they are safe”.
The panellists agreed that this education piece needs to be done together. All stakeholders in the transaction need to be working together to communicate effectively with claimants to prepare them for the settlement and payment distribution process.
When it comes to transactions of this magnitude, there are a lot of stakeholders who want to know what’s going on at any given point. Clinton shared that he spends a lot of time reviewing spreadsheets. He jested that spreadsheets are “the bane of his life...even worse is a lawyer with a spreadsheet!”.
The solution to this is technology. Clinton explained that “data tells the truth”, it allows for real-time accuracy. There needs to be an interface to relay the information to the relevant parties, which is where APIs connecting platforms together and surfacing the information in dashboards enables enhanced communication. Which takes us on to the next part of the conversation…
Looking back on recent years in his technology and data career, Clinton shared that there have been major steps forwards in this space, especially emphasising the importance of the pandemic years as core drivers of automation and AI. It was over that period of time that we were “feeding the machine” - enabling technology to improve exponentially but also, making room for it to be deployed at greater scales and in new use cases.
Attitudes have also shifted, and we have “a totally new relationship with digital payments” such as voucher codes, pre-payment cards, online and open banking solutions, to name a few.
With these recent evolutions and advancements, we are seeing better and earlier integration of payment solutions into the end-to-end litigation process. For example, during the discussion, Polly referenced reconfiguring their CRM to allow for case mode and for distribution mode to allow for the paying agent, legal team and client care team to all be synced up throughout the process.
Looking back on recent years in his technology and data career, Clinton shared that there have been major steps forwards in this space, especially emphasising the importance of the pandemic years as core drivers of automation and AI. It was over that period of time that we were “feeding the machine” - enabling technology to improve exponentially but also, making room for it to be deployed at greater scales and in new use cases.
Attitudes have also shifted, and we have “a totally new relationship with digital payments” such as voucher codes, pre-payment cards, online and open banking solutions, to name a few.
With these recent evolutions and advancements, we are seeing better and earlier integration of payment solutions into the end-to-end litigation process. For example, during the discussion, Polly referenced reconfiguring their CRM to allow for case mode and for distribution mode to allow for the paying agent, legal team and client care team to all be synced up throughout the process.
Pogust Goodhead is an innovative and forward-thinking law firm with a strong belief that the industry must be adopting new technologies to constantly improve the efficiency of legal services, ultimately delivering an enhanced customer experience. For a firm that represents vast numbers of customers, their ability to deliver work quickly, accurately and securely is critical.
For claimants, a bank transfer is a simple way to gain access to their entitled compensation. The end recipient benefits from a smoother and much faster payment journey. In the words of a claimant from a recent 5-star Trustpilot review:
“[This was] one of the easiest, fastest and most secure transactions I have completed online.”
A thread that ran through the discussion was best practice for engaging with claimants throughout the settlement process.
Internal collaboration
Another key point is collaboration. Polly explained that internally, law firms need to get together and have “a few hats in the room” to deploy an effective, and compliant, communications campaign. She suggested that there should be:
From an external perspective and working with partners, all panellists re-emphasised the need to be aligned. There needs to be clear, concise messaging across the teams. Lawyers, client care teams, compliance, the payments partner, etc., all need to be saying the same things.
As a starting point for alignment, Polly shared her list of FAQs from claimants:
These questions should have standard answers, at minimum. There will be a host of secondary questions as well that need to be addressed and circulated around every stakeholder that communicates with claimants.
It is not easy to manage a large group of claimants, and that becomes apparent when communications go out that a settlement has been reached.
Polly explained that there are two ends of the scale – some are pleased and will follow procedures, but some are not so trusting and want to speak to someone and ask all the questions. Even with the best people running the client care and support teams, there is a strong likelihood that there will be escalations with individuals who sit on the latter half of Polly’s scale.
Law firms must work with their payments provider to not only have clear and aligned messaging, but also agreed lines of escalation to successfully manage disgruntled clients and avoid complaints.
The tail-end of the payout process
Shieldpay has achieved 95 - 98% completion of payouts for cases to date, but what happens to the final 2-5% of people?
From this summary of the conversation, it is clear that the panel successfully achieved their mission to debunk the myth that “payments are the easy part”, but with adequate planning, they can be quick and seamless.
Claire rounded off the discussion with a reminder that we have already gained a strong file of case studies distributing compensation funds for GLOs here in the UK, and even more experience around the globe in other jurisdictions. This conversation was to demonstrate our learnings and how we are working together to identify the blockers and implement new technology and process flows to streamline the payment journey.
It all comes back to that point of collaboration. We are in it together to build the most simple, convenient and secure payment experiences for claimants – they are at the heart of that journey.
