What is Miscellaneous Credit Litigation?

Miscellaneous Credit Litigation

The term ‘miscellaneous credit litigation’ is one that you might have come across in your bank statement at the end of the month. This might have left you wondering where this strange credit alert came from.

A miscellaneous credit litigation alert in your account arises as a result of a class action lawsuit in which you are a member of that class. You may not have been aware that you were a member of the class, though you should have been notified.

Legal processes are often unclear or vague to the layman, which leads to misinformation or an inability to practice their rights. Class action lawsuits are often a way of bringing justice to people who were unable to step up and seek it themselves.

As an individual, you should understand what situations you are entitled to sue in and what legal rights you possess. This way, you will be better equipped to understand what it means when legal matters come up concerning you.

Being a member of the class in a class action lawsuit can be a good way to learn about legal proceedings and get justice for wrongs that have been done to you. Still, it is important to know when you can take that step yourself and seek out justice.

In this article, we will be explaining what class action lawsuits are with in-depth examples of how these proceedings work. The ‘miscellaneous credit litigation’ tag on your bank account doesn’t have to confuse you anymore.

Similarly, you no longer have to wait for someone else to start the legal proceedings in a case where you are a member of the class. Instead, each individual can have comprehensive legal education that lets them speak up when they need to.

What is litigation?

In broad terms, the word “litigation” describes the entire process of taking a dispute to a court of law to be resolved. The process of litigation is very long and complex and can include and exclude different steps depending on the case.

Many cases are settled out of court and do not include a full litigation process. If a dispute is brought up between lawyers and settled between the included parties, this is not considered a full litigation process.

However, if parties are unable to come to an agreement between themselves and the case is taken to court in search of a fair resolution, the litigation process begins and can take months or even years to be resolved.

Litigation can be used to solve a myriad of cases, such as personal injury claims, personal or professional disputes, matrimonial issues, commercial matters, claims against government bodies, and many more.

In some situations, litigation can be carried out on behalf of a group of people if one person from that group speaks up and begins the litigation process. This is what is known as a class action or a class action lawsuit.

Stages of litigation

The litigation process can be divided into three broad stages that include many smaller stages and procedures. These are the issuing of proceedings and filing of defense, the pre-trial proceedings such as depositions, and the trial itself.

Issuance of proceedings

The litigation process starts with a formal issue of claims about a defendant. This includes the claim form and the statement of the case, which are the basic documents required to claim any party.

The claim form is a document that includes the names of the parties that are the subject of the claim as well as general details of the case, while the statement of the case gives a detailed account of the claim with facts to support it.

Once the claim form and statement of the case have been issued to the defendant, they will have to file a defense. Their defense can include an objection to the claims and a full defense filed by the defendant.

Objections to the claim can be filed if the facts stated in the statement of case are false or do not support the claim. The defendant can also request further information on the claim before filing their defense.


After the pleadings have been filed on both sides of the case, both parties have a clear idea of the stance of the other. Pre-trial proceedings can then occur with the knowledge of the basis of the dispute.

Pre-trial proceedings are usually carried out after groups have tried to settle to no avail. At different stages in the litigation process, parties will likely try to reach out of court settlements to avoid further litigation.

If either party refuses to reach a settlement agreement, litigation will continue to trial. The pre-trial stage allows both parties to prepare in every aspect that they need to before the trial. This includes research and acquiring documents.

Each party is legally obligated to disclose the documents and records in their possession to the other if they are relevant to the case. Both parties are also allowed to pursue depositions with witnesses or key personnel regarding the case.

Both parties must co-operate with each other when needed and disclose or provide whatever information or documentation is requested by the other. Obstructive behavior from either party in this stage can result in a penalty.


The trial is the open court process where both parties are presented with the opportunity to present whatever evidence, arguments, or witnesses they have to prove their case. The trial is headed by a judge or jury board.

The trial takes place over a previously estimated number of court days that can be spread out over months or even years. Court administrators inform both parties of trial dates, times, and locations so that all parties of interest are prepared.

The attorneys of both sides do the work of presenting their cases to the judicial officer in charge of the case and this is done by making compelling arguments, interrogating witnesses, and presenting pieces of evidence to the court.

The attorney is allowed to submit these pieces of evidence, witness testimonies, and more to build on their case which will then be judged by the judicial body in charge which can either be an individual judge or a jury board.

Once the trial has come to an end and both parties have submitted all they can for their case, the court makes a decision known as a judgment. This is the legal conclusion of a case and results in the defendant being found innocent or guilty.

If the defendant is found guilty, they can be charged with payments of reimbursement fees, prison time, fines, and other forms of punishment. If they are found innocent, they are allowed to go free. In some cases, the defendant may be found innocent of some charges and guilty of others.

What is a class action lawsuit?

A class action is a lawsuit filed by one or more plaintiffs on behalf of a large group of people who are referred to as a class. The class includes all people that are affected by the claims of the suit during the class period.

The purpose of a class action is to represent lawsuits in a more affordable manner as only the plaintiff that files the suit tries the case in court while all members of the class benefit from the outcome if the plaintiff wins.

The members of the class must all prove that they were victims of the claims laid out against the defendant which is why a class period exists. The class period is the predetermined amount of time for the class to qualify to belong.

The class action will usually follow the previously outlined steps for the process of litigation. The only difference is that the rulings of the court after the trial do not only affect the plaintiff but the entire class involved in the case.

Class action lawsuits are usually taken up against companies or corporations where people like customers or shareholders are the represented class who have been wronged in some way by the company.

If the plaintiff wins in a class action case, the rewards are distributed among the class. The extent of reimbursement received by each member of the class depends on how severely they were affected by the defendant.

Rule 23, a legal rule, spells out the criteria for a class action suit. The class in the lawsuit can be made up of customers, consumers, employees, patients, or any other group of individuals who have similar legal gripes against a defendant. Their claims could be anything from fraud to a breach of contract.

When a class action suit is being filed, the court order of the case must clearly define the class. This includes stating the class claims, the issues they have faced, their defenses, and who is serving as the class counsel.

Benefits of class action suits

There are a few benefits of filing a case as a class. The first of these is that class action lawsuits are very cost-efficient. This is because the individual members of the class do not have to pursue separate lawsuits but can all pursue their claims at once.

Another benefit of class actions is that they provide an accessible means of litigation for plaintiffs. Many people would never have pursued legal cases if not for the existence of a class to pursue it with. This may be for financial reasons or others.

Class action suits also provide a higher chance of success in pursuing claims against defendants due to their numbers. Individual cases may be easier to dismiss than class action cases and being a member of a class can give a good starting point for an individual to further pursue their legal claims.

Types of class action lawsuits

There are three main types of class actions. These include securities litigation, consumer product liability cases, and civil rights proceedings. In most class action cases, defendants will agree to settle at the pre-trial stage to avoid going to trial.

All types of class action suits can be filed by groups of individuals of different types. Out of these, civil rights class action suits are the most common and often include requests for legal remedies rather than payments or compensation.

Class action waivers

A class action waiver is a document that prevents individuals from filing class action lawsuits against companies. Many contracts between employers and employees or employees and customers include class action waivers to prevent class action litigation.

When filing a class action lawsuit, you will first have to verify that there are no class action waivers present in any contracts that have previously been signed. The presence of a class action waiver in a contract is often contested as it may be a means for companies to get away with things they shouldn’t.

How to file a class action lawsuit

If you are interested in filing a class action lawsuit, the first thing you have to do is contact a lawyer. The lawyer will help to determine whether your case is credible and whether your class can win the case.

They will then research to find out if there have been any similar cases in the past and examine the outcome of these cases. After all of these things have been assessed, your lawyer will advise on whether you should file the suit or not.

If a complaint is filed, it will have to include the details of the class action case. These details include the individuals affected by the case, the claims being raised against the defendant, the demands of the class, and so on.

Once the complaint is filed, the litigation process can begin and may ultimately lead to a trial or may be settled outside of court. The settlement class includes the members of the class that remain in the suit by the end as people have the option of excluding themselves from the class.

Most class action lawsuits end up in settlement. The settlement amount is distributed among all the members of the class and the litigation fees are usually covered by the plaintiff who initially filed the lawsuit. In some cases, a judge might rule that the defendant covers the litigation fees as well.

Why did I get miscellaneous credit litigation funds?

If you are a member of a class, even unknowingly, you are entitled to the settlement money obtained once a class action case has been won. This settlement amount shows up in your bank record with the tag ‘miscellaneous credit litigation’.

This means that the class action case was won and that is your cut of the settlement funds. In most cases, members of a class are aware that they are included in the class and can choose to opt out of the class action if they are not interested in the litigation.

However, in cases where members of the class were unaware of the class was so large that it includes more people than can be notified, the ‘miscellaneous credit litigation’ funds may come as a surprise to you.  

The Roberts v. Capital One Lawsuit

A recent class action suit that was filed and that we can use as an example is a suit against Capital One Bank. In this suit, a plaintiff sued the bank for charging overdraft fees to their bank account and those of other account holders, and Capital One bank had to settle.

The official title of the case was Roberts v. Capital One, N.A. Overdraft Settlement Program and was raised when the plaintiff, Tawanna M. Roberts, noticed that they were charged an overdraft fee on a debit card transaction.

The transaction was authorized with a positive available balance but resulted in a negative balance due to the overdraft fee. This led to Roberts filing the class action lawsuit against the bank with the class period being defined for different states.

Overdraft fees are essentially any fee charged to an account when there are insufficient funds in that account. This results in the account holder seeing a negative balance in their account which they will have to pay back.

Members of the class were notified of the suit and given the option to exclude themselves from the class before a certain deadline. The class period was stipulated and varied in different states. Customers of Capital One bank could check online if they were included in the class and then decide whether they wanted to remain in the lawsuit or not.

The settlement class was defined as current or former Capital One customers who received overdraft fees within the class period. Holders of Capital One 360 accounts were exempted because they were not affected by the claim.

A settlement for the case was reached in the southern district of New York with a conclusion that Capital One had breached its contract with its account holders, stating that the overdraft fees were improperly collected.

While Capital One remained adamant that they did no wrong, they agreed to pay the settlement fee to avoid further litigation and protect themselves from the effects that the litigation would incur on them.

The final settlement fee that was agreed on by Capital One amounted to 17 million dollars. This settlement would be distributed among members of the settlement class in the form of direct payment and account credits.

The amount distributed to each member of the class depended on how many people were included in the settlement class, the number of overdraft fees they each received, and how affected they were by these overdraft fees.

Capital One also agreed to pay Settlement Administration Costs separately from the settlement fees for the class. These costs amounted to $750,000 maximum. Alongside this, a service award was paid to the plaintiff by the bank and they also covered the attorney’s fees for the class counsel.

Each member of the class that remained until the settlement time would have received a credit alert labeled ‘miscellaneous credit litigation’ after the settlement was concluded. For members who wanted to be excluded from the class, they had to send an email stating so before a specified date.

Capital One data breach lawsuit

Capital One bank was the subject of another class action lawsuit very recently. This suit was filed against them due to a data breach that was discovered in their network in July 2019. This breach led to many of the bank’s customers being affected.

The data breach resulted in customers losing money, time, and resources as their data was hacked and they were subject to identity theft and other forms of cyber-crime. Capital One agreed to a $190 million settlement for the case.

The information that was compromised during the breach included names, phone numbers, addresses, emails, income statements, and more of credit card holders at the bank. This made it very easy for anyone to attempt cyber fraud with the information.

The settlement covers customers of Capital One who suffered losses that can be traced to the data breach during the class period. Members of the class can seek reimbursement for up to $25,000 worth of losses. These losses include:

· Costs of filing reports, monitoring of funds and credit, and other protective measures that had to be taken due to identity theft.

· The losses include the cost of fraudulent tax returns, identity theft, and any financial losses incurred due to that.

· Expenses incurred during the class period resulted in out-of-pocket losses to the customers.

· Credit freezes and damages to customers’ credit files.

There is also compensation for time spent managing the issue by customers included in the settlement fund. This is because many customers had to deal with the financial and emotional toll of being victims of identity theft and fraud.

Another benefit included in the settlement is that customers will receive at least three years of cyber security services aimed at identity defense from Pango, a data security company that works with Capital One.

These cyber security services include threat detection for identity fraud, online monitoring, identity verification, digital wallet protection, insurance, and many more means to ensure that customers are not victims again.

This was a very high-profile case which is why the settlement terms are so extreme. Some customers had their social security numbers compromised and the settlement terms provide credit monitoring services to such people.

Even victims of the data breach who have refused to file claims against the bank are allowed to receive identity defense services for at least three years from Pango. This gives them access to specialists that can help with fraud resolution and setting up alerts and systems to report any attempted fraudulent activities.

The class for this case includes up to 98 million United States citizens as reported by Capital One. It is the bank’s responsibility to send out a notice to these individuals of the settlement arrangements and inform them of their benefits.

An official settlement website was set up for the data breach to allow affected individuals to file their claims and be included in the settlement class. These people had to fill out a form with their claims for reimbursement and documentation that proves that they were victims of the breach.

Critiques of class action lawsuits

The merits of class action lawsuits are evident, but that does not mean that this method of pursuing legal justice is not without its disadvantages and critiques. For decades, class action lawsuits have been subject to different critiques.

One of the biggest praises of class action lawsuits is that they are an effective way to hold largescale defendants accountable for offenses that may not have been taken seriously as individual cases. However, one main critique of the method is how little compensation the class gets.

Because of the large number of people that usually make up a class, even when defendants are brought to justice for their wrongdoings, the class members rarely get a substantial amount in compensation once the case is over.

Another critique of class action cases comes from the angle that they are difficult to get off the ground. The class needs an attorney to represent them and litigation fees can be very high. If the attorney doesn’t believe the class will win, they will likely refuse the case.

From another angle, one of the biggest criticisms of class action cases are the attorney fees. In most cases, the attorneys end up receiving a large portion of the settlement fee while the rest is distributed among the class.

In some cases, the class counsel can request for up to 30% of the settlement fee, which leaves them with thousands of dollars while the affected parties may only get a few dollars or even cents. This is a situation that has been brought up in many different types of cases and not only class action cases.

Defendants are more eager to settle cases outside of court when they are facing a class rather than an individual. This gives attorneys more grounds to demand higher settlement fees and then pocket large percentages of these fees.

The entire litigation process in a class action case is usually totally controlled by the plaintiff’s lawyer. Because the members of the class have very little at stake individually, the lawyer can negotiate mostly for themselves.

Another criticism that class action cases have faced is that the attorneys who head these cases are not often looking for social justice but professional and financial accolades. This is because winning a class action case can result in significant recognition for the attorney or firm that handled it.


As we can see from all that has been mentioned, the ‘miscellaneous credit litigation’ tag entails much more than it seems. When banks issue such credit alerts, it is a sign that a class action case has been concluded.

Understanding class action cases means that you first have to understand litigation and what situations the law permits you to pursue legal recompense. There are many factors and stages included in the litigation process.

The ‘miscellaneous credit litigation’ tag is proof that the defendant in the class action case has paid off their settlement and the transaction is complete. Only a proper litigation process has the authority to demand that a defendant pay off a settlement like that.

There are many reasons for individuals to pursue class action cases. These could include professional issues like unpaid income or breached employee contracts or inability to pay different funds for various reasons.

Different types of companies, financial institutions, medical institutions, and others can be subject to class action cases. The examples we used included the bank Capital One to display the different ways that class action cases can be pursued.

In the first example, the issue was with overdraft fees which are annoying and can be problematic to the people affected. The bank agreed on a settlement for the affected parties and the case didn’t make it to court.

In the second case, the situation was direr with a class consisting of millions of people. You can see that the settlement terms were more intensive and cost the bank more than the previous case due to the severity of the case.

Class action cases can be pursued for both dire cases like the second example and less critical cases like the first. They provide a means for people to pursue legal cases in an affordable and easy-to-access manner.

On the side of the legal institutions, class action cases also benefit them. This is because dealing with multiple people through one case saves money resources and time that would have been spent on individual cases if the class action wasn’t filed.

Ultimately, class members in a class action case may end up being notified of the case or may be caught unaware by receiving settlement fees they were not expecting. Class members always have the option to exclude themselves from the class.

If you have ever received a settlement fee that you were unaware of, you can look up whether there were any class action cases that you were a member of the class without your knowledge. It is to your benefit to follow any cases that you are involved in or exclude yourself from the class while you still can.

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