Ever wonder what happens to unclaimed cash left on the table after a company settles a big lawsuit with a large group of people? It can amount to tens of millions of dollars. In most of the U.S., it usually goes right back to the company or person accused of cheating or causing harm in the first place.
But it doesnt have to.
In 11 states, this unclaimed money is fueling better health, better schools, food banks, housing and legal assistance for those in need.
A pioneering movement based in Dr. Mikes hometown (were talking about you, Cleveland!) is urging lawyers in Ohio and beyond to lead the charge.
Patrick Perotti, a partner in the northeast Ohio law firm of Dworken & Bernstein, got the ball rolling several years ago when he discovered that there were hundreds of thousands of dollars left over in one of his first consumer class-action lawsuits. Wielding a legal concept called cy pres (pronounced sigh-PRAY), which means as near as possible, he argued that the funds should go to charity. They did, and he vowed never to settle a class action without considering the use of cy pres for unclaimed funds.
That was just the beginning. Perotti and his partners founded Ohio Lawyers Give Back to help spread the word. The group estimates that $500 million in class-action settlement money goes uncollected each year across the U.S.
To date, Mr. Perotti has distributed more than $25 million to more than 187 groups that help fight and prevent a variety of diseases and ailments. Kids have been the big winners, with funds going to help a childrens hospital, a kids emergency room, schools, after-school programs, projects that provide warm clothing and shoes, and programs for pregnant women and mothers with new babies, too.
Want to help?
Make your state a Smart State. If you live in one of 11 smart states California, Hawaii, Illinois, Indiana, Massachusetts, North Carolina, New Mexico, Pennsylvania, South Dakota, Tennessee and Washington, according to the National Law Journal rules direct lawyers to make plans upfront for this unspent money, usually earmarking it for legal aid or charities. But in the rest of the states, there usually are no provisions.
So if you dont live in one of the states, spread the word; and if youre a lawyer, our friends at Ohio Lawyers Give Back can help you reclaim and redirect leftover funds from class-action suits youve worked on.
By the way, if you try to make this a state law, you probably will run into resistance. Opposition by the Chamber of Commerce is why this smart idea was not enacted as law yet in Ohio (according to one key politician we spoke with). But even where it is not a law, each plaintiffs lawyer can insist on such a community-building resolution. And lawyers wont earn an extra dime by doing this but the rewards are priceless.
Mehmet Oz, M.D., is host of The Dr. Oz Show, and Mike Roizen, M.D., is chief medical officer at the Cleveland Clinic Wellness Institute.