Glossary

Class action lawsuits are a type of lawsuit that is brought by a single, affected individual on behalf of a large group of similarly affected individuals. Class actions were created by the judicial system because, frequently, the number of plaintiffs involved in a lawsuit is so numerous that it would be onerous to name and adjudicate the claims of all plaintiffs on an individual basis.

The Class Action Fairness Act of 2005 (CAFA) is a law intended to prevent abuses associated with class action lawsuits. CAFA places class action cases under federal jurisdiction (previously, such cases were within the jurisdiction of state courts), provided the amount at issue is greater than $5 million. CAFA also makes it more difficult for plaintiffs to go "forum shopping" in search of jurisdictions known for class action lawsuit abuses. Another important provision within CAFA contains procedures for judicial review of attorneys' fees, which are often excessive relative to the recoveries received by plaintiffs. Opponents of CAFA have asserted that these changes will deny aggrieved persons their day in court by making it much more difficult to bring class action suits and that taking such cases out of state court jurisdiction will clog the federal courts' dockets.

Class action waivers are provisions in an arbitration agreement or other contract or agreement in which one party (e.g., the employee) waives the right to file a class action lawsuit against the other party (e.g., the employer). Any potential recourse is thereby restricted to individual legal action. The validity of class action waivers under the Federal Arbitration Act (FAA) and the National Labor Relations Act (NLRA) has been upheld by the Supreme Court as recently as 2018, in a decision that thereby mitigates employment practices liability (EPL) and benefits employers.

A class III railroad has operating revenues of $36.6 million or less. Also known as a short-line railroad.

A class II railroad has operating revenues between $36.6 million and $457.9 million.

Under the Clean Air Act, a class I area is one in which visibility is protected more stringently than under the National Ambient Air Quality Standards (NAAQS); it includes national parks, wilderness areas, monuments, and other areas of special national and cultural significance.

A class I railroad has operating revenues that exceed $457.9 million.

Class of business refers to an industry classification according to the perils insured and the exposure. The purpose is to group homogeneous risks for purposes of rate development.

Class rating is an Insurance Office Services, Inc. (ISO), method of determining property insurance premium for properties occupied by businesses that fall into certain "classes," provided that they meet certain eligibility criteria. Properties that do not qualify for class rating (generally, large or specially protected properties or properties that have high-risk or unusual occupancies) must be specifically rated, using rates that are specific to those particular properties, as determined by physical inspection of the property.

A clause is a section of a policy contract or of an endorsement attached to it dealing with a particular subject in the contract—for example, the "insuring clause" or the "coinsurance clause."