What is Automatic Distribution (direct Distribution)?

Class action glossary term

Short Definition

A settlement where eligible people are paid automatically (no claim form) because the defendant or administrator has the needed records.

What It Means

Some settlements pay automatically when class members can be identified from account records, transaction data, or employer files. You might receive a check, account credit, or digital payment unless you opt out. You still should watch for notices in case you need to update your address or choose a payment method.

Example

Example: A bank fee settlement that credits current account holders and mails checks to former customers.

Why It Matters

It’s the easiest way to get paid—but you can still miss out if your contact info is outdated.

Related Terms

Settlement administrator

Settlement notice (class notice)

Opt out (request exclusion)

Primary Source

Manual for Complex Litigation, Fourth (Federal Judicial Center)

Transparency

This class action term is explained for general informational purposes only and does not constitute legal advice. Definitions and applications may vary by jurisdiction and case context.

To see how this term is applied in real cases, explore current and past class action settlements.