"There's a certain amount of good faith that administrators will do what they say they will do," said John Nadolenco, a partner in the class-action group at Mayer, Brown, Rowe & Maw in San Diego.

Plaintiffs and defense lawyers typically select settlement administrators by mutual consent. "There aren't that many to choose from, so it's pretty easy to agree on who you're going to use," said Lewis Kahn, managing partner at Kahn Gauthier Swick, in New Orleans, which specializes in product liability and stock-fraud class-actions.

The most popular administrators include Garden City Group, of Melville, New York; Poorman-Douglas, of Beaverton, Oregon; Gilardi & Co., of San Rafael, California; Analytics Inc., of Chanhassen, Minnesota; and Rust Consulting, of Minneapolis.

Though administrators occasionally submit bids for large contracts, many times lawyers choose firms based on past experience. "It'd be really hard to break into the field, since no one wants to use someone they don't have any experience with," says Nadolenco. Administrators are paid a flat fee out of the settlement fund. Compensation can range from thousands to millions of dollars, depending on the size and complexity of the job.

"With a cap on their fee, there's only so much an administrator can do to get in touch with class members and still make a profit," said Francis E. McGovern, a professor at Duke Law School, in Durham, North Carolina, and an expert in mass-claim litigation. "I'm not sure there's abuse going on, but there are obviously inherent problems with the system."

Administrators said it would be against their interest not to be conscientious in executing settlements. "This is a very small market, and you live or die on residual good will," said Richard Simmons, president of Analytics. "You survive by not screwing up."

And that requires a technologically sophisticated operation capable of tracking tens of millions of pieces of mail, not to mention every call received by toll-free call centers.

"The amount of data you have to keep track of in this business is enormous," said James Blayney, president of Rust Consulting, which has a 1,200-line call center and 135,000-square-foot sorting and storage facility. "No one may ask to see all that data, but we have it should they ask for it."