In most (all?) other developed nations it is the role of the executive branch of the elected government to regulate and punish businesses so as to prevent defuse harms. This business with the civil justice system being distorted to create self appointed, profit seeking, ad hoc regulators is not the only way to skin the cat.
If the state isn't going to prosecute big businesses for misbehaving, say goodbye to _any_ public support for business at all, small or bit.
There was a philosophy that said, 'markets are important, so when a big player misbehaves, make sure the state his them HARD, otherwise people will lose faith in the markets'
Now the prevailing attitude is 'these people can't be allowed to fail or the whole system will fall down.' And then, to nobody's surprise, they misbehave.
As to the question of criminal prosecution or harsher penalties (e.g. dissolving the corporation): to my knowledge, these suits actually draw AG attention to areas of civil misbehavior which often borders criminal misbehavior. They even surface which citizens were harmed and bring forth information gained by discovery, etc. Thus class action lawsuits actually make it easier for the government to act — that they should prosecute but do not is an independent problem.
I'm not sure, but is civil disclosure readily accessible to prosecutors? I thought normally it was kept confidential, and thus would only be available in the case of an active criminal case. I would expect that prosecutors wouldn't be able to trawl through it searching for evidence of wrongdoing, and there's some procedure around that in parallel construction, but I'm not a lawyer and I can't find any specific discussion of that matter particularly.
Under what law?
If there's some specific law they violated, then by all means, prosecute them. But you can't post-facto say "that seems like it was wrong" and prosecute; you can only say "we should pass laws to make that wrong in the future" and prosecute further offenders.
(For instance, they clearly violated insider trading laws. But what other laws, actually written and on the books, did they violate?)
We can and we have. There are a few justification loopholes that have been used in the past, but we can say something is so wrong that laws can be passed after the fact to punish people engaging in it. This power is dangerous, but so is many other government powers currently used.
American owners of diesel VWs might have their cars bought back from them and be offered up to $10k in additional compensation. Furthermore VW has portrayed this as an obvious decision they made because they love their customers and want to make things right again.
The same customers in Germany might get a free "upgrade" at the dealership which reduces airflow so that the car is compliant with pollution regulations, but less powerful.
I'm not here to say that class actions are the best, or even a good way of regulating, but I really don't see how the joinder rules offer a useful solution.
