Eric Alan Isaacson v. Meta Platforms, Inc., fka Facebook, Inc.

“Since the decisions in Trustees v. Greenough, 105 U.S. 527 (1882), and Central Railroad & Banking Co. v. Pettus, 113 U.S. 116 (1885), this Court has recognized consistently that a litigant or a lawyer who recovers a common fund for the benefit of persons other than himself or his client is entitled to a reasonable attorney’s fee from the fund as a whole,” Boeing Co. v. Van Gemert, 444 U.S. 472, 478 (1980), provided the fee award is “made with moderation.” Greenough, 105 U.S. at 536-37. But payments to representative plaintiffs for their own “personal services” in the case are “decidedly objectionable,” “illegally made,” id. at 537- 38, and “unsupported by reason or authority.” Pettus, 113 U.S. at 122. The Eleventh Circuit thus holds that “Supreme Court precedent prohibits incentive awards” to reward settling plaintiffs for serving as class representatives. Johnson v. NPAS Solutions, LLC, 975 F.3d 1244, 1255 (11th Cir.2020). The First, Second, Seventh, and Ninth Circuits reject that conclusion, holding that Greenough and Pettus no longer bind them. Ignoring Greenough’s mandate that fee awards be “made with moderation,” moreover, lower courts regularly approve of paying class-action lawyers several times the unenhanced lodestar that this Court holds is a presumptively reasonable attorney’s fee in fee-shifting cases. The questions presented are:

1. May district courts approve payments from class-action settlement funds to reward and encourage litigants for service as representative plaintiffs?

2. May district courts in common-fund cases pay class-action lawyers multiples of their lodestar, unconstrained by this Court’s precedents on reasonable attorney’s fees?