Thomas J. Dart, Sheriff, Cook County, Illinois, et al. v. Quintin Scott

The Seventh Circuit allows class representatives to receive “incentive awards” specially compensating them for costs incurred in that role. It justifies these awards on the theory that class plaintiffs are mere “agents” of the “real principals” – class counsel – who need to be reimbursed the money promised to induce class representatives to sue despite the risk their class claims will be sanctionably frivolous. But when called on to name the legal authority for incentive awards, as required to show redressability under Article III, the Seventh Circuit identified only Fed. R. Civ. P. 23(e)’s language requiring judicial approval of class settlements, despite this case involving no certified class, nor a class settlement to approve. Under Rule 23(e), the court declared, a putative class representative seeking an incentive award has Article III standing to continue class litigation even after receiving relief on his individual claims. This ruling deepened an entrenched circuit conflict regarding the legality of incentive awards, over the warning of Judge Easterbrook and Chief Judge Sykes that this broad understanding of Article III means “everyone would have standing to litigate about anything.” The question presented is: Does a putative class representative have Article III standing solely to seek an “incentive award” nowhere authorized by statute, rule, or historic principles of equity?