Eric Alan Isaacson v. National Veterans Legal Services Program, et al.

“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 litigants for serving as representative plaintiffs in class-action litigation. Johnson v. NPAS Solutions, LLC, 975 F.3d 1244, 1255 (11th Cir.2020), reh’g denied, 43 F.4th 1138 (11th Cir.2022). Five other circuits have rejected that conclusion, finding it superseded by modern class-action practice. The question presented is: May district courts, consistent with the common-fund doctrine of Greenough and Pettus, and without authorization by statute or rule, approve payments from class-action commonfund settlement funds to reward litigants for serving as representative plaintiffs?