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11th Circuit Ruling Against Class Incentive Awards Still Causing Confusion, Conflicting Approaches

By Lance A. Harke
Incentive awards have long been justified as necessary to incentivize named plaintiffs to step forward and incur unique burdens on behalf of the class well beyond the prospect of a limited class member recovery.
Incentive awards have long been justified as necessary to incentivize named plaintiffs to step forward and incur unique burdens on behalf of the class well beyond the prospect of a limited class member recovery.

These awards have been routine in class actions around the country.

In a split decision last year, the 11th Circuit surprised the class action bar by rejecting a proposed $6,000 incentive award to the class representative as part of a settlement in a fairly straightforward TCPA case. According to the Johnson majority, Supreme Court precedent dating back to the 19th Century prohibits such awards, which have been customary and routine in class action jurisprudence throughout the country, including the 11th Circuit, for many decades.  Incentive awards have long been justified as necessary to incentivize named plaintiffs to step forward and incur unique burdens on behalf of the class well beyond the prospect of a limited class member recovery. The 11th Circuit stands alone in rejecting incentive awards on this basis, and the ruling has led to conflicting approaches for class action attorneys and district judges within the 11th Circuit seeking to modestly compensate lead plaintiffs for the time and effort expended to represent settlement classes.

In the most recent ruling addressing this issue, Southern District of Florida United States Judge Jose Martinez rejected a proposed $5,000 incentive award to the class representative in a settlement involving Covid-related tuition fees. The judge otherwise approved the $2.4 million deal, which included an $800,000 fee award to class counsel.  The court specifically rejected the approach other district courts within the Circuit have sometimes adopted, which is to reserve jurisdiction on the incentive award in the event the 11th Circuit eventually reverses its decision.

As Judge Martinez mentioned, the 11th Circuit has withheld issuance of the mandate in Johnson and is currently accepting briefing on rehearing.  UWWM will continue to monitor developments in this and other class and mass tort actions, and will publish additional bulletins and updates for the benefit of its clients and colleagues.

UWWM will continue to monitor developments in this and other class and mass tort actions, and will publish additional bulletins and updates for the benefit of its clients and colleagues.

The select mediators and arbitrators at UWWM’s Center for National Class and Mass Actions have decades of specific experience in class and mass actions and are uniquely qualified to assist you in resolving these legal disputes.  For further information and scheduling, please visit our website.


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