Since 2005 and passage of the Class Action Fairness Act, scholars have bemoaned the ongoing attack on class action procedures. Much of this work has focused on judicial reinterpretations of Federal Rule of Civil Procedure 23. Plaintiffs face new prerequisites to aggregating their claims such as: (1) stricter pleading standards; (2) the judicially created “ascertainability requirement”; and (3) earlier and more frequent Daubert motions, just to name a few. These increased procedural hurdles are already hampering private enforcement efforts. In 2022, the Eleventh Circuit lobbed a new challenge when it banned incentive awards for class representatives in Johnson v. NPAS Solutions, LLC. Alexander J. Noronha explores the decision—warts and all—in his student note.
Incentive awards are never guaranteed; plaintiffs file motions articulating why class representatives deserve recompense beyond their share of a settlement or judgment award. Judges evaluate these requests using multiple factors to consider representatives’ efforts on behalf of the class. Since passage of Rule 23 in 1966, courts in every circuit have approved such motions under the right circumstances—despite Rule 23 providing no explicit authority for such awards. In categorically foreclosing such awards, the Eleventh Circuit upended close to fifty years of precedent.
Noronha begins by succinctly chronicling the general history of class actions and the specific history of incentive awards. He details how such awards are rooted in equity, not statutory or constitutional authority. Courts and commentators have rationalized such recompense as necessary given services rendered to the class, including time, labor, and reputational costs incurred. Noronha maintains that these awards play a critical role in incentivizing individuals to serve as class representatives and private attorneys general, thereby advancing access to justice and enforcement of laws critical to the public interest.
With this background in place, Noronha moves to Johnson. He explains how the Eleventh Circuit anchored its reasoning in late nineteenth-century Supreme Court jurisprudence, primarily Trustees v. Greenbough (1881), an equity suit brought by a creditor alleging wrongdoing by the trustees of a fund. The prevailing plaintiff sought a substantial portion of the trust fund to offset travel expenses and pay him a salary for pursuing the suit. The Court permitted recovery of reasonable costs and attorney’s fees, creating what has become known as the “common fund doctrine.” But the Court denied plaintiff’s request for compensation for personal services and private expenses. Applying this hoary precedent, the Eleventh Circuit denied the request for an incentive award, deeming it “part salary and part bounty” and thereby improper.
Noronha argues that the Eleventh Circuit “overlooked crucial historical and legal context.” This dismantling of the Eleventh Circuit’s rationale represents the article’s biggest contribution. First, Greenough is the product of an anachronistic form of litigation, too distinguishable from the modern class action to warrant barring incentive awards. Relatedly, Greenough was an “equity receivership” suit, a form of litigation once commonplace but now obsolete. Thus, the decision proves a faulty foundation from which to render a blanket prohibition against class action incentive awards. As Noronha points out, equity receiverships are a closer analogue to Chapter 11 reorganizations than class actions.
Noronha next articulates how the policy concerns underlying Greenough do not translate to the class action context. Greenough sought to protect against creditors meddling with trust funds for their personal gain. But Federal Rule of Civil Procedure 23 provides safeguards against such meddling. The Eleventh Circuit failed to explain why further protection, in barring incentive awards, was warranted for class actions.
Finally, Noronha distinguishes the modest amounts (a few thousand dollars) plaintiffs seek as incentive awards from the “approximately $1.3 million in 2002 dollars” the Greenough plaintiff sought. The plaintiff in Greenough essentially demanded the equivalent of ten years salary simply for suing. In contrast, class representatives do not receive huge amounts of money for simply suing; they seek compensation for their risks and contributions, based on a multi-factor judicial test.
By debunking the primary authority on which the Eleventh Circuit relied, Noronha provides other circuits ample justification to reach a contrary conclusion. Nonetheless, Noronha proposes additional solutions should Johnson spread. One novel idea reconceptualizes incentive awards as costs, moving them squarely within the purview of costs and fees recoverable under Federal Rule of Civil Procedure 54(d). Unlike incentive awards, which lack statutory grounding, Rule 54 affords courts clear authority to permit discretionary cost awards to class representatives. Although attorneys have yet to rely on this rule to request incentive awards, Noronha convincingly argues how this approach is both historically and legally defensible.
On Behalf of All Others reminds us of the value of student notes in legal scholarship. Noronha’s article offers new insights, particularly regarding the history of incentive awards—limited as that history may be. When well done, as here, a note can illuminate corners of procedure heretofore underexplored.
