Professor Howard Erichson was quoted in Law360 sharing his expert opinion on incentive payments and class action settlements.
Employment lawyers should consider retooling class action settlement agreements to make sure that questions about incentive payments for lead plaintiffs don’t blow up the whole deal in light of a recent Eleventh Circuit ruling, attorneys say.
Incentive payments compensate named plaintiffs for the time and stress of litigating on behalf of others. The Eleventh Circuit’s Sept. 17 panel decision in Johnson v. NPAS Solutions LLC questioned whether the named plaintiffs could consider OK’ing a classwide settlement out of self-interest, rather than doing what’s good for class members, because of the payments.
“On the one hand, incentive payments are important if we want people to be willing to serve as class representatives,” Howard Erichson, a civil procedure professor at Fordham University School of Law, told Law360. “On the other hand, the Eleventh Circuit is right that when class representatives are given a bonus for going along with a settlement, then that puts them in a conflicted position vis-à-vis the class.”