Article Covers A Gamut Of Class Action Fee Issues.
In the October/November 2016 issue of Practical Law, there is a nice article summarizing a gamut of issues relating to class action fee awards. Here are the major points made in this article:
• Appealability – Decisions on fee awards may be appealable, separate and apart from the underlying disposition or settlement of the class action.
• Standing to Appeal – A class member generally has standing to appeal, but must independently satisfy Article III standing requirements. In a common fund settlement, class members generally have standing to appeal. Class members might have standing to appeal a fee award if class counsel obtained an excessive fee in exchange for accepting an inadequate class settlement (with the fee award and class recovery considered to be a “constructive” common fund in these situations). However, if fees are paid by the defendant independently, class members usually lack standing unless there is evidence of collusion. A class member not participating in the settlement process (not filing a claim) might not have standing to appeal, although an objector can appeal a denial of his own fee claim. Usually, defendants do not have standing to appeal unless they have to pay fees individually or unless awarded under a statute allowing fees absent an agreement between the parties. Class counsel generally has standing to appeal the amount (or lack) of a fee award.
• Standard of Review—The usual standard of review is for abuse of discretion, including the methodology of the fee award (district judge’s use of the lodestar or a percentage of fund recovery method).