Challenging a Core Assumption in Class Action Practice
For decades, courts have awarded representative plaintiffs in class actions an additional “incentive” or “service” payment on the premise that no one would take on the extra work without financial compensation. But new empirical research from Vanderbilt Law School challenges this foundational assumption—with implications for class action practice nationwide.
At Lawtechnology.ai, we monitor research that reshapes how legal professionals understand litigation dynamics. This study by Brian Fitzpatrick and Colton Cronin offers data that may surprise practitioners who’ve long relied on incentive awards as essential to class action viability.
The Johnson Decision: A Natural Experiment
In 2020, the U.S. Court of Appeals for the Eleventh Circuit became the first and only circuit to deem incentive awards unlawful in Johnson v. NPAS Solutions, LLC. This created a natural experiment: if incentive awards are truly necessary to attract representative plaintiffs, class action filings should decline in the Eleventh Circuit relative to other circuits.
The researchers analyzed nationwide class action filings from 2017-2024 using Lex Machina data, excluding securities cases (which are governed by a special statute). Their finding: no statistically significant reduction in non-securities filings in the Eleventh Circuit after Johnson, relative to other circuits.
Why People Serve Without Extra Pay
The authors express surprise at their own findings, noting that the results “cannot help but raise doubt about the veracity of the instrumentalist argument for representative payments.”
They explore several potential explanations:
Altruistic motivation: Class representatives may serve to right a wrong or help others. The researchers note this theory was confirmed anecdotally through conversations with class action attorneys—some plaintiffs genuinely want to pursue justice regardless of personal financial benefit.
Judicial workarounds: Lower courts in the Eleventh Circuit may not be strictly following Johnson. District judges have begun holding that the decision doesn’t apply to diversity cases. However, the study found no effect on filings even in non-diversity cases where Johnson should clearly apply.
Principled participation: Some class members may view representative service as a civic or principled duty, separate from financial incentive.
Implications for Practice
The research carries significant implications for class action practitioners:
For plaintiffs’ attorneys: The data suggests that finding willing class representatives may be less dependent on promised incentive awards than conventional wisdom holds. This could affect case strategy and client conversations about realistic expectations.
For defense counsel: The study provides empirical ammunition for challenging incentive award requests, particularly in circuits that haven’t addressed the Johnson ruling.
For courts: As the authors note, the findings “may give courts and commentators additional reason to rethink the prevailing practices in federal court.” Other circuits may reconsider their approach to incentive awards given evidence that they may not be necessary to maintain class action viability.
For policy discussions: The research informs ongoing debates about class action reform and the economics of representative litigation.
The Broader Question
The study doesn’t definitively answer whether incentive awards should be permitted—only whether they appear necessary to sustain class action filing rates. The Eleventh Circuit’s Johnson decision was based on historical legal grounds, not economic necessity.
But the empirical finding matters because much of the justification for incentive awards has rested on the assumption that without them, no one would serve. If that assumption is wrong—if class members serve for selfless or principled reasons—the policy calculus shifts.
Study Authors
Brian Fitzpatrick is the Milton R. Underwood Chair in Free Enterprise at Vanderbilt Law. Colton Cronin is a fifth-year student in the Law & Economics Ph.D. program at Vanderbilt Law. Their article “Do Representative Payments Matter? An Empirical Study” appears in the Journal of Empirical Legal Studies.
Access the complete Vanderbilt Law School coverage for additional context on this research.