En Banc Court Stands by Ban on Class-Action Incentive Payments for Plaintiffs

Nearly two years after a divided three-three judge panel held that federal law prohibits “incentive payments” to named class representatives (see our previous blog post here), the Eleventh Circuit denied a petition to rehear that case en banc. Johnson v. NPAS Solutions, LLC, 2022 U.S. App. LEXIS 21455 (11th Cir. Aug. 3, 2022). The denial effectively upholds that prohibition across federal courts in Alabama, Florida, and Georgia.

Judge Jill Pryor (joined by Judges Wilson, Jordan, and Rosenbaum) dissented from the denial of rehearing en banc. Judge Pryor noted that the Second Circuit had “expressly rejected” the Eleventh Circuit’s “novel” interpretation of Supreme Court precedent on the issue, and she further observed that “since the majority opinion in this case issued, every court outside this circuit to have considered it has declined to follow it.”

Despite Judge Pryor’s concern that “the panel majority’s opinion threatens the very viability of class actions in this circuit,” Johnson’s ban on incentive awards is now the law throughout the Eleventh Circuit—at least unless the court decides to revisit the issue en banc in a future case or the Supreme Court decides to resolve the resulting circuit split.

Posted by Lee Peifer.

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