How Much Do Class Action Lawyers Get Paid?
Class counsel don't bill class members. They take a court-approved fee from the recovery, usually set as a percentage of the fund or based on hours worked.
Class action lawyers are usually paid a fee that a judge approves at the end of the case, and only if there is a recovery. The fee is most often calculated as a percentage of the settlement fund, commonly somewhere in the range of a quarter to a third in many federal courts, or based on the hours the lawyers worked multiplied by a reasonable hourly rate. Class members do not pay class counsel out of pocket. The exact amount varies widely and depends on the court, the size of the settlement, and the work involved.
Why judges set the fee
Class members don't sign a fee agreement with class counsel, so there is no private contract to rely on. Instead, Federal Rule of Civil Procedure 23(h) lets the court award reasonable attorneys' fees and costs. Class members must be told about the fee request and can object to it. The judge has the final say and can award less than counsel asked for.
The percentage-of-the-fund method
Under the common fund doctrine, lawyers who create a fund for the benefit of others can be paid from it. Courts often award a percentage of the total. Some appeals courts use benchmarks as a starting point and then adjust up or down. Percentages for very large settlements are often lower, because a small percentage of a huge fund can still be a very large fee.
The lodestar method
The lodestar method multiplies the hours reasonably spent on the case by a reasonable hourly rate. Courts may then apply a multiplier to reward risk or exceptional results, or reduce it for inefficiency. Many judges use the lodestar as a cross-check on a percentage award, to make sure the fee isn't out of line with the actual work.
What judges look at
- ✓The results achieved for the class, ideally what class members actually receive.
- ✓The risk the lawyers took, since they could have lost and been paid nothing.
- ✓The complexity and length of the case.
- ✓The skill and quality of the work.
- ✓Fees awarded in similar cases.
- ✓Any objections from class members.
Under the Class Action Fairness Act, when a settlement pays class members in coupons, the part of the fee tied to those coupons must be based on the value of coupons actually redeemed, not their face value.
Why the fee can look large
Headlines often compare a big fee with small individual payments. That comparison is real, but it leaves some things out. Class counsel usually advance all the costs of litigation, including experts and document review, and work for years with no guarantee of payment. Many cases are lost or dismissed, and those lawyers recover nothing. The fee on successful cases funds that risk.
Still, fees deserve scrutiny. A fee calculated on a large fund that mostly goes unclaimed, or on non-cash relief of uncertain value, can overcompensate the lawyers relative to what the class gets. That is one of the most common grounds for objections. Our guide to judging whether a settlement is fair covers it.
How fees affect your payment
In many settlements, fees come out of the fund before class members are paid, so a larger fee means a smaller net fund. In others, the defendant pays fees separately and they don't reduce the class recovery. Read the settlement agreement or the notice to see which model your case uses.
What about named plaintiffs?
Named plaintiffs are not paid a salary. Courts may approve a modest service award, sometimes called an incentive award, to recognize their time and effort. Not every court allows them, and the amount must be approved by the judge.
Where to find the actual fee
The class notice usually states the maximum fee counsel will request. The full fee motion is often posted on the settlement website before the objection deadline, and the final award appears in the court's approval order, which you can find on the docket.
When lawyers get paid nothing
The contingency model means class counsel carry the downside. If the case is dismissed, certification is denied, or the defendant wins at trial, the lawyers typically recover neither their time nor the expenses they advanced. That risk is one reason courts allow a meaningful fee when a case succeeds.
You don't need to pay anyone to file a class action claim. SettleScout helps you find settlements you match and reminds you before the deadline, and you file directly on the official administrator's site.
Frequently Asked Questions
What percentage do class action lawyers take?
It varies by court and case. Percentage awards in many federal courts commonly fall somewhere around a quarter to a third of the fund, and they are often lower for very large settlements. The judge sets the final amount.
Do I have to pay the class action lawyer?
No. Class members don't pay class counsel directly. Fees are approved by the court and paid from the settlement or separately by the defendant.
Can class members object to attorneys' fees?
Yes. Rule 23(h) requires notice of the fee request, and class members can object to it by the deadline in the notice. The judge considers objections before awarding fees.
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