Plaintiffs ” incentive ” awards slashed in US data breach deal

  • DC federal judge approves deal resolving privacy claims
  • Incentive payments to plaintiffs in sharp focus in recent cases

(Reuters) – A federal judge on Friday said she will slash thousands of dollars in proposed “incentive” awards for plaintiffs who settled data-breach claims against the US Office of Personnel Management, as the court prepares to issue a final order approving the $ 63 million deal.

US District Judge Amy Berman Jackson in Washington, DC, at a hearing said she will approve a “nominal” amount of $ 1,000 for 36 named plaintiffs who led the privacy case against the Office of Personnel Management (OPM), the primary human resources agency in the federal government.

The plaintiffs’ attorneys had argued for $ 5,000 payments for a total of $ 180,000.

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The legality of incentive awards, which are payments to plaintiffs who played key roles in litigation, have come into sharp focus in several recent big cases. A federal appeals court in 2020 said a winning plaintiff suing on behalf of a class can recover legal fees and expenses but nothing more.

Incentive awards recognize the time a plaintiff has dedicated to a case and the risk of being involved.

Jackson said the plaintiffs in the OPM data breach litigation had not been deposed or required to attend numerous court hearings. “We never got into the factual issues at all,” Jackson said.

The OPM settlement resolves allegations against the agency that a systems breach in 2015 compromised sensitive information of millions of current and former US employees.

The Justice Department supported the settlement amount but objected to the $ 180,000 in incentive awards.

The government acknowledged that incentive awards “are often reflexively” approved but also pointed out that some courts have expressed concern “because they represent a bounty that plaintiffs may expect simply for bringing suit.”

A Justice Department spokesperson on Friday did not immediately respond to a message seeking comment.

Plaintiffs ‘attorney Daniel Girard of Girard Sharp said “the court recognized their clients’ commitment and contributions to this case.”

In a recent case involving an Apple Inc settlement, the plaintiffs’ lawyers sought $ 3,500 for each of the nine named plaintiffs who were deposed and $ 1,500 for other plaintiffs.

A panel of the 9th US Circuit Court of Appeals ordered a new look at the settlement but noted in its ruling that incentive awards are lawful.

Such “awards cannot categorically be rejected or approved,” Circuit Judge Jacqueline Nguyen wrote for the 9th Circuit panel in the Apple case. “So long as they are reasonable, they can be awarded.”

The 9th Circuit’s view contrasted with an 11th Circuit ruling in 2020 that said two late 19th century US Supreme Court decisions prohibited awards to lead class representatives.

The case is In re: Office of Personnel Management Data Security Breach Litigation, US District Court for the District of Columbia, No. 1: 15-mc-01394-ABJ.

For plaintiffs: Daniel Girard of Girard Sharp

For OPM: Elizabeth Shapiro of the Justice Department

Read more:

US Justice Dept. fights class ‘incentive’ awards in $ 63 million privacy pact

Split deepens on incentive awards for class representatives

Coming soon to the Supreme Court: Can class reps receive incentive awards?

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Our Standards: The Thomson Reuters Trust Principles.


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