United States Court of Appeals

For the Eighth Circuit

___________________________

No. 15-3191

___________________________

Robert McKeage; Janet McKeage, on behalf of themselves and all others similarly

situated

lllllllllllllllllllll Plaintiffs - Appellees

v.

TMBC, LLC

lllllllllllllllllllll Defendant - Appellant

Tracker Marine Retail, LLC; Bass Pro Outdoor World, LLC

lllllllllllllllllllll Defendants

___________________________

No. 15-3286

___________________________

Robert McKeage; Janet McKeage, on behalf of themselves and all others similarly

situated

lllllllllllllllllllll Plaintiffs - Appellants

v.

TMBC, LLC

lllllllllllllllllllll Defendant - Appellee
Tracker Marine Retail, LLC; Bass Pro Outdoor World, LLC

lllllllllllllllllllll Defendants

____________

Appeals from United States District Court 

for the Western District of Missouri - Springfield

____________

 Submitted: September 22, 2016

 Filed: February 13, 2017

[Published] 

____________

Before WOLLMAN, BRIGHT, and KELLY, Circuit Judges. 1

____________

PER CURIAM.

Robert and Janet McKeage brought this class action lawsuit to challenge

TMBC’s nationwide practice of charging a document fee when selling boats and

2

trailers under form contracts governed by Missouri law. After approving class

certification, the district court determined that TMBC prepared legal documents

attendant to its sales and that charging a fee for those documents constituted

unauthorized law business in violation of Mo. Rev. Stat. §§ 484.010 and 484.020. 

The district court granted summary judgment in favor of the class and awarded treble

The Honorable Myron H. Bright died on December 12, 2016. This opinion is 1

being filed by the remaining judges of the panel pursuant to 8th Cir. Rule 47E. It

incorporates in large part the views expressed by Judge Bright during the pendency

of this case. 

TMBC, LLC’s parent company is Tracker Marine Retail, LLC. Tracker 2

Marine Retail, LLC’s parent company is Bass Pro Group, LLC.

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damages in the amount of $21,735,754. The district court also awarded attorneys’

feesto class counsel in the amount of $2,425,359, to be paid out of the common fund.

TMBC filed an appeal challenging the class certification, grant of summary

judgment, and application of Missouri law to sales that occurred outside Missouri. 

The McKeages filed a cross appeal to enforce the fee-shifting provision in TMBC’s

contract and to challenge the district court’s calculation of fees based on the amount

of untrebled damages rather than the entire common fund. We affirm the district

court on the main appeal. We reverse and remand for further proceedings on the

cross appeal.

I

TMBC is a corporation headquartered in Springfield, Missouri. It sells boats

and trailers through dealerships across the nation, most of which are located within

Bass Pro Shops. On May 23, 2008, Robert and Janet McKeage purchased a boat 3

from TMBC at the Tracker Boat Center located inside the Bass Pro Shop in St.

Charles, Missouri. The purchase was memorialized in a standard form contract

TMBC has used since 2007, which has a choice-of-law provision that states, in

relevant part:

GOVERNING LAW. THE PARTIES AGREE THAT THIS

AGREEMENT SHALL BE GOVERNED BY THE LAWS OF

MISSOURI. The venue for any action or proceeding arising from this

Agreement . . . shall be in Greene County, Missouri. The prevailing

party in any such action or proceeding shall be entitled to recover all

litigation costs and expenses, including reasonable attorneys’ fees at all

levels of litigation . . . .

As of 2008, TMBC operated seventy-three dealerships nationwide. Fifty-two 3

of those dealerships were located within Bass Pro Shops, and twenty-one were

freestanding dealerships.

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As part of the contract, TMBC charged the McKeages a $75 “document fee.” TMBC

charged the fee to cover the cost of preparing and/or completing documents such as

the form contract itself (sometimes referred to by the parties as the Order

Acknowledgment and Agreement of Sale, or OAAS form); a bill of sale; a power of

attorney form; and title, license, and registration documents.

Unhappywith their purchase, the McKeages contacted an attorney to help them

rescind the sale. After reviewing the contract, counsel for the McKeages filed suit

against TMBC in the Circuit Court for St. Charles County, Missouri. Among other

things, the McKeages alleged that TMBC’s practice of charging a document fee

constituted unauthorized law business in violation of Mo. Rev. Stat. §§ 484.010 and

484.020. Pursuant to the contract’s choice-of-law provision, venue was thereafter

4

transferred to Greene County, Missouri.

Section 484.010 states in relevant part: 4

The “law business” is hereby defined to be and is the advising or

counseling for a valuable consideration of any person, firm, association,

or corporation as to any secular law or the drawing or the procuring of

or assisting in the drawing for a valuable consideration of any paper,

document or instrument affecting or relating to secular rights . . . .

Section 484.020 states in relevant part:

No person shall engage in the practice of law or do law business . . .

unless he shall have been duly licensed therefor and while his license

therefor is in full force and effect . . . . Any person, association,

partnership, limited liability company or corporation who shall violate

the foregoing prohibition of this section . . . shall be subject to be sued

for treble the amount which shall have been paid him or it for any

service rendered in violation hereof by the person, firm, association,

partnership, limited liability company or corporation . . . .

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The McKeages asked the state court to certify a nationwide class action. The

state court certified a class, but limited it to customers whose purchases occurred in

Missouri. The McKeages sought review from the Missouri Supreme Court,

contending that the district court should have certified a nationwide class. The

Missouri Supreme Court agreed, noting that TMBC chose Missouri law for the

standardized formcontracts it used nationwide. State ex rel. McKeage v. Cordonnier,

357 S.W.3d 597, 601 (Mo. banc 2012). Pursuant to the Missouri Supreme Court’s

decision, the state trial court then certified a nationwide class.

In March 2012, TMBC removed the action to federal district court pursuant to

the Class Action Fairness Act of 2005, 28 U.S.C. § 1332(d)(8). After removal,

TMBC brought a motion to decertify the class. Extensive litigation followed over

whether a class action was appropriate, and eventually the district court denied the

motion to decertify. After TMBC unsuccessfully petitioned this court for permission

to appeal the denial of its motion to decertify the class, TMBC asked the district court

to reconsider. Ultimately, the district court required the McKeages’ counsel to hire

reviewers to manually inspect each of TMBC’s customer files in order to determine

which contracts contained a Missouri choice-of-law provision, the inclusion of which

formed the basis for the nationwide class. After the document review, the class was

determined to consist of approximately 100,000 members.

The parties filed cross motions for summary judgment. As relevant to the

issues now on appeal, TMBC argued that charging a document fee did not amount to

unauthorized law business because TMBC’s employees did not exercise legal

judgment when filling out documents for customers. TMBC also argued that some

individuals had been improperly identified as customers who signed contracts

governed by Missouri law. TMBC further argued that Missouri law should not be

applied nationwide to customers who signed contracts with TMBC outside Missouri. 

Finally, TMBC argued that damages should not be calculated based on the entire

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document fee because portions of the fee went to services that did not constitute

unauthorized law business.

The district court rejected TMBC’s arguments and granted the McKeages’

motion for summary judgment. The district court determined that the class members

were properly identified, TMBC’s conduct in charging a document fee constituted

unauthorized lawbusiness,Missouri law applied to transactionsthat occurred outside

Missouri, and damages should be awarded based on the entire document fee. The

district court then awarded treble damages pursuant to Mo. Rev. Stat. § 484.020. 

Based on the number of members in the class, the amount of damages was calculated

at $21,735,754.

After the district court’s grant of summary judgment, the McKeages filed a

motion for attorneys’ fees. Although the parties’ contract provided that “[t]he

prevailing party in any [action or proceeding arising from the agreement] shall be

entitled to recover . . . reasonable attorneys’ fees at all levels of litigation,” the district

court determined that “even in cases where a fee shifting provision may be applicable,

attorney’s fees should come from the common fund.” The district court used the

percentage-of-the-benefit method to calculate the fees and determined that thirty-three

percent was appropriate in this case. Finally, the district court noted that the common

fund included $7,349,574 in actual damages and $14,386,180 in statutory interest and

treble damages. Based on a trilogy of Eighth Circuit cases involving treble damages

under Section 4 ofthe Clayton Act—TwentiethCentury-Fox FilmCorp. v. Brookside

Theatre Corp., 194 F.2d 846 (8th Cir. 1952); International Travel Arrangers, Inc. v.

Western Airlines, Inc., 623 F.2d 1255 (8th Cir. 1980); and Rose Confections, Inc. v.

Ambrosia Chocolate Co., 816 F.2d 381 (8th Cir. 1987)—the district court concluded

that calculating the fee award “from the actual damages [rather than treble damages]

. . . is preferable because it better reflects the policies behind a common fund

recovery[.]” As a result, the district court awarded class counsel $2,425,359.42 in

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attorneys’ feesto be paid from the common fund, representing thirty-three percent of

the untrebled damages. 

TMBC timely appealed, contending: (1) the class should not have been

certified because individualized proof was required to determine whether each

customer’s contract contained a Missouri choice-of-law provision; (2) the district

court misinterpreted Missouri case law regarding unauthorized law business in

granting summary judgment to the class; and (3) the district court erred in applying

Missouri law to conduct which occurred outside Missouri. The McKeages filed a

timely cross appeal contending that the district court should have enforced the feeshifting provision in TMBC’s standard form contract and that the fee award should

have been based on the entire common fund rather than the untrebled damages.

II

A

TMBC first contends that the district court erred when it certified a class. We

review the district court’s decision to certify a class for an abuse of discretion, but

review de novo any issues of law involved in the class certification. In re St. Jude

Med., Inc., 425 F.3d 1116, 1119 (8th Cir. 2005).

TMBC argues that the McKeages failed to satisfy the commonality and

predominance requirements of Federal Rules of Civil Procedure 23(a)(2) and (b)(3). 

See Fed. R. Civ. P. 23(a)(2) (setting forth the prerequisite to class certification that

there be “questions of law or fact common to the class”); Fed. R. Civ. P. 23(b)(3)

(setting forth an additional requirement that there be “questions of law or fact

common to class members [that] predominate over any questions affecting only

individual members”). More specifically, TMBC argues individual issues

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predominated over common issues during the highly individualized process the

district court used to identify class members. 

TMBC’s complaints about an individualized inquiry relate to both the

identification of the class members and the evidence necessary to establish liability

once a class has been identified. TMBC’s argument thus implicates not only the

commonality and predominance requirements, but also Rule 23’s implicit requirement

that a class “‘must be adequately defined and clearly ascertainable.’” Sandusky

Wellness Ctr. v. Medtox Sci., Inc., 821 F.3d 992, 996 (8th Cir. 2016) (quoting Ihrke

v. N. States Power Co., 459 F.2d 566, 573 n.3 (8th Cir.), vacated as moot, 409 U.S.

815 (1972)). Though ascertainability is an implicit requirement that our court

enforces through “a rigorous analysis of the Rule 23 requirements,” id., a dispute

regarding the method for identifying class members calls for an independent

discussion of whether a class is ascertainable. 

A class may be ascertainable when its members may be identified by reference

to objective criteria. See id. at 997–98. In Sandusky, the plaintiffs alleged Medtox

Scientific violated the Telephone Consumer Protection Act (TCPA) by sending

unsolicited faxes without the opt-out notice required by the TCPA. We identified the

“fax logs showing the numbers that received each fax” as “objective criteria that

make the recipient clearly ascertainable.” Id. at 997. We concluded that the district

court abused its discretion by denying class certification, despite the fact that the logs

may have identified some fax recipients “who don’t have rights under the [TCPA],”

noting that those class members “just wouldn’t be entitled to share in the damages

awarded to the class by a judgment or settlement.” Id. at 998 (alteration in original)

(quoting Chapman v. Wagener Equities, Inc., 747 F.3d 489, 492 (7th Cir. 2014)).

Here, class members were identified by reviewing TMBC’s customer files

according to objective criteria. The purpose of the review process was to identify for

class membership the customers whose files contained an OAAS formor a terms-and-

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conditionssheet with a Missouri choice-of-law provision. The district court adopted

an intensive file-by-file review process specifically for the purpose of excluding

customers whose contracts did not contain the Missouri choice-of-law provision and

who therefore did not have rights under Missouri law. Indeed, our examination of the

record indicatesthat review process worked, and that most customers who may have 5

been subject to TMBC’s individual defenses were excluded from the class during the

review process.

In addition to the class being clearly ascertainable, the commonality and

predominance requirements of Rule 23(b) are satisfied here. The class identified as

a result of the intensive file-by-file review included TMBC customers that entered

into a contract identical or substantially similar to the one entered into by the

McKeages. In addition, evidence gleaned during discovery showed that it was

TMBC’s corporate policy to require all customers to sign the standard form contract

governed by Missouri law. Thus, this case presented a “classic case for treatment as

a class action.” Steinberg v. Nationwide Mut. Ins. Co., 224 F.R.D. 67, 74 (E.D.N.Y.

2004) (internal quotation omitted); see also Flanagan v. Allstate Ins. Co., 242 F.R.D.

421, 428 (N.D. Ill. 2007) (“Claims arising out of form contracts are particularly

appropriate for class action treatment.”); Egge v. Healthspan Servs. Co., 208 F.R.D

265, 269 (D. Minn. 2002) (“Claims arising from interpretations of a form contract

appear to present the classic case for treatment as a class action.”) (alteration omitted)

(quoting Kleiner v. First Nat’l Bank of Atlanta, 97 F.R.D. 683, 692 (N.D. Ga. 1983)). 

As to the class members eventually identified, the common and predominant issue

was whether TMBC’s practice of charging a document fee in the standardized

contract violated Missouri’s prohibition on unauthorized law business. Although the

The district court denied summary judgment asto 2,293 individuals who were 5

initially included in the class after finding there was a genuine issue of material fact

as to whether the transactions of 68 of those individuals were governed by Missouri

law, and whether 2,225 of those individuals whose transactions were governed by

Missouri law had actually paid a document fee.

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documents TMBCprepared for individual customers varied at times, the district court

correctly determined that the variety ofservices and the differences between contracts

were not distinct enough to decertify the case as a class action. See Janson v.

LegalZoom.com, Inc., 271 F.R.D. 506, 510, 512 (W.D. Mo. 2010) (involving a claim

of unauthorized law business and finding that Rule 23’s commonality and

predominance requirements were met even when the defendant offered more than 200

separate legal forms, noting that variation in forms did not negate the overarching

common legal question of “whether LegalZoom’s preparation of legal documents

violates Missouri law”). 

We conclude that the district court did not abuse its discretion in finding that

the class as ultimately defined met the requirements of Rule 23 and certifying the case

as a class action.

B

TMBC next contends that the district court erred in granting summary

judgment to the class. We review the district court’s grant of summary judgment de

novo. Green v. Dillard’s, Inc., 483 F.3d 533, 538 (8th Cir. 2007).

TMBC contends that the district court misconstrued Missouri law when it

concluded thatTMBC’s practice of charging a document fee constituted unauthorized

law business under Mo. Rev. Stat. §§ 484.020 and 484.010. TMBC contendsthat the

district court misunderstood that “an activity must first be the practice of law before

charging for its performance by a non-lawyer can be unauthorized.”

Under Missouri law, “charging a separate fee for the completion of legal forms

by non-lawyers constitutes the unauthorized practice of law business.” Carpenter v.

Countrywide Home Loans, Inc., 250 S.W.3d 697, 702 (Mo. banc 2008). Determining

whether a particular form is legal in nature requires the court to “balance the

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protection of the public against a desire to avoid unnecessary inconvenience and

expense.” Hargis v. JLB Corp., 357 S.W.3d 574, 584 (Mo. banc 2011) (quoting In

re First Escrow, Inc., 840 S.W.2d 839, 843 (Mo. banc 1992)). A key factor in this

inquiry is the legal judgment or discretion required to prepare the form. See Hargis,

357 S.W.3d at 584; In re First Escrow, Inc., 840 S.W.2d at 843; Hulse v. Criger, 247

S.W.2d 855, 861 (Mo. banc 1952). However, once it has been determined that a

particular document is legal in nature, the act of charging a fee for the preparation or

completion ofthat document constitutes unauthorized law business, even when a nonlawyer does not exercise any legal judgment in completing the form.

For example, in Eisel v. Midwest BankCentre, 230 S.W.3d 335 (Mo. banc

2007), bank employees prepared a number of pre-printed documents when processing

mortgage loans. The pre-printed forms included, among other things, a deed of trust

and a promissory note. Id. at 337 n.3. The Missouri Supreme Court had previously

determined that deeds of trust and promissory notes were legal documents because

their preparation requiresthe exercise of legal judgment or discretion. See id. (citing

In re First Escrow, 840 S.W.2d at 846). As a result, the court found it unnecessary

to consider whether bank employees’ completing the pre-printed forms required the

exercise of legal judgment or discretion. Rather, the court held the bank’s practice

of charging a fee for completing the pre-printed forms was unauthorized law business

prohibited by § 484.020, explaining that “charging of a separate additional charge

tends to place emphasis on conveyancing and legal drafting as a business rather than

on the business of being a [banker].” Id. at 339.

The forms for which TMBC charged a fee included forms Missouri has

determined to be legal documents—namely, power of attorney forms—as well as

forms that have yet to be analyzed under Missouri law. See id. (companies and their

non-lawyer agents prohibited “from drawing, preparing, or assisting in the

preparation of trust workbooks, trusts, wills, and powers of attorney for valuable

consideration”) (citing In re Mid-Am. Living Trust Assocs., Inc., 927 S.W.2d 855,

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871 (Mo. banc 1996)). As a consequence, TMBC’s practice of charging a separate

fee for the completion of those forms was unauthorized law business under § 484.020

whether or not the act of completing the forms required the exercise of legal judgment

or discretion. See id.

Relying on Bray v. Brooks, 41 S.W.3d 7 (Mo. Ct. App. 2001), TMBC further 

contends the district court misconstrued Missouri law when it calculated damages

based upon the entire document fee, because some of the forms for which it charged

a document fee were not legal documents. TMBC contendsthat the district court was

required to parse the document fee to determine what portion should be allotted to the

preparation of legal documents and to calculate damages only upon that amount. 

However, Bray does not mandate such a procedure. Bray involved a real estate

broker who charged a single fee for all of his services, which included the

unauthorized drafting of a number of legal documents as well as legitimate broker

services, without making a defined separate charge for document preparation. In

deciding whether damages for the violation of § 484.020 should be based upon the

broker’s entire fee, the Missouri Court of Appeals said a distinction must be made

between the legitimate and unauthorized services the broker provided. Id. at 14.

As the district court correctly determined, the facts of Bray differ from those

involved here. TMBC did not charge the McKeages a single contract price for the

sale of the boat. Rather, the unauthorized fee for document preparation was charged

separately from the legitimate portions of the contract. Thus, there was no need to

address the dilemma the court faced in Bray. In situations where the unauthorized

charge is separate from the legitimate portions of the parties’ transaction, damages

may be based upon the entire unauthorized fee, even if some of the documents are not

legal in nature. See Eisel, 230 S.W.3d at 337 n.3. 

 

Finally, TMBC contends it had no notice that the choice-of-law clause in its

contract would subject it to treble damages. We disagree. See Carpenter, 250 S.W.3d

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at 702 (“Countrywide had clear and fair notice, both by statute and case law, that its

activities constituted the unauthorized practice of law business and that this conduct

would subject it to treble the amount of fees paid in exchange for those services.”);

Janson v. LegalZoom, Inc., 802 F. Supp. 2d 1053, 1067 (W.D. Mo. 2011) (finding

application of Missouri’s unauthorized practice of law statute did not violate the

defendant’s constitutional due process rights where Missouri “cases such as Hulse,

First Escrow, Mid-America, and Eisel put [the defendant] on notice that it could not

charge a fee for the preparation of legal documents”). 

We conclude that the district court did not err in granting the class members’

motion for summary judgment or in calculating damages based upon the entire

document fee.

C 

Finally, TMBC contends the district court erred in applying Missouri law to

sales that occurred outside Missouri. This issue involves the interpretation and

application of the choice-of-law provision in TMBC’s standard form contract, and

thus is an issue of law reviewed de novo. See Schwan’s Sales Enters., Inc. v. SIG

Pack, Inc., 476 F.3d 594, 595–96 (8th Cir. 2007).

TMBC characterizes this issue as an unconstitutional extra-territorial

application of Missouri penal law, arguing that “[t]o allow Missouri to control the

regulation of law licenses and decide what constitutes the practice of law in other

states is unprecedented” and violative of the Commerce and Full Faith and Credit

Clauses of the United States Constitution. In making this argument, TMBC relies on

the fact that § 484.020(2) makes it a misdemeanor to engage in unauthorized law

business and that the Missouri attorney general has the right to sue for treble damages

in the event the parties granted a private cause of action under the statute “neglect and

fail to sue for or recover such treble amount.” Mo. Rev. Stat. § 484.020(2). 

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The fundamental flaw in TMBC’s argument is that Missouri is not a party to

this action. Missouri has not charged TMBC with any crimes, nor has the Missouri

attorney general pursued an action against TMBC for treble damages arising out of

its contracts with class members. Missouri makes no attempt to enforce its law extraterritorially. Thus, whether Missouri can control the regulation of law licenses extraterritorially and whether the Missouri attorney general can enforce § 484.020 extraterritorially are issues not before us.

Instead, the question here is whether a corporation headquartered in Missouri

can choose that Missouri law govern its conduct in standard form contracts it used

nationwide. There is nothing inherently unconstitutional about enforcing a

corporation’s choice to have its contractual duties governed by the law of a particular

state. On the contrary, “[t]he general rule is that competent persons shall have the

utmost liberty of contracting and that their agreements voluntarily and fairly made

shall be held valid and enforced in the courts.” Twin City Pipe Line Co. v. Harding

Glass Co., 283 U.S. 353, 356 (1931); State ex rel. McKeage, 357 S.W.3d at 600

(“Generally, parties may choose the state whose law will govern the interpretation of

their contractual rights and duties. A valid choice of law provision in a contract binds

the parties.” (internal citation omitted)). Aside from its argument that application of

§ 484.020 in this case constitutes the unconstitutional extra-territorial application of

Missouri penal law, TMBC does not otherwise challenge the validity or enforcability

of the choice-of-law clause. We thus conclude that the district court did not err in

applying Missouri law to sales that occurred outside Missouri.

D

In their cross appeal, the McKeages challenge the district court’s award of

attorneys’ fees. We review the district court’s award of attorneys’ fees for an abuse

of discretion, but review de novo any rulings of law related to the award of fees. 

Roemmich v. Eagle Eye Dev., LLC, 526 F.3d 343, 354–55 (8th Cir. 2008). 

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We first address the McKeages’ contention that the district court erred when

it held that the attorneys’ fees should be paid from the common fund rather than paid

by TMBC pursuant to the contractual fee-shifting provision. In concluding that 6

attorneys’ fees should be paid by the class members out of the common fund even

though there was a fee-shifting provision in TMBC’s contract, the district court cited

three cases: Entergy Arkansas, Inc. v. Nebraska, 226 F. Supp. 2d 1174 (D. Neb.

2002); In re Workers’ Compensation Insurance Antitrust Litigation, 771 F. Supp.

284 (D. Minn. 1991); and In re Chrysler Motors Corp. Overnight Evaluation Program

Litigation, 736 F. Supp. 1007 (E.D. Mo. 1990). However, none of these cases

involved a common fund in a class action in which a contractual fee-shifting

provision played a part. See Entergy Ark., 226 F. Supp. 2d at 1182 (noting the

common fund doctrine exists “independently ofthe variousfee-shifting statutes,” and

not addressing whether the presence of a common fund necessarily precludes the

enforcement of a contractual fee-shifting provision); In re Workers’ Comp., 771 F.

Supp. at 286 (honoring class counsel’s request that fees be paid out of common fund

rather than under applicable statutory fee-shifting provisions because “the settlement

agreements contain an explicit termcreating a common fund”); In re Chrysler Motors

Corp., 736 F. Supp. at 1012–13 (discussing other cases initiated pursuant to

We reject TMBC’s contention, articulated in its reply brief, that the

6

contractual fee-shifting provision does not apply because this suit is not an action or

proceeding arising from its agreements. The $75 document fee was part of the

contracts, this class action was brought to challenge the lawfulness of that part of the

contracts—a determination that relatesto the interpretation of the contract—and thus

this class action arises from those agreements and triggers the fee-shifting provision. 

See Major v. McCallister, 302 S.W.3d 227, 231–32 (Mo. Ct. App. 2009) (“Generally

speaking, whether a forum selection clause that by its terms applies to contract

actions also reaches non-contract claims ‘depends on whether the resolution of the

claims relates to interpretation of the contract.’” (quoting Manetti-Farrow, Inc. v.

Gucci Am., Inc., 858 F.2d 509, 514 (9th Cir. 1988)).

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fee-shifting statutes in which common fund principles were applied to determine

fees). These cases, while informative, are not dispositive.

The question here is whether, in a case in which both a common fund and a

contractual fee-shifting provision exist, attorneys’ fees should be awarded from the

common fund or paid under the contract’s terms. Our court has yet to address this

question. In deciding this issue, we first note that the presence of a fee-shifting

statute does not necessarily preclude awarding attorneys’ fees out of a common fund. 

See 5 William B. Rubenstein, Newberg on Class Actions § 15:61 (5th ed. 2016)

(“[C]ounsel may in some cases be able to seek both statutory fee-shifting and

common fund fee-spreading.”). Instead, the presence of a fee-shifting statute

precludes a common fund award only when that result is required by the statutory

scheme involved. See Alan Hirsch et al., Fed. Judicial Ctr., Awarding Attorneys’

Fees and Managing Fee Litig., 78 & n.447 (3d ed. 2015) (“The Second, Third, and

Seventh Circuits have held that, absent . . . a showing of legislative intent [to preclude

a common fund award], the fact that a fee-shifting statute applies to a particular case

does not preclude recovery from a common fund.”) (citing Suffolk v. Long Island

Lighting Co., 907 F.2d 1295, 1327 (2d Cir. 1990); Skelton v. Gen. Motors Corp., 860

F.2d 250, 255 (7th Cir. 1988); In re Fine Paper Antitrust Litig., 751 F.2d 562, 583 (3d

Cir. 1984)); see also Haggart v. Woodley, 809 F.3d 1336, 1357 (Fed. Cir.), cert.

denied, 136 S. Ct. 2509 (2016) (holding that fee-shifting provision under section

304(c) of the Uniform Relocation Assistance and Real Property Acquisition Policies

Act precluded a common fund award because the statutory scheme “expressly allows

landowners to retain the full compensation of the value of their property by

mandating the Government to assume the litigation expenses of counsel”). But when

a particular statutory scheme does not manifest congressional intent to preclude

equitable fee-shifting under the common fund doctrine, courts are afforded greater

discretion in determining the appropriate source of attorneys’ fees. See Haggart, 809

F.3d at 1359 (“We do not foreclose the application of the common fund doctrine in

all instances in which a fee-shifting statute is present. Equity may sometimes deem

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it appropriate to give counsel a piece of either the final judgment or settlement

agreement.”).

In cases involving contractual fee-shifting provisions, there is no relevant

underlying congressional intent that might preclude a common fund award. Instead,

the court must weigh the equitable principles underlying the creation of the common

fund doctrine against the fee-shifting provision agreed upon by the parties. See

Boeing Co. v. Van Gemert, 444 U.S. 472, 478 (1980) (explaining that the common

fund doctrine is grounded in equity). 

There is a distinction between the amount a losing party may be required to pay

under an agreed-upon contractual fee-shifting provision and the amount a class

member should equitably be required to pay his or her own lawyer under the common

fund doctrine. Cf. Gisbrecht v. Barnhart, 535 U.S. 789, 806 (2002)(emphasizing that

the lodestar method of awarding fees under a fee-shifting provision “was designed to

govern imposition of fees on the losing party . . . . [but] nothing prevents the attorney

for the prevailing party from gaining additional fees, pursuant to contract, from his

own client.” (citation omitted)); Venegas v. Mitchell, 495 U.S. 82, 90 (1990)

(explaining that the relevant statutory fee-shifting provision “controls what the losing

defendant must pay, not what the prevailing plaintiff must pay his lawyer”). In Nilsen

v. York County, the court discussed Venegas and Gisbrecht in the context of a class

action common fund case and concluded that “[t]hese cases, read together, uncouple

the fee analysis in determining an award against the losing defendant . . . from the fee

analysis for determining an award to the lawyer from the amount that he or she has

recovered.” 400 F. Supp. 2d 266, 272 (D. Me. 2005).

“The fact that a common fund has been created is not sufficient to establish a

finding that the common fund doctrine must be applied when awarding attorney

fees . . . .” Haggart, 809 F.3d at 1356. The common fund doctrine is intended to

ensure that class counsel receives a fee similar to what would have been received had

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a retainer agreement been in place with all class members, as well as to prevent

“persons who obtain the benefit of a lawsuit without contributing to its cost”—e.g.,

passive class members—from being “unjustly enriched at the successful litigant’s

expense.” Boeing Co., 444 U.S. at 478. Payment of attorneys’ fees under the feeshifting provision accommodates both concerns underlying the common fund

doctrine: First, lawyers are able to recoup reasonable compensation. Second, there

is no risk that named plaintiffs alone will be required to pay the class’s lawyers,

thereby unjustly enriching passive class members by providing them the benefit of

a portion of the award without the burden of litigation costs. Furthermore, the

McKeages’ counsel successfully obtained a judgment on behalf of the class against

a defendant who freely entered into a contract containing a fee-shifting provision. 

Requiring the class to pay the entire attorneys’ fee award from the common fund in

this case is inequitable because it nullifies the class’s contractual right, as the

prevailing party, “to recover all litigation costs and expenses, including reasonable

attorneys’ fees at all levels of litigation” from its opponent. Enforcement of the feeshifting provision honors both the contract and the principles underlying the common

fund doctrine. 

However, should the district court determine that counsel for the class is

entitled to additional fees from the common fund, apart from those reasonable

expenses covered by the fee-shifting provision, it is not prohibited from awarding

additional fees. See Nilsen, 400 F. Supp. 2d at 272–73 (fee analysis for determining

an award against the losing defendant is distinct fromthe fee analysis for determining

an award to the lawyer from the amount that a plaintiff has recovered). We make no

comment with respect to whether fees beyond those resulting from the contractual

fee-shifting provision should be awarded in this case, and we leave that determination

to the district court’s sound discretion. Should it determine that an additional award

out of the common fund is justified in this case, the district court should look to “the

fund as a whole,” including the trebled damages, Boeing Co., 444 U.S. at 478, but

is free to award any portion of the fund that it deems appropriate.

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III

For the reasons stated, we affirm on all issuesraised in the primary appeal. We

reverse and remand for further proceedings consistent with this opinion on the issues

raised in the cross appeal.

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