Opinion ID: 3168179
Heading Depth: 3
Heading Rank: 1

Heading: A Common Fund Exists

Text: The Woodleys and the Government assert that, con- trary to the Claims Court’s determination, “[t]here is no common fund.” Woodley Br. 12. Specifically, the Gov- 15 The doctrine presents one variant to the American Rule of attorney fees reaffirmed by the Supreme Court in Alyeska Pipeline Service Company v. Wilderness Society, under which all parties are to bear their own costs in litigation. 421 U.S. 240, 275 (1975). 26 HAGGART v. UNITED STATES ernment argues that “[t]he bundling of individual payments so [c]lass [c]ounsel can conveniently collect fees cannot transform separate payments into a ‘common fund’ entitling [c]lass [c]ounsel to common-fund fees.” Government Br. 38. In response, the Haggarts argue that the Woodleys and the Government’s contention that the Claims Court’s “award was merely a ‘bundling’ of individual claims is [] puzzling” because “[a]ll class actions, and hence all class action settlements, are necessarily a bundling of individual claims.” Haggart Br. 41. The issue here is whether the circumstances of this case create a common fund. Although often collapsed by courts into a single analysis, as we explain in greater detail below, the question of whether a common fund has been created is distinct from whether the doctrine may be applied to allow class counsel or the prevailing litigant to recover attorney fees. See Brytus v. Spang & Co., 203 F.3d 238, 243 (3d Cir. 2000) (“[T]he fact that a common fund has been created does not mean that the common fund doctrine must be applied in awarding attorney’s fees.”). Recovery of attorney fees under a common fund is based on the existence of some inequity borne by counsel or the successful litigant. See id. at 246. Conversely, whether a common fund exists concerns whether the $110 million settlement agreement to be distributed to class members may be so characterized. See Knight v. United States, 982 F.2d 1573, 1582 (Fed. Cir. 1993). Although the historical origins of the common fund doctrine suggests it was primarily applied to decisions involving express trusts in which there was a clearly defined trust fund, see Greenough, 105 U.S. at 527; Pettus, 113 U.S. at 127, it has also been applied where the creation of the fund is prospective and has yet to be made formally available to individuals who are similarly situated, see Sprague v. Ticonic Nat’l Bank, 307 U.S. 161, 167 HAGGART v. UNITED STATES 27 (1939). 16 The Supreme Court spoke more precisely on this issue in Boeing, where it determined that “[t]he criteria [for application of the common fund doctrine] are satisfied when each member of a certified class has an undisputed and mathematically ascertainable claim to part of a lumpsum judgment recovered on his behalf.” 444 U.S. at 479. Here, the lump-sum amount is the $110 million to be paid by the Government and each landowner’s individual ascertainable claim is the fair market value of his property. Id. The Woodleys and the Government argue that be- cause the individual appraisal values must first be determined, then summed before arriving at the $110 million settlement, this is substantively distinct from first determining the aggregate amount of the fund, then from this total, apportioning individual claims. However, predicating the creation of a common fund on the order in which the settlement agreement was calculated would yield an untenable distinction not contemplated by any prevailing Supreme Court precedent. The determination of a total settlement agreement is always derived from the aggregation of some underlying individual claim. Moreover, limiting the common fund doctrine to exclude the discrete bundling of individual awards would unduly narrow the application of the doctrine, which is expressly designed to give courts the power to equitably spread costs. See Sprague, 307 U.S. at 167. Our decision finds support from the Ninth Circuit, which has allowed the creation of putative or hypothetical funds by aggregating the amount a defendant would pay in damages to members of the class under the settlement 16 In Sprague, the creation of the fund was not based on a common pool of money in which each claimant is entitled, but instead distributed across fourteen individual trusts. 307 U.S. at 166. 28 HAGGART v. UNITED STATES agreement. See Staton v. Boeing Co., 327 F.3d 938, 972 (9th Cir. 2003); see also id. at 971 n.21 (“The description of the total amount of the [common] fund need not take any particular form and could result from adding up separately-enumerated amounts in the agreement.”). Thus, we hold the circumstances in this case create a common fund.