A holdback order requires that a specified percentage of gross recovery in participating cases be withheld and deposited with the court or an escrow agent to compensate leadership for common benefit work.
Percentages typically range in the single digits.
Alternative Names:
Common Benefit Holdback, Assessment Order
Why it Matters?
The order's reach is the contested question, since courts have divided on whether holdbacks apply to recoveries in state court cases and to firms that did not participate in the MDL. Broad orders reaching non-participants have drawn appellate scrutiny on the ground that a court's authority over cases before it does not extend to recoveries elsewhere. For defendants the order matters in settlement design, since holdback reduces net claimant recovery and affects participation.
Frequently Confused with
Related terms
Frequently asked questions
Do holdback orders reach state court recoveries?
Why does it matter in settlement design?
