Common Benefit Fund

A common benefit fund is a court-supervised account into which a percentage of each plaintiff's recovery is deposited to compensate PSC attorneys for the legal work that benefited all claimants on the docket — discovery, expert retention, motion practice, and bellwether preparation. The transferee court sets the holdback percentage, typically ranging from 4% to 8% of gross recoveries, and the fund is distributed among contributing firms through a fee allocation process. From a litigation finance perspective, the common benefit assessment is a structural cost that funders must factor into their recovery modeling — a 6% common benefit hold reduces effective net proceeds and therefore affects the return multiple on capital deployed at the individual claim level. Funders providing PSC-level capital sometimes structure their return as a percentage of the common benefit fund rather than individual claim proceeds.

Funders model the common benefit holdback percentage as a direct reduction to net proceeds at the individual claim level, since a 6% assessment on gross recovery changes the effective return multiple on capital deployed against that claim just as materially as a change in the underlying settlement grid value. Funders providing PSC-level capital sometimes prefer structuring their return as a share of the common benefit fund itself, since that claim ranks differently in priority than individual claimant proceeds.