Effective September 1, 2023, New Mass. R. Civ. P. 23 Requirements for Notice to IOLTA Committee Regarding Proposed Class Action Cy Pres Recipient
Residual or cy pres funds from class actions provide critical financial support to the Massachusetts IOLTA Committee and the legal aid organizations and access to justice projects it funds.
Since 2015, class action plaintiffs have been required to notify the IOLTA Committee of the proposed recipient(s) of any potential residual funds before a settlement is approved by the court or a judgment is entered. Effective September 1, 2023, such notice must be provided to the IOLTA Committee at least 30 days prior to the entry of judgment or any hearing approving a compromise that creates residual funds (including a preliminary approval hearing). Under the amended rule, if the plaintiff does not certify to the court at least 10 days prior to entry of judgment or such approval hearing that the required notice has been provided, no judgment will enter and any hearing will be continued.
Full Text of Amended Massachusetts Rule of Civil Procedure 23(e)(3) – Effective September 1, 2023
(e) Where residual funds may remain, no judgment may enter or compromise be approved unless the plaintiff has given notice to the Massachusetts IOLTA Committee for the limited purpose of allowing the committee to be heard on whether it ought to be a recipient of any or all residual funds. The plaintiff shall provide such notice no later than 30 days prior to the entry of judgment or any hearing approving any compromise that creates residual funds. If no later than 10 days prior to the entry of judgment or such hearing, the court does not receive a certification by the plaintiff that the required notice has been provided to the Massachusetts IOLTA Committee, no judgment shall enter and any such hearing shall be continued to a date at least 30 days after the required notice has been provided and certification of such is submitted to the court.The Reporter’s Notes clarify that the pre-hearing notice requirement is “intended also to include any hearing preliminarily approving any compromise that creates residual funds.” (Emphasis added). See the IOLTA Committee’s Cy Pres Fact Sheet for more information.
What does the IOLTA Committee do with residual funds?
The IOLTA Committee funds non-profit organizations all over Massachusetts that provide civil legal services to residents who cannot afford an attorney. The IOLTA Committee also funds projects to improve the administration of justice, such as courthouse lawyer-for-the-day programs. Unlike criminal defendants, people facing serious civil legal problems—such as domestic violence, housing, health care, employment, government benefits, bankruptcy, and elder issues—do not typically have the right to an attorney if they cannot afford one.
Due to insufficient funding, legal aid organizations in Massachusetts that offer free legal representation are forced to turn away nearly half of eligible people seeking help. Since 2012, the IOLTA Committee has received more than $9 million in cy pres and other residual funds. These funds help shrink the justice gap by providing significant funding to nearly 100 legal organizations and projects across the Commonwealth every year
Due to insufficient funding, legal aid organizations in Massachusetts that offer free legal representation are forced to turn away nearly half of eligible people seeking help. Since 2012, the IOLTA Committee has received more than $9 million in cy pres and other residual funds. These funds help shrink the justice gap by providing significant funding to nearly 100 legal organizations and projects across the Commonwealth every year
Need more information?
To learn more about how you can make an impact by directing cy pres and other residual awards to the Massachusetts IOLTA Committee, please contact executive director Jenna Miara at This email address is being protected from spambots. You need JavaScript enabled to view it. or 617-963-9093.