Vasquez et al v. Coast Roofing, No. 1:2007cv00227 - Document 72 (E.D. Cal. 2010)
Court Description: Memorandum Decision and ORDER Granting 60 Motions for Final Approval of Class Action Settlement, Class Certification, and Judgement and 61 for Approval of Fees, Representative Awards and Cost signed by Judge Oliver W. Wanger on 3/8/2010. (Figueroa, O)
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1 2 3 4 5 UNITED STATES DISTRICT COURT 6 FOR THE EASTERN DISTRICT OF CALIFORNIA 7 8 10 ENRIQUEZ VASQUEZ and JUAN ANDRES RUIZ on behalf of a class of similarly situated employees, 11 Plaintiffs, 9 12 13 14 1:07-CV-00227 OWW DLB MEMORANDUM DECISION AND ORDER GRANTING JOINT MOTIONS FOR FINAL APPROVAL OF CLASS ACTION SETTLEMENT, CLASS CERTIFICATION, AND JUDGMENT (DOC. 60), AND FOR APPROVAL OF FEES, REPRESENTATIVE AWARDS, AND COSTS (DOC. 61). v. COAST VALLEY ROOFING, INC., dba COAST ROOFING, and FRANCIS DOMINIC GIANGROSSI, 15 Defendants. 16 17 18 19 I. INTRODUCTION Plaintiffs Enriquez Vasquez and Juan Andres Ruiz brought this 20 action on behalf of themselves and approximately 177 current and 21 former roofing workers employed by Defendants Coast Roofing, Inc. 22 ( Coast ) and Francis Dominic Giangrossi, alleging violations of 23 federal and state wage-and-hour laws. See First Amended Class Action 24 Complaint ( FAC ), filed Sept. 19, 2007, Doc. 23. On November 17, 25 2009, the district court preliminarily approved the terms of a 26 27 28 negotiated Class Action Settlement. Doc. 57. Before the court for decision are joint motions for final approval of the class action 1 1 settlement, class certification, and judgment, Doc. 60, and for 2 approval of fees, representative awards, and costs, Doc. 61. 3 oppositions have been filed, nor was any oral objection made in open No 4 court during the publicly-noticed hearing of these motions on February 5 22, 2010 at 10:00 AM in Courtroom 3 (OWW). 6 7 8 II. FACTUAL BACKGROUND A. 9 10 Summary of the Litigation. The FAC alleges that Coast failed to pay overtime and minimum wages; failed to pay wages due at termination of employment; failed to 11 provide all legally required meal periods and rest breaks; failed to 12 provide accurate, itemized employee wage statements; and failed to 13 14 compensate employees for travel time and mileage. 15 certify a class composed of Plaintiffs and similarly situated 16 individuals and to recover back wages, interest, penalties, and 17 attorneys fees and costs from Defendants. 18 19 The FAC seeks to Plaintiffs counsel reviewed employee records gathered pursuant to pre-litigation non-discovery methods provided by California Labor 20 Code section 226, interviewed numerous witnesses, and reviewed 21 22 23 hundreds of pages of documents from employees before filing the complaint. Mallison Decl., Doc. 62, at ¶¶ 37-39. 24 B. Summary of the Settlement. 25 1. The Gross Settlement Payment. 26 Under the Settlement, Coast will make a Gross Settlement Payment 27 of $300,000. This payment will cover Settlement Shares to be paid to 28 2 1 Class Members who submit valid claims; the employer share of payroll 2 taxes on the Settlement Shares; a $10,000 payment to the California 3 Labor and Workforce Development Agency for its share of the settlement 4 of civil penalties; the Settlement Administrator s reasonable fees and 5 expenses of $25,000 (which is less than the Administrator s actual 6 7 costs of $27,592); and (subject to court approval) payments to 8 Plaintiffs, in addition to their Settlement Shares, of $5,000 each in 9 compensation of their services as Class Representatives and payments 10 to Class Counsel of up to $100,000 for their reasonable attorneys 11 fees and up to $10,000 in expenses. 12 See Settlement Agreement ( Settlement ) § III.A-C, attached to Mallison Decl. at Ex. 1, Doc. 13 62-2. There will be no reversion of the Gross Settlement Payment to 14 15 Coast. 16 2. 17 After the other amounts are deducted, the Gross Settlement Amount 18 Payment of Settlement Shares. (termed the Net Settlement Amount ) will be distributed as Settlement 19 Shares to all Class Members who submit valid claims, based upon the 20 21 22 23 24 25 26 following allocation formula: The Settlement Share for each Claimant will be based on (a) that Claimant s total number of Months of Employment during the Class Period (b) divided by the aggregate number of Months of Employment of all Participating Class Members during the Class Period (with the division rounded to four decimal places) (c) multiplied by the value of the Net Settlement Amount. Settlement § III.D.1. This simple formula relies upon information 27 readily available from Coast s records and is commonly used in wage28 3 1 and-hour cases. Mallison Decl. at ¶43. 2 3 4 3. Distribution of Unclaimed Funds and Uncashed Checks. In the event that not all Class Members submit claims, the 5 residual will be redistributed to those Class Members who do submit 6 valid claims. 7 to Class Members are not cashed, these monies will be donated to two 8 public interest organizations on a 50%/50% basis: (1) the California 9 Settlement § III.D.3. In the event that checks issued Rural Legal Assistance; and (2) the Boys and Girls Club of 10 Bakersfield. Id. § III.F.10. Donation of the residual to these 11 public interest organizations that serve low-income workers is 12 13 14 15 appropriate. 4. See Mallison Decl. at ¶44. Scope of the Release. The Settlement provides that all Participating Class Members 16 release Defendants as follows: 17 18 19 20 21 22 23 24 25 26 27 28 As of the date of the Judgment, all Participating Class Members hereby fully and finally release Coast, and its parents, predecessors, successors, subsidiaries, affiliates, and trusts, and all of its employees, officers, agents, attorneys, stockholders, fiduciaries, other service providers, and assigns, from any and all claims, known and unknown, for or related to all claims based on or arising from the allegations that they were or are improperly compensated under federal, California, or local law (the Class s Released Claims ). The Class s Released Claims include all such claims for alleged unpaid wages, including overtime compensation, missed meal-period and rest-break wages or penalties, and interest; related penalties, including, but not limited to, recordkeeping penalties, paystub penalties, minimum-wage penalties, missed meal-period and rest-break penalties, and waiting-time penalties; and costs and attorneys fees and expenses. Settlement § III.G.2. 4 1 5. 2 Any Class Member who so wishes had an opportunity to object to or Objections and Opt-Out Process 3 comment on the Settlement, or may elect not to participate in the 4 Settlement. The Class Notice fully explains the objection/comment and 5 opt-in procedures. Settlement § III.F.4. 6 7 6. 8 The Settlement provided for confirmatory discovery to be 9 10 Termination of Settlement. conducted during the approval process. Plaintiffs reserved the right to void the Settlement if this confirmatory discovery revealed any 11 substantial variance from previous discovery or other factual 12 representations made by defendants and relied upon by Plaintiffs as 13 14 the basis for the Settlement. Settlement § III.F.7. Plaintiffs 15 completed this confirmatory discovery, including consultation with 16 experts in construction accounting and database analysis. 17 discovery did not reveal any reason to void the settlement. 18 at 6. This Doc. 67 19 III. DISCUSSION 20 21 A. The Terms of Preliminary Approval Have Been Satisfied. 22 1. Notice. 23 The procedures for giving notice to the class members, as set 24 forth in the Settlement and ordered in the Court s Preliminary 25 Approval Order, Doc. 57, have been carried out. 26 Certification of Settlement Class and Collective Action, Settlement The Notice of 27 and Hearing Date for Final Court Approval (the Class Notice ), and 28 5 1 the forms of Claim for Settlement Share and Election Not to 2 Participate in Settlement (referred to in conjunction with the Class 3 Notice as Notice Packets ) were sent out by the Settlement 4 Administrator via U.S. Mail to Class Members on December 9, 2009, in 5 the manner specified by the Settlement. Donly Decl., Doc. 69, at ¶10. 6 7 In addition, on December 11, 2009 a summary version of the Class 8 Notice was published in the Bakersfield Californian and El Popular 9 newspapers. 10 11 12 Id. at ¶11. The U.S. Postal Service returned 40 Notice Packets to the Settlement Administrator. Id. at ¶13. Best efforts to trace these individuals and/or find their updated addresses were conducted 13 resulting in 24 additional delivered notice packets mailed and 23 14 15 delivered. Id. at ¶13. On December 26, 2009, the Settlement 16 Administrator contacted 165 Class Member who had not yet provided 17 claims forms via phone to remind them about the deadlines in the 18 settlement. 19 20 Id. at ¶12. As of January 14, 2010, 56 class members, or more than 31% of the class members submitted claims. Id. at ¶12. Zero individuals 21 submitted elections not to participate, id. at ¶15, and as of January 22 22, 2010, the date on which Plaintiffs motion for final approval was 23 24 25 filed, no class member had submitted an objection to the settlement, id. at ¶18. 26 B. Final Approval of a Settlement Class is Appropriate. 27 In order to approve a class action settlement, a district court 28 6 1 must first make a finding that a class can be certified. See, e.g., 2 Molski v. Gleich, 318 F.3d 937, 943, 946-50 (9th Cir. 2003). 3 as here, the parties have entered into a settlement agreement before When, 4 the district court certifies the class, reviewing courts must pay 5 undiluted, even heightened, attention to class certification 6 7 8 9 requirements. Staton v. Boeing Co., 327 F.3d 938, 952 (9th Cir. 2003). Pursuant to Federal Rule of Civil Procedure 23(c)(1), approval of 10 the class is appropriate where the plaintiff establishes the four 11 prerequisites of Federal Rule of Civil Procedure 23(a) -- (1) 12 numerosity, (2) commonality, (3) typicality, and (4) adequacy of 13 representation -- as well as one of the three requirements of Rule 14 15 16 17 23(b). See Horton v. USAA Cas. Ins. Co., --- F.R.D. --- 2009 WL 5066681, *4 (D. Ariz. 2009). Here, the proposed class is comprised of all individuals who have 18 been employed by Coast in California as non-exempt roofing workers 19 during the period from January 31, 2003 to July 31, 2009. 20 approximately 177 Class Members. There are 21 22 1. Numerosity. 23 A proposed class must be so numerous that joinder of all members 24 is impracticable. 25 requirement demands examination of the specific facts of each case 26 Fed. R. Civ. P. 23(a)(1). and imposes no absolute limitations. The numerosity General Tel. Co. of the 27 Northwest, Inc. v. EEOC, 446 U.S. 318, 330 (1980). 28 7 Courts have 1 routinely found the numerosity requirement satisfied when the class 2 comprises 40 or more members. 3 112, 114 (S.D.N.Y. 1998). Ansari v. New York Univ., 179 F.R.D. Here, the presence of approximately 177 4 similarly situated Class Members satisfies the numerosity requirement. 5 Plaintiffs also must establish impracticability of joinder. A 6 7 court should consider not only the class size but other factors as 8 well, including the geographic diversity of class members, the ability 9 of individual members to institute separate suits, and the nature of 10 the underlying action and the relief sought. 11 Radiation Survivors v. Walters, 111 F.R.D. 595, 599 (N.D. Cal. 1986). 12 See, Nat l Ass n of The limited size of any individual plaintiff s recovery is also 13 relevant. Edmondson v. Simon, 86 F.R.D. 375, 379 (N.D. Ill. 1980). 14 15 Here, where the potential recovery by any individual plaintiff is 16 relatively small, individual members of the class would likely be 17 unwilling or unable to bring institute separate suits. 18 filing of individual suits by 177 separate plaintiffs would create and 19 unnecessary burden on judicial resources. Moreover, the 20 21 2. Commonality. 22 Rule 23(a) also demands questions of law or fact common to the 23 class. 24 common to every single member of the class. 25 commonality requirement, plaintiffs need only point to a single issue 26 It does not require that all questions of law or fact be common to the class. To satisfy the Dukes v. Wal-Mart, Inc., 474 F.3d 1214, 1225 27 (9th Cir. 2007); Slaven v. BP Am., Inc., 190 F.R.D. 649, 655 (C.D. 28 8 1 Cal. 2000). 2 case, the lawsuit challenges a system-wide practice or policy that 3 affects all of the putative class members. Commonality is generally satisfied where, as in this Armstrong v. Davis, 275 4 F.3d 849, 868 (9th Cir. 2001); LaDuke v. Nelson, 762 F.2d 1318, 1332 5 (9th Cir. 1985). Differences in the ways in which these practices 6 7 affect individual members of the class do not undermine the finding of Armstrong, 275 F.3d at 868 (finding commonality 8 commonality. 9 requirement satisfied despite individual class members having 10 different disabilities, since all suffered similar harm as a result of 11 defendant s actions). 12 Here, for purposes of the Settlement only, the parties agree that 13 common questions of both fact and law exist regarding Coast s alleged 14 15 failure to abide by federal and state wage-and-hour law, including: 16 ¢ whether Coast failed to provide roofing workers with required meal periods; 17 ¢ whether Coast failed to pay roofing workers wages for meal periods during which they remained on duty; ¢ whether Coast authorized and permitted the roofing workers to take required rest periods; ¢ whether Coast failed to pay roofing workers an additional hour of wages for missed meal periods and rest breaks; ¢ whether Coast failed to pay all legally required minimum wages and overtime compensation to hourly production workers; ¢ whether hourly production workers are owed waiting time penalties because Coast allegedly willfully failed to pay them additional wages for missed meal periods and rest breaks, and for meal periods taken during which they remained on duty, upon the termination of their employment; and ¢ whether Coast s business practices violated Business and Professions Code section 17200 et seq. 9 18 19 20 21 22 23 24 25 26 27 28 1 ¢ whether Coast s failed to pay for travel time and mileage to roofing workers. 2 These common questions of law or fact are sufficient to satisfy the 3 commonality requirement. 4 5 3. 6 Rule 23(a)(3) demands that the claims or defenses of the 7 Typicality. representative parties are typical of the claims or defenses of the 8 class. Armstrong, 275 F.3d at 868. Typicality ... is said ... to 9 be satisfied when each class member s claim arises from the same 10 11 course of events, and each class member makes similar legal arguments Id. 12 to prove the defendant s liability. 13 permissive standards, representative claims are typical if they are 14 reasonably co-extensive with those of absent class members; they need 15 to be substantially identical. 16 1011, 1020 (9th Cir. 1998). Under the rule s Hanlon v. Chrysler Corp., 150 F.3d Plaintiffs claims are essentially 17 identical to those of the class as whole, as they are all roofing 18 19 20 21 workers who were paid under the same pay practices. The typicality requirement is satisfied. 4. Adequacy of Representation. 22 The final Rule 23(a) prerequisite is satisfied if the 23 representative parties will fairly and adequately protect the 24 25 interests of the class. Fed. R. Civ. P. 23(a)(4). The proper 26 resolution of this issue requires that two questions be addressed: (a) 27 do the named plaintiffs and their counsel have any conflicts of 28 10 1 interest with other class members and (b) will the named plaintiffs 2 and their counsel prosecute the action vigorously on behalf of the 3 class? In re Mego Fin. Corp. Sec. Litig., 213 F.3d 454, 462 (9th 4 Cir. 2000). The adequacy of representation requirement is met here 5 because Plaintiffs have the same interests as the remaining members of 6 7 the Settlement Class, i.e. obtaining payment for wages unlawfully 8 withheld; there is no apparent conflict between the named Plaintiffs 9 claims and those of the other Class Members; and Plaintiffs are 10 represented by experienced and competent counsel who has experience in 11 litigating over 40 wage and hour class action cases. 12 13 5. 14 Having satisfied the prerequisites set forth in Rule 23(a), 15 Plaintiffs must also satisfy one of the three provisions of Rule 16 23(b). 17 certification of the Class is appropriate under Rule 23(b)(3) because 18 Rule 23(b)(3). The parties agree for purposes of the Settlement only that questions of law or fact common to the members of the class 19 predominate over any questions affecting only individual members, and 20 21 22 23 ... a class action is superior to other available methods for the fair adjudication of the controversy. Fed. R. Civ. P. 23(b)(3). With regard to superiority, Rule 23(b) provides four determining 24 factors. 25 is the interest of each member in individually controlling the 26 Fed. R. Civ. P. 23(b). The first factor for consideration prosecution or defense of separate actions. Fed. R. Civ. P. 27 23(b)(3)(A). This factor is more relevant where each class member has 28 11 1 suffered sizeable damages or has an emotional stake in the litigation. 2 See, e.g., In re N. Dist. of Cal., Dalkon Shield, Etc., 693 F.2d 847, 3 856 (9th Cir. 1982). Here, where the monetary damages each plaintiff 4 individually suffered are relatively modest, certifying a class action 5 is favored. Id. 6 7 The second factor to consider is the extent and nature of any 8 litigation concerning the controversy already commenced by or against 9 members of the class. 10 litigation concerning the controversy is the consolidated cases at 11 issue in this settlement. 12 Fed. R. Civ. P. 23(b)(3)(B). The only known The third factor to consider is the desirability or 13 undesirability of concentrating the litigation of the claims in the 14 15 particular forum. Fed. R. Civ. P. 23(b)(3)(C). The fourth and final 16 factor is the likely difficulties in managing a class action. Fed. 17 R. Civ. P. 23(b)(3)(D). 18 practical problems that may render the class format inappropriate for 19 a particular suit. 20 (1974). This factor encompasses the whole range of Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 164 However, the context of settlement, these two factors are 21 essentially irrelevant. See Amchem Prods. Inc. v. Windsor, 521 U.S. 22 591, 620 (1997) (where a district court is confronted with a 23 24 settlement-only class certification, the court need not inquire 25 whether the case, if tried, would present manageability problems 26 because the point is that there will be no trial). 27 Here, where the monetary damages each plaintiff individually 28 12 1 suffered are relatively modest, and where no other litigation 2 concerning these allegations is pending, certifying a class action is 3 favored under Rule 23(b)(3). 4 The motion for final approval of the Settlement Class is GRANTED. 5 6 7 8 9 C. Final Approval of the Settlement Is Appropriate. The court must approve any settlement ... of the claims ... of a certified class. Fed. R. Civ. P. 23(e)(1)(A). A settlement may be approved only after a hearing and on finding that it is fair, 10 reasonable, and adequate. Fed. R. Civ. P. 23(e)(1)(C). Such approval 11 is required to make sure that any settlement reached is consistent 12 13 with plaintiffs fiduciary obligations to the class. See Ficalora v. 14 Lockheed Cal. Co., 751 F.2d 995, 996 (9th Cir. 1985). The court also 15 serves as guardian for the absent class members who will be bound by 16 the settlement, and therefore must independently determine the 17 fairness of any settlement. 18 Id. However, the district court s role in intruding upon what is otherwise a private consensual agreement is 19 limited to the extent necessary to reach a reasoned judgment that the 20 21 agreement is not the product of fraud or collusion between the 22 negotiating parties, and that the settlement, taken as a whole, is 23 fair, reasonable, and adequate to all concerned. 24 F.3d 1503, 1506 (9th Cir. 1996). 25 not to be turned into a trial or rehearsal for trial on the merits. 26 FDIC v. Alshuler, 92 Therefore, the settlement hearing is Officers for Justice v. Civil Service Com., 688 F.2d 615, 625 (9th 27 Cir. 1982). Ultimately, the district court s determination is nothing 28 13 1 more than an amalgam of delicate balancing, gross approximations, and 2 rough justice. 3 Id. In determining whether a settlement agreement is fair, adequate, 4 and reasonable to all concerned, a district court may consider some or 5 all of the following factors: (1) the strength of the Plaintiff s case 6 7 (2) the risk, expense, complexity, and likely duration of further 8 litigation; (3) the risk of maintaining class action status throughout 9 the trial; (4) the amount offered in settlement; (5) the extent of 10 discovery completed; (6) the stage of the proceedings; (7) the views 11 and experience of counsel; (8) any opposition by class members; (9) 12 Linney v. Cellular Alaska the presence of a governmental participant. 13 Pshp., 151 F.3d 1234,1242 (9th Cir. 1998). This list of factors is 14 15 not exclusive and the court may balance and weigh different factors 16 depending on the circumstances of each case. 17 Torrisi v. Tucson Elec. Power Co., 8 F.3d 1370, 1376 (9th Cir. 1993). 18 1. Strength of Plaintiffs Case. 19 An important consideration in judging the reasonableness of a 20 21 settlement is the strength of the plaintiffs case on the merits Nat l Rural 22 balanced against the amount offered in the settlement. 23 Telecom. Coop. v. DirectTV, Inc., 221 F.R.D. 523, 528 (C.D. Cal. 2004) 24 (quoting 5 Moore s Federal Practice § 23.85[2][b] (Matthew Bender 3d. 25 ed.)). 26 However, in balancing these factors, a proposed settlement is not to be judged against a speculative measure of what might have been 27 awarded in a judgment in favor of the class. 28 14 Id. 1 [T]he settlement or fairness hearing is not to be turned into a trial or rehearsal for trial on the merits. Neither the trial court nor [the Court of Appeals] is to reach any ultimate conclusions on the contested issues of fact and law which underlie the merits of the dispute, for it is the very uncertainty of outcome in litigation and avoidance of wastefulness and expensive litigation that induce consensual settlements. 2 3 4 5 6 Officers for Justice v. Civil Serv. Comm n, 688 F.2d 615, 625 (9th 7 Cir. 1982). 8 Although Plaintiffs maintain their strong belief in the 9 underlying merits of their case, Plaintiffs counsel acknowledges that 10 11 wage and hour cases on behalf of low wage workers can difficult to 12 prove on a class basis and considered the uncertainties surrounding 13 proving their claims in a lengthy and complex jury trial. 14 weighs in favor of approval. This factor 15 16 17 18 2. Risk, Expense, Complexity, and Likely Duration of Further Litigation. Another relevant factor is the risk of continued litigation balanced against the certainty and immediacy of recovery from the 19 Settlement. See Dunleavy v. Nadler (In re Mego Fin. Corp. Sec. 20 Litig.), 213 F.3d 454, 458 (9th Cir. 2000). A court may consider the 21 22 vagaries of litigation and compare the significance of immediate 23 recovery by way of the compromise to the mere possibility of relief in 24 the future, after protracted and expensive litigation. 25 v. Standard Oil Co. (Ind.), 64 F.R.D. 597, 624 (D. Colo. 1974). 26 has been held proper to take the bird in hand instead of a prospective 27 flock in the bush. Id. 28 15 Oppenlander It 1 Here, there are significant risks in continued litigation and no 2 guarantee of recovery given the current state of the law. 3 California Supreme Court is currently reviewing the standards The 4 applicable to recovery of rest and meal period premiums. See Brinker 5 Restaurant Corp. v. Superior Court, 85 Cal. Rptr. 3d 688 (2008). This 6 7 8 factor weighs in favor of approval. 3. 9 Risk of Maintaining Class Action Status Throughout the Trial. 10 To the extent that all class members were employed as roofers and 11 were compensated on the same basis, the only lack of class eligibility 12 is that lost compensation calculations are individual. 13 defeat class treatment. This would not This factor is neutral. 14 15 4. Amount Offered in Settlement. 16 The recovery of $300,000, or approximately $2600 per claimant net 17 of all expenses, is a sizeable settlement in a wage and hour case 18 involving low-income workers. 19 was arguably possible, the very essence of a settlement is 20 Although a higher per claimant award compromise, a yielding of absolutes and an abandoning of highest 21 hopes. Linney v. Cellular Alaska P ship, 151 F.3d 1234, 1242 (9th 22 23 24 Cir. 1234)(internal citation and quotation omitted). This factor weighs in favor of approval. 25 26 5. Extent of Discovery Completed, and the Stage of the Proceedings. 27 A settlement following sufficient discovery and genuine arms- 28 length negotiation is presumed fair. 16 See City P'ship Co. v. Atlantic 1 Acquisition Ltd. P'ship, 100 F.3d 1041, 1043 (1st Cir. 1996). 2 Plaintiffs conducted significant discovery of the underlying 3 timekeeping and payroll documents in this case, consisting of tens of Here, 4 thousands of pages, and undertook in depth interviews of numerous 5 Class members, resulting in informed prosecution and eventual 6 7 settlement of the matter. By the time the settlement was reached, the 8 litigation had proceeded to a point in which both plaintiffs and 9 defendants ha[d] a clear view of the strengths and weaknesses of 10 their cases. 11 735, 745 (S.D.N.Y. 1985). In re Warner Communications Sec. Litig., 618 F Supp This factor weighs in favor of approval. 12 13 6. Experience and Views of Counsel. 14 In reviewing the opinions of counsel, great weight is accorded In re Painewebber Ltd. 15 to the recommendation of the attorneys. 16 P'ships Litig., 171 F.R.D. 104, 125 (S.D.N.Y. 1997). 17 the ones who are most closely acquainted with the facts of the 18 underlying litigation. Id. They are Parties represented by competent counsel 19 are better positioned than courts to produce a settlement that fairly 20 21 reflects each party's expected outcome in the litigation. Pac. 22 Enters. Sec. Litig., 47 F.3d 373, 378 (9th Cir. 1995). 23 judge, absent fraud, collusion, or the like, should be hesitant to 24 substitute its own judgment for that of counsel. 25 559 F.2d 1326, 1330 (5th Cir. 1977); Hanrahan v. Britt, 174 F.R.D. 26 [T]he trial Cotton v. Hinton, 356, 366-368 (E.D. Pa. 1997) (presumption of correctness applies to a 27 class action settlement reached in arms -length negotiations between 28 17 1 experienced, capable counsel after meaningful discovery). 2 Here, class counsel understood the complex risks and benefits of 3 any settlement and concluded that the proposed Settlement was a just, 4 fair, and certain result. This factor weighs in favor of approval. 5 6 7. 7 Pursuant to California s Private Attorneys General Act ( PAGA ), 8 9 Presence of a Governmental Participant. Cal. Lab. Code. § 2699.3, California granted Plaintiffs the right to stand in the shoes of the State of California to enforce these claims 10 on behalf of the state and employees. As a result, Plaintiffs stand 11 as a proxy for the State and have obtained $10,000 for the State of 12 13 14 15 California. 8. This factor does not weigh against approval. Reaction of Class Members to the Proposed Settlement. The reactions of the members of a class to a proposed settlement 16 is a proper consideration for the trial court. Nat l Rural Telecom. 17 18 Coop., 221 F.R.D. at 528 (quoting 5 Moore s Fed. Practice § 19 23.85[2][d]). Class representatives opinions of the settlement are 20 especially important because [t]he representatives views may be 21 important in shaping the agreement and will usually be presented at 22 the fairness hearing; they may be entitled to special weight because 23 the representatives may have a better understanding of the case than 24 most members of the class. Id. (citing Manual for Complex 25 Litigation, Third, § 30.44 (1995)). 26 27 28 The Class Representatives, who have an extensive understanding of the merits of the case and the Settlement, see Vasquez Decl., Doc. 63 18 1 at ¶¶ 7-17; Ruiz Decl., Doc. 64 at ¶¶ 7-17, are strongly in support of 2 the Settlement, Mallison Decl., Doc. 62 at ¶57. 3 members have objected to the settlement. In addition, no class This factor weighs in favor 4 of approval. 5 6 In sum, the majority of the relevant factors weigh in favor of 7 8 approving the Settlement. It represents a substantial recovery that 9 avoids the risks associated with protracted litigation in a document- 10 intensive wage and hour case. 11 12 13 14 D. Class Representative Payments; Class Counsel Attorneys Fees Payment and Class Counsel Litigation Expenses Payment. Where the payment of attorney s fees is also part of the negotiated settlement, the fee settlement must be separately evaluated 15 for fairness in the context of the overall settlement. Kinsely v. 16 17 18 Network Assocs., 312 F.3d 1123, 1126 (9th Cir. 2002). Plaintiffs and their counsel seek (and Defendants do not oppose), 19 awards to Plaintiffs of Class Representative Payments of $5,000 each, 20 in addition to their Settlement Shares, in compensation for their 21 services as Class Representatives; a Class Counsel Attorneys Fees 22 Payment of $100,000 (or 33-1/3% of the Gross Settlement Amount); and a 23 Class Counsel Litigation Expenses Payment of $8,967. See Settlement § 24 III.B.1-2. 25 26 27 28 1. Class Representative Payments of $5,000 Each are Fair and Reasonable. Plaintiffs seek payments in the amount of $5,000 to Class 19 1 Representatives Enriquez Vasquez and Juan Andres Ruiz. 2 are intended to recognize the time and efforts Mr. Vasquez and Mr. 3 Ruiz spent on behalf of the Class Members. These payments Mallison Decl., Doc. 62, 4 at ¶67.; see generally Vasquez Decl., Doc. 63; Ruiz Decl., Doc. 64. 5 Courts routinely approve incentive awards to compensate named 6 7 plaintiffs for the services they provide and the risks they incurred Ingram v. The 8 during the course of the class action litigation. 9 Coca-Cola Company, 200 F.R.D. 685, 694 (N.D. Ga. 2001) (internal 10 quotations and citations omitted) (approving service awards of 11 $300,000 to each named plaintiff in recognition of the services they 12 provided to the class by responding to discovery, participating in the 13 mediation process, and taking the risk of stepping forward on behalf 14 15 of the class.); see also Van Vranken v. Atlantic Richfield Co., 901 F. 16 Supp. 294, 299 (N.D. Cal. 1995) (approving $50,000 participation award 17 to plaintiffs). 18 Here, the Class Representatives assisted prosecution and 19 settlement of the Class claims by: (1) investigating and 20 substantiating the claims alleged in this action; (2) helping to 21 prepare the complaint; (3) producing documentary evidence to Counsel; 22 and (4) aiding with settlement of this litigation. See Mallison Decl. 23 24 at ¶57; Vasquez Decl. at ¶¶ 6-17 (estimating that he has devoted 25 dozens of hours of his time to the litigation); Ruiz Decl. at ¶¶ 6- 26 17 (same). 27 risk that, in the event of a judgment in favor of Defendant in this Moreover, Class Representatives undertook the financial 28 20 1 action, they could have been personally responsible for any costs 2 awarded in favor of Defendant. 3 Office & Print Services, Inc., 2007 WL 4531783, at *2-*4 (N.D. Cal. See, e.g., Whiteway v. Fed Ex Kinkos 4 Dec. 17, 2007). There has been no objection to the Class 5 Representative payment. 6 7 In light of the work the Class Representatives performed on 8 behalf of Class Members, the risk the Class Representatives undertook, 9 and the Class Members response to the Settlement, the requested 10 payment is reasonable and appropriate. 11 12 13 14 15 2. Class Counsel Attorneys Fee Payment of $100,000 is Fair and Reasonable. Class Counsel seeks an attorney s fee award of $100,000, or 33 1/3% of the common fund. This is significantly less than Class Counsel s asserted lodestar of $178,475. 1 Courts have long recognized 16 17 the common fund or common benefit doctrine, under which attorneys 18 who create a common fund or benefit for a group of persons may be 19 awarded their fees and costs to be paid out of the fund. 20 150 F.3d at 1029. See Hanlon, [A] lawyer who recovers a common fund for the 21 22 23 24 25 26 27 28 1 The district court has reviewed the billing records of Plaintiffs counsel, submitted as attachments to the Supplemental Declaration of Stan Mallison. Doc. 71. These records reveal that Stan Mallison, a partner who bills at $525 per hour spent approximately 190 hours on this case; Hector Martinez, a partner who also bills at $525 per hour spent approximately 75 hours on this case; Marco Palau, an associate who bills at $350 per hour spent approximately 30 hours on the case; and Hector Hernandez, a paralegal who bills at $150 per hour, spent approximately 170 hours on the case. See id. at ¶4. The billed lodestar is reasonable, given that this case involved considerable investigation, the filing of a fairly complex, thirty-six page complaint, the litigation of a motion to dismiss followed by the filing of an amended complaint, and the subsequent settlement of a putative class action, requiring preliminary approval, notice, and final approval. Moreover, the settlement only provides for recovery of slightly more than half of the total lodestar. 21 1 benefit of persons other than himself or his client is entitled to a 2 reasonable attorney s fee from the fund as a whole. 3 Co., 327 F.3d 938, 972 (9th Cir. 2003) (quoting Boeing Co. v. Van Staton v. Boeing 4 Gemert, 444 U.S. 472, 478 (1980)). Awarding a percentage of the 5 common fund is particularly appropriate when each member of a 6 7 certified class has an undisputed and mathematically ascertainable 8 claim to part of a lump-sum judgment recovered on his behalf. 9 Id. (quoting Boeing Co., 444 U.S. at 478-79). 10 11 12 Here, where the Settlement requires lump sum allocations to each Settlement Class and applies distribution formulas pursuant to which each Class Member who submits a valid claim will receive a 13 mathematically ascertainable payment, application of the percentage of 14 15 common fund doctrine appropriate. The typical range of acceptable 16 attorneys fees in the Ninth Circuit is 20% to 33 1/3% of the total 17 settlement value, with 25% considered the benchmark. 18 Eichen, 229 F.3d 1249, 1256 (9th Cir. 2000); Hanlon, 150 F.3d at 1029; 19 Staton, 327 F.3d at 952. 20 depending on the facts of the case, and in most common fund cases, Powers v. However, the exact percentage varies 21 the award exceeds that benchmark. Knight v. Red Door Salons, Inc., 22 2009 WL 248367 (N.D. Cal. 2009); see also In re Activision Sec. 23 24 25 26 27 Litig., 723 F. Supp. 1373, 1377-78 (N.D. Cal. 1989) ( nearly all common fund awards range around 30% ). When assessing whether the percentage requested is reasonable, courts look to factors such as: (a) the results achieved; (b) the risk 28 22 1 of litigation; (c) the skill required, (d) the quality of work; (e) 2 the contingent nature of the fee and the financial burden; and (f) the 3 awards made in similar cases. Vizcaino v. Microsoft Corp., 290 F.3d 4 1043, 1047 (9th Cir. 2002); Six Mexican Workers v. Arizona Citrus 5 Growers, 904 F.2d 1301 (9th Cir. 1990). 6 7 8 9 a. Results Achieved. Given that the individual claims in this case concerned Defendants alleged failure to pay class members for portions of days 10 on an intermittent basis and failure to proper provide rest and meal 11 periods, claims that would not generally produce substantial damages 12 13 awards, the recovery of $300,000, which will provide the 56 claimant 14 employees with a net recovery of approximately $2,600 per employee on 15 average, is a favorable result. 16 b. Risks Involved. 17 18 There were significant risks in pursuing this case. Among other 19 things, some of the key claims involved the timely provision of rest 20 and meal periods, an issue that is pending before the California 21 Supreme Court. 22 significantly lower the potential recovery in this case. It is possible that any resulting decision could 23 24 25 c. Skill Required This case required specialized skills to find and contact largely 26 Spanish speaking workers, litigate cutting-edge legal theories 27 surrounding rest and meal periods, and navigate challenging issues of 28 23 1 proof in light of the limited recording keeping by Defendant. 2 case also required intensive extrapolation from existing records. The 3 d. 4 The Quality of the Work. Counsel thoroughly investigated the case, weeding through a 5 6 myriad of potential claims to find those that could be litigated. 7 Counsel also developed sophisticated legal claims, such as the clock 8 rounding and on-duty meal period claims, despite the lack of clear 9 caselaw on point. 10 e. 11 Contingent Nature of the Representation. Class Counsel prosecuted the case on a contingency basis, which 12 presented considerable risk. See In re Sumitomo Copper Litig., 74 F. 13 Supp. 2d 393, 396-398 (S.D.N.Y. 1999) ( No one expects a lawyer whose 14 15 compensation is contingent on the success of his services to charge, 16 when successful, as little as he would charge a client who in advance 17 of the litigation has agreed to pay for his services, regardless of 18 success. 19 recoveries, is it just to make a fee depend solely on the reasonable 20 Nor, particularly in complicated cases producing large amount of time expended. ). 21 f. 22 23 Awards made in similar cases. The requested fee is in line with fee awards made in the 24 following, similar class action wage and hour cases litigated in the 25 Central Valley: 26 ¢ 33.3% in Benitez et al. v. Wilbur (E.D. Cal., 1:08-CV-1122 LJO 27 28 GSA) 24 1 ¢ 2 3 33.3% in Chavez et al. v. Petrissans et al. (E.D. Cal., 1:08-CV00122 LJO-GSA) ¢ 30% in Vasquez v. Aartman (E.D. Cal., 1:02-CV05624 AWI LJO) ¢ 31.25% in Baganha v. California Milk Trans. (E.D. Cal., 1:01-CV- 4 5 05729 AWI LJO) 6 7 8 9 ¢ 33% in Randall Willis et al. v. Cal Western Transport, and Earl Baron et al. v. Cal Western Transport, Coordinated Case No. 1:00cv-05695 AWI LJO) 10 11 The Settlement s provision of $100,000 in attorney s fees (or 12 13 approximately 33.3% of the total recovery obtained, is fair and 14 reasonable in light of the good result achieved for Plaintiffs, the 15 risk counsel took pursuing the matter, and the skill they exhibited 16 prosecuting the case. 17 18 3. 19 In the course of this litigation, Plaintiffs counsel incurred 20 Class Counsel Litigation Expenses Payment of $8,967 is Fair and Reasonable. out-of- pocket costs totaling $8,967, and expect to incur modest 21 additional in costs related to the final approval of the Settlement. 22 23 See Mallison Decl. at ¶62. The costs billed, which include ground 24 transportation, copy and scanning costs, computer research, and expert 25 witness fees, are reasonable. 26 are less than the estimated $10,000, which was included in the Class 27 Notice. See Doc. 71. 28 25 The actual costs incurred 1 IV. CONCLUSION 2 For the reasons set forth above, the joint motion to: 3 (1) Certify the Settlement Class is GRANTED; 4 (2) Approve the Settlement is GRANTED; 5 (4) Approve the proposed Class Representative Payments in the 6 amount of $5,000 to Enrique Vasquez and $5,000 to Juan Andres 7 8 Ruiz is GRANTED; 9 (5) Approve the proposed Class Counsel Attorney Fee Award in the 10 amount of $100,000 is GRANTED; 11 (6) Approve Class Counsel s Costs Award in the amount of 8,967 is 12 GRANTED. 13 14 15 SO ORDERED Dated: March 8, 2010 /s/ Oliver W. Wanger Oliver W. Wanger United States District Judge 16 17 18 19 20 21 22 23 24 25 26 27 28 26
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