Alvarado et al v. Nederend et al, No. 1:2008cv01099 - Document 73 (E.D. Cal. 2011)
Court Description: MEMORANDUM DECISION Re Unopposed Motion For Final Approval of Class Action Settlement 59 , signed by Judge Oliver W. Wanger on 5/17/2011. ((1) The Settlement Class is CERTIFIED; (2) The Class Settlement is APPROVED; (3) The payment of $165,5 23 in attorneys fees and $10,827.70 in costs is APPROVED; (4) They payment of a $7,500 enhancement to the named Plaintiffs Octavio Alvarado, Pablo Martinez, Omar Gomez,Daniel Gomez, and Jose de Jesus Garcia is APPROVED; (5) The payment of $15,000 to the SettlementAdministrator is APPROVED. Plaintiffs shall submit a form of order consistent with this decision within five (5) days following electronic service. )(Gaumnitz, R)
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1 2 3 4 5 6 7 8 9 10 11 UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF CALIFORNIA OCTAVIO ALVARADO, PABLO MARTINEZ, OMAR GOMEZ, DANIEL GOMEZ, JOSE DE JESUS GARCIA, on behalf of themselves and all other similarly situated individuals, v. 13 15 16 MEMORANDUM DECISION RE UNOPPOSED MOTION FOR FINAL APPROVAL OF CLASS ACTION SETTLEMENT (DOC. 59) Plaintiffs, 12 14 1:08-cv-01099 OWW DLB REX NEDEREND AND SHERI NEDEREND (dba Northstar Dairy, Wildwood Farms, Freeway Associates ), Defendants. 17 18 I. INTRODUCTION 19 This is a wage-and-hour class action brought on 20 behalf of Dairy workers employed by Rex and Sheri 21 Nederend in, or around, Tulare and/or Kern County, 22 California. 23 2; see also Second Amended Class Action Complaint 24 25 26 27 28 Declaration of Stan S. Mallison, Doc. 60, ¶ ( SAC ), Doc. 27, filed Jan. 19, 2010. The action is brought on behalf of Plaintiffs and approximately 150 current and former non-exempt employees of Defendants for alleged violations of federal and state wage-and-hour 1 1 2 3 4 5 6 7 laws. Id. The parties have entered into a Joint Stipulation of Settlement. A January 11, 2011 memorandum decision: (1) conditionally certified a Settlement Class; (2) preliminarily approved the Class Settlement; (3) appointed Class Representatives and Class Counsel; (4) 8 approved class notice and related materials; (5) 9 appointed a settlement administrator; and (6) scheduled a 10 final approval hearing for April 4, 2011. 11 stipulation, the final approval hearing was continued to 12 13 14 15 Doc. 51. By May 2, 2011, Doc. 55, and again to May 16, 2011, Doc. 58. Supplemental notice of the revised hearing date was mailed to all class members. Declaration of Michael Bui, 16 Doc. 66 at ¶ 9. Plaintiffs have filed a motion for final 17 approval of the settlement, Doc. 56, along with numerous 18 supporting declarations, Docs. 60-66. 19 approval have been received. No objections to 20 21 II. BACKGROUND 22 Plaintiffs allege that Defendants failed to pay 23 overtime and minimum wages; failed to pay wages due at 24 termination of employment; failed to provide all legally 25 required meal periods and rest breaks; and failed to 26 27 28 provide accurate, itemized employee wage statements. Plaintiffs sought to certify a class composed of 2 1 themselves and similarly situated individuals and to 2 recover back wages, interest, penalties, and attorneys 3 fees and costs from Defendants. 4 5 6 7 See SAC. After the complaint was filed, Plaintiffs conducted substantial discovery and non-discovery investigation regarding class certification and the merits of their 8 claims. 9 Plaintiffs served an extensive set of document requests, 10 demanding all of the critical payroll and timekeeping 11 information at issue in this case, as well as the names 12 13 14 15 Mallison Decl. at ¶ 34. Among other discovery, and contact information for Defendants former and current employees. After meeting and conferring regarding these issues, Defendants produced the core 16 payroll and timekeeping information. 17 Defendants timekeeping system is both computer and 18 paper-based, consisting of paper time records for the 19 earlier part of the time period and a database for the 20 later part of the time period. 21 22 23 24 Id. at ¶ 34. Id. at ¶ 35. This required Plaintiffs counsel to employ both database experts to analyze the data as well as to copy and review tens of thousands of pages of documents. Id. Much of 25 the document and data review took place with Plaintiffs 26 and other witnesses, who guided counsel through time and 27 payroll records. 28 Id. 3 1 III. SUMMARY OF THE SETTLEMENT. 2 The case was resolved with the aid of a mediator s 3 proposal drafted by Mediator former District Court Judge 4 Raul Ramirez. 5 6 7 8 9 10 The Settlement Agreement covers approximately 150 current and former Dairy employees who worked for Defendants from July 30, 2004 to September 7, 2010. Mallison Decl., Ex. 1, Doc. 47-1, Settlement Agreement ( Settlement ) § I.N. A. Gross Settlement Payment. 11 Pursuant to the Settlement, Defendants will make 12 13 Id. at ¶ 37. Gross Settlement Payments totaling between $480,000.00 14 and $498,588.37 by November 8, 2011, depending on the 15 date of complete payment. 16 March 9, 2011, Defendant has deposited $496,569.86 with 17 the Settlement Administrator. 18 14. 19 20 ¢ Mallison Decl. at ¶ 38. As of Bui Decl., Doc. 66, at ¶ This total sum will cover: Settlement Shares to be paid to Class Members who submit valid claims; 21 22 ¢ any payroll withholding on the Settlement Shares; 23 ¢ a $10,000 payment to the California Labor and 24 Workforce Development Agency for its share of the 25 settlement of civil penalties; 26 27 28 ¢ the Settlement Administrator s reasonable fees and expenses (no more than $15,000); 4 1 ¢ 2 (subject to court approval) payments to Plaintiffs, in addition to their Settlement Shares, of $7,500 3 each in compensation of their services as Class 4 Representatives; and 5 ¢ 6 (also subject to court approval) payments to Class 7 Counsel of no more than 33.33% of the gross 8 settlement amount for their reasonable attorneys 9 fees, as well as $10,000 in expenses incurred in 10 investigating and prosecuting the case, preparing for 11 and negotiating at the mediation, documenting the 12 Settlement, securing approval of the Settlement, and 13 related tasks. 14 15 Settlement, § III.A - C. There will be no reversion of 16 the Gross Settlement Payment to Defendants. 17 Decl. at ¶ 39. Mallison 18 19 20 B. Payment of Settlement Shares. After the other amounts are deducted, the Gross 21 Settlement Amount (then called the Net Settlement 22 Amount ) will be distributed as Settlement Shares to all 23 Class Members who submit valid claims, see Settlement § 24 III, based upon the following allocation formula: 25 26 27 28 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 5 1 during the Class Period (with the division rounded to four decimal places) (c) multiplied by the value of the Net Settlement Amount. 2 3 4 5 6 7 Settlement § III.D.1. This formula relies upon objective evidence of the term of employment, which Class Members can easily review and confirm. Mallison Decl. at ¶ 40. In addition, this information is readily available from 8 Defendants records, and the Settlement Administrator can 9 apply the formula in a fair and transparent manner. 10 The parties estimate that, if all amounts sought under 11 the Settlement are awarded, a Class Member s average 12 13 14 15 16 17 18 19 20 Settlement Share will average approximately $2,000 per employee. C. Id. Distribution of Unclaimed Funds and Uncashed Checks. In the event that not all Class Members submit claims, the residue will be redistributed to those Class Members who do submit valid claims. III.D.3. 22 23 24 25 26 27 28 Settlement, § The settlement agreement provides that in the 1 21 Id. 1 Plaintiffs counsel considered other, more complicated methods, but determined that although these methods have some merit, they were not without controversy and would likely lead to a myriad of objections. Mallison Decl. at ¶ 41. Plaintiffs counsel represents that the formula employed in the Settlement is commonly used in wage-and-hour cases, and is appropriate in this case, where most workers experience the same working conditions and have similar claims that roughly correlate with the number of hours that they have worked. Id. Further, Plaintiffs counsel maintains that, although their might be marginally better theoretical methods for calculating allocations amongst class members, the costs of obtaining and processing the information necessary and to make such calculations (especially given Defendants reliance upon a paper based payroll system for part of the class period) would likely outweigh any benefits of using a more complex calculation method. Id. 6 1 event that checks issued to Class Members are not cashed, 2 these monies will be donated to California Rural Legal 3 Assistance, Id., § III.F.10, a public interest 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 organizations that serves low-income workers in the same geographical area as the class. D. Scope of the Release. The scope of the release by all Participating Class Members (all Class Members other than those who elect not to participate in the Settlement) tracks the scope of Plaintiffs allegations: As of the date of the Judgment, all Participating Class Members hereby fully and finally release Defendants, 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. 27 28 7 1 E. Objections and Opt-Out Process 2 Any Class Member who so wishes may object to or 3 comment on the Settlement; or may elect not to 4 participate in the Settlement. 5 6 7 8 The Class Notice fully explains the objection/comment and opt-in procedures. Settlement, § III.F.4, Exh. C. The Class Notice, as with all forms, has been provided to the Class Members in 9 English and Spanish. A small number of notices have been 10 returned based upon contact information that is no longer 11 correct, and the Settlement Administrator is attempting 12 to locate those individuals. Doc. 56. 13 15 Class Representative Payments; Class Counsel Attorneys Fees Payment and Class Counsel Litigation Expenses Payment. 16 By a motion to be filed prior to the Final Approval 14 F. 17 Hearing, Plaintiffs and their counsel will seek (and 18 Defendants have agreed not to oppose): 19 ¢ 20 Payments of $7,500 each, in addition to their 21 Settlement Shares, in compensation for their 22 services as Class Representatives; and 23 24 awards to Plaintiffs of Class Representative ¢ awards to Class Counsel of a Class Counsel 25 Attorneys Fees Payment of not more than 33.33% of 26 the Gross Settlement Amount and a Class Counsel 27 28 Litigation Expenses Payment of not more than 8 1 2 $10,000. Settlement, § III.B.1-2. 3 IV. DISCUSSION 4 5 6 A. Certification of a Class for Settlement. As the Class has only been conditionally certified, 7 final certification is required and is governed by 8 Federal Rule of Civil Procedure Rule 23. 9 10 11 1. Rule 23(a) Requirements. Federal Rule of Civil Procedure 23(a) states in 12 pertinent part that [o]ne or more members of a class may 13 sue or be sued as representative parties on behalf of 14 all. 15 class, a court must be satisfied that 16 As a threshold matter, in order to certify a 22 (1) the class is so numerous that joinder of all members is impracticable (the "numerosity" requirement); (2) there are questions of law or fact common to the class (the "commonality" requirement); (3) the claims or defenses of representative parties are typical of the claims or defenses of the class (the "typicality" requirement); and (4) the representative parties will fairly and adequately protect the interests of the class (the "adequacy of representation" requirement). 23 In re Intel Secs. Litig., 89 F.R.D. 104, 112 (N.D. Cal. 24 1981)(citing Fed. R. Civ. P. 23(a)). 17 18 19 20 21 25 26 27 28 a. Numerosity. Here, the proposed class is comprised of all individuals who have been employed by defendants in 9 1 California as non-exempt Dairy workers during the period 2 July 30, 2004 through September 7, 2010. 3 approximately 150 Class Members. 4 5 6 7 There are Courts have routinely found the numerosity requirement satisfied when the class comprises 40 or more members. Ansari v. New York Univ., 179 F.R.D. 112, 114 (S.D.N.Y. 1998). Numerosity is also 8 satisfied where joining all Class members would serve 9 only to impose financial burdens and clog the court s 10 docket. 11 Here, the joinder of approximately 150 individual former 12 13 14 In re Intel Secs. Litig., 89 F.R.D. at 112. employees would only further clog this court s already overburdened docket. 15 b. Commmon Questions of Fact and Law. 16 Commonality exists when there is either a common 17 legal issue stemming from divergent factual predicates or 18 19 20 21 a common nucleus of facts resulting in divergent legal theories. Hanlon v. Chrysler Corp., 150 F.3d 1011, 1019 (9th Cir. 1998). Here, the parties agree that potential 22 Class Members advance claims that raise common questions 23 of both law and fact, including: 24 ¢ 25 26 27 28 Whether Northstar authorized and permitted the Dairy workers to take required rest periods; ¢ Whether Northstar failed to pay Dairy workers an additional hour of wages for missed meal periods and 10 1 2 rest breaks; ¢ 3 minimum wages and overtime compensation to hourly 4 production workers; 5 6 Whether Northstar failed to pay all legally required ¢ Whether hourly production workers are owed waiting 7 time penalties because Northstar allegedly willfuly 8 failed to pay them additional wages for missed meal 9 periods and rest breaks, and for meal periods taken 10 during which they remained on duty, upon the 11 termination of their employment; and 12 13 ¢ Whether Northstar s business practices violated 14 Business and Professions Code section 17200 et seq. 15 Every class member was paid under the same pay 16 practices as every other class member. 17 The Commonality requirement is satisfied. 18 19 20 c. Typicality. Typicality is satisfied if the representatives 21 claims arise from the same course of conduct as the class 22 claims and are based on the same legal theory. 23 Kayes v. Pac. Lumber Co., 51 F.3d 1449, 1463 (9th Cir. 24 1995)(claims are typical where named plaintiffs have the 25 26 27 28 See e.g., same claims as other members of the class and are not subject to unique defenses). Because every class member was paid under the same pay practices as every other 11 1 class member, the representatives claims are typical of 2 those of the other class members. 3 d. 4 Fair & Adequate Representation. The final Rule 23(a) requirement is that the class 5 6 representative fairly and adequately protect the 7 interests of the class. 8 First, the representative s attorney must be qualified, 9 10 11 12 This requirement has two parts. experienced, and able to conduct the litigation. In re United Energy Corp. Solar Power Modules Tax Shelter Inv. Secs. Litig., 122 F.R.D. 251, 257 (C.D. Cal. 1998). 13 Second, the suit must not be collusive and the named 14 Plaintiff s interests must not be antagonistic to the 15 class. 16 17 18 19 20 21 22 Id. All requirements are satisfied here. Proposed class counsel, Stan S. Mallison, Esq., of the law firm Mallison & Martinez, is highly experienced in labor class action litigation for more than 15 years. 5-6. Mallison Decl. at ¶¶ He is highly qualified. In addition, the Class Representatives interests are 23 completely aligned with those of the class. 24 Representatives interest is in maximizing their 25 recovery. 26 27 28 Each Although they will receive an additional $7,500, this appears to be reasonable to compensate them for the time and expense he devoted to pursuing this 12 1 case. 2 41-45. See Declarations of Class Representatives, Docs. 3 4 2. 5 Once the threshold requirements of Rule 23(a) are 6 satisfied, a class may be certified only if the class 7 action satisfies the requirements of Rule 23(b)(1), 8 (b)(2), and/or (b)(3). 9 10 11 12 Certification of a Class under Rule 23(b)(3). Here, the parties agree for purposes of the Settlement only that certification of the Class is appropriate under Rule 23(b)(3) because questions of law or fact common to the members of the 13 class predominate over any questions affecting only 14 individual members, and ... a class action is superior to 15 other available methods for the fair adjudication of the 16 controversy. Fed. R. Civ. P. 23(b)(3). 17 18 19 20 21 22 23 B. The Terms of the Preliminary Approval Have Been Satisfied. The January 27, 2011 preliminary approval of the Settlement and conditional certification of the Class ordered that the Class be sent notice of the Settlement, approved the form of notice proposed by the parties, 24 approved the forms of claims for settlement share and 25 election not to participate, and set the hearing for 26 final approval. 27 Simpluris, has carried out this Court s order to the 28 Doc. 53. The claims administrator, 13 1 extent possible. 2 On March 1, 2011 class Notice Packets were mailed to all 3 125 class members with a known address. 4 5 6 7 See generally Bui Declaration, Doc. 66. Id. at ¶7. The U.S. Postal Service returned 51 Notice Packets to the Settlement Administrator. Id. ¶ 10. Best efforts to trace these individuals and/or find their updated 8 addresses were conducted by use of Accurint a reputable 9 research tool owned by Lexis-Nexis and remailed 53 class 10 notice packets. 11 Simpluris did not obtain any claims from these 53 12 13 14 15 mailings. Id. Id. However, despite best efforts, On March 23, 2011, Simpluris also mailed out 111 reminder notices to class members who had not yet responding to the initial notice. Id. at ¶ 8. Despite these difficulties, 56 claims (40.57%) were 16 17 received and accepted by the Claims Administrator. 18 11. 19 high for the type of workforce at issue in this case. 20 Doc. 70 at 8. 21 22 23 24 25 26 27 28 Id. ¶ According to Plaintiffs, this figure is extremely No claims have been rejected. Doc. 66, at ¶ 11. not to participate. Bui Decl., Zero individuals submitted elections Id. at ¶ 12. As of May 5, 2011, no class member has submitted an objection to the Settlement. C. Id. at ¶ 13. Approval of the Settlement. The court must approve any settlement ... of the 14 1 claims ... of a certified class. 2 23(e)(1)(A). 3 hearing and on finding that it is fair, reasonable, and 4 5 6 7 adequate. Fed. R. Civ. P. A settlement may be approved only after a Fed. R. Civ. P. 23(e)(1)(C). Such approval is required to make sure that any settlement reached is consistent with plaintiffs fiduciary obligations to the 8 class. 9 996 (9th Cir. 1985). The court also serves as guardian 10 for the absent class members who will be bound by the 11 settlement, and therefore must independently determine 12 13 14 15 See Ficalora v. Lockheed Cal. Co., 751 F.2d 995, the fairness of any settlement. Id. However, the district court s role in intruding upon what is otherwise a private consensual agreement is limited to the extent 16 necessary to reach a reasoned judgment that the agreement 17 is not the product of fraud or collusion between the 18 negotiating parties, and that the settlement, taken as a 19 whole, is fair, reasonable, and adequate to all 20 concerned. 21 22 23 24 Cir. 1996). FDIC v. Alshuler, 92 F.3d 1503, 1506 (9th Therefore, the settlement hearing is not to be turned into a trial or rehearsal for trial on the merits. Officers for Justice v. Civil Service Com., 688 25 F.2d 615, 625 (9th Cir. 1982). 26 court's determination is nothing more than an amalgam of 27 delicate balancing, gross approximations, and rough 28 15 Ultimately, the district 1 2 3 4 5 6 7 justice. Id. In determining whether a settlement agreement is fair, adequate, and reasonable to all concerned, a district court may consider some or all of the following factors: (1) the strength of the Plaintiff's case (2) the risk, expense, complexity, and likely duration of further 8 litigation; (3) the risk of maintaining class action 9 status throughout the trial; (4) the amount offered in 10 settlement; (5) the extent of discovery completed; (6) 11 the stage of the proceedings; (7) the views and 12 13 14 15 experience of counsel; (8) any opposition by class members; (9) the presence of a governmental participant. Linney v. Cellular Alaska Pshp., 151 F.3d 1234,1242 (9th 16 Cir. 1998). This list of factors is not exclusive and 17 the court may balance and weigh different factors 18 depending on the circumstances of each case. 19 Tucson Elec. Power Co., 8 F.3d 1370, 1376 (9th Cir. 20 1993). Torrisi v. 21 22 23 24 25 26 1. The Relative Strengths of the Parties Cases Supports Approval of the Settlement. Defendants contest liability in this action and are prepared to vigorously defend against these claims if the action is not settled. Mallison Decl. at ¶ 48. If the 27 litigation proceeds, Plaintiffs would face significant 28 risks. Id. For example, the primary cause of action in 16 1 this case revolves around the provision of meal periods. 2 However, the meaning of an employer s obligation to 3 provide meal periods under California law is currently 4 5 6 7 before the California Supreme Court (see Brinker Restaurant Corp. v. Superior Court (Hohnbaum), 165 Cal. App. 4th 25 (2008) (review granted)). A defense ruling 8 in Brinker could impair Plaintiffs ability to proceed on 9 these causes of action. 10 11 12 13 14 15 16 17 Even if Plaintiffs were to prevail, they would be required to expend considerable additional time and resources potentially outweighing any additional recovery obtained through successful litigation. In addition, continued litigation would clearly delay payment to the Class. See Mallison Decl. at ¶ 48. In light of these risks, the significant recovery is 18 fair, reasonable, and adequate and is in the best 19 interest of the Settlement Class in light of all known 20 facts and circumstances. 21 22 2. The Settlement Amount is Fair and Reasonable. 23 The Settlement provides for a payment of almost 24 $500,000.00 by Defendants, which is substantial given the 25 relatively small size of the class (approximately 150 26 27 28 members, with approximately 40 full time employees at any given time) and the limited nature of the alleged 17 1 violations at issue. 2 nearly $4,000 per employee. 3 Settlement Shares to be paid under the Settlement are 4 5 6 7 The average settlement share is Mallison Decl. at ¶ 40. All determined by the number of months each Class Member worked in a Covered Position. Id. The Class Representative Payments and the Class 8 Counsel Attorneys Fees Payment are appropriate, and are 9 separately approved below. 10 11 12 13 14 Finally, the expected Settlement Administrator s fees and costs of approximately $15,000 are less than similar wage-and-hour settlements of this type and size. Mallison Decl. at ¶ 39. 15 3. 16 As part of the Settlement, Class Members will be 17 18 19 20 21 The Release Is Appropriate. deemed to have released all claims based on or arising from the allegations that they were or are improperly compensated under federal, California, or local law. Settlement, § III. These released claims appropriately 22 track the breadth of Plaintiffs allegations in the 23 action and the settlement does not release unrelated 24 claims that class members may have against defendants. 25 26 27 28 4. The Settlement Was the Project of Informed, Arm s Length Negotiations. The Settlement was reached after informed, arm s 18 1 length negotiations between the parties. 2 conducted extensive investigation and discovery allowing 3 them to assess the strengths and weaknesses of the case. 4 5 6 7 Both parties As such, the Settlement is the product of non-collusive negotiations. See Mallison Decl. at ¶¶ 35-54. Plaintiffs counsel had access to thousands of pages of 8 documents and the full database of timekeeping entries 9 for the relevant time period, which Plaintiffs expert 10 and Plaintiffs counsel reviewed prior to and during the 11 negotiations. 12 13 14 15 Counsel was also informed by numerous interviews with witnesses to the allegations. Decl. at ¶ 36. Mallison In addition, there is no evidence of collusion. 16 5. 17 The reactions of the members of a class to a 18 19 20 21 Reaction of the Class Members. proposed settlement is a proper consideration for the trial court. Vasquez v. Coast Valley Roofing, 266 F.R.D. 482 (E.D. Cal. 2010) (citing 5 Moore s Fed. 22 Practice § 23.85[2][d]). 23 of the settlement are especially important as [t]he 24 representatives' views may be important in shaping the 25 agreement and will usually be presented at the fairness 26 27 28 Class Representative s opinion hearing; they may be entitled to special weight because the representatives may have a better understanding of 19 1 the case than most members of the class. 2 Complex Litigation, Third, § 30.44 (1995). 3 4 5 6 7 Manual for Here, the Class Representatives strongly support the settlement. See Declaration of Octavio Alvarado, Doc. 65, at ¶ 5; Declaration of Daniel Gomez, Doc. 63, at ¶ 5; Declaration of Pablo Martinez, Doc. 61, at ¶ 5; 8 Declaration of Omar Gomez, Doc. 62, at ¶ 5; Declaration 9 of Jesus Garcia, Doc. 64, at ¶ 5. 10 Representatives and their attorneys have extensive 11 understanding of the merits of this settlement having 12 13 14 15 Each of these Class participated extensively in the strategy, formulation, filing, litigation and negotiation process. See Alvarado Decl. at ¶¶ 3-4; Martinez Decl. at ¶¶ 3-4; O. Gomez Decl. 16 at ¶¶ 3-4; D. Gomez Decl. at ¶¶ 3-4; Garcia Decl. at ¶¶ 17 3-4. 18 Class Members or any other members of the public. 19 There have been no objections to the settlement by The settlement is fair and reasonable. 20 21 D. Class Counsel s Requested Fees and Costs. 22 Courts have long recognized the common fund or 23 common benefit doctrine, under which attorneys who 24 create a common fund or benefit for a group of persons 25 may be awarded their fees and costs to be paid out of the 26 27 28 fund. Hanlon v. Chrysler Corp., 150 F.3d 1011, 1029 (9th Cir. 1998). [A] lawyer who recovers a common fund for 20 1 the benefit of persons other than himself or his client 2 is entitled to a reasonable attorney's fee from the fund 3 as a whole. 4 5 6 7 Staton v. Boeing Co., 327 F.3d 938, 972 (9th Cir. 2003) (quoting Boeing Co. v. Van Gemert, 444 U.S. 472, 478 (1980)). Awarding a percentage of the common fund is particularly appropriate when each 8 member of a certified class has an undisputed and 9 mathematically ascertainable claim to part of a lump-sum 10 judgment recovered on his behalf. 11 Co., 444 U.S. at 478-79). 12 13 14 15 Id. (quoting Boeing Here, where the Settlement requires lump sum allocations to each Settlement Class and applies distribution formulas pursuant to which each Class Member 16 who submits a valid claim will receive a mathematically 17 ascertainable payment, application of the percentage of 18 common fund doctrine appropriate. 19 acceptable attorneys' fees in the Ninth Circuit is 20% to 20 33 1/3% of the total settlement value, with 25% 21 22 23 24 considered the benchmark. The typical range of Powers v. Eichen, 229 F.3d 1249, 1256 (9th Cir. 2000); Hanlon, 150 F.3d at 1029; Staton, 327 F.3d at 952. However, the exact percentage 25 varies depending on the facts of the case, and in most 26 common fund cases, the award exceeds that benchmark. 27 Knight v. Red Door Salons, Inc., 2009 WL 248367 (N.D. 28 21 1 Cal. 2009); see also In re Activision Sec. Litig., 723 F. 2 Supp. 1373, 1377-78 (N.D. Cal. 1989) ( nearly all common 3 fund awards range around 30% ). 4 5 6 7 Class Counsel seeks an attorney s fee award of $165,523, or 33 1/3% of the Settlement amount. This is significantly less than Class Counsel's asserted lodestar 8 of $198,593.75. 2 9 requested is reasonable, courts look to factors such as: 10 (a) the results achieved; (b) the risk of litigation; (c) 11 the skill required, (d) the quality of work; (e) the 12 13 14 15 When assessing whether the percentage contingent nature of the fee and the financial burden; and (f) the awards made in similar cases. Vizcaino v. Microsoft Corp., 290 F.3d 1043, 1047 (9th Cir.2002); Six 16 Mexican Workers v. Arizona Citrus Growers, 904 F.2d 1301 17 (9th Cir.1990). 18 1. 19 The Results Achieved. 2 20 21 22 23 24 25 26 27 28 The district court has reviewed the billing records of Plaintiffs' counsel, submitted as attachments to the Declaration of Stan Mallison. Doc. 60. These records reveal that Stan Mallison, a partner who bills at $595 per hour spent approximately 176 hours on this case; Hector Martinez, a partner who also bills at $595 per hour spent approximately 85 hours on this case; Marco Palau, an associate who bills at $450 per hour spent approximately 7 hours on the case; Jessica Juarez, an associate who bills at $325 per hour, spent approximately 37.5 hours on the case, and Joseph Sutton, another associate who bills at $325 per hour, spent approximately 2.5 hours on the case. See id. at ¶ 57. 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 partial recovery of the total lodestar. 22 1 The individual claims in the case concerned 2 defendants failure to pay class members for portions of 3 days on an intermittent basis and failure to provide 4 5 6 7 proper rest and meal periods. Such claims would not ordinarily produce large recoveries per claimant. Here, the recovery of nearly $500,000 will provide the 56 8 claimant employees with a net recovery of over $4,000 per 9 employee. 10 11 12 2. Mallison Decl ¶ 40. This is substantial. The Risks Involved. There were significant risks in pursuing this case. 13 One of the primary issues involved in this case has to do 14 with the timely provision of rest and meal periods an 15 issue that is currently before the California Supreme 16 Court in the Brinker and Brinkley cases. It is unknown 17 what the outcome of the Supreme Court s decision will be, 18 19 20 21 but it is possible that decision could seriously damage the recovery in this case. The Defendants also posed serious defenses to the 22 claims. And defense counsel demonstrated that they were 23 very able in defense of their client. 24 25 26 Plaintiffs Counsel invested $198,593.75 in lodestar and $10,827.70 in costs in litigating this case with no guarantee or recovery. 27 28 23 1 3. 2 This case required specialized skills in finding and The Skill Required. 3 contacting largely Spanish speaking workers, and in 4 litigating cutting-edge legal theories surrounding rest 5 6 7 8 and meal periods and issues of proof in light of the limited recording keeping by Defendant. In addition to the large number of witness interviews, the case also 9 involved an intensive use and extrapolation from the 10 existing records. 11 experienced in class action wage and hour litigation of 12 this nature. Class Counsel has extensive See Mallison Decl. at ¶¶3-17. 13 14 4. Quality of the Work. 15 Counsel thoroughly investigated the case, researching 16 numerous potential claims to find those that could be 17 developed and litigated. 18 sophisticated legal claims were advanced, based on, among 19 20 21 22 23 24 Eventually, several other things, clock-rounding and on-duty meal period theories, despite the lack of clear caselaw on point. 5. The Contingent Nature of the Fee and the Financial Burden This case was conducted on a contingent fee basis 25 against a well-represented Defendant. 26 received no money from plaintiffs or any other source to 27 litigate this case. 28 Counsel has The plaintiffs are all low-wage 24 1 workers who could never meaningfully contribute to any 2 such expenses. 3 risk of litigation. 4 5 6 7 significant liability exposure such that it was willing to pay nearly $500,000 to settle Plaintiff s claims. 6. 9 11 12 13 hour cases litigated in the Central Valley. For example, this court has awarded the following fees: ¢ 18 ¢ 30% in Vasquez v. Aartman, E.D. Cal. Case No. 1:02CV05624 AWI LJO; ¢ 31.25% in Baganha v. California Milk Transport, Case No. 1:01-cv-05729 AWI LJO; 19 20 33.3% in Vasquez v. Coast Valley Roofing, 266 F.R.D. 482 (E.D. Cal. 2010), Case No. 1:07-cv-00227 OWW DLB; 16 17 Awards in Similar Cases. The requested fee is in line with similar wage and 14 15 Despite such challenges, Class Counsel were able to persuade Defendant that it faced 8 10 Plaintiffs counsel accepted the entire ¢ 33.3% in Randall Willis et al. v. Cal Western 21 Transport, and Earl Baron et al. v. Cal Western 22 Transport, Coordinated Case No. 1:00-cv-05695 AWI 23 LJO; 24 25 ¢ Wilbur, Case No. 1:08-cv-01122 LJO GSA; 26 27 28 33.3% in Benitez, et al. v. Jeff Wilbur and Lisa ¢ 33.3% in Chavez, at al. v. Petrissans, Case No. 1:08cv-00122 LJO GSA; 25 1 2 In light of the overall success, the skill with which the 3 case was prosecuted, the substantial legal risks 4 5 6 7 associated with Plaintiffs claims, the financial risks borne by Plaintiffs Counsel, and similar awards made in similar cases, the requested attorney s fee award of 33 8 1/3% of the total recovery (or $165,523) is reasonable 9 under the circumstances. 10 11 12 E. Class Counsel s Request for Costs. Class Counsel incurred out-of-pocket costs totaling 13 $10,827.70, and expect to incur modest additional in 14 costs related to the final approval of the Settlement. 15 See Settlement Agreement III.B.1. The bulk of the 16 incurred costs included filing fees, mediator fees (of 17 $5,367.50), ground transportation, copy charges, computer 18 19 20 21 research, and database expert fees. Mallison Decl. ¶ 58. Id.; see also Such costs are routinely reimbursed in these types of cases. See, In re United Energy Corp. 22 Sec. Litig., 1989 WL 73211, at *6 (C.D. Cal. 1989) 23 (quoting Newberg, Attorney Fee Awards, § 2.19 (1987)); 24 see e.g. Vasquez, 266 F.R.D. at 493 (Class Counsel 25 litigation expenses payment of approximately $9,000 was 26 27 28 fair and reasonable in similar case). Here, the actual costs incurred are greater than the 26 1 estimated $10,000, which was included in the Class Notice 2 and to which no Class Member objected. 3 request, which is capped at $10,000 is reasonable. Plaintiffs 4 5 F. Class Representative Enhancement. Pursuant to the Settlement, Plaintiff seeks an 6 7 enhancement in the amount of $7,500 to the named 8 Plaintiffs Octavio Alvarado, Pablo Martinez, Omar Gomez, 9 10 11 12 Daniel Gomez, and Jose de Jesus Garcia. 45. Mallison Decl. ¶ This payment is intended to recognize the time and efforts that the named Plaintiffs spent on behalf of the 13 Class Members. Id.; see also Declarations of Octavio 14 Alvarado, Pablo Martinez, Omar Gomez, Daniel Gomez, and 15 Jose de Jesus Garcia, Docs. 61-65. 16 17 18 19 20 21 Courts routinely approve incentive awards to compensate named plaintiffs for the services they provide and the risks they incurred during the course of the class action litigation. Ingram v. The Coca-Cola Company, 200 F.R.D. 685, 694 (N.D. Ga. 2001) (internal 22 quotations and citations omitted). 23 Court approved service awards of $300,000 to each named 24 plaintiff in recognition of the services they provided to 25 the class by responding to discovery, participating in 26 27 28 In Coca-Cola, the the mediation process, and taking the risk of stepping forward on behalf of the class. 27 Coca-Cola, 200 F.R.D. at 1 694; see, e.g., Van Vranken v. Atl. Richfield Co., 901 F. 2 Supp. 294, 299 (N.D. Cal. 1995) (approving $50,000 3 participation award to plaintiffs); Glass v. UBS 4 5 6 7 8 Financial Services, Inc., 2007 WL 221862, at *17 (N.D. Cal. Jan. 26, 2007) (approving $25,000 enhancement to each named plaintiff). In this case, among other things, the named 9 Plaintiff: (1) travelled from Bakersfield to Sacramento 10 for mediation sessions (2) assisted Counsel in 11 investigating and substantiating the claims alleged in 12 13 14 15 this action; (3) assisted in the preparation of the complaint in this action; (4) produced evidentiary documents to Counsel; and (5) assisted in the settlement 16 of this litigation. 17 Octavio Alvarado, Pablo Martinez, Omar Gomez, 18 DanielGomez, and Jose de Jesus Garcia, Docs. 61-65. 19 Moreover, as with any plaintiff who files a civil action, 20 Plaintiffs undertook the financial risk that, in the 21 22 23 24 See Mallison Decl.; Declarations of event of a judgment in favor of Defendant in this action, they could have been personally responsible for the costs awarded in favor of the Defendant. See, e.g., Whiteway 25 v. Fed Ex Kinkos Office & Print Services, Inc., No. C 08- 26 2320 SBA, 2007 WL 4531783, at **2-4 (N.D. Cal. Dec. 17, 27 2007). 28 28 1 2 G. Claims Administrator Fee. The Class Notice provided that the Claims 3 Administrator would receive a few of up to $15,000. 4 Plaintiffs request that the full amount of $15,000 be 5 6 7 8 approved as Simpluris fee. Doc. 70 at 25-26. The Declaration of Michael Bui, a Case Manager at Simpluris, explains the tasks undertaken by Simpluris to accomplish 9 notify the Class of the settlement and administer its 10 terms. 11 $15,000, taking into consideration both costs incurred to 12 date and those anticipated to be incurred in the future. 13 14 15 16 Mr. Bui estimates administration costs of This request is substantially lower than previous administrator fees awarded in this District. See Vasquez, 266 F.R.D.at 483-84 ($25,000 administrator fee 17 awarded in wage and hour case involving 177 potential 18 class members). 19 20 21 22 V. CONCLUSION For all the reasons set forth above: (1) The Settlement Class is CERTIFIED; 23 (2) The Class Settlement is APPROVED; 24 (3) The payment of $165,523 in attorney s fees and 25 26 27 28 $10,827.70 in costs is APPROVED; (4) They payment of a $7,500 enhancement to the named Plaintiffs Octavio Alvarado, Pablo Martinez, Omar Gomez, 29 1 2 3 4 5 6 7 8 9 10 Daniel Gomez, and Jose de Jesus Garcia is APPROVED; (5) The payment of $15,000 to the Settlement Administrator is APPROVED. Plaintiffs shall submit a form of order consistent with this decision within five (5) days following electronic service. SO ORDERED Dated: May 17, 2011 /s/ Oliver W. Wanger United States District Judge 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 30
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