Guerra et al v. Madera Management Company, Inc. et al, No. 1:2011cv01488 - Document 51 (E.D. Cal. 2012)
Court Description: FINDINGS and RECOMMENDATIONS Granting the Petition to Approve the Compromises of Minors' Claims. Referred to Judge O'Neill; Objections to F&R due within 15 days of service of this recommendation. signed by Magistrate Judge Barbara A. McAuliffe on 9/17/2012. (Herman, H)
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Guerra et al v. Madera Management Company, Inc. et al Doc. 51 1 2 3 4 5 6 UNITED STATES DISTRICT COURT 7 EASTERN DISTRICT OF CALIFORNIA 8 9 10 11 12 13 14 LUPE GUERRA, an Individual; C.T., a minor, by and through her GUARDIAN AD LITEM, LUPE GUERRA; M.T., a minor, by and through his GUARDIAN AD LITEM LUPE GUERRA; J.T., a minor, by and through his GUARDIAN AD LITEM LUPE GUERRA, Plaintiffs, 15 16 17 18 19 20 v. MADERA MANAGEMENT COMPANY, INC., a California Corporation; ANNAMARIE BROWN AS TRUSTEE OF THE RAMONA BRON SURVIVOR’S TRUST created by Trust Agreement dated September 30, 1981; and DOES 1 -10, Inclusive, 21 22 23 Defendants. ______________________________ ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) No. 1:11-cv-01488-LJO-BAM FINDINGS AND RECOMMENDATIONS GRANTING THE PETITION TO APPROVE THE COMPROMISES OF MINORS’ CLAIMS 24 25 26 27 28 1 Dockets.Justia.com I. 1 2 INTRODUCTION On August 10, 2012, Lupe Guerra (“Petitioner”), as the court-appointed guardian ad litem of 3 the named minor plaintiffs in this case, Clarissa Tavarez1, J.T. and M.T. (J.T. and M.T. are collectively 4 referred to as the “Minors”; the Petitioner, Ms. Tavarez and the Minors are collectively referred to as 5 the “Plaintiffs”), filed a petition to approve the proposed settlement between Ms. Tavarez, the Minors 6 and Madera Management Company, Inc., and Anna Marie Brown, as trustee of the Ramona Bron 7 Survivor’s Trust (collectively, the “Defendants”). (Doc. 44.) On September 5, 2012, Defendants filed a 8 response to the Petition. (Doc. 48.) The matter was heard on September 14, 2012. (Doc. 50.) Counsel 9 Craig Fagan appeared telephonically on behalf of the Petitioner, Ms. Tavarez, and the Minors. Counsel 10 Thomas Gelini appeared in person on behalf of the Defendants. (Doc. 50.) Having considered the 11 Petition, the terms of the settlement, arguments presented at the September 14, 2012 hearing, as well as 12 the Court’s file, the Court finds that the proposed settlement agreement is fair and reasonable. For the 13 reasons that follow, the Court RECOMMENDS that the Petition to Confirm Minors’ Compromises BE 14 APPROVED and GRANTED. II. 15 FACTUAL BACKGROUND 16 Plaintiffs’ Complaint was filed on September 6, 2011. (Doc. 1.) Plaintiffs filed a Second 17 Amended Complaint (“SAC”) on May 2, 2012. (Doc. 38.) Plaintiffs’ SAC brings claims against 18 Defendants under the Fair Housing Act, 42 U.S.C. § 3601 et seq. (“FHA”) and related federal and state 19 laws. Plaintiff’s claims relate to two primary allegations: (1) Defendant’s resident manager, Jose Rios, 20 sexually harassed Ms. Tavarez; and (2) Defendants treated children and families with children 21 differently from families without children in the enforcement of rules and regulations at the El 22 Descanso Apartments complex. (SAC, ¶¶ 15-22.) 23 On July 26, 2012, the parties attended a private mediation and agreed to settle all of Plaintiffs’ 24 claims. Plaintiffs filed a Petition to compromise the minors’ claims on August 10, 2012. (Doc. 44.) 25 Defendants filed a response to the Petition which did not oppose the terms of the settlement, however, 26 expressed concern over Plaintiffs’ failure to address outstanding Medi-Cal lien issues with respect to 27 1 28 Clarissa Tavarez has been referred to throughout these proceedings as “C.T.,” a minor. However, as of September 9, 2012, Ms. Tavarez became of majority age, and is no longer a minor. See, Declaration of Lupe Guerra, Doc. 44, Attach. 2, ¶ 3. Accordingly, the Court refers to Ms. Tavarez by her full name in this Order and does not address the Petition as to her. 2 1 then minor Clarissa Tavarez. (Doc. 48.) At the September 14, 2012 hearing, however, it was 2 acknowledged and agreed to by the parties that because Ms. Tavarez was no longer a minor, her claims 3 were no longer subject to the Petition to Compromise Minor Claims. Thus, only the claims of Minors 4 J.T. and M.T. are discussed herein. 5 A. Terms of the Settlement Defendants have offered consideration in the amount of $140,000.00 in exchange for a release 6 7 of all Plaintiffs' claims. Under the terms of the settlement, $23,700 will be paid to Petitioner, 8 $66,850.00 will be paid to Clarissa Tavarez, $2,500.00 will be paid to Minor M.T., and $2,500.00 will 9 be paid to Minor J.T. The remainder of the settlement - $44,450.00 - will paid to Plaintiffs’ counsel as 10 attorneys’ fees. 11 Regarding the Minors’ settlements, the Settlement Agreement requires Petitioner to deposit the 12 checks in blocked accounts at a federally insured bank or credit union. No withdrawals of principal or 13 interest may be made from the blocked accounts without a written order under this case name and 14 number, signed by a judge, and bearing the seal of this court, until the respective minors attain the age 15 of 18 years. When the respective minor attains the age of 18 years, the depository, without further 16 order of this court, is authorized and directed to pay by check or draft directly to the former minor, 17 upon proper demand, all moneys including interest deposited under this order. The money on deposit 18 is not subject to escheat. III. 19 20 21 A. DISCUSSION Legal Standard For Compromise of Minors’ Claims As a derivative of Federal Rule of Civil Procedure 17(c), district courts have a special duty to 22 safeguard the interests of litigants who are minors. Rule 17(c) provides, in pertinent part, that a district 23 court “must appoint a guardian ad litem—or issue another appropriate order—to protect a minor or 24 incompetent person who is unrepresented in an action.” Fed. R. Civ. P. 17(c). In the context of 25 proposed settlements in suits involving minor plaintiffs, the district court's special duty requires it to 26 “conduct its own inquiry to determine whether the settlement serves the best interests of the minor.” 27 Robidoux v. Rosengren, 638 F.3d 1177, 1181 (9th Cir. 2011) (quoting Dacanay v. Mendoza, 573 F.2d 28 1075, 1080 (9th Cir.1978)). Local Rule 202(b) further states that “[n]o claim by or against a minor or 3 1 incompetent person may be settled or compromised absent an order by the Court approving the 2 settlement or compromise. 3 In Robidoux, the United States Court of Appeals for the Ninth Circuit provided specific 4 guidance “on how to conduct this independent inquiry.” Robidoux, 638 F.3d at 1181. While the Ninth 5 Circuit noted that district courts have typically applied state law and the local rules governing the 6 award of attorney's fees to make the reasonableness and fairness determination, the court held that “this 7 approach places an undue emphasis on the amount of attorney's fees provided for in a settlement, 8 instead of focusing on the net recovery of the minor plaintiffs under the proposed agreement.” Id. The 9 Ninth Circuit held that, instead, district courts should “limit the scope of their review to the question 10 whether the net amount distributed to each minor plaintiff in the settlement is fair and reasonable, in 11 light of the facts of the case, the minor's specific claim, and recovery in similar cases.” Id. at 1181–82. 12 Further, the fairness of each minor plaintiff's net recovery should be evaluated “without regard to the 13 proportion of the total settlement value designated for adult co-plaintiffs or plaintiffs' counsel—whose 14 interests the district court has no special duty to safeguard.” Id. at 1182 (citing Dacanay, 573 F.2d at 15 1078). 16 B. The Reasonableness and Fairness of the Settlement Amount 17 The parties agree that payment of $2,500.00 to each Minor Plaintiff is reasonable. Having 18 reviewed settlement amounts approved similar cases, this Court agrees. In Angstman v. Carlsbad 19 Seapointe Resort et al., No. 11-cv-00620-L-WMc (S.D. Cal., Aug. 30, 2011, Doc. 36), the United 20 States District Court for the Southern District of California approved of a compromise of $750.00 to 21 each minor child in a case where children had been subjected to similar discriminatory rules at a 22 timeshare resort. In Maria Gonzalez et al. V. Diversified Real Property Management, No. 09-cv- 23 00718-PA-RNB (C.D. Cal., Mar. 29, 2010, Doc. 76), the United States District Court for the Central 24 District of California found that a settlement of $2,500.00 to each minor plaintiff was reasonable when 25 the children were prohibited from using common areas at an apartment complex. In Monroe v. Cowing 26 Litton, No. 11-cv-0479-CJC-MLG (C.D. Cal., Dec. 5, 2011, Doc. 33) the United States District Court 27 for the Central District of California approved compromises of $3,500 per minor where children were 28 prohibited from playing in the common area of an apartment complex. 4 Minor Plaintiffs M.T. and J.T. were not alleged to have been sexually harassed. The Minor 1 2 Plaintiffs are not alleged to have suffered any physical injury, nor are they alleged to have incurred any 3 out-of-pocket expenses as a result of the alleged FHA violation. The Minors’ claims stemmed from an 4 allegation that the El Descanso Apartments complex manager prevented them from playing outside in 5 the common areas of the complex, in violation of the FHA. Having considered the circumstances of 6 the Minors’ claims, and comparing those circumstances to the settlements approved in other similar 7 minor’s compromise cases, the Court finds that payment of $2,500 to each J.T. and M.T. is a 8 reasonable settlement. IV. 9 Based on the foregoing, the Court RECOMMENDS as follows: 10 11 12 CONCLUSION AND RECOMMENDATIONS 1. The PETITION TO COMPROMISE THE CLAIMS OF Minors M.T. and J.T. is approved. The minor plaintiffs shall receive the following by way of settlement: 13 a. $2,500 to M.T. 14 b. $2,500 to J.T. 15 2. Within 72 hours of receipt of a check payable to the order of the Petitioner as trustee for 16 the respective Claimants, Petitioner must deposit the checks in blocked accounts at a 17 federally insured bank or credit union. 18 3. copy of this order. 19 20 Petitioner and Minors’ attorney must deliver to each depository at the time of deposit a 4. The blocked accounts belong to minors. As to the minors, they are as follows: 21 M.T.’s date of birth is 7-14-97 22 J.T.’s date of birth is 4-8-02 23 5. No withdrawals of principal or interest may be made from the blocked accounts without 24 a written order under this case name and number, signed by a judge, and bearing the seal 25 of this court, until the respective minors attain the age of 18 years. When the respective 26 minor attains the age of 18 years, the depository, without further order of this court, is 27 authorized and directed to pay by check or draft directly to the former minor, upon 28 proper demand, all moneys including interest deposited under this order. The money on 5 deposit is not subject to escheat. 1 2 6. The Petitioner is authorized and directed to execute any and all documents reasonably necessary to carry out the terms of the settlement. 3 4 7. Bond is waived. 5 These findings and recommendations are submitted to the district judge assigned to this action, 6 pursuant to Title 28 of the United States Code section 636(b)(1)(B) and this Court’s Local Rule 304. 7 Within fifteen (15) days of service of this recommendation, any party may file written objections to 8 these findings and recommendations with the Court and serve a copy on all parties. Such a document 9 should be captioned “Objections to Magistrate Judge’s Findings and Recommendations.” The district 10 judge will review the magistrate judge’s findings and recommendations pursuant to Title 28 of the 11 United States Code section 636(b)(1)(C). Failure to file objections within the specified time may 12 waive the right to appeal the district judge’s order. Martinez v. Ylst, 951 F.2d 1153 (9th Cir. 1991). 13 14 15 16 To expedite resolution of these Findings and Recommendations, if the Parties do not have any objections, they should each file a “Notice of Non-Objection to Findings and Recommendations.” IT IS SO ORDERED. Dated: 10c20k September 17, 2012 /s/ Barbara A. McAuliffe UNITED STATES MAGISTRATE JUDGE 17 18 19 20 21 22 23 24 25 26 27 28 6
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