Schiller v. David's Bridal, Inc., No. 1:2010cv00616 - Document 60 (E.D. Cal. 2012)

Court Description: FINDINGS and RECOMMENDATIONS recommending that the Motion for Final Approval of Class Action Settlement 48 be GRANTED; that the Motion for Attorneys' Fees 49 be GRANTED. Matter referred to Judge Ishii; Objections to F&R's due within fourteen (14) days of service of this recommendation; signed by Magistrate Judge Sheila K. Oberto on 6/11/2012. (Timken, A)
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Schiller v. David's Bridal, Inc. Doc. 60 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 12 13 ESTELLA SCHILLER, individually, and on behalf of other members of the general public similarly situated, and as an aggrieved employee pursuant to the Private Attorneys General Act, 14 15 CASE NO. 1:10-cv-00616-AWI-SKO FINDINGS AND RECOMMENDATIONS THAT: THE MOTION FOR FINAL APPROVAL OF CLASS ACTION SETTLEMENT BE GRANTED Plaintiff, v. (Doc. No. 48) 16 17 DAVID'S BRIDAL, INC., a Florida Corporation; and DOES 1 through 10, inclusive, THE MOTION FOR ATTORNEYS' FEES BE GRANTED 18 (Doc. No. 49) Defendants. 19 OBJECTIONS DUE: 14 DAYS / 20 21 I. INTRODUCTION 22 On March 9, 2012, Plaintiff Estella Schiller filed motions for final approval of a class action 23 settlement, for an award of attorneys' fees, and for an enhancement award for Plaintiff as class 24 representative.1 (Docs. 48, 49.) No opposition to the motions was filed, and no objection by a Class 25 Member was submitted. The matter was heard on May 16, 2012; Arthur Meneses, Esq., of Initiative 26 Legal Group APC appeared on behalf of Plaintiff, and Cary Palmer, Esq., of Jackson Lewis LLP 27 28 1 Although the electronic docket indicates that Plaintiff filed a "Motion for Judgment," the caption of the motion filed is a "Motion for Final Approval of Class Action Settlement." (Doc. 48.) 1 appeared on behalf of Defendant David's Bridal, Inc. ("David's Bridal" or "Defendant"). No Class 2 Member appeared at the hearing. For the reasons set forth below, the Court RECOMMENDS that 3 Plaintiff's motions for (1) final approval of the class action settlement, (2) an award of attorneys' fees, 4 and (3) an enhancement award to Plaintiff as class representative be GRANTED. 5 II. FACTUAL BACKGROUND 6 This case was filed on January 15, 2010 (Doc. 1, Exh. A, p. 3), in Stanislaus County Superior 7 Court and was removed by Defendant to federal court on April 8, 2010. (Doc. 1.) The complaint 8 stated putative class wage-and-hour claims alleging that Defendant failed to (1) pay overtime wages; 9 (2) provide meal periods and pay meal period premiums; (3) reimburse for necessary business- 10 related expenses and costs; (4) pay minimum wages; (5) timely pay wages upon termination; 11 (6) timely pay wages during employment; (7) provide accurate and itemized wage statements; and 12 (8) comply with the California Business & Professions Code §§ 17200 et seq. (Doc. 1, Exh. A; Doc. 13 37.)2 The complaint also sought penalties under the California Private Attorneys General Act of 14 2004 ("PAGA"). Plaintiff unsuccessfully challenged Defendant's removal to federal court. (Doc. 15 23.) Discovery commenced in September 2010. (See Doc. 31.) A Second Amended Complaint 16 alleging the same claims was filed on June 29, 2011. (Doc. 37.) 17 On May 4, 2011, the parties mediated their dispute with David Rotman, Esq., and after 18 approximately 10 hours of negotiation, the parties reached a settlement of Plaintiff's claims. 19 (Williams Decl., Doc. 39-1, ¶ 8.) The parties memorialized the terms of their proposed settlement 20 in a "Joint Stipulation of Settlement and Release Between Plaintiff and Defendant" ("Settlement 21 Agreement") (Doc. 39-1, Exh. 1), and on October 7, 2011, filed a request for preliminary approval 22 of the class settlement. (Doc. 39.) On November 9, 2011, the Court granted preliminary approval 23 for the settlement, authorized the notice process, and scheduled a hearing to consider final approval 24 of the settlement. (Doc. 46.) On March 9, 2012, Plaintiff filed a Motion for Final Approval of Class 25 Action Settlement ("Motion for Final Approval"), a motion for attorneys' fees, and a request for an 26 27 28 2 Plaintiff filed the original compliant on January 15, 2010, Defendant was served with a First Amended Complaint on March 9, 2010 (See Doc. 1, ¶ 13), and a Second Amended Complaint was filed with this Court on June 29, 2011 (Doc. 37). 2 1 enhancement award. (Docs. 48, 49.) Defendant filed a statement of non-opposition to Plaintiff's 2 motions. (Doc. 54.) On April 9, 2012, the Court issued an order for supplemental briefing and reset 3 the hearing on Plaintiff's motions to May 16, 2012. (Doc. 55.) A hearing was held on May 16, 2012, 4 and Plaintiff's motions were submitted for decision. 5 III. THE PARTIES' SETTLEMENT 6 On October 7, 2011, the parties filed a Notice of Settlement, indicating that they had 7 negotiated a resolution of their dispute. (Doc. 39.) The terms of the parties' Settlement Agreement 8 is summarized below. 9 A. The Composition of the Settlement Classes 10 The Settlement Agreement provides for the certification, for settlement purposes only, of two 11 classes comprised of (1) all salaried store employees of David's Bridal in California between January 12 1, 2007, and November 9, 2011; and (2) all hourly store employees of David's Bridal in California 13 between January 1, 2007, and November 9, 2011 (the "Settlement Classes"). (Doc. 39-1, Exh. A, 14 ¶ 5.) The parties agreed that the Settlement Classes would not include any person who previously 15 settled or released any of the claims covered by the Settlement Agreement, or any person who 16 previously was paid or received awards through civil or administrative actions for the claims covered 17 by the Settlement Agreement. (Doc. 39-1, Exh. 1, ¶ 5.) 18 B. The Material Terms of the Settlement Agreement 19 Plaintiff and Defendant have agreed to settle the underlying class claims in exchange for a 20 "Maximum Settlement Amount," which totals $518,245.00.3 The Maximum Settlement Amount 21 includes: 22 (1) 23 A payment of 33 1/3 percent of the Maximum Settlement Amount for attorneys' fees and up to $25,000 in costs to be paid to Class Counsel, (Doc. 39-1, Exh. 1, ¶ 16); 24 3 25 26 27 28 Plaintiff's Motion for Final Class Settlement Approval indicates that Class Counsel originally negotiated a Maximum Settlement Amount of $500,000. According to Plaintiff, to ensure that the Maximum Settlement Amount remained fair and adequate consideration, Class Counsel obtained a guarantee from Defendant that if, after preliminary approval, the Class size or total number of work weeks exceeded the original estimates by more than 10 percent, the Maximum Settlement Amounts would be increased proportionally. After preliminary approval, the size of the Classes and the total work weeks exceeded the original estimates by more than 10 percent and the Maximum Settlement Amount was increased to $518,245.00 to account for this. (Doc. 48, 9:13, n.2.) At the May 16, 2012, hearing, counsel for both parties confirmed the Maximum Settlement Amount is $518, 245.00. 3 1 (2) 2 A payment of $5,000 to Plaintiff as the class representative, (Doc. 39-1, Exh. 1, ¶ 14(c)(v)); 3 (3) 4 A payment of $7,500 to the California Labor and Workforce Development Agency for payment of civil penalties, (Doc. 39-1, Exh. 1, ¶ 14(c)); and 5 (4) The costs of administration of settlement to Simpluris, Inc., the settlement administrator, up to $30,000, (Doc. 39, 15:18);4 6 7 The remainder of the settlement amount, after deduction of the above-noted payments, 8 constitutes the "Net Settlement Amount" and will be used to pay the Class Members. (Doc. 39-1, 9 Exh. 1, ¶ 14(c).) After deductions, there will be approximately $286,078.00 remaining as the Net 10 Settlement which will be distributed as follows: 11 (1) 12 Class Members who submit valid and timely claim forms are entitled to payment from the Net Settlement Amount, (Doc. 39-1, Exh. 1, ¶ 14(c)); 13 (2) No matter how many Class Members submit valid claim forms, at least 55% of the 14 Net Settlement Amount will be paid to Participating Class Members, (Doc. 39-1, 15 Exh. 1, ¶ 14(c)); 16 (3) If less than 55% of the Net Settlement is claimed, the difference between 55% of the 17 Net Settlement Amount and the Net Settlement Amount claimed will be distributed 18 to the Participating Class Members in proportion to their recovery under the 19 Settlement (Doc. 39-1, Exh. 1, ¶ 13); and 20 (4) 21 22 Any Net Settlement Amount in excess of 55% that is not claimed by Participating Class Members will be retained by Defendant (Doc. 39-1, Exh. 1, ¶ 14(c)). C. The Scope of the Release in the Settlement Agreement 23 The parties' Settlement Agreement sets forth the following release by the Class Members: 24 21. Upon final approval by the Court of this Stipulation of Settlement, and except as to such rights or claims as may be created by this Stipulation of Settlement, the Hourly Associate Class and the Store Manager Class, and each member of those Classes who has not submitted a valid Request for Exclusion, fully releases and discharges Defendant, its present and former parent companies, subsidiaries, related or affiliated companies, shareholders, officers, directors, employees, agents, 25 26 27 28 4 An supplemental declaration submitted by a case manager of Simpluris, Inc. indicates that the total cost for administering the settlement was $28,000. (Bui Supp. Decl., Doc. 57, ¶ 11.) 4 1 2 3 4 attorneys, insurers, successors and assigns, and any individual or entity which could be jointly liable with Defendant, from any and all claims, debts, liabilities, demands, obligations, guarantees, costs, expenses, attorneys' fees, damages, action or causes of action under any state, federal or local law, arising out [of ] the allegations made in the Action and that reasonably arise out of the facts alleged in the Action. (Doc. 39-1, Exh. 1, ¶ 21.) 5 1. 6 a. The claims to be released by the Hourly Associate Class include all claims under state, federal, and local law arising out of the allegations made in the Lawsuit and that reasonably arise out of the facts alleged in the Lawsuit as to the Hourly Associate Class, including claims for alleged unpaid wages, unpaid overtime wages, unpaid minimum wages, off-the-clock work regular rate of pay, unreimbursed business expenses, failure to provide meal periods or pay meal period premiums, failure to provide rest periods or pay rest period premium payments, failure to timely pay wages during employment, failure to timely pay wages at separation, failure to provide accurate and itemized wage statements, failure to maintain payroll records as required by law, additional 401(k) benefits and/or deferred compensation benefits and/or matching benefits for payments received under the Settlement, unfair competition, unfair business practices, unlawful business practices, fraudulent business practices, injunctive relief, penalties, interest, fees, costs, claims for restitution and other equitable relief, liquidated damages, and any other claims and allegations made in the Lawsuit and that arise out of the facts alleged in the Lawsuit, from January 1, 2007[,] up to and including the date of this Final Order, arising from employment by Defendant within California ("Hourly Associate Released Claims"). The Released Claims do not include workers' compensation claims. In addition, as of the date of the final approval of the Settlement, the Class Representative and the Settlement Class and each member of the Class who has not submitted a valid Request for Exclusion will be forever [] barred and enjoined from instituting or accepting damages or obtaining relief against Defendant for any acts or omissions occurring during the period from January 1, 2007[,] up to and including the date of entry of the final approval order, relating to the Released Claims. 7 8 9 10 11 12 13 14 15 16 17 Claims Released by the Hourly Associate Class 18 (Doc. 39-1, Exh. 1, ¶ 21(a).) 19 2. Claims to be Released by the Store Manager Class 20 21 22 23 24 25 26 27 b. The claims to be released by the Store Manager Class include all claims under state, federal, and local law arising out of the allegations made in the Lawsuit and that reasonably arise out of the facts alleged in the Lawsuit as to the Store Manager Class, including claims for alleged unreimbursed business expenses, unfair competition, unfair business practices, unlawful business practices, fraudulent business practices, injunctive relief, penalties, interest, fees, costs, claims for restitution and other equitable relief, liquidated damages, and any other claims and allegations made in the Lawsuit and that arise out of the facts alleged in the Lawsuit from January 1, 2007[,] up to and including the date of this Final Order, arising from employment by Defendant within California ("Store Manager Released Claims"). The Released Claims do not include workers' compensation claims. In addition, as of the date of the final approval of the Settlement, the Class Representative and the Settlement Class and each member of the Class who has not submitted a valid Request for Exclusion will be forever [] barred and enjoined from instituting or accepting damages or obtaining relief against Defendant for any acts or omissions 28 5 1 occurring during the period from January 1, 2007[,] up to and including the date of entry of the final approval order, relating to the Released Claims. 2 (Settlement Agreement, Doc. 39-1, Exh. 1, ¶ 21(b).) 3 D. Notice to the Class Members 4 The procedures for giving notice to the Class Members, as set forth in the parties' Settlement 5 Agreement (see Doc. 39-1, Exh. 1, ¶ 18) and ordered in the Court's Preliminary Approval Order 6 (Doc. 46), have been carried out by the Settlement Administrator, Simpluris, Inc. (Bui Supp. Decl., 7 8 Doc. 57, ¶ 2.)5 On November 10, 2011, Simpluris received the Class Notice prepared jointly by Class Counsel and counsel for Defendant and approved by the Court. (Bui Decl., Doc. 52, ¶ 4.)5 9 The Class Notice summarized the Settlement Agreement's principal terms, provided Class Members 10 with an estimate of how much they would be paid if the Settlement Agreement received final 11 approval, and advised Class Members regarding how to submit claims for payment, opt out of the 12 Settlement, or object to the Settlement. (Bui Supp. Decl., Doc. 57, Exh. B.) 13 Counsel for Defendant subsequently provided Simpluris with a list ("Class List") of all Class 14 Members, their mailing addresses, and other information necessary to calculate estimated settlement 15 payments. (Bui Decl., Doc. 52, ¶ 4.) The mailing addresses contained in the Class List were 16 processed and updated using the National Change of Address Database maintained by the U.S. Postal 17 Service. (Bui Decl., Doc. 52, ¶ 5.) On December 23, 2011, a Notice Packet, containing a claim form 18 and the approved Class Notice (see Bui Supp. Decl., Doc. 57, Exhs. A-B), was mailed to 3,326 Class 19 Members via First-Class U.S. mail. (Bui Supp. Decl., Doc. 57, ¶ 4.) A toll-free telephone number 20 was included in the Class Notice for the purposes of allowing the Class Members to call Simpluris 21 for inquiries regarding the Settlement. (Bui Decl., Doc. 52, ¶ 3.) 22 On January 18, 2012, an additional person was added to the Settlement Class and a Notice 23 Packet was mailed to this individual. (Bui Supp. Decl., Doc. 57, ¶ 6.) This person was a former 24 employee of Defendant, and contacted Simpluris to inquire about the Settlement Agreement. (Bui 25 26 27 28 5 Michael Bui, a case manager for Simpluris, Inc., filed a supplemental declaration in support of Plaintiff's Motion for Final Approval on April 18, 2012, to clarify certain typographical errors contained in his original March 9, 2012, declaration. (Doc. 57.) 5 On November 9, 2011, the Court appointed Initiative Legal Group APC "Class Counsel." (Doc. 46.) 6 1 Supp. Decl., Doc. 57, ¶ 6.) This individual was employed by Defendant during the period covered 2 by the settlement, but was not named in the Class List provided by Defendant. (Bui Supp. Decl., 3 Doc. 57, ¶ 6.) Defendant's counsel was able to confirm that this individual was a member of the 4 Settlement Class, thus bringing the total number of Class Members to 3,327. (Bui Supp. Decl., Doc. 5 57, ¶ 6.) 6 A total of 699 Class Notice and Claim Forms ("Notice Packets") were returned by the post 7 office. (Bui Decl., Doc. 52, ¶ 8.) For those individuals without a forwarding address, Simpluris 8 attempted to locate their current mailing address using Accurint, a research tool owned by Lexis- 9 Nexis. (Bui Decl., Doc. 52, ¶ 8.) In total, 621 Notice Packets were re-mailed to either a new 10 address, a forwarding address provided by the U.S. Postal Service, or pursuant to the individual's 11 request. (Bui Decl., Doc. 52, ¶ 8.) Ultimately, 143 Notice Packets remain undeliverable because 12 Simpluris was unable to find a current mailing address. (Bui Decl., Doc. 52, ¶ 8.) 13 As of April 18, 2012, Simpluris has received a total of 779 completed Claim Forms from 14 Class Members. Of the 779 claim forms submitted, 19 were untimely and 7 were deficient. (Bui 15 Supp. Decl., Doc. 57, ¶ 7.) The 779 claims received from participating Class Members represent 16 23.41 percent of the entire Settlement Class. (Bui Supp. Decl., Doc. 57, ¶ 7.) Participating Class 17 Members have claimed approximately 41.02 percent of the Net Settlement Amount, or 18 approximately $114,879.50. (Bui Supp. Decl., Doc. 57, ¶ 7.) As April 18, 2012, there were five (5) 19 requests for exclusion, which represents 0.15 percent of the Settlement Classes, and no Class 20 Member has submitted an objection to the Settlement Agreement. (Bui Supp. Decl., Doc. 57, ¶¶ 9- 21 10.)6 22 23 IV. DISCUSSION A. Final Approval of the Class-Action Settlement Should be Granted 24 1. 25 Federal Rule of Civil Procedure 23(e) requires court approval of class action settlements. 26 "[I]n the context of a case in which the parties reach a settlement agreement prior to class The Rule 23(a) Class-Certification Requirements Are Satisfied 27 6 28 At the May 16, 2012, hearing, the parties confirmed that this information remained unchanged as of the date of the hearing. 7 1 certification, courts must peruse the proposed compromise to ratify both the propriety of the 2 certification and the fairness of the settlement." Staton v. Boeing Co., 327 F.3d 938, 952 (9th Cir. 3 2003). In confirming the propriety of class certification, courts assess the following prerequisites: 4 "(1) numerosity of plaintiffs; (2) common questions of law or fact predominate; (3) the named 5 plaintiff's claims and defenses are typical; and (4) the named plaintiff can adequately protect the 6 interests of the class." Hanlon v. Dataproducts Corp., 976 F.2d 497, 508 (9th Cir. 1992) (citing Fed. 7 R. Civ. P. 23(a)). 8 a. Numerosity 9 Numerosity requires that the class be so numerous that the joinder of individual class 10 members would be impracticable. Fed. R. Civ. P. 23(a)(1). Across the two Settlement Classes, 11 3,327 California Class members were ultimately identified. The number of Class Members in this 12 case indicates that the numerosity factor has been satisfied. See, e.g., Jordan v. L.A. Cnty., 669 F.2d 13 1311, 1319 (9th Cir. 1982) (indicating that class sizes of 39, 64, and 74 are sufficient to satisfy the 14 numerosity requirement), vacated on other grounds, 459 U.S. 810 (1982). 15 b. Commonality 16 Rule 23(a) also requires there be "questions of law or fact common to the class." The Rule 17 does not require that all questions of law or fact be common to every single member of the class. 18 To satisfy the commonality requirement, Plaintiff need only point to a single issue common to the 19 class. Dukes v. Wal-Mart, Inc., 509 F.3d 1168, 1177 (9th Cir. 2007). Commonality exists when 20 there is either a common legal issue stemming from divergent factual predicates or a common 21 nucleus of facts resulting in divergent legal theories. Hanlon v. Chrysler Corp. ("Chrysler Corp."), 22 150 F.3d 1011, 1019 (9th Cir. 1998). In other words, commonality is generally satisfied where, as 23 in this case, "the lawsuit challenges a system-wide practice or policy that affects all of the putative 24 class members." Armstrong v. Davis, 275 F.3d 849, 868 (9th Cir. 2001), abrogated on other 25 grounds by Johnson v. California, 543 U.S. 499, 504-05 (2005). Differences in the ways in which 26 these practices affect individual members of the class do not undermine the finding of commonality. 27 Id., at 868 (finding commonality requirement satisfied despite individual class members having 28 different disabilities, since all suffered similar harm as a result of defendant's actions). 8 1 2 3 Here, the parties have agreed for purposes of settlement only that the following questions of law and fact are common to the classes: (1) Whether Defendant complied with applicable laws affecting Plaintiff and the Settlement Classes regarding hours worked, unpaid wages, overtime wages, minimum wages, meal and rest periods, record-keeping violations, pay stubs, wage statements and methods of payment, under the California Labor Code and Wage Orders of the California Industrial Welfare Commission; (2) Whether Defendant engaged in unfair, unlawful or fraudulent business practices affecting Plaintiff and the Settlement Classes in violation of California Business and Professions Code sections 17200-17208; and (3) Whether Plaintiff and the Settlement Classes are entitled to injunctive or declaratory relief. 4 5 6 7 8 9 10 (Doc. 39-1, Exh. 1, ¶ 6(b)(i)-(iii).) These common questions of law or fact are sufficient to satisfy 11 the commonality requirement. 12 c. Typicality 13 Typicality exists when "the claims or defenses of the representative are typical of the claims 14 or defenses of the class." Fed. R. Civ. P. 23(a)(3). "Typicality . . . is said . . . to be satisfied when 15 each class member's claim arises from the same course of events, and each class member makes 16 similar legal arguments to prove the defendant's liability." Armstrong, 275 F.3d at 868. Under the 17 rule's "permissive standards," representative claims are typical if they are "reasonably co-extensive 18 with those of absent class members; they need to be substantially identical." Chrysler Corp., 19 150 F.3d at 1020. Plaintiff's claims are "co-extensive" with the other Class Members, as Plaintiff 20 and the absent Class Members were all Defendant's employees who were paid under the same pay 21 practices and worked under the same company-wide employment policies. 22 requirement is satisfied. 23 d. The typicality Adequacy of Representation 24 The final Rule 23(a) prerequisite, adequacy of representation, is satisfied if "the 25 representative parties will fairly and adequately protect the interests of the class." Fed. R. Civ. P. 26 23(a)(4). The satisfaction of constitutional due process concerns requires that absent class members 27 be afforded adequate representation prior to an entry of judgment, which binds them. Chrysler 28 Corp., 150 F.3d at 1020. Determining the adequacy of representation requires consideration of two 9 1 questions: "(1) do the named plaintiffs and their counsel have any conflicts of interest with other 2 class members and (2) will the named plaintiffs and their counsel prosecute the action vigorously 3 on behalf of the class?" Id. 4 The adequacy-of-representation requirement is met here because Plaintiff has the same 5 interests as the absent Class Members, e.g., obtaining payment for wages unlawfully withheld and 6 reimbursement of business expenses. Further, there is no apparent conflict of interest between the 7 named Plaintiff's claims and those of the other Class Members, particularly because Plaintiff has no 8 separate and individual claims apart from the Classes. 9 Moreover, here there are no allocation dilemmas among the Settlement Classes as in Amchen 10 Products, Inc. v. Windosr ("Amchen"), 512 U.S. 591 (1997). In Amchen, the settlement agreement 11 eliminated all present and future claims against asbestos manufacturers, and the class counsel was 12 attempting to represent both groups of plaintiffs, i.e., those who had present claims and those who 13 had future claims. The conflict between the two groups of plaintiffs was that "the present plaintiffs 14 had a clear interest in a settlement that maximized current funds, while future plaintiffs had a strong 15 interest in preserving funds for their future needs and protecting the total fund against inflation." 16 Chrysler Corp., 150 F.3d at 1020-21 (discussing Amchen, 512 U.S. 591 (1997)). This case does not 17 involve sub-classes or classes with diverging interests with respect to allocation of the settlement 18 funds in the same manner as Amchen. The Court does not perceive any conflicts of interest between 19 Plaintiff and Class Counsel and other Class Members. 20 In considering the adequacy requirement, the Court also evaluates whether Plaintiff and Class 21 Counsel will pursue the Classes' claims with vigor. The Ninth Circuit has held that, "[a]lthough 22 there are no fixed standards by which 'vigor' can be assayed, considerations include competency of 23 counsel and, in the context of a settlement-only class, an assessment of the rationale for not pursuing 24 further litigation." Chrysler Corp., 150 F.3d at 1021. There is no challenge to the competency of 25 the Class Counsel, and the Court finds that Plaintiff is represented by experienced and competent 26 counsel who have successfully certified 21 class actions through contested motions. (Meneses Decl., 27 Doc. 50, ¶ 2.) Further, this is not a case where Class Counsel will receive a disproportionate 28 10 1 distribution of the settlement or where the Class Members will receive no monetary distribution, but 2 Class Counsel will be rewarded amply. Chrysler Corp., 150 F.3d at 1021. 3 The rationale to settle this case was supported, in part, by the pendency of Brinker Restaurant 4 Corp. v. Superior Court, 165 Cal. App. 4th 25 (2008), aff'd in part, 53 Cal. 4th 1004 (2012) before 5 the California Supreme Court at the time the matter was settled. California law, as it related to 6 certain of the Classes' claims, was in potential flux, and settlement, rather than continued litigation, 7 was potentially more beneficial to the Class Members. In other words, it appears that the settlement 8 was arrived at for strategic reasons that benefitted the Classes, rather than Class Counsel's inability 9 or unwillingness to pursue further litigation. See Chrysler Corp., 150 F.3d at 1021 (class counsel 10 inadequate by definition where counsel demonstrates an inability or unwillingness to try the case). 11 In sum, the Court finds that the adequacy factor is satisfied. 12 13 14 e. Conclusion As initially determined in the Court's preliminary approval order and as set forth above, the Rule 23(a) requirements for class certification have been satisfied. 15 2. 16 In addition to meeting the requirements of Rule 23(a), to be certified a class must also meet 17 at least one of the requirements of Rule 23(b). Plaintiff asserts that class resolution is superior to 18 other available methods for the fair and efficient adjudication of the controversy and the 19 requirements of Rule 23(b) are met. Rule 23(b)(3) Requirements 20 Pursuant to Rule 23(b)(3), a class action may be maintained if: 21 (3) 22 the court finds that the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods of fairly and efficiently adjudicating the controversy. The matters pertinent to these findings include: 23 (A) the class members' interests in individually controlling the prosecution or defense of separate actions; (B) the extent and nature of any litigation concerning the controversy already begun by or against class members; (C) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; and (D) the likely difficulties in managing a class action. 24 25 26 27 28 11 1 Certification under Rule 23(b)(3) is appropriate whenever the interests of the parties can be served 2 best by settling their differences in a single action. Courts refer to the requirements of Rule 23(b)(3) 3 as its "predominance" and "superiority" requirements. Amchen, 521 U.S. at 615. 4 5 a. Predominance As the Rule 23(a)(3) analysis already considers the issue of commonality, the focus of the 6 Rule 23(b)(3) predominance inquiry is on the balance between individual and common issues. 7 Hanlon, 150 F. 3d at 1022. In other words, "[t]he Rule 23(b)(3) predominance inquiry tests whether 8 proposed classes are sufficiently cohesive to warrant adjudication by representation." Amchen, 9 521 U.S. at 623. The "main concern in the predominance inquiry . . . [is] the balance between 10 individual and common issues." In re Wells Fargo Home Mortg. Overtime Pay Litig., 571 F.3d 953, 11 959 (9th Cir. 2009). 12 The parties' Settlement Agreement sufficiently demonstrates that "[a] common nucleus of 13 facts and potential legal remedies dominates this litigation." Chrylser Corp., 150 F.3d at 1022. If 14 individual Class Members were to sue individually, members of the same proposed settlement class 15 would bring essentially the same claims against Defendant. The central issues raised by the 16 complaint concern policies and practices of Defendant which applies broadly to all the employees 17 in each of the two proposed settlement classes. Similar to Wright v. Linkus Enterp., Inc., 259 F.R.D. 18 468, (E.D. Cal. 2009), this case derives from alleged policies that required Class Members to work, 19 for example, without compensation, meal and rest periods, and/or reimbursement for expenses. The 20 alleged company-wide and uniform employment policies comprise a common nucleus of facts for 21 employees in each group of salaried and hourly store employees. Kamar v. Radio Shack Corp., 254 22 F.R.D. 387, 399 (C.D. Cal. 2008) (class certification is usually appropriate where "liability turns on 23 an employer's uniform policy that is uniformly implemented, since in that situation predominance 24 is easily established"); see also Perez v. Safety-Kleen Sys., Inc., 253 F.R.D. 508, 520 (N.D. Cal. 25 2008) (common issues predominate meal break claims and claims for failure to provide itemized 26 wage statements because these were class-wide policies, and litigation of these claims involve class- 27 wide proof rather than individualized inquiry). Moreover, the alleged violations of state law entitle 28 the Class Members to the same legal remedies. Thus, despite the minor factual differences among 12 1 Class Members in each of the two proposed settlement classes – such as the number of hours worked 2 – common issues predominate. 3 b. Superiority 4 In addition to the predominance requirement, Rule 23(b)(3) provides a non-exhaustive list 5 of matters relevant to the Court's determination that class action treatment is superior to other 6 methods of adjudication. Rule 23(b)(3)(A)-(D). The first factor considers the interest of each 7 member in "individually controlling the prosecution or defense of separate actions." 8 23(b)(3)(A). This factor weighs against class certification where each class member has suffered 9 sizeable damages or has an emotional stake in the litigation. See, e.g., In re N. Dist. of Cal., Dalkon 10 Shield, Etc., 693 F.2d 847, 856 (9th Cir. 1982), abrogated on other grounds in Valentino v. Carter- 11 Wallace, Inc., 97 F.3d 1227 (9th Cir. 1996). In this case, where monetary damages that each Class 12 Member suffered individually are relatively modest, certifying a class action is favored. Id. Rule 13 The second factor to consider is "the extent and nature of any litigation concerning the 14 controversy already begun by or against members of the class." Fed. R. Civ. P. 23(b)(3)(B). The 15 only known litigation concerning the controversy is the case at issue in this settlement; thus this 16 factor favors certification. 17 The third Rule 23(b)(3) factor is "the desirability or undesirability of concentrating the 18 litigation of the claims in the particular forum" (Fed. R. Civ. P. 23(b)(3)(C)), and the fourth factor 19 is "the likely difficulties in managing a class action" (Fed. R. Civ. P. 23(b)(3)(D)). The fourth factor 20 "encompasses the whole range of practical problems that may render the class format inappropriate 21 for a particular suit." Eisen v. Carlisle & Jacqueline, 417 U.S. 156, 164 (1974). In the context of 22 settlement, however, the third and fourth factors are rendered moot and are not relevant. See 23 Amchem, 521 U.S. at 620 (where a district court is confronted with a settlement-only class 24 certification, the court need not inquire whether the case, if tried, would present manageability 25 problems because the point is that there will be no trial). 26 "Where classwide litigation of common issues will reduce litigation costs and promote 27 greater efficiency, a class action may be the superior method for managing litigation if no realistic 28 alternative exists." Valentino, 97 F.3d at 1234. The potential recovery by any individual plaintiff 13 1 is relatively small and thus individual members of the classes would likely be unwilling or unable 2 to institute separate suits, and the filing of individual suits by 3,327 separate plaintiffs would create 3 an unnecessary burden on judicial resources. In sum, the Rule 23(b)(3) predominance and 4 superiority requirements are satisfied. 5 6 7 c. Conclusion For the reasons set forth above, the Settlement Classes here meet the class-certification requirements of Rules 23(a) and 23(b)(3). 8 3. 9 Settlements are afforded a presumption of fairness if (1) the negotiations occurred at arm's 10 length; (2) there was sufficient discovery; (3) the proponents of the settlement are experienced in 11 similar litigation; and (4) only a small fraction of the class objected. 4 William B. Rubenstein, Alba 12 Conte, & Herbert B. Newberg, Newberg on Class Actions § 11.41 (4th ed. West 2011). Here, the 13 parties' Settlement Agreement was reached through the efforts of counsel in mediation with the 14 assistance of a mediator who has experience handling wage-and-hour class-action disputes. Thus, 15 the parties' settlement is entitled to a presumption of fairness. The Proposed Settlement is Fair, Reasonable, and Adequate 16 A settlement may be approved only after a hearing and on a finding that it is fair, reasonable, 17 and adequate. Fed. R. Civ. P. 23(e)(1)(C). Such approval is required to ensure that any settlement 18 reached is consistent with the plaintiff's fiduciary obligations to the class. See Ficalora v. Lockheed 19 Cal. Co., 751 F.2d 995, 996 (9th Cir. 1985). The court also serves as guardian for the absent class 20 members who will be bound by the settlement, and therefore must independently determine the 21 fairness of any settlement. Id. However, the court's role in intruding upon what is otherwise a 22 private consensual agreement is limited to the extent necessary to reach a reasoned judgment that 23 the agreement is not the product of fraud or collusion between the negotiating parties, and that the 24 settlement, taken as a whole, is fair, reasonable, and adequate to all concerned. FDIC v. Alshuler 25 (In re Imperial Corp. of Am.), 92 F.3d 1503, 1506 n.5 (9th Cir. 1996). Therefore, the settlement 26 hearing is not meant to be conducted as a trial or rehearsal for trial on the merits. Officers for Justice 27 v. Civil Serv. Comm'n, 688 F.2d 615, 625 (9th Cir. 1982). 28 14 1 In determining whether a proposed settlement is "fair, reasonable, and adequate" pursuant 2 to Rule 23(e), courts may consider factors including (1) the strength of the case; (2) the risk, expense, 3 complexity, and likely duration of further litigation; (3) the risk of maintaining class action status 4 throughout the trial; (4) the settlement amount; (5) the extent of discovery completed and the stage 5 of the proceedings; (6) whether the class has been fairly and adequately represented during the 6 settlement negotiations; and (7) the reaction of the class to the proposed settlement. See Churchill 7 Village, LLC v. Gen. Elec., 361 F.3d 566, 575 (9th Cir. 2004) (citing Chrysler Corp., 150 F.3d at 8 1026). 9 a. The Strength of Plaintiff's Case 10 The initial fairness factor addresses Plaintiff's likelihood of success on the merits and the 11 range of possible recovery. See Rodriguez v. West Publ'g Corp., 563 F.3d 948, 964-65 (9th Cir. 12 2009). In determining the probability of the plaintiff's success on the merits, there is no "particular 13 formula by which that outcome must be tested." Id. at 965. Instead, the court's assessment is based 14 on "nothing more than an 'amalgam of delicate balancing, gross approximations and rough justice.'" 15 Officers for Justice, 688 F.2d at 625 (quoting City of Detroit v. Grinnell Corp., 495 F.2d 448, 468 16 (2d Cir. 1974)). The court is not required to "reach any ultimate conclusions on the contested issues 17 of fact and law which underlie the merits of the dispute, for it is the very uncertainty of the outcome 18 in litigation and avoidance of wasteful and expensive litigation that induce consensual settlements." 19 Id. Rather, the court may presume that, through negotiation, the parties, their counsel, and the 20 mediator arrived at a reasonable range of settlement by considering Plaintiff's likelihood of recovery. 21 See Rodriguez, 563 F.3d at 965 ("We put a good deal of stock in the product of an arms-length, non- 22 collusive, negotiated resolution . . . "). 23 Plaintiff acknowledges that it was forced "to discount David's Bridal's potential liability by 24 the risks associated with certifying a claim for meal break violations," particularly because of the 25 pendency of Brinker Rest. Corp. v. Super. Ct., 165 Cal. App. 4th 25, 31 (2008) before the California 26 Supreme Court. (Doc. 48, 19:18-20:5.) In Brinker, the Supreme Court considered whether 27 California law requires an employer to ensure meal breaks are taken or whether an employer need 28 15 1 only provide a meal break. This unsettled area of California law potentially diminished Plaintiff's 2 possible recovery with respect to the meal break claim.7 3 Further, Plaintiff indicates that Defendant began automatically paying meal period premiums 4 in November 2008; since 2008, Defendant has paid over 10,500 meal period premiums to putative 5 class members and continues to automatically pay meal period premiums. (Doc. 48, 20:5-12.) 6 Plaintiff's rest-break claim rested on a similar theory of liability as the meal-break claim, but 7 because employers have no obligation to record rest breaks, the relative lack of written proof as to 8 this claim diminished the prospect of certifying that claim and the value of the claim was 9 significantly discounted. (Doc. 48, 20:13-20.) 10 Therefore, although Plaintiff maintained her strong belief in the underlying merits of the case, 11 Plaintiff's counsel has acknowledged the weaknesses in both the meal and rest-break claims and 12 considered the uncertainties surrounding proving the claims in a lengthy and complex jury trial in 13 negotiating the settlement amount. As a result, Plaintiff's likelihood of success appears to have been 14 properly accounted for in the settlement amount. This factor weighs in favor of approval. 15 b. The Risk, Expense, Complexity, and Likely Duration of Further Litigation 16 The risk, expense, complexity, and likely duration of further litigation are factors that 17 consider "the probable costs, in both time and money, of continued litigation." In re Warfarin 18 Sodium Antitrust Litig., 212 F.R.D. 231, 254 (D.Del. 2002). Generally, "unless the settlement is 19 clearly inadequate, its acceptance and approval are preferable to lengthy and expensive litigation 20 with uncertain results." Nat'l Rural Telecomms. Cooperative. v. DIRECTV, Inc., 221 F.R.D. 523, 21 526 (C.D. Cal. 2004) (quoting 4 A Conte & H. Newberg, Newberg on Class Actions, § 11:50 at 155 22 (4th ed. 2002)). Moreover, settlement is encouraged in class actions where possible. See Van 23 Bronkhorst v. Safeco Corp., 529 F.2d 943, 950 (9th Cir. 1976) ("It hardly seems necessary to point 24 out that there is an overriding public interest in settling and quieting litigation. This is particularly 25 26 27 28 7 On April 12, 2012, the California Supreme Court issued its decision in Brinker, affirming it in part and holding that employers need only provide a meal break, not ensure that it is taken by the employee. Brinker Rest. Corp. v. Super. Ct., 53 Cal. 4th 1004 (2012). 16 1 true in class action suits which are now an ever increasing burden to so many federal courts and 2 which present serious problems of management and expense."). 3 In this case, there remained significant procedural hurdles for the putative class to confront, 4 including certification of the class. Avoiding such unnecessary expenditures of resources and time 5 benefits all the parties and the Court. Moreover, there were significant risks in continued litigation 6 and no guarantee of recovery given the current state of the law due to the pendency of Brinker. The 7 settlement, therefore, provides Class Members with another significant benefit that they would not 8 receive if the case proceeded: certain and prompt relief. See Oppenlander v. Standard Oil Co., 64 9 F.R.D. 597, 624 (D. Colo. 1974) ("It has been held proper to take the bird in hand instead of a 10 11 prospective flock in the bush."). This factor weighs in favor of approval. c. The Risk of Maintaining Class Action Status Throughout the Trial 12 A settlement in this case was reached prior to the Supreme Court's recent decision in Brinker 13 Restaurant Corp. v. Superior Court. Given the recent decision by the California Supreme Court in 14 that case, class certification for Plaintiff's claim regarding missed meal breaks would be more 15 difficult. See Brinker, 53 Cal. 4th at 1040 (holding employer is required to provide a meal period 16 to employees, but "is not obligated to police meal breaks and ensure no work thereafter is 17 performed"). On the other hand, the fact that one claim may not be amenable to class treatment does 18 not necessarily affect the propriety of class certification with respect to other claims of the class or 19 necessarily impact the ability to maintain class-action status throughout trial. See generally Norris- 20 Wilson v. Delta-T Grp., Inc., 270 F.R.D. 596, (S.D. Cal. 2010) (granting class certification find that 21 "[t]he overtime, wage statement, and waiting time claims are suitable for class-wide treatment, but 22 the meal and rest break and reimbursement claims aren't.") Because the Court is not aware of any 23 risks to maintaining class-action status throughout trial, this factor is neutral. 24 d. The Settlement Amount 25 "[S]ettlement is about compromise, a yielding of the highest hopes in exchange for certainty 26 and resolution." In re Warfarin, 212 F.R.D. at 257-58. Class counsel negotiated a Maximum 27 Settlement Amount of $518,245 to resolve the claims. The Maximum Settlement Amount includes 28 (1) $166,667 for attorneys' fees and up to $25,000 in costs to be paid to Class Counsel; (2) a $5,000 17 1 Class Representative enhancement award; (3) a $7,500 PAGA payment to the California Labor and 2 Workforce Development Agency; and (4) $28,000 in Claims Administration Costs. The Net 3 Settlement Amount to the Classes is approximately $286,078.00. Twenty-four percent of the 4 Settlement Classes claimed 41 percent of the Net Settlement Amount. Predicated on the weeks 5 worked by a particular Class Member during the relevant time period, the average recovery is 6 $198.70 across the Settlement Classes, and the highest recovery is approximately $695.78. Although 7 a larger award was theoretically possible, "the very essence of a settlement is compromise, a yielding 8 of absolutes and an abandoning of highest hopes." Linney v. Cellular Alaska P'ship, 151 F.3d 1234, 9 1242 (9th Cir. 1998) (internal citations and quotation marks omitted). 10 In light of the claims at issue in this case and the size of the proposed settlement classes, the 11 Court finds that the Settlement Amount appears fair and reasonable and this factor weighs in favor 12 of final approval. 13 e. The Extent of Discovery Completed and the Stage of the Proceedings 14 "A settlement following sufficient discovery and genuine arms-length negotiation is 15 presumed fair." DIRECTV, 221 F.R.D. at 528. What is required is that "sufficient discovery has 16 been taken or investigation completed to enable counsel and the court to act intelligently." 4 William 17 B. Rubenstein, Alba Conte, & Herbert B. Newbert, Newberg on Class Actions § 11.41 (4th ed. West 18 2011). Here, Plaintiff's counsel expended significant time and resources conducting formal 19 discovery including propounding interrogatories and 276 document requests. (Williams Decl., Doc. 20 39-1, ¶ 5; Doc. 48, 11:26-12:1.) In response to these discovery requests, Defendant produced, among 21 other things, 4,700 pages of responsive documents as well as the names and contact information of 22 prospective Class Members. (Williams Decl., Doc. 39-1, ¶ 5, Doc. 48, 12:1-4.) Class counsel 23 interviewed prospective Class Members and, during the course of mediation, Defendant informally 24 produced class-wide data that enabled Class Counsel to realistically estimate Defendant's exposure. 25 (Williams Decl., Doc. 39-1, ¶ 6; Doc. 48, 12:5-12.) 26 27 As sufficient discovery has been conducted and the matter was settled during arms-length negotiations, this factor weighs in favor of approval. 28 18 1 f. Whether the Class Has Been Fairly and Adequately Represented During the Settlement Negotiations 2 3 In considering the adequacy of the terms of a settlement, the trial court is entitled to, and 4 should, rely upon the judgment of experienced counsel for the parties. See DIRECTV, 221 F.R.D. 5 at 528 ("Great weight is accorded to the recommendation of counsel, who are most closely 6 acquainted with the facts of the underlying litigation") (internal quotation marks and citations 7 omitted). This reliance is predicated on the fact that "[p]arties represented by competent counsel are 8 better positioned than courts to produce a settlement that fairly reflects each party's expected 9 outcome in the litigation." In re Pacific Enters. Sec. Litig., 47 F.3d 373, 378 (9th Cir. 1995). 10 Here, the experience and view of Class Counsel weigh in favor of approving the Settlement. 11 Class Counsel understood the complex risks and benefits of any settlement and concluded that the 12 proposed Settlement was a just, fair, and certain result. (Williams Decl., Doc. 39-1,¶ 8.) Moreover, 13 Class Counsel is experienced in this area of law and the settlement was reached after lengthy 14 mediation. This factor weighs in favor of approval. 15 g. The Reaction of the Class to the Proposed Settlement 16 Where a settlement agreement enjoys overwhelming support from the class, this lends weight 17 to a finding that the settlement agreement is fair, adequate, and reasonable. DIRECTV, 221 F.R.D. 18 at 529 ("It is established that the absence of a large number of objections to a proposed class action 19 settlement raises a strong presumption that the terms of a proposed class settlement action are 20 favorable to the class members"); see also Boyd v. Cechtle Corp., 485 F. Supp. 610, 624 (N.D. Cal. 21 1979) (finding that objections from only 16 percent of the class was persuasive that the settlement 22 was adequate). 23 Here, less than two-tenths of one percent of Class Members opted out of the Settlement. The 24 Class Administrator, Simpluris, has received 779 valid Claim Forms, representing approximately 25 24 percent of the total Class Members identified across the Settlement Classes. Finally, no objection 26 to the Settlement Agreement was received, and no Class Member appeared at the final approval 27 hearing to state any objection. The response of the Settlement Classes was positive, and this weighs 28 in favor of finding that the settlement is favorable to the Class Members. 19 1 4. The Proposed Payment to the Claims Administrator is Reasonable and Should be Approved 2 3 The $28,000 that Plaintiff requests be approved as payment to the Claims Administrator 4 appears fair and reasonable. The fee requested here is consistent with other Claims Administration 5 fees in similar class-action settlements, particularly in light of the number of Notice Packets that the 6 Claims Administrator was required to process. See, e.g., Harris v. Vector Marketing Corp., 2012 7 WL 381202, at * (N.D. Cal. Feb. 6, 2012) (awarding $250,000 in administration costs where claims 8 administrator sent out 68,487 notices). The Court finds the requested Claims Administration fee to 9 be reasonable and recommends that it be approved and awarded. 10 5. 11 A settlement reached between the parties on a PAGA claim is subject to court review and 12 approval. Cal. Lab. Code § 2699(l). Pursuant to the Settlement Agreement, the parties have agreed 13 to pay $7,500 to the California Labor and Workforce Development Agency ("LWDA") from the 14 Maximum Settlement Amount as civil penalties pursuant to the California Labor Code Private 15 Attorneys General Act of 2004, codified at California Labor Code §§ 2699, et seq. This comports 16 with settlement approval of PAGA awards in other cases. See, e.g., Chu v. Wells Fargo Investments, 17 LLC, No. C 2011 WL 672645, at * 1 (N.D. Cal. Feb. 16, 2011) (approving PAGA settlement 18 payment of $7,500 to the LWDA out of $6.9 million common-fund settlement). The Court finds that 19 the PAGA Payment is set at a reasonable amount, and recommends that it be approved. The Proposed PAGA Payment is Reasonable and Should be Approved 20 6. 21 In sum, as set forth above, the relevant factors weigh in favor of approving the parties' 22 Settlement Agreement. It represents a substantial recovery that avoids the risks associated with 23 protracted litigation in a document-intensive wage-and-hour case. 24 RECOMMENDED that the Settlement be APPROVED. 25 B. Conclusion It is HEREBY Plaintiff's Motion for Attorneys' Fees and Litigation Expenses Should be Granted 26 1. 27 The parties' Settlement Agreement provides that Defendant will pay "33 1/3 percent of the 28 Maximum Settlement Amount for Class Counsel's attorneys' fees, plus costs not to exceed $25,000, Payment of Attorneys' Fees in the Amount of $166,667 is Fair and Reasonable 20 1 subject to Court approval." (Doc. 39-1, Exh. 1, ¶ 16.) Defendant further agreed that it would not 2 oppose Class Counsel's application for attorneys' fees and costs up to this amount.8 (Doc. 39-1, Exh. 3 1, ¶ 16.) On March 9, 2012, Plaintiff filed a motion for an award of attorneys' fees and costs in the 4 amount of $166,667.00 and $25,000.00, respectively. (Doc. 49, 11:5-7.) 5 Federal Rule of Civil Procedure 23(h) provides that, "[i]n a certified class action, the court 6 may award reasonable attorney's fees and nontaxable costs that are authorized by law or by the 7 parties' agreement." Fed. R. Civ. P. 23(h). In diversity actions such as this, the Ninth Circuit applies 8 state law to determine the right to fees and the method for calculating fees. See Mangold v. Cal. 9 Public Util. Comm'n, 67 F.3d 1470, 1478 (1995); see also Hartless v. Clorox Co., 273 F.R.D. 630, 10 642 (S.D. Cal. 2011). 11 The California Supreme Court has held that, "when a number of persons are entitled in 12 common to a specific fund, and an action brought by a plaintiff or plaintiffs for the benefit of all 13 results in the creation or preservation of that fund, such plaintiff or plaintiffs may be awarded 14 attorneys' fees out of the fund." Serrano v. Priest, 20 Cal. 3d 25, 34 (1977). A common fund results 15 when "the activities of the party awarded fees have resulted in the preservation or recovery of a 16 certain or easily calculable sum of money-out of which sum or 'fund' the fees are to be paid." Id. at 17 35. Here, the structure of the parties' Settlement Agreement creates a Maximum Settlement Amount 18 that constitutes a common fund out of which reasonable attorneys' fees will be paid. 19 California courts employ two methods when calculating a reasonable award of attorneys' fees 20 in common fund actions. See Lealao v. Beneficial Cal., Inc., 82 Cal. 4th 19, 26 (2000). The first 21 calculates attorneys' fees based on a percentage of the benefit bestowed upon the class. Id. 22 ("Percentage fees have traditionally been allowed in such common fund cases, although, as will be 23 24 25 26 27 28 8 A defendant's agreement not to oppose a fee request up to a certain amount as part of a settlement is often referred to as a "clear sailing" provision or clause. See, e.g., Appollo Grp. Inc. Sec. Litig., No. CV 04-2147-PHX-JAT, 2012 W L 1378677, at *5 (D.Ariz. Apr. 20, 2012). Notwithstanding an agreement between the parties related to the payment of attorneys' fees, courts have an independent duty to determine whether the requested attorneys' fees are reasonable. Bluetooth Headset Prods. Liab. Litig. v. Brennan, 654 F.3d 935, 941 (9th Cir. 2011). 21 1 seen, the lodestar methodology may also be utilized in this context.").9 The second approach utilizes 2 the lodestar method determined by multiplying the hours counsel reasonably expended by a 3 reasonable hourly rate, which may then be enhanced by a multiplier. Id. 4 5 A California appellate court has recently evaluated the two differing methods and summarized the law as follows: 6 9 Regardless of whether attorney fees are determined using the lodestar method or awarded based on a "percentage-of-the-benefit" analysis under the common fund doctrine, "[t]he ultimate goal . . . is the award of a 'reasonable' fee to compensate counsel for their efforts, irrespective of the method of calculation . . . It is not an abuse of discretion to choose one method over another as long as the method chosen is applied consistently using percentage figures that accurately reflect the marketplace. 10 In re Consumer Privacy Cases ("Consumer Privacy"), 175 Cal. App. 4th 545, 557 (2009). 7 8 11 Under the percentage method, "[e]mpirical studies show that, regardless whether the 12 percentage method or the lodestar method is used, fee awards in class actions average around one- 13 third of the recovery." Id. at 558, n. 13 (internal citation and quotation marks omitted). Here, the 14 Settlement Agreement provides that out of the common fund, up to 33 and 1/3 percent will be paid 15 for attorneys' fees. (Doc. 39-1, p. 14:26-28.) 16 No one set of factors has been prescribed by the California courts to evaluate the 17 reasonableness of the percentage-of-the-benefit requested in common fund settlements; instead, the 18 goal is to assess the reasonableness of the requested fee. Consumer Privacy, 175 Cal. App. 4th at 19 557. 20 determining a multiplier where fees were calculated under the lodestar method. For example, in 21 Cundiff v. Verizon California, Inc., 167 Cal. App. 4th 718, 724 n. 3, the court noted that a lodestar 22 figure may be adjusted based on various factors including, "(1) the novelty and difficulty of the To assess reasonableness, Plaintiff cites several California cases that discuss factors in 23 24 25 26 27 28 9 But see Dunk v. Ford Motor Co., 48 Cal. App. 4th 1794, 1809 (1996) ("The award of attorney fees based on a percentage of a 'common fund' recover is of questionable validity in California."). Although the California Supreme Court recognized the use of a percentage method in common fund cases in Serrano v. Priest, 20 Cal. 3d 24 (1977), the Dunk court asserted that later cases have cast doubt upon the use of the percentage method to determine attorneys' fees in California Class actions. Id. (citing People ex rel. Dep't of Transp. v. Yuki, 31 Cal. App. 4th 1754, 1769 (1995), Salton Bay Marina, Inc. v. Imperial Irrigation Dist., 172 Cal. App. 3d 914, 954 (1985), Jutkowitz v. Bourns, Inc., 118 Cal. App. 3d 102, 110 (1981)). Several recent California cases following Dunk, however, apply the percentage method of calculation. See Chavez v. Netflix, Inc., 162 Cal. Ap.. 4th 43, 63 (2008); Apple Computer, Inc. v. Super. Ct., 126 Cal. App. 4th 1253, 1270 (2005) (noting that although awards in common fund cases are calculated on percentage, ultimate goal is reasonable fee to compensate counsel); Bell v. Farmers Ins. Exch., 115 Cal. App. 4th 715, 726 (2004). 22 1 questions involved, (2) the skill displayed in presenting them, (3) the extent to which the nature of 2 the litigation precluded other employment by the attorneys, and (4) the contingent nature of the fee 3 award." 4 Many of the same factors assessed by California courts in calculating a lodestar multiplier 5 are considered by federal courts in weighing the reasonableness of a percentage-of-the-benefit 6 attorneys' fee award. The Ninth Circuit has approved consideration of six factors to determine 7 whether the percentage requested is fair and reasonable: (1) the results achieved; (2) the risk of 8 litigation; (3) the skill required; (4) the quality of work performed; (5) the contingent nature of the 9 fee and the financial burden; and (6) the awards made in similar cases. Vizcalino v. Microsoft Corp., 10 290 F.3d 1043, 1047 (9th Cir. 2002); Six Mexican Workers v. Az. Citrus Growers, 904 F.2d 1301 11 (9th Cir. 1990); In Re Omnivision Techs., Inc., 559 F. Supp. 2d 1036, 1046 (N.D. Cal. 2007). The 12 typical range of acceptable attorneys' fees under this approach in the Ninth Circuit is 20 percent to 13 33 and 1/3 percent of the total settlement value, with 25 percent considered a benchmark percentage. 14 Powers v. Eichen, 229 F.3d 1249, 1256 (9th Cir. 2000). 15 California courts do not prescribe the 25-percent benchmark that is established under federal 16 law in the Ninth Circuit as a starting point to evaluate fee requests. See 1 Richard M. Pearl, 17 California Attorney Fee Awards, §§ 8.12-8.15 (3d ed. 2012). Nonetheless, the 25-percent 18 benchmark is a helpful assessment tool in evaluating the requested fee award, even where use of the 19 benchmark is not required. As there is no definitive set of factors that California courts mandate or 20 endorse for determining the reasonableness of attorneys' fees in the context of a common-fund 21 percentage-of-the-benefit approach, the Court considers the reasonableness of the percentage 22 requested in light of the factors endorsed by the Ninth Circuit, with the 25 percent award as a starting 23 point. 24 1. 25 The claims in this case concerning Defendant's alleged failure to pay class members for meal 26 and rest breaks, provided compliant wage statements, or reimburse employees for business expenses 27 are not types of claims that generally produce substantial individual damage awards; thus the The Results Achieved 28 23 1 recovery of $518,245 is a favorable result, particularly in light of the pendency of Brinker during the 2 settlement negotiations. 3 Plaintiff notes that Class Members will receive an average of approximately $198.70, with 4 the highest payment to a Class Member being $695.78. Plaintiff contends that this is a substantial 5 recovery where Defendant asserted compelling defenses to liability; Plaintiff also notes several 6 similar actions where the gross recoveries per class member were less than $90, including Doty v. 7 Costco, No. 05-cv-03241 (C.D. Cal. May 14, 2007) ($58 average gross recovery); Sorenson v. 8 PetSmart, No. 2:06-cv-02674-JAM-DAD (E.D. Cal. Dec. 17, 2008) ($57 average gross recovery). 9 Overall, the Court finds that the results achieved are good, which is highlighted by the fact that there 10 was no objection to the settlement amount or the attorneys' fees requested. See DIRECTV, 221 11 F.R.D. at 529. 12 2. 13 As noted above, there were significant risks involved in this litigation. Specifically, some 14 of the central claims involved the timely provision of rest and meal periods – an issue that was 15 pending before the California Supreme Court at the time this case was settled. Further, Plaintiff 16 notes that Defendant began automatically paying meal period premiums in November 2008 and has 17 paid over 10,500 meal period premiums since that time. (Doc. 48, 20:5-12.) Moreover, as noted 18 above, the rest period claims were similar to those for meal periods. Proof of missed rest periods 19 was complicated by the lack of payroll records, and would have had to be established through 20 declarations, which would have diminished the prospect of certifying that claim. (Doc. 48, 20:13- 21 25.) The Risks Involved 22 As to Plaintiff's claim that Defendant provided employees with non-compliant wage 23 statements, Plaintiff would have been required to show that the failure to provide an accurate paystub 24 caused an employee to suffer injury. There was a risk that Plaintiff would not have been able to 25 establish that Class Members suffered actual injury as a result of non-compliant wage statements. 26 Plaintiff maintains that employers have successfully argued that the "suffering injury" requirement 27 is not satisfied merely by the deprivation of a legal right, and thus Plaintiff would have been required 28 to confront this defense in litigating this claim. 24 1 With respect to Defendant's alleged failure to reimburse Class Members for expenses 2 necessarily incurred by employees in the execution of their duties, the claim was generally predicated 3 on the mileage Class Members were required to drive to perform the tasks for Defendant. (Doc. 48, 4 21:24-22:5.) Defendant claimed that most of the miles driven by Class Members were actually part 5 of those members' return commutes because the banking tasks were performed at the end of the Class 6 Members' shifts, and thus not compensable. Plaintiff and Class Members faced risk that Defendant's 7 argument would undercut the viability of this claim. 8 As a result, Plaintiff and the Classes faced significant substantive risks in further litigation 9 of these claims. 10 3. 11 The case required specialized skills to litigate the legal theories relating to the wage-and-hour 12 law at issue, particularly in light of the uncertainty of California law as it related to meal breaks. As 13 it related to rest periods, this was challenging in light of the fact that Defendant did not keep records 14 of rest breaks. Skill Required and Quality of the Work Performed 15 Moreover, this case was actively litigated for approximately two years, there was motion 16 practice, and significant discovery was taken. See generally Navarro v. Servisair, No. C 08-02716 17 MHP, 2010 WL 1729538, at *3 (N.D. Cal. Apr. 27, 2010) (finding proposed award of 30 percent 18 of settlement fund unjustifiably departed from benchmark due in part to speed with which parties 19 reached a settlement). Overall, the specialized skill of Class Counsel in this area of the law was 20 generally an asset to the Class Members and the quality of work performed was good. 21 4. 22 Class Counsel litigated the case on a contingency basis, which necessarily presented 23 considerable risk. See In re Sumitomo Copper Litig., 74 F. Supp. 2d 393, 396-98 (S.D.N.Y. 1999) 24 ("No one expects a lawyer whose compensation is contingent on the success of his services to 25 charge, when successful, as little as he would charge a client who in advance of the litigation has 26 agreed to pay for his services, regardless of success. Nor, particularly in complicated cases 27 producing large recoveries, is it just to make a fee dependent solely on the reasonable amount of time The Contingent Nature of the Representation 28 25 1 expended."). Class Counsel also maintains that the contingent nature of the work was even riskier 2 here because Class Counsel advanced substantial costs that would not be recouped had the litigation 3 been unsuccessful. (Doc. 49, 28:5-6.) 4 In considering both the contingent nature of the work performed by Class Counsel as well 5 as the risk involved in the costs advanced, these factors support the fee award requested. See 6 Graham v. Daimler Chrysler Corp., 34 Cal. 4th 553, 580 (2004) ("A contingent fee must be higher 7 than a fee for the same legal services paid as they are performed. The contingent fee compensates 8 the lawyer not only for the legal services he renders but for the loan of those services.") (internal 9 citations omitted). 10 5. 11 Finally, the percentage award requested in this case is commensurate with the percentage-of- 12 13 Awards Made in Similar Cases the-benefit awards made in other wage-and-hour actions in this district: (1) Bond v. Ferguson Enterprises, Inc., No. 1:09-cv-01662-OWW-MJS, Docket No. 59 14 (E.D. Cal. June 30, 2011) (court approved attorneys' fees in the amount of 30 percent 15 of the common fund); 16 (2) Vasquez v. Coast Valley Roofing, 266 F.R.D. 482 (E.D. Cal. 2010) (wage-and-hour 17 action putative class-action settlement where court approved award of attorneys' fees 18 in the amount of 33.3 percent of the common fund); 19 (3) 20 21 Benitez v. Wilbur, No. 1:08-cv-01122 LJO GSA, Doc. No. 52 (E.D. Cal., Dec. 15, 2009) (awarding 33.3 percent of the benefit to the class in attorneys' fees); (4) Chavez v. Petrissans, (Case No. 1:08-cv-00122 LJO GSA, Doc. No. 89 (E.D. Cal. 22 Dec. 15, 2009) (court approved awards of attorneys' fees of 33.3 percent of the 23 common fund); 24 (5) Romero v. Producers Dairy Foods, Inc., No. 1:05-cv-0484-DLB, 2007 WL 3492841, 25 at * 4 (E.D. Cal. Nov. 14, 2007) (class-action settlement where court approved 26 attorneys' fees in the amount of 33 percent of common fund); 27 28 26 1 (6) Vasquez v. Jim Aartman, Inc., No. 1:02-cv-05624-AWI-LJO, Doc. No. 130 (class- 2 action settlement where court approved attorneys' fees in the amount of 30 percent 3 of the settlement amount); 4 (7) Baganha v. Cal. Milk Transport, No. 1:01-cv-05729-AWI-LJO, Doc. No. 147 (class- 5 action settlement where court approved attorneys' fees in the amount of 31.25 percent 6 of settlement amount); and 7 (8) Randall Willis et al. v. Cal. Western Transport and Earl Baron et al. v. Cal Western 8 Transport (consolidated cases), No. 1:00-cv-05695-AWI-LJO (court approved 9 attorneys' fees in the amount of 33.3 percent of the settlement amount). 10 The Settlement Agreement's provision of $166,667 in attorneys' fees (approximately 32.1 11 percent of the total settlement amount), is fair and reasonable in light of the awards of attorneys' fees 12 in similar wage-and-hour cases in this district. 13 6. 14 Although Class Counsel's requested fees exceed the 25 percent benchmark under federal law, 15 this diversity case is not governed by federal law. Further, even applying the federal-law benchmark, 16 the Court finds sufficient reasons to exceed that marker considering the risks of litigation, the 17 contingent nature of the work, the favorable reaction of the class, and the fee awards in other wage- 18 and-hour cases. As discussed below, the requested fee is far smaller than the lodestar calculation, 19 even where the hourly rates requested by counsel are reduced to account for attorney hourly rates 20 charged in the local community. See Vasquez, 266 F.R.D. at 491 (approving attorneys' fees award 21 of 33 1/3 of the settlement fund and noting it was "significantly less" than the asserted lodestar). 22 Reducing the award to 25 percent of the class recovery would not adequately compensate counsel 23 and would essentially result in an unreasonably low award of attorneys' fees, particularly in light of 24 the lodestar cross-check. The Fee Request is Reasonable 25 Based on the risks faced in the litigation, the contingent nature of the work performed, the 26 reaction of the class, and awards in other wage-and-hour cases, the Court concludes there are 27 sufficient reasons to depart upward from the benchmark even if this case were governed by federal 28 27 1 law. In any event, under both California and federal standards for assessing fee awards, the 2 requested 32.1 percent of the class recovery represents a reasonable fee award and should be 3 approved. See Ozga v. U.S. Remodelers, Inc., No. C 09-05112 JSW, 2010 WL 3186971, at * 3 (N.D. 4 Cal. Aug. 9, 2010) (departure from benchmark warranted due to excellent results, reaction of the 5 class, the risks faced due to the uncertainty of California law in similar wage-and-hour cases). 6 3. Cross-Check of Percentage Request with Lodestar Calculation Indicates Fee Award is Reasonable 7 8 Courts frequently cross-check a percentage fee request with the lodestar analysis. See, e.g., 9 Sutter Health Uninsured Pricing Cases, 171 Cal. App. 4th 495, 512 (2009) (cross-checking 10 percentage-based award by noting that multiplier of 2.52 is "fair and reasonable"). 11 "In conducting a lodestar cross-check, the court must first determine the dollar value of the 12 proposed percentage-based fee award." In re Portal Software, Inc. Sec. Litig. ("Portal Software"), 13 No. C-03-5138-VRW, 2007 WL 4171201, at *14 (N.D. Cal. Nov. 26, 2007). The requested award 14 here is $166,667.00, which represents a requested fee of 32.1 percent of the $518,245.00 Settlement 15 Amount. The next step is to cross-check the proposed percentage fee against the lodestar. Id. 16 "Three figures are salient in a lodestar calculation: (1) counsel's reasonable hours, (2) counsel's 17 reasonable hourly rate and (3) a multiplier thought to compensate for various factors (including 18 unusual skill or experience of counsel, or the ex ante risk of nonrecovery in the litigation)." In re 19 HPL Tech., Inc. Sec. Litig. ("HPL Tech."), 366 F. Supp. 2d 912, 919 (N.D. Cal. 2005). 20 The multiplier is calculated from the ratio of the proposed percentage fee to the computed 21 lodestar fee and is assessed for reasonableness. Portal Software, 2007 WL 4171201, at *14. Where 22 the use of the lodestar method is used as a cross-check to the percentage method, it can be performed 23 with a less exhaustive cataloguing and review of counsel's hours. See In re Rite Aid Corp. Sec. 24 Litig., 396 F.3d 294, 306 (3d Cir. 2005) ("The lodestar cross-check calculation need entail neither 25 mathematical precision nor bean-counting."); In re Immune Response Sec. Litig., 497 F. Supp. 2d 26 1166 (S.D. Cal. 2007) ("Although counsel have not provided a detailed cataloging of hours spent, 27 the Court finds the information provided to be sufficient for purposes of lodestar cross-check."); 28 28 1 Sutter Health Uninsured Pricing Cases, 171 Cal. App. 4th 495, 512 (2009) (where lodestar used to 2 cross-check percentage approach, documentation of the lodestar figure is often submitted in 3 summary or declaration form, without submission of full time records). 4 Here, Class Counsel's asserted lodestar totals $275,404.50. By declaration, Class Counsel 5 indicates the following rates, hours, and fees of each attorney who performed work on the litigation: 6 Schedule of Fees 7 Attorney Title Hourly Rate Hours Worked Total Fees Requested Partner $695 30.7 $21,337 Mark Estrella Former Senior Counsel $655 60.8 $39,824 Gene Williams Senior Counsel $590 61.8 $36,462 13 David Medby Former Senior Counsel $520 22.3 $11,596 14 Jamie Greene Associate $420 47.5 $19,950 15 Eduardo Santos Associate $420 112.8 $47,376 16 Liana Beneli Associate $395 25.1 $9,915 17 Sue Kim Associate $395 174.3 $68,849 Alexandria Witte Associate $330 14.2 $4,686 Carla Topdjian Associate $330 46.7 $15,411 596.2 $275,406 8 9 10 11 Arthur Meneses 12 18 19 Total 20 21 (Meneses Decl., Doc. 50, ¶ 9.)10 22 The Court finds the 596.2 hours expended on the litigation to be reasonable in light of law 23 and motion practice with respect to subject matter jurisdiction, the amount of discovery conducted, 24 the number of Defendant's employees included in the Settlement Classes, and the mediation 25 preparation required. The Court notes that in Alvarado v. Nederend, No. 1:08-cv-01099-OWW- 26 27 28 10 The figures in the table were rounded up or down to the nearest dollar by Class Counsel, and thus, the total reflects this rounding. 29 1 DLB, 2011 WL 1883188, at * 8 n.2 (E.D. Cal. May 17, 2011), counsel expended approximately 308 2 hours reaching a settlement in a wage-and-hour class action involving issues related to meal and rest 3 breaks with approximately 150 class members. Class membership here is significantly larger than 4 that in Alvarado and arguably entailed review of a larger amount of discovery. The Court finds no 5 reason to reduce the number of hours set forth in counsel's lodestar calculations. 6 As it relates to Class Counsel's requested hourly rates, in Bond v. Ferguson Enterprises, Inc., 7 No. 1:09-cv-01662-OWW-MSJ, 2011 WL 2648879, at *11-13 (E.D. Cal. Jun. 30, 2011), the court 8 recently considered a motion for attorneys' fees in the context of finally approving a wage-and-hour 9 class action settlement. In performing a lodestar cross-check of the class counsel's fee request, the 10 court noted that "[p]revailing hourly rates in the Eastern District of California are in the $400/hour 11 range." Id. at *12. The court then compared the requested rates to those prescribed under the Laffey 12 Matrix, a widely recognized compilation of attorney and paralegal rates used in the District of 13 Columbia, and frequently used in determining fee awards. Id. In comparison to the Laffey Matrix 14 rates, adjusted for cost of living, the hourly rates requested by the class counsel in Bond were 15 approximately 10 percent higher. The court determined that a 10 percent "haircut" to class counsel's 16 requested rates was justified. Thus, for example, a requested hourly rate of $750 for a partner with 17 more than 20 years of experience was adjusted to $675 per hour. A requested hourly rate of $290 18 for an associate with two years of experience was adjusted to $261 per hour.11 19 In this case, a similar reduction should be applied to account for hourly rates in the relevant 20 community. While Class Counsel cites numerous cases where their requested hourly rates have been 21 approved, none of these cases is from the Fresno division of the Eastern District, which is the 22 relevant community for purposes of the fee motion. Nichols v. City of Taft, 155 Cal. App. 4th 1233, 23 1242-43 (2007) ("The lodestar figure is calculated using the reasonable rate for comparable legal 24 services in the local community for noncontingent litigation of the same type, multiplied by the 25 26 11 27 The version of the court's order in Bond that is published electronically on W estlaw contains a formatting error such that the entire text of the order does not appear on the electronic W estlaw publication. The complete order is located on the court's electronic docket at number 59 in case 1:09-cv-01662-OW W -MSJ. 28 30 1 reasonable number of hours spent on the case.") The hourly rates requested by Class Counsel are 2 similar to those requested in Bond and should be reduced. Moreover, because the declaration filed 3 to support the requested rates does not specify the numbers of years each attorney has been practicing 4 in this area of law, or practicing law in general, a larger across-the-board reduction is warranted. For 5 these reasons, reducing the requested hourly rates by 20 percent is a reasonable "haircut" that 6 accounts for the rates in this forum. This adjustment is as follows: 7 8 Schedule of Fees Attorney Title Hourly Adjusted Hours Rate Hourly Rate Worked Partner $695 $556 30.7 $17,069 9 Total Fees 10 Arthur Meneses 11 Mark Estrella Former Senior Counsel $655 $524 60.8 $31,859 Gene Williams Senior Counsel $590 $472 61.8 $29,170 David Medby Former Senior Counsel $520 $416 22.3 $9,277 Jamie Greene Associate $420 $336 47.5 $15,960 Eduardo Santos Associate $420 $336 112.8 $37,901 Liana Beneli Associate $395 $316 25.1 $7,932 Sue Kim Associate $395 $316 174.3 $55,079 Alexandria Witte Associate $330 $264 14.2 $3,749 Carla Topdjian Associate $330 $264 46.7 $12,329 596.2 $220,325 12 13 14 15 16 17 18 19 20 21 Total 22 23 The resulting lodestar amounts to $220,325 for 596.2 hours expended, which equates to an across- 24 the-board billing rate of $369.54 per hour for attorney time, without consideration of the attorneys' 25 years of experience. The adjusted rates range from $264 to $556 per hour to account for the 26 27 28 31 1 respective attorney's greater experience and position within Class Counsel's firm.12 This comports 2 generally with the observation by the Court in Bond that the prevailing rates in the Eastern District 3 are in the range of $400 per hour for attorney work, and is consistent with the $225 to $675 range 4 of hourly rates awarded in Bond. Where the lodestar is utilized as a cross-check, such a "rough 5 calculation" is appropriate. Bond, 2011 WL 2648879, at * 12 ("Because the lodestar is being used 6 here as a cross-check, the court may use a 'rough calculation of the lodestar.'" (quoting Fernandez 7 v. Victoria Secret Stores, LLC, No. CV 06-04149 MMM, 2008 WL 8150856, at * 9 (C.D. Cal. July 8 21, 2008) (courts "generally also use a rough calculation of the lodestar as a cross-check to assess 9 the reasonableness of the percentage award"))). 10 Notwithstanding this reduction in hourly rates, however, the resulting lodestar ($220,325) 11 is still greater than the percentage fee award counsel requests ($166,667). This results in an implied 12 multiplier of 0.76 ($166,667 / $220,325), i.e., a negative multiplier. An implied negative multiplier 13 supports the reasonableness of the percentage fee request. See, e.g., Portal Software, 2007 WL 14 4171201, at *16 (resulting negative multiplier under lodestar cross-check analysis "suggest[ed] that 15 the percentage-based amount is reasonable and fair based on the time and effort expended by class 16 counsel"). The lodestar cross-check confirms the reasonableness of the percentage-fee requested by 17 Class Counsel. 18 Based on the factors weighed in considering the award under the percentage method and the 19 lodestar cross-check method, the requested award of fees is reasonable and the Court 20 RECOMMENDS that Class Counsel's request for attorneys' fees be GRANTED. 21 C. Plaintiff's Motion for the Award of an Enhancement to the Class Representative Should be Granted 22 23 Plaintiff seeks an enhancement award in the amount of $5,000 for Class Representative 24 Estella Schiller. This payment is intended to recognize the time and efforts Ms. Schiller spent for 25 the benefit of Class Members, as well as the additional risk Ms. Schiller undertook. 26 12 27 28 The Court was able to ascertain the number of years each attorney performing work on the case has been admitted to practice law in California through the records maintained by the State Bar of California located at 32 1 An enhancement award paid to a class representative must be assessed by the court because 2 "[i]f class representatives expect routinely to receive special awards in addition to their share of the 3 recovery, they may be tempted to accept suboptimal settlements at the expense of the class members 4 whose interests they are appointed to guard." Staton, 327 F.3d at 975 (quoting Weseley v. Spear, 5 Leeds & Kellogg, 711 F. Supp. 713, 720 (E.D.N.Y. 1989) (internal quotation marks omitted)). Thus, 6 in considering an enhancement award to a class representative, a court should weigh all "relevant 7 factors including the actions the plaintiff has taken to protect the interests of the class, the degree to 8 which the class has benefitted from those actions, . . . the amount of time and effort the plaintiff 9 expended in pursuing the litigation[,] . . . and reasonable fears of workplace retaliation." Staton, 10 327 F.3d at 977 (internal quotation marks and citation omitted). 11 In this case, the Class Representative assisted in the prosecution and settlement of the Class' 12 claims by (1) reviewing her own personal employment records to select documents she believed 13 would assist Class Counsel in litigating the case; (2) spending time assisting Class Counsel with 14 discovery; (3) assisting with settlement negotiations, and (4) spending time evaluating the settlement. 15 (Schiller Decl., Doc. 51, ¶¶ 8-11.) Plaintiff estimates that she spent approximately 25 to 30 hours 16 assisting Class Counsel in the prosecution of the case. (Schiller Decl., Doc. 51, ¶ 13.) Further, 17 Plaintiff agreed to execute a general release of claims which is broader than the release signed by the 18 other Class Members. (Schiller Decl., Doc. 51, ¶ 12.) Plaintiff, as Class Representative, undertook 19 a financial risk that, in the event of a judgment in favor of Defendant, she may have been personally 20 responsible for any costs awarded in favor of Defendant. See, e.g., Whiteway v. FedEx Kinkos Office 21 & Print Servs., Inc., No C 05-2320 SBA, 2007 WL 4531783, at * 2-*4 (N.D. Cal. Dec. 17, 2007). 22 Additionally, there has been no objection to the Class Representative enhancement award. 23 Finally, the amount requested is consistent with other incentive awards in this Circuit. See 24 In re Mego Fin. Corp. Sec. Litig., 213 F.3d 454, 463 (9th Cir. 2000) (approving $5,000 to two 25 plaintiff representatives of 5,400 potential class members in a $1.75 million settlement); Chu v. 26 Wells Fargo Investments, LLC, 2011 WL 672645, at * 5 (N.D. Cal. Feb. 16, 2011) (awarding 27 $10,000 to two plaintiff representatives involved in case for five years and $4,000 to three 28 33 1 representative plaintiffs participating in case for two years, from a $6.9 million settlement fund); 2 Hopson v. Hanesbrands, Inc., No. 08-cv-0844 EDL, 2009 WL 928133, at *10 (N.D. Cal. Apr. 3, 3 2009) (approving $5,000 award to one member of 217-member class from $408,420 settlement 4 amount); Glass v. UBS Fin. Servs., No. C-06-4068 MMC, 2007 WL 221862, at *16-17 (N.D. Cal. 5 Jan. 26, 2007) (approving $25,000 award to each of four plaintiff representatives of 13, 176-member 6 class from $45 million settlement amount). 7 In view of the work the Class Representative has performed on behalf of Class Members, the 8 risk the Class Representative undertook, and the Class Members' response to the Settlement, the 9 requested payment is reasonable and appropriate. The Court RECOMMENDS that Plaintiff's request 10 for a $5,000 Class Representative enhancement award be GRANTED. 11 12 13 IV. RECOMMENDATION Based on consideration of the memorandums, declarations, and exhibits filed in support of the present motions, the Court RECOMMENDS as follows: 14 1. Plaintiff's Motion for Final Approval of the Class Action Settlement be GRANTED; 15 2. Plaintiff's Motion for Attorneys' Fees be GRANTED in the amount of $166,667.00; 16 3. Plaintiff's Request for a Class Representative Enhancement Award be GRANTED; 17 18 in the amount of $5,000 and 4. Should the district court adopt these findings and recommendations, Plaintiff's 19 proposed order for final approval of the class action settlement filed at Docket No. 20 59 is recommended for issuance. 21 These findings and recommendations are submitted to the district judge assigned to this 22 action, pursuant to 28 U.S.C. § 636(b)(1)(B) and this Court's Local Rule 304. Within fourteen (14) 23 days of service of this recommendation, any party may file written objections to these findings and 24 recommendations with the Court and serve a copy on all parties. Such a document should be 25 captioned "Objections to Magistrate Judge's Findings and Recommendations." The district judge 26 will review the magistrate judge's findings and recommendations pursuant to 28 U.S.C. 27 28 34 1 § 636(b)(1)(C). The parties are advised that failure to file objections within the specified time may 2 waive the right to appeal the district judge's order. Martinez v. Ylst, 951 F.2d 1153 (9th Cir. 1991). 3 4 IT IS SO ORDERED. 5 Dated: ie14hj June 11, 2012 /s/ Sheila K. Oberto UNITED STATES MAGISTRATE JUDGE 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 35