John Utne v. Home Depot U.S.A., Inc., No. 3:2016cv01854 - Document 370 (N.D. Cal. 2023)
Court Description: ORDER GRANTING MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION AND PAGA SETTLEMENT. Signed by Chief Judge Richard Seeborg on July 28, 2023. (rslc3, COURT STAFF) (Filed on 7/28/2023)
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1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 NORTHERN DISTRICT OF CALIFORNIA 9 10 JOHN UTNE, et al., Case No. 16-cv-01854-RS Plaintiffs, 11 United States District Court Northern District of California v. 12 13 HOME DEPOT U.S.A., INC., Defendant. ORDER GRANTING MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION AND PAGA SETTLEMENT 14 15 16 17 I. INTRODUCTION More than seven years after this litigation began, the parties have reached a settlement for 18 which Plaintiffs seek preliminary approval. Under the proposed Settlement Agreement, Defendant 19 Home Depot U.S.A., Inc. (“Home Depot”), will provide a gross payment of $72.5 million to 20 resolve the claims of three classes — two of which have already been certified (the “Hourly 21 Employee Class” and the “Post-Shift Class”), and one class (the “Rounding Class”) for which 22 Plaintiffs seek certification pursuant to Rule 23(e) of the Federal Rules of Civil Procedure. Upon 23 review, the Settlement Agreement appears fair, adequate, and reasonable such that preliminary 24 approval is warranted. As such, the motion will be granted. 25 26 II. BACKGROUND The background of this case and Plaintiffs’ averments have been discussed at length in the 27 many orders previously issued in this case. In short, this wage and hour class action avers that 28 Home Depot failed to pay its employees all wages due, in several ways. Plaintiffs sought and United States District Court Northern District of California 1 obtained certification of two classes: the Post-Shift Class (previously referred to and certified as 2 the “Lock-In Class”) and the Hourly Employee Class. With respect to the former, Plaintiffs allege 3 Home Depot did not pay employees who worked closing shifts for the time they spent waiting in 4 locked stores until being let out by a supervisor; and with respect to the latter, Plaintiffs contend 5 Home Depot did not compensate employees for time spent walking through Home Depot stores to 6 clock-in for their shifts. Summary judgment was granted to Home Depot as to its rounding policy 7 with respect to timekeeping. 8 The parties proceeded through class certification, partial summary judgment, formal and 9 expert discovery, and a Daubert hearing. After participating in a full-day mediation session and 10 subsequent negotiations, the parties arrived at the current Settlement Agreement. Under the 11 Agreement, Home Depot will pay $72.5 million as a gross settlement amount. From this, Plaintiffs 12 propose to deduct (1) one-third of the gross amount (or roughly $24.16 million) in attorney fees; 13 (2) out-of-pocket costs not to exceed $3.5 million; (3) a $25,000 service award for the Estate of 14 John Utne and a $7,500 award for Alfred Pinto;1 (4) up to $750,000 in settlement administration 15 costs;2 and (5) a $10,000 reserve fund for “disputed, untimely and self-identified claims,” the 16 balance of which will be donated to The Homer Fund as the cy pres recipient. Dkt. 363 (“Mot.”), 17 at 6; see Dkt. 363-3 ¶ 3 (describing The Homer Fund). After these deductions, 5% (or $2.2 18 million) will constitute the PAGA Settlement Fund. Pursuant to Cal. Lab. Code § 2699(i), 75% of 19 this Fund will be paid to the California Labor and Workforce Development Agency (“LWDA”), 20 and the remaining 25% will go to the PAGA group members. This leaves around $41.8 million as 21 22 23 24 25 26 27 28 1 John Utne initially served as the named Plaintiff and class representative. Alfred Pinto was then added as an additional class representative in light of Mr. Utne’s failing health. After Mr. Utne passed away earlier this year, the parties stipulated to substituting him with his Estate through his successor in interest Karen Utne. 2 Plaintiffs have since selected KCC as the proposed Settlement Administrator, with costs not to exceed $693,400. See Dkt. 364. Because KCC’s actual costs do not meaningfully change the Net Settlement Amount, this order uses the $750,000 figure presented in the motion to calculate and compare the Class and PAGA recovery with Plaintiffs’ estimated maximum recoveries on their claims. That said, in their motion for final approval, Plaintiffs should correct these figures to reflect the actual costs. ORDER GRANTING PRELIMINARY APPROVAL OF CLASS/PAGA SETTLEMENT CASE NO. 16-cv-01854-RS 2 1 the Net Class Settlement Fund. From this, 41% is dedicated to the Hourly Employee Class claims; 2 50% is dedicated to the Post-Shift Class claims; and 9% is dedicated to the Rounding Class 3 claims. This results in an average payout of roughly $77 for Hourly Employee Class members, 4 $72 for Post-Shift Class members, $25 for Rounding Class members, and $2.50 for PAGA group 5 members.3 As the gross settlement is non-reversionary, “any deductions from the [gross] fund not 6 approved by the Court will go back into the net settlement fund.” Mot. at 1. Further, Class 7 members will not be required to file claims. Rather, payments will be calculated based on each 8 member’s respective number of shifts worked based on Defendant’s records, and payments will 9 then be distributed directly. The Agreement also contains an escalation clause that effectively 10 limits Defendant’s overall exposure should the actual number of Class members increase. United States District Court Northern District of California 11 Gross Settlement Amount $72,500,000.00 Minus Attorney Fees (33.3%) $24,166,666.67 Minus Costs (up to) $3,500,000.00 Minus Service Awards $32,500.00 Minus Settlement Administration costs $750,000.00 12 13 14 15 (up to) Reserve Fund 16 Net Settlement Amount PAGA Settlement (5%) PAGA Members (25%) LWDA (75%) Class Settlement (95%) Post-Shift Class (41%) Hourly Employee Class (50%) Rounding Class (9%) 17 18 19 20 21 22 $44,040,833.33 $2,202,041.67 $550,510.42 $1,651,531.25 $41,838,791.66 $17,153,904.58 $20,919,395.83 $3,765,491.25 In exchange, the class members will release all claims “that were or could have been 23 24 $10,000.00 asserted based on the facts alleged in any Complaint or any notice provided to the LWDA by any 25 26 27 28 3 Plaintiffs report there are 272,386 members of the Hourly Employee Class, 235,934 members of the Post-Shift Class, 149,551 members of the Rounding Class, and 227,139 PAGA group members as of March 2023. ORDER GRANTING PRELIMINARY APPROVAL OF CLASS/PAGA SETTLEMENT CASE NO. 16-cv-01854-RS 3 United States District Court Northern District of California 1 Named Plaintiff.” Dkt. 363-1 (“SA”) ¶ 66. This includes the state wage and hour claims raised 2 here, as well as claims under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201 et seq.4 3 III. LEGAL STANDARD 4 The Ninth Circuit maintains a “strong judicial policy that favors settlements” in class 5 actions. Class Plaintiffs v. City of Seattle, 955 F.2d 1268, 1276 (9th Cir. 1992). Under Rule 23(e), 6 parties may seek approval of classes “proposed to be certified for the purposes of settlement.” Fed. 7 R. Civ. P. 23(e). First, the proposed settlement class(es) must meet the criteria for certification 8 under Rule 23(a) — that is, numerosity, commonality, typicality, and adequacy — as well as one 9 of the Rule 23(b) categories. Here, Plaintiffs rely on Rule 23(b)(3), which permits certification of a 10 class where “questions of law or fact common to class members predominate over any questions 11 affecting only individual members, and [where] a class action is superior to other available 12 methods for fairly and efficiently adjudicating the controversy.” Fed. R. Civ. P. 23(b)(3). Under Rule 23(e), courts must also determine whether the settlement agreement is “fair, 13 14 adequate, and reasonable to all concerned.” Uschold v. NSMG Shared Servs., LLC, 333 F.R.D. 15 157, 169 (N.D. Cal. 2019). This requires assessing the following factors: (1) the strength of the plaintiff’s case; (2) the risk, expense, complexity, and likely duration of further litigation; (3) the risk of maintaining class action status throughout the trial; (4) the amount offered in settlement; (5) the extent of discovery completed and the stage of the proceedings; (6) the experience and views of counsel; (7) the presence of a governmental participant; and (8) the reaction of the class members of the proposed settlement. 16 17 18 19 20 In re Bluetooth Headset Prods. Liab. Litig., 654 F.3d 935, 946 (9th Cir. 2011) (quoting Churchill 21 Vill. v. Gen. Elec., 361 F.3d 566, 575 (9th Cir. 2004)). The Northern District of California has also 22 adopted additional procedural guidance for evaluating proposed settlements. Procedurally, parties must first seek preliminary approval of their settlement agreement. 23 24 This step primarily evaluates whether “the proposed settlement appears to be the product of 25 26 27 28 The Settlement Agreement and the proposed Notice both misstate the citation for FLSA as “29 U.S.C. Section 20, et seq.” See SA ¶ 66; Dkt. 363-1, Ex. 2, at 4. These must be corrected as a condition for preliminary approval. 4 ORDER GRANTING PRELIMINARY APPROVAL OF CLASS/PAGA SETTLEMENT CASE NO. 16-cv-01854-RS 4 1 serious, informed, non-collusive negotiations, has no obvious deficiencies, does not improperly 2 grant preferential treatment to class representatives or segments of the class, and falls within the 3 range of possible approval.” Haralson v. U.S. Aviation Servs. Corp., 383 F. Supp. 3d 959, 966 4 (N.D. Cal. 2019) (quoting In re Tableware Antitrust Litig., 484 F. Supp. 2d 1078, 1080 (N.D. Cal. 5 2007)). But see Cotter v. Lyft, Inc., 193 F. Supp. 3d 1030, 1036 (N.D. Cal. 2016) (questioning the 6 rationale for conducting a “lax” inquiry at the preliminary approval stage). If preliminary approval 7 is granted, notice is distributed to the class members and a final hearing is held to determine 8 whether the settlement satisfies Rule 23(e)(2). IV. DISCUSSION 9 Each of the proposed Settlement Classes satisfies the requirements of Rule 23, and the United States District Court Northern District of California 10 11 proposed Settlement Agreement appears fair, adequate, and reasonable. As such, preliminary 12 approval is warranted. A. Rule 23(a) and Rule 23(b) Requirements 13 14 As discussed above, the Hourly Employee Class and the Post-Shift Class were previously 15 certified under Rule 23(b)(3). Notwithstanding the fact that it has been five years since that order, 16 these two Classes still presumptively meet the Rule 23(a) and Rule 23(b)(3) requirements. See 17 Harris v. Vector Mktg. Corp., No. C-08-5198 EMC, 2012 WL 381202, at *3 (N.D. Cal. Feb. 6, 18 2012); Sinohui v. CEC Ent., Inc., No. 14-cv-02516-JSK-KK, slip op. at 7 (C.D. Cal. Dec. 13, 19 2017). But see Spann v. J.C. Penney Corp., 314 F.R.D. 312, 318–19 (C.D. Cal. 2016). This 20 presumption is further justified by the fact that both Classes survived Defendant’s motion to 21 decertify unscathed. See Dkt. 272. Plaintiffs propose to modify the Class definitions in very minor 22 ways: (1) they seek to expand the Class Period through the date of Preliminary Approval; and (2) 23 they seek to change the definition of the Hourly Employee Class to specify that the class 24 encompasses retail employees.5 Neither of these modifications meaningfully change the analysis 25 26 27 28 The Hourly Employee Class was certified as “[a]ll individuals employed by Home Depot in hourly-paid or non-exempt positions in California at any time since March 8, 2012.” Dkt. 92, at 1. The class definition included in the Settlement Agreement, by contrast, is “all individuals employed by Home Depot who worked one or more shifts in retail stores in hourly-paid or non5 ORDER GRANTING PRELIMINARY APPROVAL OF CLASS/PAGA SETTLEMENT CASE NO. 16-cv-01854-RS 5 1 under Rule 23(a) or 23(b)(3). The first would, if anything, tend only to increase the number of 2 class members, of which there are already more than enough to satisfy Rule 23(a)(1). The second 3 mainly conforms the Class definition more precisely to the scope of this litigation. 4 5 6 7 8 United States District Court Northern District of California 9 Plaintiffs further propose adding the Rounding Class as a component of the settlement. This Class is defined as: all individuals employed by Home Depot who worked one or more shifts in retail stores in hourly-paid or non-exempt positions in California during the Class Period and who were paid less than their actual clock-in and clock-out time for his or her total hours worked during the Class Period as a result of Home Depot’s practice of rounding time to the nearest quarter hour, including persons hired after notice of class certification. 10 SA ¶ 74. This definition is very similar in scope to those of the two certified Classes, and it may 11 be certified for the same reasons. Plaintiffs represent that this Class, like the other two, is 12 composed of several hundred thousand employees, thus easily satisfying the numerosity 13 requirement. The Class mechanism is superior for the same reasons as the certified Classes. 14 Plaintiffs themselves were further subject to the rounding policies in question, rendering them 15 typical; and they are adequate to represent this Class as well. Because the rounding policy appears 16 to have applied broadly, rather than in a site-specific manner, both commonality and 17 predominance are met. See Tijero v. Aaron Bros., Inc., 301 F.R.D. 314, 322 (N.D. Cal. 2013) 18 (collecting cases involving common policies). Finally, while the rounding claims themselves were 19 sheared on summary judgment, this does not stand in the way of certification for the purposes of 20 settlement: “case law has long recognized the ability to settle claims that had been previously 21 dismissed on the merits.” In re Dynamic Random Access Memory (DRAM) Antitrust Litig., No. C 22 06-4333 PJH, 2013 WL 12333442, at *48 (N.D. Cal. Jan. 8, 2013), report and recommendation 23 adopted, 2014 WL 12879520 (N.D. Cal. June 27, 2014). As such, the Rounding Class passes 24 muster under Rule 23(a) and Rule 23(b)(3), as with the previously certified Classes. 25 26 27 28 exempt positions in California during the Class Period, including persons hired after notice of class certification.” SA ¶ 40 (emphasis added). ORDER GRANTING PRELIMINARY APPROVAL OF CLASS/PAGA SETTLEMENT CASE NO. 16-cv-01854-RS 6 B. The Settlement Agreement Appears to Be Fair, Adequate, and Reasonable 1 1. The Amount of the Settlement Falls Within the Generally Acceptable Range for 2 Approval, and It Is Justified Given the Risks of Continued Litigation United States District Court Northern District of California 3 4 The overall amount is “perhaps the most important factor to consider” in assessing a 5 proposed settlement. Cotter v. Lyft, Inc., 176 F. Supp. 3d 930, 935 (N.D. Cal. 2016). On this score, 6 the settlement appears to serve the Class members’ interests. Plaintiffs’ counsel describes the 7 settlement reached here as “an outstanding result for the settlement class . . . especially when 8 compared against the risks involved in litigating this action through trial and potential appeals.” 9 Dkt. 363-2 ¶ 10. There are a number of ways to test this assertion, but in the end, “the negotiated 10 amount is fair and reasonable no matter how you slice it.” Rodriguez v. West Pub. Corp., 593 F.3d 11 948, 965 (9th Cir. 2009). The Net Class Settlement Fund, regardless of the amount of attorney fees ultimately 12 13 deducted, represents a significant percentage of what Plaintiffs estimate to be Defendant’s 14 maximum exposure on each of the three Classes’ claims (excluding penalties, interest, and 15 liquidated damages).6 Zooming in, the portion of the Fund allocated to the Hourly Employee Class 16 claims is roughly one-third of Defendant’s maximum exposure; the portion allocated to the 17 Rounding Class claims is nearly 90% of Defendant’s maximum exposure; and the portion 18 allocated to the Post-Shift Class claims “actually exceeds (or is roughly equal to) the potentially 19 recoverable unpaid wages.” Mot. at 15. These figures necessarily shrink when you include 20 penalties, interest, and liquidated damages, but the Net Class Settlement Fund would nonetheless 21 be substantial. The story is slightly different when examining the PAGA penalties. Again, the 22 settlement establishes roughly $2.2 million as the PAGA Settlement Fund. This is contrasted 23 24 25 26 27 28 6 Plaintiffs estimate Defendant’s maximum exposure, excluding penalties, interest, and liquidated damages to be roughly $82 million. This is calculated as follows: $23,252,728.08 (max. exposure for Post-Shift claims) + $54,366,994.00 (max. exposure for Hourly Employee claims) + $4,450,720.00 (max. exposure for Rounding claims) = $82,070,442.08. See Mot. at 15–18. Even if Plaintiff’s large fee request (one-third of the gross amount) were to be granted, the Net Settlement Fund would still represent over 50% of Defendant’s maximum exposure. ORDER GRANTING PRELIMINARY APPROVAL OF CLASS/PAGA SETTLEMENT CASE NO. 16-cv-01854-RS 7 1 against a theoretical maximum of over $1 billion, though if litigated successfully the penalties 2 would likely be much lower: by Plaintiffs’ estimate, this figure would be somewhere closer to $99 3 million. Plaintiffs concede this is a “small percentage of the possible exposure,” coming in at a 4 little over 2% of the “realistic” number and only 0.22% of the theoretical maximum. Mot. at 27.7 Combining these two pools — the Class recovery and the (reasonable) PAGA recovery — United States District Court Northern District of California 5 6 Plaintiffs estimate they stand to recover somewhere between $181 million (excluding penalties, 7 etc.) and $313 million (including penalties, etc.) if they were to prevail at trial. The Net Settlement 8 Fund is thus discounted,8 to be sure, but it is certainly within the range of recoveries that Ninth 9 Circuit district courts often approve. See, e.g., Glass v. UBS Fin. Servs., Inc., No. C-06-4068 10 MMC, 2007 WL 221862, at *4 (N.D. Cal. Jan. 26, 2007) (preliminarily approving settlement of 11 about 25% to 35% of the maximum); Viceral v. Mistras Grp., Inc., No. 15-CV-02198-EMC, 2016 12 WL 5907869, at *7–8 (N.D. Cal. Oct. 11, 2016) (preliminarily approving settlement worth 8.1% 13 of the full verdict value); O’Connor v. Uber Tech., Inc., 201 F. Supp. 3d 1110, 1132 & n.18 (N.D. 14 Cal. 2016) (collecting cases and noting 10% recovery was “at the low end of reasonable 15 recovery”); cf. Cavazos v. Salas Concrete, Inc., No. 19-cv-00062-DAD-EPG, 2022 WL 2918361, 16 at *5–6 (E.D. Cal. July 25, 2022) (concluding fund worth 5.8% of the value of non-PAGA claims 17 was “below the general range of percentage recoveries that California courts . . . have found to be 18 reasonable”). Similarly, the PAGA recovery, while even smaller, is above the 1% threshold that 19 many courts find inherently concerning. See Haralson, 383 F. Supp. 3d at 972–73. These discounts are justified when examining the strength of the overall case. Plaintiffs 20 21 suggest that they present strong claims on behalf of the Post-Shift Class, but that several risks at 22 trial and on appeal could still have undermined or reduced them. The Hourly Employees’ claims 23 appear weaker and riskier, owing in part to their novelty. In any case, prevailing on either would, 24 25 26 27 28 7 The motion appears to state erroneously that the PAGA allocation is $3,625,000, though this is inconsistent with earlier portions of the motion as well as the Agreement itself. See Mot. at 27. 8 Again, assuming (without deciding) that the one-third fee request is approved, the $44 million Net Settlement Fund would represent between 14% and 24% of the projected range of recovery. ORDER GRANTING PRELIMINARY APPROVAL OF CLASS/PAGA SETTLEMENT CASE NO. 16-cv-01854-RS 8 United States District Court Northern District of California 1 of course, require convincing a jury that Defendant committed the violations averred, which 2 cannot be taken for granted. As noted above, the Rounding Class claims are no longer part of the 3 litigation, having been dismissed earlier; and the Hourly Employees’ wage statement penalties, 4 and both certified Classes’ waiting time penalties, were also dismissed. Thus, recovering anything 5 on those three bases would have required a successful appeal. Finally, although this case is at an 6 advanced stage in the litigation lifecycle, Plaintiffs would of course have to prepare for and 7 undergo a trial in order to recover anything, which would magnify the already sizable costs they 8 (alongside Defendant) have incurred to date. Plaintiffs’ counsel have significant experience 9 handling complex litigation, and their representations that the settlement is not only justified, but 10 also to the Class’s substantial benefit, is worthy of deference. See Dkt. 363-3 ¶¶ 6–10; Dkt. 363-1 11 ¶¶ 29–31. Thus, in light of the risks inherent to proceeding to trial, and taking counsel’s 12 perspectives into consideration, the settlement appears fair, reasonable, and adequate. 13 2. The Proposed Settlement Presents No Deficiencies Precluding Preliminary Approval 14 For the most part, the settlement itself appears to be the product of “arm’s length, non- 15 collusive, negotiated resolution.” Rodriguez, 563 F.3d at 965. First, as noted above, the Class 16 release covers FLSA claims that were not brought here. While releases of claims not included in 17 the complaint are frequent causes for concern, e.g., Haralson, 383 F. Supp. 3d at 967–69, 18 Plaintiffs are correct that these claims would have been released even without this additional 19 language. See Rangel v. PLS Check Cashers of Cal., Inc., 899 F.3d 1106, 1111–12 (9th Cir. 2018). 20 As such, the release of these claims is more a technicality than anything, and this does not present 21 an obstacle to preliminary approval. The proposed service awards are also reasonable, especially 22 given the length of this case. E.g., Carlin v. DairyAmerica, Inc., 380 F. Supp. 3d 998, 1026 (E.D. 23 Cal. 2019) (approving $45,000 service awards for four named plaintiffs). 24 In addition, the settlement does not appear to prejudice certain class members over others. 25 The Net Settlement Fund is to be divided among the three subclasses based on “the relative 26 valuations of the claims.” Mot. at 21. Thus, while Plaintiffs estimate Hourly Employee claims to 27 be potentially worth more overall than the Post-Shift claims, the settlement apportions the riskier 28 ORDER GRANTING PRELIMINARY APPROVAL OF CLASS/PAGA SETTLEMENT CASE NO. 16-cv-01854-RS 9 United States District Court Northern District of California 1 Hourly Employee claims a lower amount of the Net Settlement Fund than the more-certain Post- 2 Shift Claims. Of course, as noted above, the Rounding Class claims have been dropped, which 3 justifies the fact they constitute a smaller portion of the Fund. This approach to allocating the 4 benefits of the settlement among the Class members thus appears fair, given the respective risks 5 and values of the claims. Further, the likely high amount of overlap among members of the 6 different Classes means that, even if the Fund were to be apportioned differently, it would only 7 marginally change any given member’s recovery. 8 3. Plaintiffs Will Be Expected to Provide Strong Support for the Attorney Fee Request 9 Plaintiffs’ attorney fee request is not unreasonable per se, but it is incomplete. For one 10 thing, Plaintiffs’ counsel does not provide a lodestar estimate, either in the motion or any of its 11 accompanying declarations. Counsel has noted this is a work in progress, and the motion instead 12 generally states that they have expended significant time and resources on this litigation. No doubt 13 they have, but it is difficult to test the validity of their claim to one-third of the Gross Settlement 14 Fund without a lodestar to serve as a cross-check. While Plaintiffs describe a one-third award as 15 “extremely reasonable,” Mot. at 18, that request falls on the higher end of fee awards typically 16 granted by district courts in the Ninth Circuit. See, e.g., Arredondo v. S.W. & Pac. Spec. Fin., Inc., 17 No. 18-cv-01737-DAD-SKO, 2022 WL 2052681, at *11 (E.D. Cal. June 7, 2022). That said, the 18 settlement does leave a large portion to the Class, which mitigates the concern that the fee request 19 will dwarf the Class recovery. E.g., Harris v. Vector Mktg. Corp., C-08-5198 EMC, 2011 WL 20 4831157, at *6 (N.D. Cal. Oct. 12, 2011) (balking at potential that counsel could recover “the 21 lion’s share — 80 percent — of the total payout”). 22 Of some concern is the presence of a “clear sailing” provision in the Settlement 23 Agreement. Under this provision, Defendant agrees it will “not oppose a request for a maximum 24 of one-third (33.33%) of the Gross Settlement Amount.” SA ¶ 94a. While such provisions are not 25 prohibited, they are nonetheless disfavored, as they both “increase[] the likelihood that class 26 counsel will have bargained away something of value to the class” and “deprive[] the court of the 27 advantages of the adversary process.” Bluetooth, 654 F.3d at 948 (first alteration in original) 28 ORDER GRANTING PRELIMINARY APPROVAL OF CLASS/PAGA SETTLEMENT CASE NO. 16-cv-01854-RS 10 United States District Court Northern District of California 1 (quoting Weinberger v. Great N. Nekoosa Corp., 925 F.2d 518, 525 (1st Cir. 1991)); see Roes, 1–2 2 v. SFBCS Mgmt., LLC, 944 F.3d 1035, 1050–51 (9th Cir. 2019). As such, district courts have a 3 “heightened duty to peer into the provision and scrutinize closely the relationship between 4 attorneys’ fees and benefits to the class.” Id. Plaintiffs’ motion does not address this provision, and 5 it is difficult to ascertain on the record presented whether its inclusion is evidence of collusive 6 behavior. See Hoffman v. Dutch LLC, 317 F.R.D. 566, 578 (S.D. Cal. 2016). However, the non- 7 reversionary nature of the Fund means that even reducing or adjusting these amounts will 8 ultimately benefit the Class members, rather than Defendant, thus reducing the likelihood of 9 collusion or impropriety. See In re Toys R Us-Del., Inc. Fair and Accurate Credit Transactions 10 Act (FACTA) Litig., 295 F.R.D. 438, 459 (C.D. Cal. 2014); cf. Harris, 2011 WL 4831157, at *5. 11 For this reason, the provision does not preclude granting preliminary approval. However, between 12 the large fee request and the fact that the request will be unopposed, Plaintiffs are advised that 13 their motion for attorney fees will be subject to close scrutiny. V. CONCLUSION 14 15 Plaintiffs have demonstrated that the Settlement Class may be certified under Rule 23(e) 16 and that the proposed Settlement Agreement appears to be fair, adequate, and reasonable. As such, 17 the motion is granted. The Court orders the following: 18 19 20 1. The proposed settlement is preliminarily approved, under the terms, definitions, and provisions expressed in the Settlement Agreement. 2. Pursuant to Rule 23(e), the proposed Settlement Class is preliminarily certified, with the 21 Class Period running from March 8, 2012, through and including the date of this order. 22 The Settlement Class contains the following subclasses: 23 a. The “Hourly Employee Class” is defined as all individuals employed by Home 24 Depot who worked one or more shifts in retail stores in hourly-paid or non-exempt 25 positions in California during the Class Period, including persons hired after notice 26 of class certification. 27 28 b. The “Post-Shift Class” is defined as all individuals employed by Home Depot in ORDER GRANTING PRELIMINARY APPROVAL OF CLASS/PAGA SETTLEMENT CASE NO. 16-cv-01854-RS 11 1 hourly-paid or non-exempt positions in Home Depot stores in California during the 2 Class Period, including persons hired after notice of class certification, who worked 3 at least one Closing Shift. 4 5 worked one or more shifts in retail stores in hourly-paid or non-exempt positions in 6 California during the Class Period and who were paid less than their actual clock-in 7 and clock-out time for his or her total hours worked during the Class Period as a 8 result of Home Depot’s practice of rounding time to the nearest quarter hour, 9 including persons hired after notice of class certification. 10 United States District Court Northern District of California c. The “Rounding Class” is defined as all individuals employed by Home Depot who 3. Plaintiffs are preliminarily appointed as class representatives for the Settlement Class. 11 Shaun Setareh and Thomas Segal of the Setareh Law Group, and Cody R. Kennedy, Alan 12 Lazar, and Marissa Mayhood of Marlin & Saltzman LLP, are preliminarily appointed as 13 Class Counsel for the same. 14 4. KCC is appointed as the Settlement Administrator. 15 5. The proposed Class Notice and the notice procedures outlined by the parties are approved, 16 subject to the correction noted supra note 4. Notice shall be disseminated to the Settlement 17 Class members pursuant to the relevant provisions of the Settlement Agreement. 18 19 6. A Final Approval Hearing is scheduled for Thursday, February 15, 2024, at 1:30 p.m. The motion for final approval must be filed no later than 21 days prior to the Hearing. 20 7. As noted at the hearing, the parties shall, as soon as is practicable, file on the public docket 21 a final implementation schedule reflecting the correct dates and deadlines for each of the 22 events listed in Plaintiffs’ proposed order. See Dkt. 363-4, at 11–12. This includes the 23 dates by which the motion for attorney fees’ and costs, and the motion for final approval, 24 must be filed. 25 26 IT IS SO ORDERED. 27 28 ORDER GRANTING PRELIMINARY APPROVAL OF CLASS/PAGA SETTLEMENT CASE NO. 16-cv-01854-RS 12 1 Dated: July 28, 2023 2 3 4 ______________________________________ RICHARD SEEBORG Chief United States District Judge 5 6 7 8 9 10 United States District Court Northern District of California 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 ORDER GRANTING PRELIMINARY APPROVAL OF CLASS/PAGA SETTLEMENT CASE NO. 16-cv-01854-RS 13
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