VINCE CHHABRIA, District Judge.
On March 9, 2015, a hearing was held on the motion of Plaintiff Lyle Galeener, Individually and on Behalf of All Others Similarly Situated ("Plaintiffs") for an order (1) conditionally certifying the proposed settlement Classes as opt-out Classes under Federal Rule of Civil Procedure 23; (2) appointing Plaintiffs as Class Representatives; (3) appointing Plaintiffs' counsel as Class Counsel; (4) granting preliminary approval to the parties' Stipulation of Class Settlement and Settlement Agreement (the "Settlement," attached as Exhibit A to the declaration of Galvin Kennedy); (5) approving the mailing of the proposed Class Notice; (6) appointing CPT as the Settlement Administrator; and (7) scheduling a final approval hearing and related dates (the "Preliminary Approval Motion"). Jahan C. Sagafi, Galvin Kennedy, Gabriel Assaad, and John Padilla appeared for Plaintiffs. Margaret Keane, Michael Sheehan, and Ben Gipson appeared for Defendant Source Refrigeration & HVAC, Inc. ("Source").
Having considered the papers on the motion, the arguments of counsel, and the law, the Court now enters this Preliminary Approval Order and FINDS, CONCLUDES, and ORDERS as follows:
Plaintiffs allege that Source violated wage and hour laws by failing to pay class members for all hours worked, miscalculating the overtime rate and, with respect to the California class members, violating meal and rest period laws.
Source disputes and denies all of Plaintiffs' claims. Source contends that it has fully complied will all applicable laws at issue in this matter.
For settlement purposes only, the Parties have proposed conditional certification of the following state law settlement classes under Federal Rule of Civil Procedure 23 (the "Class"): (1) an Arizona state-law class consisting of all current and former Source employees who are or were employed in Covered Positions
The term "Covered Position" means the nonexempt hourly service technician position at Source in the United States. The term "Covered Period" means October 24, 2009 through entry of this Court's final approval order in California, and October 24, 2010 through entry of this Court's final approval order elsewhere.
The Court hereby finds and concludes that for purposes of the Settlement only, the Classes satisfy all of the requirements for certification under Rule 23(a) and (b)(3) of the Federal Rules of Civil Procedure.
1. Each Class is sufficiently numerous that joinder is impracticable.
2. The members of each Class share common issues of fact and law regarding (i) whether Source's practice of excluding shift-differential pay from the technicians' regular rate for purposes of overtime calculation violates the FLSA and state wage laws; (ii) whether standby time constitutes compensable work time, and whether Source's policy and practice of not compensating technicians for this time runs afoul of the FLSA and state wage laws; (iii) whether Source's policies and lack thereof violate the California meal period or rest break laws; and (iv) the proper method of calculating damages if the above violations are proven.
3. Each Class Representative's claims are typical of those of the Class he proposes to represent, because they arise out of the same policies and practices and course of conduct complained of by all Class Members.
4. Each Class Representative is an adequate representative of the Class he proposes to represent, because his interests are co-extensive with those of the Class Members, and he has retained experienced counsel to represent him and the Class Members.
5. Questions of law or fact common to each Class predominate over individualized issues, and a class action is superior to other available methods for the fair and efficient adjudication of this controversy.
6. Because certification of each Class is proposed in the context of a settlement, the Court need not inquire whether the case, if tried as a class action, would present intractable management problems.
Accordingly, the Court hereby certifies the Class under Rule 23(a) and (b)(3).
The Court finds and concludes that each Class Representative has claims typical of the Members of the Class he proposes to represent, and he is an adequate representative of the Class he seeks to represent. The Court hereby appoints Plaintiffs to serve as Class Representatives of the Classes they propose to represent.
The Court finds and concludes that Kennedy Hodges, LLP, Padilla & Rodriguez, LLP, and Outten & Golden LLP have, separately and collectively, extensive experience and expertise in prosecuting wage-and-hour class actions and collective actions. The Court appoints these firms as Class Counsel.
The Court has reviewed the terms of the Settlement, including the plan of allocation and the release of claims. The Court has also read and considered the declaration of Galvin B. Kennedy in support of preliminary approval. Based on review of those papers, and the Court's familiarity with this case, the Court finds and concludes that the Settlement is the result of arms-length negotiations between the Parties conducted after Class Counsel had adequately investigated Plaintiffs' claims and become familiar with their strengths and weaknesses. The assistance of an experienced mediator in the settlement process confirms that the Settlement is non-collusive. Based on all of these factors, the Court concludes that the proposed Settlement meets the criteria for preliminary settlement approval. The Settlement has no obvious defects and falls within the range of possible approval as fair adequate, and reasonable, such that notice to the Class Members is appropriate. Accordingly, the Settlement is hereby preliminarily approved.
The Parties have also submitted for this Court's approval a proposed class notice (evidenced by Exhibit 1 to the Settlement). After carefully reviewing these documents, the Court finds and concludes as follows:
The Class Notice is the best notice practicable under the circumstances and allows Class Members a full and fair opportunity to consider the Settlement.
The Class Notice fairly, plainly, accurately, and reasonably informs Class Members of: (1) appropriate information about the nature of this action, the definition of the Classes, the identity of Class Counsel, and the essential terms of the Settlement, including the plan of allocation; (2) appropriate information about Plaintiffs' forthcoming application for the Class Representative Payments and the Class Counsel Attorneys' Fees and Costs Award; (3) appropriate information about how Class Members' settlement shares will be calculated; (4) appropriate information about this Court's procedures for final approval of the Settlement, and about Class Members' right to appear through counsel if they desire; (5) appropriate information about how to comment on or opt out of the Settlement, if a Class Member wishes to do so; and (6) appropriate instructions as to how to obtain additional information regarding this action and the Settlement.
The proposed plan for distributing the Class Notice likewise is a reasonable method calculated to reach all individuals who would be bound by the Settlement. Under this plan, the Settlement Administrator will distribute the Class Notice to all Class Members by first-class mail and e-mail to their last known addresses. There is no additional method of distribution that is cost-effective and would be reasonably likely to notify Class Members who may not receive notice pursuant to the proposed distribution plan.
Not later than ten days after Plaintiffs' Preliminary Approval Motion was filed, notice of the Settlement was mailed to the Attorney General of the United States of America and the appropriate state official in each state in which, based on Source's records of last known mailing address, Class Members reside; and the notice contains the documents required by 28 U.S.C. section 1715(b)(1)-(8). On this basis, the notice of the Settlement is approved and the Court finds that Source has discharged its obligations under CAFA to provide notice to the appropriate federal and state officials.
Accordingly, the Court finds and concludes that the proposed plan for distributing the Class Notice will provide the best notice practicable, satisfies the notice requirements of Rule 23(e), and satisfies all other legal and due process requirements. Accordingly, the Court hereby orders as follows:
1. The Class Notice is approved.
2. The CAFA Notice of Proposed Settlement is approved.
3. The manner of distributing the Class Notice to the Class Members is approved.
4. Promptly following the entry of this order, the Settlement Administrator will prepare final versions of the Class Notice, incorporating into them the relevant dates and deadlines set forth in this order.
5. Within twenty-eight (28) days following entry of this order, Source will provide the Settlement Administrator with a database in a format acceptable to the Settlement Administrator, that lists, for each Class Member, the Class Member's name, Social Security number, Source employee ID number, last known mailing address, all known personal e-mail addresses, and information adequate to calculate Class Members' award allocations, including but not limited to: time records and pay records applicable to each week within the Covered Period during which the Class Member worked in a Covered Position, as well as their location (including state) of work.
6. Before the mailing of the Class Notice, the Settlement Administrator will update any new address information for Class Members as may be available through the National Change of Address ("NCOA") database or equivalent system.
7. Within forty-eight (48) days following entry of this order, the Settlement Administrator will mail, via first-class mail and e-mail, the Class Notice to all Class Members at their last known address or at the most recent address that may have been obtained through the NCOA.
8. The Settlement Administrator will take all reasonable steps to obtain the correct address of any Class Members for whom the Class Notice is returned by the U.S. Postal Service as undeliverable and otherwise to provide the Class Notice. The Settlement Administrator will trace all returned undeliverable Class Notices and re-mail them to the most recent address available. The Settlement Administrator will promptly notify Class Counsel and counsel for Source of any mail sent to Class Members that is returned as undeliverable after the first mailing as well as any such mail returned as undeliverable after any subsequent mailing(s).
9. Plaintiffs will file with their motion for final approval a declaration from the Settlement Administrator of due diligence and proof of mailing with regard to the mailing of the Notice, and will file prior to the hearing on the motion a supplemental declaration from the Settlement Administrator as applicable.
10. Before the deadline for cashing Settlement Share checks, the Settlement Administrator will contact all Participating Class Members who have not cashed their Settlement checks to remind them to do so before the deadline.
11. The Settlement Administrator will take all other actions in furtherance of settlement administration as are specified in the Settlement Agreement.
The Court hereby schedules a hearing to determine whether to grant final approval of the Settlement (the "Final Approval Hearing") for Thursday, August 20, 2015, at 10:00 a.m. The date of the hearing may be changed without further notice to the Class.
Any Class Member may opt out of participating in the Settlement by submitting a signed letter to the Settlement Administrator stating that he or she wishes to be excluded from the Settlement. The letter must include (1) the Class Member's name, address, telephone number, and signature, (2) the reasons for his or her comment on the settlement, (3) whether he or she intends to appear at the Fairness Hearing, and (4) if he or she will appear through an attorney, the attorney's name, address, and telephone number.
A completed opt-out request will be deemed timely submitted to the Settlement Administrator if it is (i) mailed to the Settlement Administrator by first-class mail and postmarked by not later than sixty (60) days after the Settlement Administrator first mails the Class Notice to Class Members, or (ii) it is delivered to the Settlement Administrator by the deadline for submission stated above, whether by mail, e-mail, facsimile transmission, professional delivery, or personal delivery. Only those Class Members who submit their opt-out request within the time and by the manner set forth in this Order will be excluded from the Settlement. Pursuant to Federal Rule of Civil Procedure 23(b)(3) and (c)(2), the Settlement will have no binding effect on any Class Member who properly opts out of the Settlement in the manner required by this Order.
If three and a half percent (3.5%) or more of the eligible Class Members validly opt out pursuant to the process set forth herein, Source will have the right to rescind the Settlement, and the Settlement and all actions taken in its furtherance will be null and void. Source must exercise this right by notifying Class Counsel of its decision in writing by email and by telephone within one hundred and forty (140) days after the Court enters its Preliminary Approval Order.
If Source exercises this option, all of Source's obligations under the Settlement will cease to be of any force and effect, and the Settlement and any order entered in connection with it, including this order, will be vacated, rescinded, canceled, and annulled, and the Parties will return to the status quo in the action as if the Parties had never entered into the Settlement in the first place. In addition, in such event, the Settlement and all negotiations, court orders, and proceedings related to the Settlement will be without prejudice to the rights of the Parties, and evidence relating to the Settlement and all negotiations will not be admissible or discoverable in the action or otherwise.
Any Class Member who wishes to comment on or object to the fairness, reasonableness, or adequacy of the Settlement must do so in writing. Class Members who have timely commented on or objected to the Settlement in writing may also appear at the Final Approval Hearing, in person or through counsel, but only if they (a) have given written notice of their intent to appear at the hearing as provided in the Class Notice or (b) can show good cause why they could not provide such notice. To be considered, any comment on or objection to the final approval of the Settlement must state the basis for the comment or objection and be mailed to the Settlement Administrator, Class Counsel, and counsel for Source, at the addresses provided in the Class Notice, via first-class mail, received within one hundred twenty-five (125) days after the Preliminary Approval Order. Any Class Member who does not timely submit such a written comment or objection will not be permitted to raise such comment or objection or appear at the Final Approval Hearing, except for good cause shown, and any Class Member who fails to object in the manner prescribed by this order will be deemed to have waived, and will be foreclosed from raising, any such comment or objection, except for good cause shown.
Every Class Member who does not opt out of the Settlement will be eligible to receive his or her share of the Net Settlement Payment. The Settlement Administrator will disperse the Settlement Share checks to the Class Members via U.S. mail within forty-nine (49) days after entry of the Final Approval Order, as defined in the Settlement Agreement. Class Members will have one hundred eighty (180) days from the date of issuance written on the check to cash their Settlement Share checks, after which time the checks will expire. Before that deadline, the Settlement Administrator will contact all Class Members who have not cashed their checks to remind them to do so.
Not later than thirty-five (35) days before the Final Approval Hearing, Plaintiffs will file a motion for final approval of the Settlement.
Not later than fourteen (14) days before the expiration of the 60-day opt-out and objection period, Class Counsel may file a motion for approval of Class Representative Payments. Not later than seven (7) days before the Final Approval Hearing, Class Counsel may file a reply brief providing additional information and argument and/or responding to any opposition to the motion.
Not later than fourteen (14) days before the expiration of the 60-day opt-out and objection period, Class Counsel may file a motion for approval of their Class Counsel Attorneys' Fees and Costs Payment. Not later than seven (7) days before the Final Approval Hearing, Class Counsel may file a reply brief providing additional information and argument and/or responding to any opposition to the motion.
If, at the Final Approval Hearing, this Court grants final approval to the Settlement, Plaintiffs and every Class Member who does not opt out will, pursuant to the Settlement, be adjudicated to have granted the release of Covered Claims as set forth in the Settlement. Each Participating Class Member, by cashing his or her Settlement Check, opts into the Action and will also release all Covered Claims under the Fair Labor Standards Act as set forth in the Settlement.
CPT is hereby appointed Settlement Administrator to carry out the duties set forth in this Preliminary Approval Order and the Settlement.
The following schedule sets for the sequence for the relevant dates and deadlines based on the preliminary approval of the Settlement on March 9, 2015.
