STANLEY A. BOONE, Magistrate Judge.
Plaintiffs Francisco Rodriguez, Jesus Hernandez Infante, Marco Garcia, Juan Manuel Bravo, Estela Patino, Jose F. Orozco, and Antonio Ortiz ("Plaintiffs") on behalf of themselves and other members of the public similar situated, filed this action on December 7, 2016, against Defendants Danell Custom Harvesting, LLC; Rance Danell, Eric Danell, David Danell, and Justin Danell ("Defendants") alleging wage and hour claims in violation of federal and state law. (Compl. 1.) Currently before the Court is Plaintiffs' unopposed motion for final approval of the class action settlement.
The Court, having reviewed the record and considering that no class member has objected to the settlement, finds this matter suitable for decision without oral argument.
Defendant Danell Custom Harvesting, LLC is a California company doing business in Kings County, State of California. (Compl. ¶ 14.) Defendant Danell Custom Harvesting LLC is a company that develops, manufactures, and sells specialized equipment and parts for harvesting purposes and provides machinery and personnel to client dairies at their premises to harvest, transport, and weigh wheat and corn that is used for animal feed ("silage"). (Compl. ¶ 21.) Defendant Danell Custom Harvesting, LLC is co-owned by Defendants Rance Danell, Eric Danell, David Danell, and Justin Danell. (Compl. ¶¶ 15-18.)
Defendant Danell Custom Harvesting LLC's day to day operations and wage and hour practices are managed by Defendants Rance Danell, Eric Danell, David Danell, and Justin Danell. (Compl. ¶ 21.) Defendants Rance Danell, Eric Danell, David Danell, and Justin Danell regularly visit and oversee operations at the Danell Custom Shop and at numerous customer sites where the putative class members worked. (Compl. ¶ 22.) These defendants make decisions regarding the scheduling, working conditions, and hiring and termination decisions. (Compl. ¶ 22.) They also exercise control over the wages, hours, or working conditions. (Compl. ¶ 22.)
Defendant Danell Custom Harvesting LLC employs five groups of workers: 1) mechanics who service cars and trucks and develop parts at their shop ("mechanics"); 2) maintenance workers who service and clean agricultural equipment at their shop ("maintenance workers"); 3) farm equipment operators who work in the fields harvesting ("operators"); 4) truck drivers who transport silage from the fields to the dairy ("drivers"); and 5) weighers who weigh the silage for billing purposes ("weighers"). (Compl. ¶ 23.)
Defendants employ a large team of mechanics who service trucks, forklifts, the defendants' personal race cars, and the defendants' family vehicles. (Compl. ¶ 24.) Some of the mechanics also do welding, painting, and machinist duties. (Compl. ¶ 24.) The mechanics are paid an overtime rate after working more than 10 hours per day or 60 hours per week. (Compl. ¶ 24.) A meal break is provided for mechanics after they have worked six hours in their shift. (Compl. ¶ 24.) Although the mechanics typically work more than a 10-hour day, they are not provided with a second meal period. (Compl. ¶ 24.) Sometimes the mechanics will work twelve or more hours per day and are not provided with a third rest break. (Compl. ¶ 24.) Mechanics must purchase and use their own tools to work for Defendants despite being paid less than double the California minimum wage. (Compl. ¶ 24.)
Defendants also employ maintenance workers who service and clean agricultural equipment, including choppers, swathers, and dozers at their shop. (Compl. ¶ 25.) Maintenance workers are subjected to the same conditions as the mechanics. (Compl. ¶ 25.)
Defendants also employ operators who handle farm machinery such as dozers and choppers to harvest corn or wheat at Defendants' clients' fields. (Compl. ¶ 26.) The operators typically work more than 12-hours per day without being provided meal and rest periods and must eat while operating their vehicles. (Compl. ¶ 26.)
The truck drivers transport silage from Defendants' clients' fields to their dairies. (Compl. ¶ 27.) Around mid-2016, Defendants began paying their truck drivers at an overtime rate when they worked more than 8-hours in a day. (Compl. ¶ 27.) Previously, truck drivers were not paid overtime until they worked more than 10-hours in a day or 60-hours per work week. (Compl. ¶ 27.) Truck drivers have never been provided with meal and rest periods. (Compl. ¶ 27.) Truck drivers typically work more than 12-hours per day and are required to eat while they are driving their trucks and delivering the silage. (Compl. ¶ 27.)
Weighers work at the premises of Defendants' clients weighing and recording the silage brought by the truck drivers. (Compl. ¶ 28.) Weighers are paid an overtime rate after working 10-hours per day or 60-hours per week. (Compl. ¶ 28.) Although weighers typically work more than 12-hours per day, they are not provided with meal and rest periods and must eat while performing their work. (Compl. ¶ 28.) Weighers must also purchase and use their own equipment, such as tables and chairs, and are not fully reimbursed for using their own vehicles. (Compl. ¶ 28.)
Plaintiff Rodriguez was employed by Defendants as a maintenance worker at their shop from approximately May 2012 to May 2016. (Compl. ¶ 7.) Plaintiff Infante has been employed as a maintenance worker at their shop since approximately June 2012 to the present. (Compl. ¶ 8.) Plaintiff Garcia was employed as a shop mechanic and maintenance worker in Defendants' shop from approximately June 2015 to September 2016. (Compl. ¶ 9.) Plaintiff Bravo has been employed by Defendants as a maintenance worker and farm equipment operator from approximately 1998 to the present. (Compl. ¶ 10.) Plaintiff Patino was employed by Defendants as a weigher from approximately 2004 to September 2016. (Compl. ¶ 11.) Plaintiff Orozco was employed by Defendants as a truck driver from approximately November 2014 to June 2016. (Compl. ¶ 12.) Plaintiff Ortiz has been employed by Defendants as a truck driver from approximately July 2014 to the present. (Compl. ¶ 13.)
On December 7, 2016, Plaintiffs filed a class and collective action alleging failure to pay overtime wages in violation of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 201, et seq.; failure to pay overtime wages in violation of California Labor Code sections 510, 1194 and IWC wage orders; failure to provide meal and rest periods in violation of California Labor Code section 226.7 and IWC wage orders; failure to furnish accurate wage statements in violation of California Labor Code section 226; indemnification of work related expenses, California Labor Code section 2802; waiting time penalties, California Labor Code section 203; Unfair Business Practices in violation of California Business and Professions Code section 17200, et seq.; and civil penalties for violation of the California Labor Code section 2699. Plaintiffs brought this action proposing six classes of non-exempt employees who worked for Defendants during the limitations period:
(Compl. ¶ 30.)
On February 28, 2017, the scheduling order issued setting dates and deadlines in the action. (ECF No. 13.) On June 9, 2017, the action was stayed for the parties to engage in mediation. (ECF No. 24.) On October 16, 2017, the stay was lifted. (ECF No. 27.) Plaintiffs' filed a motion for preliminary approval of the class action settlement on November 22, 2017. (ECF No. 30.) A hearing on the motion for preliminary approval was held on December 13, 2017, after which Plaintiffs were granted the opportunity to file supplemental briefing. (ECF Nos. 31, 32.) Following supplemental briefing and several telephonic conferences on February 23, 2018, an order issued granting preliminary approval of the class action settlement. (ECF No. 42.)
On June 8, 2018, Plaintiffs filed an unopposed motion for final approval of the class action settlement. (ECF No. 45.) On June 22, 2018, Plaintiffs filed a declaration in support of the motion for attorney fees and the unredacted time accounting records were filed under seal. (ECF Nos. 50, 51.)
The Ninth Circuit has declared that a strong judicial policy favors settlement of class actions.
To guard against the potential for abuse, "Rule 23(e) of the Federal Rules of Civil Procedure requires court approval of all class action settlements, which may be granted only after a fairness hearing and a determination that the settlement taken as a whole is fair, reasonable, and adequate."
Review of the proposed settlement of the parties proceeds in two phases.
Plaintiffs seek final approval of the class action settlement as fair, reasonable and adequate under Rule 23(e) of the Federal Rules of Civil Procedure, and a a fair and reasonable resolution of a bona fide dispute under the FLSA; certification of the Rule 23 class and of the collective action class under 29 U.S.C. § 216(b); approval that the class notice and FLSA notice complied with law and due process; an enhancement award of $5,000.00 for each named plaintiff; and an award of attorney fees in the amount of $375,000.00 and costs of $31,000.00.
To certify a class, a plaintiff must demonstrate that all of the prerequisites of Rule 23(a), and at least one of the requirements of Rule 23(b) of the Federal Rules of Civil Procedure have been met.
The Court has previously found that the class meets the prerequisites of numerosity, commonality, typicality, and adequacy of representation. (Order Granting Preliminary Approval of Class Action Settlement 6-10, ECF No. 42.) The Court also found that common questions predominate and allowing this action to proceed as a class action is the superior method of adjudicating the controversy of these employment related claims. (
No class member has objected to the settlement of this action nor has any class member opted out of the settlement. Counsel does not know of, and the Court is unaware of, any changes that would affect the class certification findings. (Martinez Decl. ¶ 13.) For the reasons set forth in the February 23, 2018 order on Plaintiffs' motion for preliminary approval of the class action settlement, the Court finds that the settlement classes continue to meet the requirements of Federal Rule of Civil Procedure 23(a) and (b) and the similarly situated requirement of the FLSA. (ECF No. 42.)
Rule 23(c) provides that a class certified under Rule 23(b)(3) must be provided with the best notice that is practicable in the circumstances. Fed. R. Civ. P. 23(c)(2)(B). In this instance, the approved notice was mailed to all class members after updating all addresses by conducting a National Change of Address search. (Sarich Decl. ¶ 6.) The search revealed updated addresses for sixteen class members. (
Having found the Rule 23 and FLSA requirements have been met, the Court will grant final class certification. The following class is certified for settlement in this matter:
The Court next addresses Federal Rule of Civil Procedure 23(e)(2) which requires that any settlement in a class action be approved by the court which must find that the settlement is fair, reasonable, and adequate. At the final approval stage, the court takes a closer look at the settlement, taking into consideration objections and other further developments in order to make the final fairness determination.
When the settlement takes place before formal class certification, as it has in this instance, settlement approval requires a "higher standard of fairness."
"[S]ettlements of collective action claims under the FLSA also require court approval."
The settlement agreement provides one million five hundred thousand dollars ($1,500,000) to resolve all claims of the settlement class for the alleged failure to provide meal and rest breaks and pay wages, penalties, reimbursement of work related expenses, and attorney fees and costs. (Amended Stipulation and Agreement to Settle Class and Collective Action p. 2, ECF No. 45-3.) The following class is certified for purposes of settlement only,
(
Prior to any settlement funds being paid to eligible class members, deductions to the common fund shall be made for service awards to the named plaintiffs, an award of attorney fees and costs to class counsel, all costs of settlement administration,
The net settlement funds are allocated as follows: twenty percent for unpaid wage claims; eighty percent less ten thousand dollars ($10,000) for statutory penalties and interest. (
Any unclaimed funds shall be sent to the State of California Unpaid Property Fund to be held in the name of and for the benefit of the class member under California's escheatment laws. (
Since the preliminary approval, the parties have agreed to the following modifications to the settlement agreement. The named class members have reduced the amount they are seeking an enhancement award for their services in this action from $7,500.00 to $5,000.00. Any unclaimed funds will be sent to the California Division of Labor Standards Enforcement's Unpaid Wages Fund to be held in the name of and for the benefit of the class members under California's escheatment laws. This is the more specific fund for unclaimed wages. (Martinez Decl. ¶ 37.)
The court considers a number of factors in making the fairness determination including: "the strength of the plaintiffs' case; the risk, expense, complexity, and likely duration of further litigation; the risk of maintaining class action status throughout the trial; the amount offered in settlement; the extent of discovery completed and the stage of the proceedings; the experience and views of counsel; the presence of a governmental participant; and the reaction of the class members to the proposed settlement."
To approve settlement of an FLSA claim, the court "must determine whether the settlement is a fair and reasonable resolution of a bona fide dispute."
Here, the parties dispute whether Defendants are entitled to an exemption under the FLSA for farmers. The Supreme Court has held that there are two branches of the definition of farming included in the FLSA.
Defendants contend that they are a farmer under the secondary meaning of agriculture because they provide harvesting services to farmers. Plaintiffs' position is that Defendants are not farmers under the exemption but are an independent company that provides commercial services to farmers on the farmers' land.
As to the specific groups of employees, Defendants contend that the maintenance workers and mechanics are exempt because they repair machines used in harvesting operations. Plaintiffs reply that the line of cases that Defendants rely on to support their position is inapplicable and the mechanics do not work on farm equipment and neither group falls within the definition of farming for the exemption.
Defendants contend that the truck drivers are exempt because they work for a farm as part of the farming process. Plaintiffs disagree arguing the truck drivers are not engaged in primary farming, nor are they engaged in secondary farming because they haul product off the fields and are not employed by the farmers.
Defendants believe that the weighers are covered under the primary and secondary meaning of agriculture, but Plaintiffs disagree because harvesting never extends to transportation or other operations off a farm citing 29 C.F.R. § 780.118(b).
The Court finds that the parties have a bona fide dispute for the purposes of the FLSA claims.
"An important consideration in judging the reasonableness of a settlement is the strength of the plaintiffs' case on the merits balanced against the amount offered in the settlement."
Plaintiffs' complaint alleges claims for failure to pay overtime wages in violation of the FLSA; failure to pay overtime wages; and failure to provide meal and rest periods; failure to furnish accurate wage statements; and indemnification of work related expenses under California law. (ECF No. 1.) Defendants contend that they are entitled to an affirmative defense for both the FLSA and state law claims based on the agriculture exemptions. Plaintiffs take the position that the agriculture exemptions do not apply to the classes at issue in this action based on the nature of the work.
As to the rest break claims, Plaintiffs contend that Defendants required rest breaks to be taken on duty, while Defendants argue that the employees were allowed to take ten-minute rest breaks during down time and the on and off duty breaks is not relevant. Plaintiffs also argue that the nature of the work does not prevent employees from being relieved from duty during meal periods and therefore the on-duty meal periods violated the law.
Finally, as to the work-related expenses, Plaintiffs take the position that they were required to purchase the tools for use at work and are entitled to reimbursement under state law. Defendants counter that there were some tools available for use and there was no policy requiring employees to purchase their own tools.
The settlement in this action provides the class members with substantial relief now; and given the uncertainty of ultimate success at trial, the proposed settlement provides the parties with a fair resolution of the issues presented which weighs in favor of settlement.
"In most situations, unless the settlement is clearly inadequate, its acceptance and approval are preferable to lengthy and expensive litigation with uncertain results."
Further, based on the positions of the parties, motions for summary judgment on the farming exemption under the FLSA and state law is fairly certain. Proceeding to conduct merits discovery and potential dispositive motions on the merits of the claims if a class is certified would cause the parties to this action to incur additional expenses that will be avoided by the settlement. Discovery and trial in this matter is also complex due to the fact that this is a class and collective action. Issues with how to present the case to the trier of fact and prove damages on a class wide basis can be expensive and complicated.
If this action were to proceed to trial, the class would be subjected to the risk of receiving nominal recovery or being denied any recovery in this action. Resolving the action at this time saves the parties the expense of conducting further litigation and confers substantial benefit to the class without being subjected to the risks inherent with proceeding to trial of the matter.
The risks inherent in continuing to litigate this action, the additional expenses that would be incurred were this action to proceed, and the complexity of this action weigh in favor of settlement.
Defendants have offered to settle this action for $1,500,000.00 and will separately pay their share of the payroll taxes. The amount offered is slightly over 53 percent of the maximum potential damages for the primary claims. (Martinez Decl. ¶ 16.)
After deducting the attorney fees, costs, service awards, PAGA penalties that go to the LWDA, and settlement administration costs, the net settlement fund is $1,037,000.00. (Sarich Decl. ¶ 15.) The Rule 23 class consists of 433 individual class members who will receive between $3.89 and $25,544.92 depending on the length of employment and the hourly rate of pay. (Sarich Decl. ¶ 16; Martinez Decl. ¶¶ 2, 19.) The average recovery is estimated to be $2,394.92. (Sarich Decl. 16; Martinez Decl. ¶ 19.) One hundred and sixty-one individuals opted into the collective action. (Martinez Decl. ¶ 2.)
The Court finds that the amount offered in settlement of this action weighs in favor of approving the settlement.
While a settlement that occurs in an advanced stage of the proceedings indicates that the parties have carefully investigated the claims before resolving the action,
Although this matter was settled before merits discovery, the defendants produced the time and pay records for more than 94 percent of the class which allowed class counsel to calculate the back wages and penalties with a reasonable degree of confidence. (Martinez Decl. ¶ 12.) Class counsel also met with the putative class members to obtain information about the unpaid overtime and other violations and obtained over 60 signed declarations for class certification and liability purposes. (
The parties also participated in a full day mediation with Jeffrey Ross who is a professional mediator specializing exclusively in mediation of employment matters. (Martinez Decl. ¶ 10.)
The fact that the parties believe they engaged in sufficient discovery to weigh the merits of the action and engaged the services of a professional mediator in settling the action weighs in favor of approving the class action settlement.
The Court is to accord great weight to the recommendation of counsel because they are aware of the facts of the litigation and in a better position than the court to produce a settlement that fairly reflects the parties' expected outcome in the litigation.
"It is established that the absence of a large number of objections to a proposed class action settlement raises a strong presumption that the terms of a proposed class settlement action are favorable to the class members."
Where a class action is settled prior to class certification, the Court must also consider whether there is evidence of collusion or other conflicts of interest before approving the settlement.
Here, none of the signs of collusion are present. The class in this action is receiving a substantial award with more than one million dollars being distributed to the class while class counsel is seeking only twenty-five percent of the common fund, or $375,000 in attorney fees.
Although the settlement agreement does provide that Defendants will not oppose the request for attorney fees, the fees requested come from the settlement fund and are reasonable so that does not raise a concern that the settlement is the product of collusion of the parties.
Additionally, the unclaimed funds in this action do not revert to the defendants, but escheat to the state for the benefit of the plaintiffs.
Finally, the settlement agreement here was negotiated with the assistance of a mediator who was experienced in wage and hour litigation. (Martinez Decl. ¶ 10.) This supports the finding that there was no collusion between the parties in reaching the agreement.
After considering the foregoing factors, the Court finds that the settlement is fair, adequate, and reasonable pursuant to Rule 23(e) and is a fair and reasonable resolution of a bona fide dispute for settlement of the FLSA action. Further, the Court finds no evidence that the settlement is the result of any collusion between the parties.
The class representatives are each seeking an enhancement payment of $5,000.00. (Martinez Decl. at ¶ 22.) In assessing the appropriateness of class representative enhancements or incentive payments, the Court must consider factors such as the actions the plaintiffs took to protect the interests of the class, the degree to which the class has benefitted, the amount of time and effort the plaintiff expended in pursuing litigation, and any notoriety or personal difficulties encountered by the representative plaintiff.
Here, the action was filed on December 7, 2016, and settlement was reached approximately 10 months later. (ECF No. 25.) The named Plaintiffs participated in strategy meetings, assisted counsel in investigating the case, and took uncompensated time to travel to and from the Central Valley to Oakland to participate in medication. (Decl. of Enrique Martinez ¶ 22.) Further, Plaintiffs contend that they took personal risks in serving as representatives in this lawsuit. (
As the Court previously found, this amount appears to be excessive in relation to the efforts and time the class representatives devoted to this action. In preliminarily approving the class action settlement the Court found that $3,500.00 appeared to be reasonable for the time and services provided by the named plaintiffs. The named plaintiffs were advised that they could present additional evidence to support a request for additional compensation. (ECF No. 42 at 18-19.) Plaintiffs argue that an award of $5,000.00 is appropriate based on the results reached in this action. The Court considers that member of the class will receive an award based on the number of pay periods that they worked. The named class members resolved this matter at a relatively early stage of the proceedings and the class is receiving substantial relief based on the settlement. The named plaintiffs also argue that they took personal risks in serving as class representatives. The finds that an award of $4,000.00, which is above the average award that the class members will receive, adequately takes into account the personal risks taken by the named class members and the fact that no class member has testified that they actually suffered any harm by representing the class.
In similar cases, this Court has found enhancement payments between $2,500 to $3,000 to be reasonable and fair to the putative class.
Therefore, the Court finds that $4,000.00 is reasonable compensation for the services provided by the class representatives in this action given the risks that they took in representing the class and the time spent adjudicating this action. The Court shall award the named class representatives an enhancement award of $4,000.00 each.
Plaintiffs are seeking attorney fees in the amount of twenty-five percent of the common fund. In the Ninth Circuit, courts typically calculate twenty-five percent of the common fund as the "benchmark" for a reasonable fee award providing adequate explanation in the record for any special circumstances that justify departure.
There is no dispute that the plaintiff is entitled to reasonable attorney fees in this action as the prevailing party. However, "[i]n a class action, the district court `must exercise its inherent authority to assure that the amount and mode of payment of attorneys' fees are fair and proper.'"
Counsel in this action has achieved exceptional results in this action. The class is receiving 53 percent of the primary damages with a gross settlement fund of $1,500,000.00. Each class member will be receiving recovery based upon the number of pay periods worked with an average recovery of approximately $2,400.00. Further, after this action was filed, Defendants changed their practices and workers are now receiving meal and rest periods and overtime.
Counsel took this action on a contingency basis and recovery was far from certain. Counsel states that when he took this action it was risky because there was a question as to whether the FLSA overtime exception applied to some or all of the groups of employees and there was a risk that the class would not be certified as to one or more of the state law claims. The risk of nonpayment supports the award of attorney fees.
The amount of attorney fees requested is at the benchmark established in the Ninth Circuit. Counsel litigated this action for two years prior to the settlement. The class members received notice of the fee request, and no class member objected to the amount requested or the request for reimbursement of costs. Therefore, the fee request appears to have the support of the class. The Court next considers if the fee request itself is reasonable.
Federal Rule 23(h) provides that "[i]n a certified class action, the court may award attorney's fees and nontaxable costs that are authorized by law or by the parties' agreement." The Ninth Circuit has affirmed the use of two separate methods of calculating attorney fees, depending upon the case.
The "lodestar" method is typically used where the benefit received by the class is primarily injunctive in nature, and therefore, monetary benefit is not easily calculated.
Since the benefit to the class is easily calculated in a common find case, courts may award a percentage of the common fund rather than engaging in a "lodestar" analysis to determine the reasonableness of the fee request.
The settlement in this action has resulted in a common fund of $1,500,000.00. Class counsel is seeking $375,000 in attorney fees which is 25% of the gross settlement amount. (Stipulation and Agreement to Settle Class and Collective Action ¶ 38.1.) Additionally, counsel seeks $31,000 in costs. (
The Court will employ the lodestar method as a cross check on the percentage method to ensure a failure and reasonable result.
Class counsel Enrique Martinez states that his hourly rate is $575.00 and he has been awarded this rate in the Eastern District. (Martinez Decl. ¶ 26.) Contract attorney Jocelyn Sperling's hourly rate is $500.00. (Sperling Decl. ¶ 11.) However, counsel recognizes that this court has awarded a lower hourly rate to attorneys with similar experience so they used an hourly rate of $400.00 for the purposes of the lodestar check in this matter. (Martinez Decl. ¶ 26.)
Mr. Martinez was admitted to practice in 2000 and has 18 years of experience with extensive experience in employment law, specializing in wage and hour actions. (
Ms. Sperling was also admitted to practice in 2000 and has 18 years of experience. (Sperling Decl. ¶ 2.) She spent years working as a law clerk and staff attorney at the Ninth Circuit and was a research attorney for the Alameda County Superior Court. (
In this district, the reasonable hourly rates for attorneys with less than fifteen years of experience are between $250.00 to $350.00 per hour.
There were three paralegals who worked on this case who receive an hourly rate of $125.00. For purposes of this motion, Plaintiffs are using the rate of $100.00 per hour for paralegal work. Generally, within the Fresno Division, paralegal rates range between $75 to approximately $150.00 per hour depending on experience.
The Court shall adopt the rates for counsel and paralegals as reasonable hourly rates for the lodestar cross-check purposes.
The declarations submitted and time records are sufficient to establish the number of hours worked in this matter. Mr. Martinez spent 527.5 hours on this case as detailed in the time entries provided in support of the motion. (ECF No. 50-1 at 2-9.) This time was spent communicating with class members and and team members, researching, drafting pleadings, and reviewing discovery. (
Ms. Sperling has spent 98.1 hours on this action, without considering the 11.4 hours she spent on fees. (ECF No. 50-1 at 10-13.) Ms. Sperling researched, drafted the FLSA certification motion, drafted notice forms, and participated in preparing the motion for final approval. (
Paralegal Rosa Rico expended 590 hours in this action. (ECF No. 50-1 at 14-20.) Paralegal Jannet Torres expended 175.3 hours in this action. (ECF No. 50-1 at 21-23.) Paralegal Lorena Sota Castro expended 64.5 hours in this action. (ECF No. 50-1 at 24-25.) The paralegals have spent expended 829.8 hours which includes communicating with the 433 class members and calculating the damages of each class member. The paralegals are anticipated to spend an additional 25 hours each in communicating with the class members during the distribution process and answering related questions. (
Given the declarations that were filed in support of the request and counsel's assertion that the hours were reasonably necessary, the Court finds that the hours were reasonably expended in prosecuting this action. Therefore, the lodestar amount is $343,120.00.
To account for the risk that class counsel assumes when they take a class action on a contingency basis, courts divide the total fees sought by the lodestar to arrive at a multiplier.
Here, based on the lodestar amount of $343,120.00, if the Court grants the request for a 25 percent fee award, the multiplier would be 1.09. In light of the results obtained in the settlement of this action, the contingent nature of the fee agreement, and the skill required to properly litigate and settle this matter, the Court finds that the multiplier of 1.09 is appropriate.
The Court finds that the attorney fees requested are reasonable and awards class counsel $375,000.00 in attorney fees.
Plaintiffs contend that their costs in this action were more than $34,000.00 but they are only seeking costs of $31,000.00 for mediations fees, travel expenses, filing fees, and mailing costs.
Upon review of the expenses submitted, the Court finds them to be reasonable, especially in light of the fact that Defendant is not seeking the total amount of the expenditures. The Court awards costs in the amount of $31,000.00.
Based on the foregoing, IT IS HEREBY ORDERED that:
1. For purposes of this order, the Court adopts the terms defined in the settlement agreement.
2. The Court finds that the Rule 23(a) prerequisites and Rule 23(b)(3) requirements are met for the settlement class. It further finds that the requirements are met for certification of the FLSA class under the FLSA, 29 U.S.C. § 216(b).
3. The Court finds that the class notice was the best notice practicable as required by Rule 23(c)(2)(B) and due process. It also finds that the FLSA notice provided accurate and timely notice concerning the FLSA action, such that the employees could make informed decisions about whether to participate. The class notice and FLSA notice were mailed to all members of the Settlement Class, using their last known addresses. The Court finds that the terms of the Settlement Agreement are fair, reasonable, and adequate under Rule 23(e). The Court also finds that the terms are a fair and reasonable resolution of a bona fide dispute under the FLSA.
4. The settlement agreement is finally approved and all provisions shall be effectuated. The named plaintiffs, the settlement class, and FLSA class members are barred from any future legal proceedings against Defendants concerning any of the released claims. However, any person who timely opted out of the class will not be bound by the settlement of the California claims, will not release his or her California claims, and will not be barred from future legal proceedings on the California claims. Any person who did not submit a consent to join/opt in to the FLSA action will not be bound by the settlement of the FLSA overtime claim, will not release the FLSA claim, and will not be barred from future legal proceedings on the FLSA claim.
5. Upon completion of administration of the settlement agreement, the claims administrator shall provide written certification of such completion to the Court and counsel for the parties.
6. Class representatives Francisco Rodriguez, Jesus Hernandez Infante, Marcos Garcia, Juan Manuel Bravo, Estela Patino, Jose F. Orozco, and Antonio Ortiz are each awarded an incentive award of $4,000.00, to be paid from the gross settlement fund.
7. Class counsel is awarded attorney fees in the amount of $375,000.00 and costs of $31,000.00, to be paid from the gross settlement fund.
8. The Court finds that an allocation of $10,000.00 of the gross settlement fund to the PAGA claims is reasonable. The claims administrators shall pay $7,500.00 (75 percent of the allocation) to the California Labor and Workforce Development Agency.
9. The claims administrator shall be paid $14,500.00 from the gross settlement fund for the cost of notice and claims administration.
10. The Court finds that the individual settlement payments to be paid to the class members and members of the collective action as set forth in the Settlement Agreement are fair and reasonable. The Court finally approves and orders the payment of those amounts be made from the net settlement proceeds in accordance with the terms of the Settlement Agreement.
11. The claims administrator shall send any unclaimed funds to California Division of Labor Standards Enforcement's Unpaid Wages Fund to be held in the name of and for the benefit of class members under California's escheatment laws.
12. The Court hereby enters judgment in favor of Plaintiffs and against Defendants, and approves the terms of the settlement agreement. The action is dismissed with prejudice. Each side shall bear its own costs and attorney fees, except as provided by the settlement agreement and set forth herein.
13. The hearing set for July 11, 2018, is VACATED and the parties need not appear at that time.
