MARILYN L. HUFF, District Judge.
On May 24, 2013, Plaintiffs Chip Williams, Adelaida Galindez, and Jupiter Ramirez (collectively "Plaintiffs") filed a motion seeking final approval of a class action settlement and a motion for attorneys' fees, costs, and class representative enhancement awards. (Doc. Nos. 51, 52.) Defendants have not opposed Plaintiffs' motions, and no objections have been raised to the proposed class settlement. On August 26, 2013, the Court held a hearing on the matter. Marc Phelps and Raul Cadena appeared for Plaintiffs. Scott J. Witlin appeared for Defendants. For the following reasons, the Court grants the motion for final approval of class action settlement, the motion for an award of fees and costs to class counsel, and the request for enhancement awards to Plaintiffs Chip Williams, Adelaida Galindez, and Jupiter Ramirez.
This is a wage and hour class action filed on behalf of all non-exempt employees or former employees of Centerplate, Inc., Centerplate of Delaware, Inc., and any subsidiaries or affiliated companies (collectively "Defendants") within California. (Doc. No. 27 ("Fourth Amend. Compl.") ¶ 1.) Defendants are hospitality service companies that provide concessions to sports stadiums, convention centers, and golf courses. (
Plaintiffs allege that Defendants did not provide class members with meal periods and rest breaks, or compensation in lieu thereof, as required by California wage and hour laws. (Fourth Amend. Compl. ¶¶ 2, 13-14.) Additionally, Plaintiffs allege that Defendants failed to compensate class members for total hours worked and for excess hours worked at overtime rates. (
On May 9, 2011, Plaintiff Williams filed a class action complaint against Defendants in the Superior Court of the State of California. (Doc. No. 1-6.) On August 11, 2011, Williams filed an amended class action complaint against Defendants. (Doc. No. 1-7.) Defendants removed the Williams action on September 15, 2011. (Doc. No. 1.)
On November 22, 2011, Plaintiffs Galindez and Ramirez filed a class action complaint against Defendants in California Superior Court. (
On May 15, 2012, the Court granted the parties' joint motion to consolidate the two actions. (Doc. No. 26.) On May 16, 2012, Plaintiffs filed a fourth amended consolidated complaint ("complaint") asserting violations of the California Labor Code, wage orders of the Industrial Welfare Commission ("IWC"), and California's Unfair Competition Law ("UCL"). (Doc. No. 27, Fourth Amend. Compl.) On June 15, 2013, Defendants filed an answer to the complaint. (Doc. No. 28.)
During the discovery period, the parties exchanged written discovery, (Doc. No. 51-2, Declaration of Roger Carter ("Carter Decl.") ¶¶ 5-6), and briefed five motions to compel discovery. (Doc. Nos. 29, 31, 34-36.) In addition, Defendants took the deposition of each named Plaintiff; and Plaintiffs took a Rule 30(b)(6) deposition of the Defendants. (Doc. No. 51-2, Carter Decl. ¶ 6.)
On August 30, 2012, the parties attended a full-day mediation before Mr. Joel Grossman, an independent mediator with extensive experience in wage and hour class actions. (
Per the proposed settlement, Defendants have agreed to pay $650,000 to establish a settlement fund to settle the class members' claims. (Doc. No. 46-2, Declaration of Roger Carter Ex. A ("Proposed Settlement").) That amount includes all applicable payroll taxes to be computed by the settlement administrator. (
On January 25, 2013, the Court granted preliminary approval of the class settlement and ordered Plaintiffs to disseminate notice of the settlement to the class members. (Doc. No. 48.) On February 19, 2013, CPT Group, Inc. ("CPT"), the class action claims administrator for this case, mailed notice to the 9,394 class members. (Doc. No. 52-2, Declaration of Tim Cunningham ("Cunningham Decl.") ¶ 8.) The notice provided class members with the opportunity to file a claim for monetary relief, opt out of the settlement, or object to the settlement. (
As of May 24, 2013, class members have submitted 2,247 responses to CPT, including 2,212 claim forms. (Doc. No. 52-2, Cunningham Decl. ¶ 12.) Based on the number of claims to date, approximately 63.49% of the Net Settlement Proceeds, or $239,363.14, will be paid to the class members who made claims. (
When the parties reach a settlement agreement prior to class certification, the Court is under an obligation to "peruse the proposed compromise to ratify both the propriety of the certification and the fairness of the settlement."
A plaintiff seeking to certify a class under Rule 23(b)(3) of the Federal Rules of Civil Procedure must first satisfy the requirements of Rule 23(a). Fed. R. Civ. P. 23(b);
On January 25, 2013, the Court preliminarily certified the proposed class. (Doc. No. 48 at 6.) The Court concluded that the proposed class satisfies the numerosity, commonality, typicality, and adequacy of representation requirements of Rule 23(a). (
Federal Rule of Civil Procedure 23(e) requires the Court to determine whether a proposed class action settlement is "fair, adequate and reasonable," and not a product of collusion.
Both parties have expended significant time, effort, and resources supporting their positions, and would continue to do so if the settlement failed to get final approval. (Doc. No. 52-1 at 8.) The disputed factual and legal issues would be complex and costly to resolve at trial. (
In the present case, the proposed settlement provides class members with immediate monetary relief through a total common fund of $650,000. Based on the number of claims to date, $239,363.14, or 63.5% of the net settlement proceeds, will be paid to 2,212 members of the class. (Doc. No. 52-1 at 9; Doc. No. 52-2, Cunningham Decl. ¶ 19.) This settlement is a good result for the class and eliminates the risks, expenses, and delay associated with continued litigation. Moreover, the settlement amount is the result of arm's-length negotiation conducted by experienced counsel. Accordingly, the Court finds the amount offered in settlement weighs in favor of granting final approval of the settlement.
In the context of class action settlements, as long as the parties have sufficient information to make an informed decision about settlement, "`formal discovery is not a necessary ticket to the bargaining table.'"
The parties reached settlement fifteen months after the first complaint was filed and after extensive discovery and analysis of Plaintiffs' claims. (
Plaintiffs' counsel has extensive experience acting as class counsel in complex class action cases, including wage and hour class actions. (
After dissemination of the notice packet to the 9,394 members, which provided each class member with the terms of the settlement and with an option to opt-out or file an objection, as of May 24, 2013, only twenty-five (25) class members have requested exclusion and no class member has filed an objection. (Doc. No. 52-2, Cunningham Decl. ¶¶ 8, 12-14, Exs. A-B.) The absence of any objector strongly supports the fairness, reasonableness, and adequacy of the settlement.
The collusion inquiry addresses the possibility the agreement is the result of either overt misconduct by the negotiators or improper incentives of certain class members at the expense of other members of the class.
The $5,000 incentive awards for Plaintiffs Chip Williams, Adelaida Galindez, and Jupiter Ramirez do not appear to be the result of collusion. The Court evaluates incentive awards using "`relevant factors including the actions the plaintiff has taken to protect the interests of the class, the degree to which the class has benefitted from those actions, . . . the amount of time and effort the plaintiff expended in pursuing the litigation . . . and reasonable fears of workplace retaliation.'"
Finally, the attorneys' fees also do not appear to be the result of collusion. Plaintiff's counsel may simultaneously negotiate the merits of the action and their attorneys' fees.
Accordingly, the Court grants Plaintiffs' motion for final approval of the settlement.
With respect to the attorneys' fees, the Ninth Circuit has established a 25% "benchmark" for common fund cases.
First, the results achieved in this case were very favorable. Class members are provided with immediate monetary relief, and the overall award is substantial. Second, the risks of litigation were real and substantial. Third, the complexity and potential duration of the case, coupled with the intensity of settlement negotiations, indicates that a 30% award is reasonable. Fourth, class counsel took this case on a contingent fee basis, bearing the entire risk and costs of litigation. (Doc. No. 51-1 at 8.) Fifth, the request for attorneys' fees in the amount of 30% of the common fund falls within the range of acceptable attorneys' fees in Ninth Circuit.
For these reasons, the Court concludes that an award of attorneys' fees in the amount of 30% of the common fund, or $195,000, and litigation costs in the amount of $20,000,
Finally, the $5,000 incentive awards for Plaintiffs Chip Williams, Adelaida Galindez, and Jupiter Ramirez each, in total representing around 2.3% of the common fund, also appear to be reasonable. "The criteria courts may consider in determining whether to make an incentive award include: 1) the risk to the class representative in commencing suit, both financial and otherwise; 2) the notoriety and personal difficulties encountered by the class representative; 3) the amount of time and effort spent by the class representative; 4) the duration of the litigation and; 5) the personal benefit (or lack thereof) enjoyed by the class representative as a result of the litigation."
In the present case, the above factors weigh in favor of approving the enhancement awards requested. By initiating the present action, Plaintiffs have risked and continue to risk damage to their reputations and future employability in the field. (Doc. No. 51-7, Williams Decl. ¶¶ 19-20.)
For the reasons stated, it is hereby ordered:
1. The Settlement Agreement and the terms therein are fair, just, reasonable and adequate as to the settling parties, including the Settlement Class, and is hereby finally approved in all respects. The parties are hereby directed to perform the terms of the Settlement Agreement.
2. Solely for the purposes of effectuating the Settlement, the Court hereby certifies the Settlement Class, defined as all current and former non-exempt hourly employees of Centerplate who worked in the State of California at any time from May 9, 2007 through January 25, 2013 (the "Settlement Class" or "Class Members"). For the reasons stated in the Preliminary Approval Order, the Court finds that the Settlement Class meets the legal requirements for class certification under Federal Rule of Civil Procedure 23 ("Rule 23").
3. In accordance with Federal Rule of Civil Procedure 23 and the requirements of due process, the Settlement Class has been given proper and adequate notice of the Settlement Agreement and the Final Fairness Hearing, such notice having been carried out in accordance with the Preliminary Approval Order. The Notice and notice methodology implemented pursuant to the Settlement Agreement and the Court's Preliminary Approval Order (a) were appropriate and reasonable and constituted due, adequate, and sufficient notice to all persons entitled to notice; and (b) met all applicable requirements of the Federal Rules of Civil Procedure and any other applicable law. The parties have complied fully with the notice provisions of the Class Action Fairness Act of 2005, 28 U.S.C. § 1715.
4. The Court hereby approves the Settlement as set forth in the Settlement Agreement and finds that the Settlement is, in all respects, fair, adequate, and reasonable and is hereby finally approved in all respects. The Court makes this finding based on a weighing of the strength of Plaintiffs' claims and Defendants' defenses with the risk, expense, complexity, and duration of further litigation. The Court also finds that the Settlement is the result of non-collusive, arms-length negotiations between experienced counsel representing the interests of the Settlement Class and Defendants, after thorough factual and legal investigation. In granting final approval of the Settlement, the Court considered the nature of the claims, the amounts and kinds of benefits paid in settlement, the allocation of settlement proceeds among the Class Members, and the fact that the Settlement represents a compromise of the Parties' respective positions rather than the result of a finding of liability at trial. Additionally, the Court finds that the terms of the Settlement have no obvious deficiencies and do not improperly grant preferential treatment to any individual Class Member. The Court further finds that the response of the Class to the Settlement supports final approval of the Settlement. Specifically, no Class Member objects to the Settlement. Accordingly, pursuant to Rule 23(e), the Court finds that the terms of the Settlement are fair, reasonable, and adequate to the Class and to each Class Member. The Court also hereby finds that Plaintiff's have satisfied the standards and applicable requirements for final approval of this class action settlement under Rule 23.
5. The Motion for Final Approval is granted, and the Settlement Agreement hereby is approved as fair, reasonable, adequate to members of the Settlement Class, and in the public interest. The parties are directed to consummate the Settlement Agreement in accordance with its terms.
6. The Carter Law Firm, The Cooper Law Firm, P.C., The Phelps Law Group, Cadena Churchill LLP, and L/O of Paul Jackson (collectively referred to as "Class Counsel"), having conferred a benefit on absent Class Members and having expended efforts to secure compensation to the Class, are entitled to a fee, and accordingly, the Court approves the application by Class Counsel for attorneys' fees in the total amount of $195,000. This amount is payable as set forth in the Settlement Agreement.
7. The Court further approves Class Counsel's reasonable litigation costs in the amount of $20,000, to be paid as set forth in the Settlement Agreement.
8. The Court further approves a payment of $5,000 to each Class Representative-Chip Williams, Adelaida Galindez and Jupiter Ramirez-for the initiation of this action, work performed, and risks undertaken in this matter.
9. The Class Administrator, CPT Group, Inc., shall be paid $40,500 in accordance with the terms of the Settlement Agreement.
10. The Court hereby enters judgment approving the terms of the Settlement Agreement and ordering that the Lawsuit be dismissed on the merits with prejudice in accordance with the Settlement. The Complaint is dismissed on the merits with prejudice on a class-wide basis. This document shall constitute a final judgment for purposes of Federal Rule of Civil Procedure, Rule 58.
11. Without affecting the finality of the Judgment, the Court shall retain jurisdiction of this action for the purpose of resolving any disputes that may arise as to the implementation of the monetary relief terms of the Settlement Agreement.