1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 SHARON OLIVEIRA, et al., Case No. 5:22-cv-02410-PCP
8 Plaintiffs, ORDER GRANTING MOTION FOR 9 v. FINAL APPROVAL OF SETTLEMENT AND GRANTING IN PART MOTION 10 LANGUAGE LINE SERVICES, INC., et FOR ATTORNEYS’ FEES, COSTS, al., AND SERVICE AWARDS 11 Defendants. Re: Dkt. Nos. 75, 76 12 13 Before the Court are plaintiffs’ unopposed motions for final settlement approval and for 14 attorneys’ fees, costs, and service awards. For the following reasons, the Court grants the motion 15 for final approval and grants in part the motion for fees, costs, and service awards. 16 BACKGROUND 17 This is a collective and class action employment lawsuit filed by named plaintiffs Sharon 18 Oliveira and Simone Franco de Andrade Boyce against two California-based companies, 19 defendants On Line Interpreters, Inc. (OLI) and Language Line Services, Inc. (LLS). Plaintiffs 20 were full-time interpreters for defendants, which offer interpreter services to consumers and hire 21 interpreters throughout the United States as nonexempt employees who are paid an hourly wage 22 and entitled to overtime pay. Oliveira was employed in California from November 21, 2018 to 23 May 31, 2019 and then in Ohio from June 1, 2019 to November 30, 2020. Boyce was employed in 24 California from March 8, 2020 to December 17, 2021.1 25 Plaintiffs allege that defendants failed to pay them minimum and overtime wages earned, 26 failed to provide compliant rest and meal breaks, failed to provide accurate wage statements, failed 27 1 to reasonably reimburse employees for business expenses, required impermissible “off-the-clock” 2 work, and engaged in unfair business practices. In their operative January 2023 complaint, 3 plaintiffs asserted violations of the federal Fair Labor Standards Act (FLSA), various California 4 labor laws, California’s Private Attorneys General Act (PAGA), and the Ohio Minimum Fair 5 Wage Standards Act. 6 After the operative complaint was filed, the parties engaged in substantial discovery and 7 two rounds of mediation before reaching the proposed settlement. The parties initially engaged in 8 informal discovery, and defendants produced their policies and procedures as well as timekeeping 9 and payroll records. Plaintiffs provided these materials to their retained experts to estimate 10 damages for the class/collective members. The parties participated in a full day of mediation on 11 April 10, 2023, but the case did not settle. The parties thereafter engaged in formal discovery from 12 May to December 2023. The parties’ discovery efforts involved an in-person deposition as well as 13 written discovery, including requests for production, form and special interrogatories, and requests 14 for admission. Soon after, the parties agreed to participate in a second mediation on February 17, 15 2024. At the conclusion of this mediation session, the parties agreed upon the proposed settlement, 16 which was initially presented as a mediator’s proposal. 17 On June 12, 2024, the parties moved for preliminary approval of a FLSA collective and 18 class action settlement, conditional certification of the settlement classes, appointment of class 19 representatives and counsel, approval of class notices, and setting of a final approval hearing. The 20 Court continued the initial hearing date and ordered the parties to provide supplemental briefing 21 addressing several issues. Plaintiffs submitted their supplemental brief and supporting evidence on 22 July 29, 2024, the Court heard argument on the motion for preliminary approval on August 1, 23 2024, and the Court granted preliminary approval on August 2, 2024. 24 As part of the settlement approval process, plaintiffs requested certification of three 25 classes: (1) the FLSA Collective, which includes all current and former OLI or LLS employee 26 interpreters in the United States from April 18, 2020 to April 1, 2024, and those who opted in after 27 notice was issued; (2) the California Class, which includes all current and former OLI or LLS 1 opt out after notice was issued; and (3) the Aggrieved Employees subclass which includes all 2 current and former OLI or LLS employee interpreters in California who were nonexempt or 3 hourly-paid employees from November 16, 2021 through April 1, 2024. Under the terms of the 4 settlement, defendants will contribute a total gross amount of $3,725,000. The parties propose 5 allocating $25,000 of that amount to service awards to the named plaintiffs and certain individuals 6 who have already opted into the FLSA collective action; $800,500 to the FLSA Collective; 7 $1,332,833.33 to the California Class; $56,250 to the Aggrieved Employees entitled to a portion 8 of the PAGA recovery; $168,750 to the Labor & Workforce Development Agency (LWDA) for its 9 portion of the PAGA recovery; $1,241,666.67 to attorneys’ fees and $50,000 to attorneys’ 10 expenses; and $50,000 to settlement administration costs. 11 The settlement includes a release of claims by members of the California Class and FLSA 12 Collective. Individuals who opt into the FLSA Collective are required to release all FLSA claims 13 that were or could have been pleaded based on the factual allegations in the first amended 14 complaint or any prior complaint. Individuals who do not opt out of the California Class are 15 required to release all federal and state law claims that were or could have been pleaded based on 16 the factual allegations in the first amended complaint or any prior complaint. The Aggrieved 17 Employees are required to release all claims under PAGA for all California Labor Code violations 18 that were pleaded in the first amended complaint or any prior complaint. 19 After preliminary approval, the parties provided notice of the terms of the settlement in 20 accordance with the preliminary approval order. Notice was provided by mail to 10,792 of the 21 10,959 California Class and FLSA Collective members—more than 98 percent. The deadline to 22 submit requests for exclusion, disputes, and objections was October 26, 2024, and the deadline to 23 submit an FLSA Collective opt-in form was November 12, 2024. As of November 27, 2024, out 24 of the 10,608 FLSA Collective members, 4,531 people opted in—a 42.7% participation rate. Out 25 of the 1,922 California Settlement Class members, no class member objected and only 6 people 26 opted out—a participation rate of 99.7%. 27 On November 27, 2024, plaintiffs moved for final approval of the FLSA, class action, and 1 awards; and settlement administrator costs. The Court heard plaintiffs’ motions on January 9, 2 2024. 3 LEGAL STANDARDS 4 I. Certification of the California Settlement Class and FLSA Collective 5 The Court must first confirm its prior determination that the requirements for certification 6 of the California Settlement Class under Federal Rule of Civil Procedure 23 and the FLSA 7 Collective under U.S.C. § 216(b) are met. Because a PAGA claim is a law enforcement action 8 brought by plaintiffs acting as the state’s designated proxy, it is not “a collection of individual 9 claims for relief” and therefore need not meet standards for class certification. Canela v. Costco 10 Wholesale Corp., 971 F.3d 845, 855 (9th Cir. 2020); see also Rodriguez v. Belfor USA Grp., Inc., 11 No. 22-CV-02071-VKD, 2024 WL 3012798, at *6 (N.D. Cal. June 13, 2024). 12 A. Rule 23 13 A class action may be certified for settlement only if it meets the requirements of Federal 14 Rule of Civil Procedure 23(a):
15 (1) the class is so numerous that joinder of all members is 16 impracticable;
17 (2) there are questions of law or fact common to the class;
18 (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and 19
20 (4) the representative parties will fairly and adequately protect the interests of the class. 21 Additionally, “parties seeking class certification must show that the action is maintainable 22 under Rule 23(b)(1), (2), or (3).” Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 614 (1997). The 23 parties seek certification under Rule 23(b)(3), which requires that common questions of law or fact 24 “predominate over any questions affecting only individual members, and that a class action is 25 superior to other available methods for fairly and efficiently adjudicating the controversy.” Fed. R. 26 Civ. P. 23(b)(3). In determining whether a class meets the requirements of Rule 23(b), the court 27 should consider: (A) the class members’ interests in individually controlling the 1 prosecution or defense of separate actions; 2 (B) the extent and nature of any litigation concerning the controversy 3 already begun by or against class members;
4 (C) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; and 5
6 (D) the likely difficulties in managing a class action. Fed. R. Civ. P. 23(b)(3). 7 Rule 23’s requirements “demand undiluted, even heightened, attention” when a proposed 8 class is to be certified only for the purposes of settlement. Amchem Prods., 521 U.S. at 620. “Such 9 attention is of vital importance, for a court asked to certify a settlement class will lack the 10 opportunity, present when a case is litigated, to adjust the class, informed by the proceedings as 11 they unfold.” Id. 12 B. 29 U.S.C. § 216(b) 13 Under the FLSA, a collective can be conditionally certified if members are “similarly 14 situated,” 29 U.S.C. § 216, meaning that “they share a similar issue of law or fact material to the 15 disposition of their FLSA claims,” Campbell v. City of Los Angeles, 903 F.3d 1090, 1117 (9th Cir. 16 2018). See also De Leon v. Ricoh USA, Inc., No. 18-CV-03725-JSC, 2020 WL 1531331, at *7 17 (N.D. Cal. Mar. 31, 2020). Conditional certification under FLSA “imposes a lower bar than Rule 18 23.” Campbell, 903 F.3d at 1112. 19 II. Final settlement approval 20 A. Rule 23 21 “The claims, issues, or defenses of a certified class may be settled ... only with the court’s 22 approval.” Fed. R. Civ. P. 23(e). “Adequate notice is critical to court approval of a class settlement 23 under Rule 23(e).” Hanlon v. Chrysler Corp., 150 F.3d 1011, 1025 (9th Cir. 1998), overruled on 24 other grounds by Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011). In addition, Rule 23(e) 25 “requires the district court to determine whether a proposed settlement is fundamentally fair, 26 adequate, and reasonable.” Id. at 1026. The district court must balance several factors—the 27 1 (1) the strength of the plaintiffs’ case; (2) the risk, expense, complexity, and likely duration of further litigation; (3) the risk of 2 maintaining class action status throughout the trial; (4) the amount offered in settlement; (5) the extent of discovery completed and the 3 stage of the proceedings; (6) the experience and views of counsel; (7) the presence of a governmental participant; and (8) the reaction of the 4 class members to the proposed settlement. 5 Churchill Vill., L.L.C. v. Gen. Elec., 361 F.3d 566, 575 (9th Cir. 2004). 6 Settlements that occur before formal class certification require a higher standard of 7 fairness. In re Mego Fin. Corp. Sec. Litig., 213 F.3d 454, 458 (9th Cir. 2000). The court must 8 ensure that “the settlement is not the product of collusion among the negotiating parties.” In re 9 Bluetooth Headset Prods. Liab. Litig., 654 F.3d 935, 947 (9th Cir. 2011) (cleaned up). Possible 10 signs of collusion include a “clear sailing provision,” a revisionary arrangement, and unreasonable 11 attorneys’ fees. Id. 12 B. FLSA 13 FLSA collective settlements similarly require a court’s determination that “the settlement 14 is a fair and reasonable resolution of a bona fide dispute.” Nen Thio v. Genji, LLC., 14 F. Supp. 3d 15 1324, 1333 (N.D. Cal. Aug. 7, 2014). “‘[T]he factors that courts consider when evaluating a 16 collective action settlement are essentially the same as those that courts consider when evaluating 17 a [class action] settlement’ under Rule 23(e).” De Leon, 2020 WL 1531331, at *7 (quoting Otey v. 18 CrowdFlower, Inc., No. 12-cv-05524, 2014 WL 1477630, at *11 (N.D. Cal. Apr. 15, 2014)). 19 “A bona fide dispute exists when there are legitimate questions about the existence and 20 extent of the defendant’s FLSA liability.” Jennings v. Open Door Mktg., LLC, No. 15-cv-4080- 21 KAW, 2018 WL 4773057, at *4 (N.D. Cal. Oct. 3, 2018) (quoting Gonzalez v. Fallanghina, LLC, 22 No. 16-cv-01832-MEJ, 2017 WL 1374582, at *2 (N.D. Cal. Apr. 17, 2017)). Thus, “there must be 23 some doubt whether the plaintiffs will be able to succeed on the merits of their FLSA 24 claims.” Heath v. Google LLC, No. 15-cv-01824-BLF, 2019 WL 3842075, at *4 (N.D. Cal. Aug. 25 15, 2019). 26 C. PAGA 27 Court approval is also required for settlement of a PAGA claim. Rodriguez, 2024 WL 1 (N.D. Cal. Mar. 13, 2023). Although “court approval of PAGA settlements is statutorily required, 2 PAGA does not provide express guidance about the scope or nature of judicial review.” 3 Rodriguez, 2024 WL 3012798, at *6. Generally, courts consider whether a PAGA settlement 4 meets the requirements set out in the statute and apply “a Rule 23-like standard” to determine 5 whether the settlement is “fundamentally fair, reasonable, and adequate.” Haralson v. U.S. 6 Aviation Servs. Corp., 383 F. Supp. 3d 959, 972 (N.D. Cal. 2019) (cleaned up); see also 7 Rodriguez, 2024 WL 3012798, at *6 (explaining that in evaluating a PAGA claim, courts draw 8 “on factors utilized by the Ninth Circuit to evaluate whether a class action settlement is 9 fundamentally fair, adequate, and reasonable”). “These factors are evaluated in light of PAGA’s 10 public policy goals of benefiting the public by augmenting the state’s enforcement capabilities, 11 encouraging compliance with Labor Code provisions, and deterring noncompliance.” Rodriguez, 12 2024 WL 3012798, at *2 (cleaned up). 13 III. Attorneys’ fees and costs, service awards, and administration costs 14 A. Attorneys’ fees and costs 15 “While attorneys’ fees and costs may be awarded in a certified class action where so 16 authorized by law or the parties’ agreement, ... courts have an independent obligation to ensure 17 that the award, like the settlement itself is reasonable, even if the parties have already agreed to an 18 amount.” In re Bluetooth, 654 F.3d at 941 (internal citation omitted). “Where a settlement 19 produces a common fund for the benefit of the entire class, courts have discretion to employ either 20 the lodestar method or the percentage-of-recovery method” to assess the reasonableness of the 21 requested attorneys’ fee award. Id. at 942. “Because the benefit to the class is easily quantified in 22 common-fund settlements,” both the Ninth Circuit and the California Supreme Court permit courts 23 “to award attorneys a percentage of the common fund in lieu of the often more time-consuming 24 task of calculating the lodestar.” Id.; see also Laffitte v. Robert Half Int’l Inc., 1 Cal. 5th 480, 503– 25 06 (Cal. 2016). 26 In the Ninth Circuit, the well-established “benchmark for an attorneys’ fee award in a 27 successful class action is twenty-five percent of the entire common fund.” Williams v. MGM- 1 Pathe Commc’ns Co., 129 F.3d 1026, 1027 (9th Cir. 1997). Courts in the Ninth Circuit generally 2 start with the 25 percent benchmark and adjust upward or downward depending on:
3 the extent to which class counsel “achieved exceptional results for the class,” whether the case was risky for class counsel, whether 4 counsel’s performance “generated benefits beyond the cash settlement fund,” the market rate for the particular field of law (in 5 some circumstances), the burdens class counsel experienced while litigating the case (e.g., cost, duration, foregoing other work), and 6 whether the case was handled on a contingency basis. 7 In re Online DVD-Rental Antitrust Litig., 779 F.3d 934, 954–55 (9th Cir. 2015) (quoting Vizcaino 8 v. Microsoft Corp., 290 F.3d 1043, 1048–50 (9th Cir. 2002)). Where state law provides the basis 9 for awarding fees, courts in the Ninth Circuit generally apply state law in making that 10 determination. Beaver v. Tarsadia Hotels, No. 11-CV-01842-GPC-KSC, 2017 WL 4310707 (S.D. 11 Cal. Sept. 28, 2017); see Mangold v. Cal. Pub. Utils, Comm’n, 67 F.3d 1470, 1478 (9th Cir. 1995). 12 In California state court, the typical award of attorneys’ fees is approximately one third of the 13 common fund. Chavez v. Netflix, Inc., 162 Cal. App. 4th 43, 66 n.11 (Cal. Ct. App. 2008) 14 (“Empirical studies show that, regardless whether the percentage method or the lodestar method is 15 used, fee awards in class actions average around one-third of the recovery.”); Smith v. CRST Van 16 Expedited, Inc., No. 10-CV-1116-IEG WMC, 2013 WL 163293, at *5 (S.D. Cal. Jan. 14, 2013) 17 (“Under the percentage method, California has recognized that most fee awards based on either a 18 lodestar or percentage calculation are 33 percent.”); Beaver, 2017 WL 4310707, at *9. 19 In common fund cases, the lodestar calculation can provide a useful cross-check on the 20 reasonableness of a percentage award. Vizcaino, 290 F.3d at 1050. “The lodestar figure is 21 calculated by multiplying the number of hours the prevailing party reasonably expended on the 22 litigation (as supported by adequate documentation) by a reasonable hourly rate for the region and 23 for the experience of the lawyer.” In re Bluetooth, 654 F.3d at 941. Where the attorneys’ 24 investment in the case “is minimal, as in the case of an early settlement, the lodestar calculation 25 may convince a court that a lower percentage is reasonable.” Vizcaino, 290 F.3d at 1050. 26 “Similarly, the lodestar calculation can be helpful in suggesting a higher percentage when 27 litigation has been protracted.” Id. Thus, even when the primary basis of the fee award is the 1 percentage method, “the lodestar may provide a useful perspective on the reasonableness of a 2 given percentage award.” Id. 3 Regardless of whether the court uses the lodestar or percentage approach, the main inquiry 4 is whether the fee award is “reasonable in relation to what the plaintiffs recovered.” Powers v. 5 Eichen, 229 F.3d 1249, 1258 (9th Cir. 2000). 6 In common fund cases, attorneys are also entitled to recover the reasonable expenses of 7 acquiring the fund. Vincent v. Hughes Air W., Inc., 557 F.2d 759, 769 (9th Cir. 1977). To recover 8 such expenses, the attorneys should provide an itemized list of their expenses by category with the 9 total amount advanced for each category so that the Court can assess whether the expenses were 10 reasonable. Wren v. RGIS Inventory Specialists, No. 06-cv-5778, 2011 WL 1230826, at *30 (N.D. 11 Cal. Apr. 1, 2011), supplemented, No. 06-cv-5778, 2011 WL 1838562 (N.D. Cal. May 13, 2011). 12 B. Service awards 13 “[Incentive or service] awards are discretionary ... and are intended to compensate class 14 representatives for work done on behalf of the class, [and] to make up for financial or reputational 15 risk undertaken in bringing the action.” Rodriguez v. W. Publ’g Corp., 563 F.3d 948, 958–59 (9th 16 Cir. 2009). The court considers:
17 (1) the actions the plaintiff has taken to protect the interests of the class; (2) the degree to which the class has benefitted from those 18 actions; (3) the duration of the litigation and the amount of time and effort the plaintiff expended in purs[uing] it; and (4) the risks to the 19 plaintiff in commencing the litigation, including reasonable fears of workplace retaliation, personal difficulties, and financial risks. 20 21 Wren, 2011 WL 1230826, at *32 (citations omitted). “[C]ourts must be vigilant in scrutinizing all 22 incentive awards to determine whether they destroy the adequacy of the class representatives.” 23 Radcliffe v. Experian Info. Sols. Inc., 715 F.3d 1157, 1164 (9th Cir. 2013). 24 ANALYSIS 25 I. Class certification 26 As the Court previously concluded, the California Settlement Class and the FLSA 27 Collective meet the requirements for certification. 1 A. Rule 23 2 1. Rule 23(a) 3 As explained above, a class action may be certified only if it meets the requirements of 4 numerosity, commonality, typicality, and adequacy of representation. Mazza v. American Honda 5 Motor Co., 666 F.3d 581, 588 (9th Cir. 2012). The California Settlement Class here does so. 6 Numerosity requires that the class be “so numerous that joinder of all members is 7 impracticable.” Fed. R. Civ. P. 23(a)(1). Generally, the numerosity requirement is met where the 8 plaintiff class contains forty or more members. Corley v. Google, Inc., 316 F.R.D. 277, 290 (N.D. 9 Cal. 2016). The California Settlement Class contains 1,916 members. Accordingly, the numerosity 10 requirement is met. 11 The second requirement of Rule 23(a) is that there be “questions of law or fact common to 12 the class.” Fed. R. Civ. P. 23(a)(2). Here, class members share common questions of law and fact 13 pertaining to whether defendants violated California wage and hour laws by failing to pay them 14 regular and overtime wages earned, provide compliant meal and rest periods, provide compliant 15 wage statements, reimburse expenses, and timely pay wages upon separation of employment. 16 Accordingly, the commonality requirement is met. 17 The typicality requirement is met when “each class member’s claim arises from the same 18 course of events, and each class member makes similar legal arguments to prove the defendant’s 19 liability.” Rodriguez v. Hayes, 591 F.3d 1105, 1124 (9th Cir. 2010) (cleaned up). Here, the claims 20 of the named plaintiffs are typical of the class, arising from the defendants’ same course of 21 conduct. 22 Finally, the class representative parties must “fairly and adequately protect the interests of 23 the class.” Fed. R. Civ. P. 23(a)(4). This requires that (1) named plaintiffs and their counsel have 24 no conflicts of interest with other class members and (2) named plaintiffs and their counsel 25 prosecute the action vigorously on behalf of the class. In re Online DVD-Rental Antitrust Litig., 26 779 F.3d at 943. Here, there are no known conflicts of interest between the named plaintiffs and 27 class counsel, on the one hand, and the proposed class members, on the other. Class counsel have 1 preliminary approval, retaining an expert to support preliminary approval of the settlement, and 2 demonstrating a willingness to take the case to trial if necessary. Further, the named plaintiffs have 3 actively participated in the litigation since its inception. Accordingly, the representation of the 4 class by class counsel and the named plaintiffs is adequate. 5 2. Rule 23(b)(3) 6 Certification also requires that the action be “maintainable under Rule 23(b)(1), (2), or 7 (3).” Amchem Prods., Inc., 521 U.S. at 614. Here, the parties seek certification under Rule 8 23(b)(3), which imposes two further requirements: predominance and superiority. 9 Predominance requires that “that the questions of law or fact common to class members 10 predominate over any questions affecting only individual members.” Fed. R. Civ. P. 23(b)(3). 11 Plaintiffs contend that the liability questions in this case can be resolved using the same evidence 12 for all class members because the common legal and factual issues turn on an alleged common 13 course of conduct by the defendants. Accordingly, plaintiffs have shown predominance. 14 Superiority “assure[s] that the class action is the most efficient and effective means of 15 resolving the controversy.” Wolin v. Jaguar Land Rover N. Am., LLC, 617 F.3d 1168, 1175 (9th 16 Cir. 2010) (cleaned up). This is generally the case where there is a significant disparity between 17 litigation costs and the recovery sought, such that a class action will allow individuals to pool 18 claims that would be uneconomical individually. Here, the average payout to members of the 19 California Settlement Class is $287.12, while class counsel’s litigation costs incurred to date are 20 roughly $40,000. If class members had pursued their own actions, these litigation costs would 21 significantly exceed their recovery. Accordingly, pursuing the claims in this case as a class action 22 is superior to other means of adjudicating the dispute. 23 *** 24 Because the requirements of Rules 23(a) and 23(b)(3) are satisfied, the Court confirms its 25 grant of class certification for settlement purposes only. 26 B. FLSA 27 The FLSA requires that collective members be “similarly situated.” 29 U.S.C. § 216. Here, 1 not paid, were not paid for rest breaks that were less than 20 minutes, had to pay for internet 2 expenses that they claim should have been borne by the defendants, and are pursuing claims for 3 unpaid wages under the FLSA. Accordingly, the FLSA Collective members are similarly situated, 4 and the Court confirms its certification of the FLSA Collective for purposes of settlement only. 5 II. Final settlement approval 6 The Court considers “essentially the same” factors in evaluating settlement of a class 7 action, an FLSA collective action, and a PAGA action. De Leon, 2020 WL 1531331, at *7; 8 Rodriguez, 2024 WL 3012798, at *6. Accordingly, the settlement of the class, FLSA, and PAGA 9 claims will be considered together. 10 A. Adequacy of notice 11 The court must “direct notice [of a proposed class settlement] in a reasonable manner to all 12 class members who would be bound by the proposal.” Fed. R. Civ. P. 23(e)(1)(B). The parties 13 must provide class members with “the best notice that is practicable under the circumstances, 14 including individual notice to all members who can be identified through reasonable effort.” Fed. 15 R. Civ. P. 23(c)(2)(B). “[T]he class must be notified of a proposed settlement in a manner that 16 does not systematically leave any group without notice.” Officers for Just. v. Civ. Serv. Comm’n of 17 City & Cnty. of S.F., 688 F.2d 615, 624 (9th Cir. 1982). To satisfy Rule 23(e)(1), settlement 18 notices must “present information about a proposed settlement neutrally, simply, and 19 understandably.” Rodriguez, 563 F.3d at 962. “Notice is satisfactory if it ‘generally describes the 20 terms of the settlement in sufficient detail to alert those with adverse viewpoints to investigate and 21 to come forward and be heard.’” Id. (quoting Churchill, 361 F.3d at 575). 22 The court approved the plaintiffs’ plan for providing notice to the class when it granted 23 preliminary approval. Plaintiffs now provide a declaration from Laura Singh, a case manager at 24 the settlement administrator, documenting the administrator’s implementation of that plan. The 25 declaration shows that the settlement administrator complied with the notice plan and successfully 26 provided notice by mail to 10,792 of the 10,959 Class/Collective members—more than 98 percent. 27 The Court is satisfied that the notice that class members received complies with Federal Rule of 1 B. Fairness, adequacy, and reasonableness 2 As discussed above, the Court must determine whether the settlement is fair, reasonable, 3 and adequate. Staton v. Boeing Co., 327 F.3d 938, 952 (9th Cir. 2003). During the preliminary 4 approval stage, the Court found that the settlement met that standard. Application of the Churchill 5 factors following notice to the class confirms that the settlement is fair, reasonable, and adequate. 6 Under the first and second factors, the Court considers (1) the strength of the plaintiffs’ 7 case, weighing the likelihood of success on the merits and the range of possible recovery; and (2) 8 the risk, expense, complexity, and duration of further litigation. The plaintiffs recognize the 9 inherent risks of going to trial, especially as they have faced strong opposition from defendants. 10 Continued litigation would likely require substantial additional discovery, including depositions, 11 and pre-trial motions, which would be expensive and time-consuming. Appeals could be expected 12 to further delay any recovery by class members. Proceeding with litigation would thus likely be 13 risky, protracted, and costly. Accordingly, the first two factors weigh in favor of final approval. 14 Under the third factor, the Court considers the risk of maintaining class action status 15 throughout the trial. At the time that the parties agreed to the proposed settlement, the Court had 16 not yet granted class certification, so the plaintiffs faced the risks of either failing to certify any 17 class or failing to maintain class certification through trial. These risks, measured against the 18 certainty of recovery under the settlement, weigh in favor of final approval. 19 The fourth factor is the amount offered in settlement. Under the terms of the settlement, 20 defendants will contribute a total gross amount of $3,725,000. California Settlement Class 21 members, FLSA Collective members, and the PAGA representative group members will receive 22 average awards of $287.12, $471.69, and $12.12, respectively, with some awards amounting to as 23 much as $5,813.11, $7,296.85, and $189.77, respectively. Some California Class and FLSA 24 Collective members will receive payments from more than one category of settlement funds. 25 Those who belong to all three classes could receive an average payment of $2,161.15. 26 Defendants faced a maximum possible FLSA exposure of $3,545,665, California exposure 27 of $6,056,203, and PAGA exposure of $5,699,059. But defendants strongly disputed that 1 for missed breaks and meal periods, and whether penalties, liquidated damages, and pre-judgment 2 interest could be stacked. Defendants argued that the “gap time” claims of the FLSA Collective for 3 minimum wages were nonexistent and had little value, if any. They argued that any time worked 4 off-the-clock was de minimis and that the named plaintiffs’ accounts of such time would not be 5 supported by other interpreters. They argued that unpaid breaks about which named plaintiffs 6 complained were subject to various defenses under the FLSA and were not prohibited by 7 California law. Defendants also argued that due to the high rate of pay for interpreters, any failure 8 to reimburse for expenses would not bring interpreters below the minimum wage in any 9 workweek, and thus would never violate the FLSA. Defendants further argued that any required 10 expense reimbursement under California law was much less than what was alleged by the named 11 plaintiffs. 12 Under these circumstances, the amount offered in settlement—just over 24% of 13 defendants’ estimated maximum potential exposure—represents a reasonable compromise 14 between the potential recovery at trial and the risks of continuing to litigate plaintiffs’ claims in 15 the face of defendants’ strong opposition. The amount offered in settlement thus weighs in favor 16 of final approval. 17 Under the fifth factor, courts consider the extent of discovery completed and the stage of 18 the proceedings. In this case, the parties’ settlement was reached after some informal and formal 19 discovery, including written discovery and a deposition. The Court is satisfied that, at the time of 20 settlement, the parties were sufficiently familiar with the strengths and weaknesses of the case to 21 make informed decisions. This factor thus weighs in favor of final approval. 22 The sixth factor is the experience and views of counsel. Class counsel have extensive 23 experience litigating similar cases. They have demonstrated a thorough understanding of the 24 strengths and weaknesses of this case and concluded that the settlement is fair, adequate, and 25 reasonable. This factor thus also favors final approval. 26 The seventh factor—the presence of a governmental participant—is neutral because there 27 is no governmental participant in this case. 1 proposed settlement. The overall reaction of the class here is overwhelmingly positive. Notice was 2 given to 10,792 class members and not a single member timely objected, only 6 California 3 Settlement Class members requested to be excluded, and 42.7% of the FLSA Collective opted in. 4 The high opt-in rate for the FLSA Collective is particularly notable. Accordingly, this factor 5 strongly favors final approval. 6 Because this settlement was reached prior to class certification, the Court must also ensure 7 that it is “not the product of collusion among the negotiating parties.” In re Bluetooth, 654 F.3d at 8 947 (cleaned up). This settlement does not contain a “clear sailing provision,” a revisionary 9 arrangement, or unreasonable attorneys’ fees, all of which can be warning signs of collusion. Id. 10 The settlement was reached only after confirmatory discovery, expert analyses, and two arm’s 11 length mediations with experienced mediators. See G. F. v. Contra Costa Cnty., No. 13-03667- 12 MEJ, 2015 WL 4606078, at *13 (N.D. Cal. July 30, 2015) (noting that “[t]he assistance of an 13 experienced mediator in the settlement process confirms that the settlement is non-collusive”). 14 Accordingly, none of the Bluetooth factors are present, and the settlement does not raise an 15 inference of collusion on any other ground. 16 With respect to the settlement of the FLSA claims, the Court finds that there was and 17 continues to be a bona fide dispute in this case because the defendant contests FLSA liability. 18 Finally, the Court finds that PAGA’s requirement that 75% of civil penalties recovered be 19 allocated to the LWDA and 25% to aggrieved employees is met. 20 *** 21 After considering the record as a whole, guided by the Churchill factors, the Court finds 22 that notice of the proposed settlement was adequate; the settlement is not the result of collusion; 23 the settlement is a fair, adequate, and reasonable resolution of a bona fide dispute; and the 24 settlement meets PAGA’s statutory requirements. Accordingly, the Court grants final approval of 25 the settlement. 26 27 1 III. Attorneys’ fees, costs, and service awards 2 A. Attorneys’ fees and costs 3 Class counsel seeks an award of attorneys’ fees in the amount of $1,241,666.67, which is 4 one-third of the total settlement value and reflects a 2.2 multiplier of their $558,789.50 lodestar. 5 Plaintiffs maintain that their requested fee award is appropriate under either the percentage 6 of recovery or the lodestar method of calculation. They contend that their request under the 7 percentage method is within the range of reasonableness when considering the Ninth Circuit’s 8 benchmark of 25%; aligns with comparable cases within the Ninth Circuit; and is consistent with 9 the California norm of 33%, which they contend should govern the calculation here because state 10 law claims predominate. They argue that the requested fee award falls within the lower range of 11 the 30–40% typical of wage and hour class actions resulting in settlement funds of less than $10 12 million. Class counsel further emphasizes the significant monetary and non-monetary value of the 13 settlement to the class; the contingent risk assumed by counsel in representing plaintiffs in this 14 litigation; the skill and experience of counsel; and counsel’s substantial hours devoted to 15 prosecuting this action. 16 After reviewing the results achieved for the class and the risk counsel incurred in pursuing 17 class members’ claims on a contingent basis, the Court concludes that an award of 30% of the 18 common fund—$1,117,500—is reasonable. This amount falls just above the Ninth Circuit 19 benchmark and just below the California norm, and thus appropriately reflects the settlement’s 20 resolution of both federal and state claims. It also reflects the strong results achieved for members 21 of the California Class and FLSA Collective. In particular, the strong response of FLSA Collective 22 members to the proposed settlement, as reflected in the high opt-in rate, justifies an award falling 23 above the Ninth Circuit’s 25% benchmark.2 24 A lodestar cross-check confirms the reasonableness of an award of 30% of the common 25 fund to class counsel. As stated above, counsel’s lodestar is $558,789.50. Although the 26
27 2 To be certain, the settlement administrator’s impressive success in notifying members of the 1 documentation submitted in advance of the hearing in support of counsel’s request for attorneys’ 2 fees was deficient in some respects, counsel addressed those deficiencies at the hearing and the 3 Court can now conclude that the hourly rates used by class counsel in their lodestar calculation, 4 which have been approved by multiple other California courts, reflect the reasonable commercial 5 value of their work.3 The Court also concludes that the number of hours expended by counsel on 6 this litigation was reasonable.4 7 Awarding class counsel 30% of the common fund reflects a multiplier of approximately 8 2.0 on their $558,789.50 lodestar. The Ninth Circuit has recognized that multipliers generally 9 range from 1 to 4. Vizcaino, 290 F.3d at 1051 n.6. District courts within the Ninth Circuit 10 commonly apply multipliers in that range in California wage and hour class actions. See, e.g., 11 Kulik, 2023 WL 2503539 (applying a multiplier of 1.83); Uschold v. NSMG Shared Servs., LLC, 12 No. 18-cv-01039-JSC, 2020 WL 3035776, at *16 (N.D. Cal. June 5, 2020) (applying a multiplier 13 of 4); De Leon, 2020 WL 1531331, at *18 (applying a multiplier of 1.09); Ridgeway v. Wal-Mart 14 Stores Inc., 269 F. Supp. 3d 975, 999 (N.D. Cal. 2017) (applying a multiplier of 2.0). Given the 15 results achieved for the class and the risk counsel faced, applying a multiplier of 2.0 to counsel’s 16 lodestar is reasonable here. 17 Class counsel also seeks reimbursement of up to $50,000 in litigation costs. As of the of 18 filing its motion for final approval, class counsel had incurred approximately $39,841.57 in costs, 19 including court fees, mediation fees, legal research charges, and expert fees. At the time, class 20 counsel anticipated additional expenses related to travel to the final approval hearing and 21 additional settlement administration costs. The Court has reviewed counsel’s expenses and finds 22 them reasonable. Therefore, the Court grants the request for reimbursement of costs up to $50,000. 23 24 3 As noted at the hearing, counsel seeking an award of fees based on a lodestar analysis should provide detailed evidence justifying each attorney’s hourly rate, including their years of 25 experience and prior relevant litigation. The Declaration of Shant A. Karnikian submitted in support of counsel’s motion for attorneys’ fees in this case provides a good example of the kind of 26 detail the Court expects. See Dkt. 75-2. 4 The Court noted deficiencies in one attorney’s documentation of their hours at the hearing, but 27 that attorney addressed the Court’s concerns. Again, Mr. Karnikian’s declaration, which breaks 1 To the extent counsel seeks reimbursement of costs not documented in its court filings, counsel 2 must provide the settlement administrator with adequate proof that those costs were incurred. 3 B. Service awards 4 Named plaintiffs Sharon Oliveira and Simone Franco de Andrade Boyce each seek a 5 service award of $8,000. The six early opt-in plaintiffs request service awards of $1,500. 6 Service awards in the Northern District of California commonly range from $2,000 to 7 $10,000. Bellinghausen v. Tractor Supply Co., 306 F.R.D. 245, 267 (N.D. Cal. 2015). $5,000 is 8 presumptively reasonable. Id.; Wong v. Arlo Techs., Inc., No. 5:19-cv-00372-BLF, 2021 WL 9 1531171, at *12 (N.D. Cal. Apr. 19, 2021). Higher awards are more common in cases involving 10 much larger settlement amounts. Bellinghausen, 306 F.R.D. at 267; see e.g., Glass v. UBS Fin. 11 Servs., No. C–06–4068 MMC, 2007 WL 221862, at *16–17 (N.D.Cal. Jan. 26, 2007) (approving a 12 $25,000 incentive award to four named plaintiffs in connection with a $45 million 13 settlement); Van Vranken v. Atl. Richfield Co., 901 F.Supp. 294, 299 (N.D. Cal. 1995) (approving 14 $50,000 award in connection with a $76,723,213.26 settlement). 15 Plaintiffs contend that the named plaintiffs should receive larger-than-average service 16 awards because they spent “significant time and effort” assisting litigation. Their assistance 17 included “searching their personal files for copies of their employee handbooks, payment plans, 18 emails, pay and time records,” being interviewed by counsel multiple times, keeping in “constant 19 communication” throughout litigation, and assisting counsel in preparation for mediations. Both 20 named plaintiffs responded to written discovery at the request of defendants, both prepared for 21 depositions, and one sat for a deposition. They also incurred the reputational risks inherent in 22 bringing the action. 23 The assistance that the named plaintiffs contributed to this litigation is precisely the kind of 24 work on behalf of the class that service awards are meant to compensate. But it does not reach the 25 level that would justify departing from the standard award of $5,000. Higher awards are typically 26 warranted when class representatives spend significantly more time working on the litigation than 27 the named plaintiffs here did. See, e.g., Rabin v. PricewaterhouseCoopers LLP, No. 16-CV- 1 the named plaintiffs where they each spent hundreds of hours on the litigation); Ontiveros v. 2 Zamora, 303 F.R.D. 356 (E.D. Cal. 2014) (approving a $15,000 service where the named plaintiff 3 spent over 270 hours on the litigation over a six-year period); Taylor v. FedEx Freight, Inc., No. 4 1:13-cv-01137-DAD, 2016 WL 6038949, at *8 (E.D. Cal. Oct. 13, 2016) (approving a $15,000 5 service award where the named plaintiff did “well over” 80 hours of work on the case). 6 Accordingly, the Court will approve service awards of $5,000 to each of the named 7 plaintiffs. 8 Plaintiffs contend that the opt-in plaintiffs should receive service awards of $1,500 because 9 they took a risk by putting their names on this lawsuit at a time when others were not willing to do 10 so and their participation was a catalyst to early resolution of this case. Further, their discussions 11 with plaintiffs’ counsel allowed counsel to fact-check assertions made by defendants and to 12 identify the strengths and weaknesses of the case, further facilitating settlement. 13 In light of the risks the opt-in plaintiffs took and their contributions to this litigation, the 14 Court grants service awards of $1,500 to each of the opt-in plaintiffs. 15 C. Settlement administrator costs 16 Plaintiffs also request settlement administration fees in the amount of $50,000 for the 17 settlement administrator CPT Group. The Court finds this amount reasonable and approves the 18 request. 19 CONCLUSION 20 For the foregoing reasons, the Court hereby orders as follows: 21 1. The Court confirms its conditional certification of the California Settlement Class and 22 FLSA Collective for settlement purposes only. 23 2. The Court grants final approval of the parties’ settlement agreement. 24 3. The Court awards class counsel $1,117,500 in attorneys’ fees. 25 4. The Court awards class counsel costs of up to $50,000. 26 5. The Court awards named plaintiffs Sharon Oliveira and Simone Franco de Andrade 27 Boyce each a service award of $5,000, and awards each of the six early opt-in plaintiffs a service 1 7. The Court grants the request for settlement administration costs up to $50,000. 2 8. The individuals who requested to opt out of the California Class are excluded from the 3 Class. 4 9. The individuals who did not opt into the FLSA Settlement are excluded from the 5 Collective. 6 IT IS SO ORDERED. 7 Dated: February 24, 2025 8 9 P. Casey Pi 10 United States District Judge 11 12
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