Phoen v. LiveRamp Holdings, Inc.

• Court: District Court, N.D. California
• Decided: October 20, 2023
• Docket: 4:22-cv-05386
• Status: Unknown

Opinion

1 RORY C. QUINTANA (SBN 258747) 2 rory@qhplaw.com QUINTANA HANAFI, LLP 3 1939 Harrison St., Ste. 202 Oakland, CA 94612 4 Telephone: (415) 504-3121 Fax: (415) 233-8770 5 Attorney for Plaintiff Karen Phoen 6 Brian J. Wagner (SBN 239981) 7 James M. Gary, Pro Hac Vice KUTAK ROCK LLP 8 One Union National Plaza 123 W. Capitol Ave., Ste. 2000 9 Little Rock, AR 72201 Tel.: (501) 975-3140 10 Fax: (501) 975-3001 Brian.wagner@kutakrock.com 11 Jim.gary@kutakrock.com

12 Attorneys for Defendants LiveRamp, Inc. 13 UNITED STATES DISTRICT COURT 14 NORTHERN DISTRICT OF CALIFORNIA 15

16 KAREN PHOEN an individual; ) CASE NO. 4:22-cv-05386-HSG 17 ) Plaintiff, ) ORDER AS MODIFIED APPROVING 18 ) JOINT REQUEST FOR APPROVAL OF vs. ) SETTLEMENT AND REQUEST FOR 19 ) DISMISSAL WITH PREJUDICE OF ALL CLAIMS LIVERAMP, INC., a Delaware ) 20 corporation, and DOES 1-10; )

21 Defendants. ) ) 22 ) Complaint Filed: September 21, 2022 23

24 ORDER AS MODIFIED 25 26 Pending before the Court is the Parties joint motion for approval of settlement and 27 request for dismissal with prejudice of all claims. Good cause appearing, the Court GRANTS the motion. 1 I. BACKGROUND 2 Plaintiff Karen Phoen (“Plaintiff”) was an employee of Defendant LiveRamp, Inc. and 3 worked as an accounts’ payable accountant for Defendant from June 17, 2019 until the 4 termination of her employment on or about April 7, 2022. Plaintiff brought this action under 5 the California Labor Code and the Fair Labor Standards Act (“FLSA”). Plaintiff alleges that 6 Defendant misclassified her as exempt from overtime and failed to pay her overtime 7 compensation pursuant to the California Labor Code and the FLSA. Among other things, 8 Defendant asserts the Plaintiff was exempt as to overtime and minimum wage pay. In 9 addition, Defendant asserts Plaintiff’s job duties did not require, and she did not actually 10 perform work over 40 hours in any week or over 8 hours in any day. Defendant denies any 11 and all liability in the matter. 12 II. Legal Standard 13 The FLSA requires employers to pay their employees time and one-half for work 14 exceeding forty hours per week. See 29 U.S.C. § 207(a)(1). Most courts hold that an 15 employee’s overtime claim under FLSA is non-waivable, and therefore cannot be settled 16 without the supervision of either the Secretary of Labor or a district court. See Lynn’s Food 17 Stores, Inc. v. United States, 679 F.2d 1350, 1352-55 (11th Cir. 1982); Till v. Saks Inc., No. C 18 12-03903, 2014 WL 1230604, at *2 (N.D. Cal. Mar. 14, 2014); see also Otey v. CrowdFlower, 19 Inc., No. 12-cv-05524, 2014 WL 1477630, at *3 & n.5 (N.D. Cal. Apr. 15, 2014) (“Otey I”) 20 (collecting cases applying Lynn’s Food Stores). 21 “The Ninth Circuit has not established the criteria that a district court must consider in 22 determining whether an FLSA settlement warrants approval.” Otey v. CrowdFlower, Inc., No. 23 12-cv-05524, 2015 WL 6091741, at *4 (N.D. Cal. Oct. 16, 2015) (“Otey II”). For that reason, 24 courts in this district apply the Eleventh Circuit’s widely followed standard set forth in Lynn’s 25 Food Stores and consider whether the proposed settlement constitutes “a fair and reasonable 26 resolution of a bona fide dispute over FLSA provisions.” Id. (quoting 679 F.2d at 1355). “If a 27 settlement in an employee FLSA suit does reflect a reasonable compromise over issues . . . 1 that are actually in dispute,” the district court may approve the settlement. Lynn’s Food 2 Stores, 679 F.2d at 1354. 3 III. DISCUSSION 4 The settlement in this case involves a single plaintiff resolving only her individual 5 overtime claims pursuant to the FLSA. In order to approve the settlement, the Court must find 6 that (1) the case involves a bona fide dispute, (2) the proposed settlement agreement is fair and 7 reasonable, and (3) the award of costs is reasonable. 8 a. Bona Fide Dispute 9 “If a settlement in an employee FLSA suit does reflect a reasonable compromise over 10 issues, such as FLSA coverage or computation of back wages, that are actually in 11 dispute[,] . . . the district court [may] approve the settlement in order to promote the policy of 12 encouraging settlement of litigation.” Nen Thio v. Genji, LLC, 14 F. Supp. 3d 1324, 1333 13 (N.D. Cal. 2014) (quoting Yue Zhou v. Wang’s Restaurant, 2007 WL 2298046, *1 (N.D. Cal. 14 Aug. 8, 2007)); Lynn’s Food Stores, 679 F.2d at 1353 n.8 (requiring “settlement of a bona fide 15 dispute between the parties with respect to coverage or amount due under the [FLSA]”). “The 16 purpose of this analysis is to ensure that an employee does not waive claims for wages, 17 overtime compensation, or liquidated damages when no actual dispute exists between the 18 parties.” Saleh v. Valbin Corp., No. 17-CV-00593-LHK, 2018 WL 6002320, at *2 (N.D. Cal. 19 Nov. 15, 2018) (citing Lynn’s Food Stores, 679 F.2d at 1353, n.8.). 20 With respect to FLSA coverage and potential liability, Plaintiff contended that she was 21 misclassified as an exempt employee based on the nature of her work for Defendant. Plaintiff 22 based her contention on her actual job duties, which she claimed largely consisted of accounts 23 payable work and bookkeeping. Among other things, Defendant asserted that Plaintiff was 24 exempt from the overtime obligations of the FLSA, based on the nature of her duties requiring 25 discretion and independent judgment on matters of significance. 26 The Parties also disputed the number of overtime hours Plaintiff actually worked for 27 Defendant. Plaintiff argued that once she became Defendant’s employee, as opposed to when 1 software Defendant engaged for its bookkeeping responsibilities did not immediately work in 2 an effective manner, requiring Plaintiff to work more time. Defendant argued that the hours 3 worked by Plaintiff when she was a consultant were a more accurate reflection of the time she 4 worked, and that the software implemented for bookkeeping purposes began reducing the time 5 worked by Plaintiff from 2020 until her termination in 2022. Moreover, Defendant claimed 6 that the nature of Plaintiff’s job was not such that she would have to work over forty (40) 7 hours in a workweek. Plaintiff on the other hand asserted that she worked well over forty 8 hours a week at times. 9 The Parties also disagreed on the proper proof, method, and measure of damages. 10 Plaintiff contended that she needed only a good faith estimate of time and was entitled to time- 11 and-one-half their regular rate of pay for each overtime hour worked. Defendant argued that 12 Plaintiff lacked evidentiary support for her overtime claims. 13 Thus, the Parties articulated bona fide disputes concerning the facts and the applicable 14 application of law in this matter. Although the Parties, with the assistance of a mediator, were 15 able to set certain aspects of their disputes aside to achieve a settlement, there still exist 16 significant disagreement as to these matters. Accordingly, this settlement is not “a mere 17 waiver of statutory rights brought about by an employer’s overreaching.” Lynn’s Food Stores, 18 supra, 679 F.2d at 1354. Based on the disputed aspects of the case, the Court finds there to be 19 a bona fide dispute under the FLSA. 20 b. Fair and Reasonable Resolution 21 “To determine whether the settlement is fair and reasonable, the Court looks to the 22 ‘totality of the circumstances’ and the ‘purposes of FLSA.’” Saleh, 2018 WL 6002320 at *3 23 (quoting Selk v. Pioneers Mem’l Healthcare Dist., 159 F. Supp. 3d 1164, 1173 (S.D. Cal. 24 2016)). “It is well-settled law that a cash settlement amounting to only a fraction of the 25 potential recovery will not per se render the settlement inadequate or unfair.” Officers for 26 Justice v. Civil Service Commission, 688 F.2d 615, 628 (9th Cir. 1982). As the Ninth Circuit 27 noted in Officers for Justice, “[u]ltimately the amount of the [settlement payments] will be less 1 those individuals are entitled to. This is precisely the stuff from which negotiated settlements 2 are made.” Id. The Court should approve the settlement in this case because, although the 3 payment to Plaintiff is substantial, it represents a reasonable compromise of Plaintiff’s wage 4 and hour claims, which was less than what they originally demanded and more than Defendant 5 wished to pay. 6 Here, Plaintiff has obtained a settlement totaling $87,500. This is certainly a 7 reasonable compromise in light of the risks of litigation. As outlined above, a number of 8 litigation scenarios reflecting reasonably likely outcomes on the damage factors would result 9 in FLSA damage estimates between zero and as much as $150,000 as a total judgment for the 10 Plaintiff. A total settlement of $87,500 is eminently reasonable. After fees and costs, 11 approximately $58,333.00 will be distributed to the Plaintiff, as described above in greater 12 detail. 13 Overall, considering the totality of the circumstances, the Court finds that the proposed 14 settlement is a fair and reasonable resolution of a bona fide dispute. 15 c. Attorneys’ Fees and Costs 16 The FLSA contains a mandatory fee- and cost-shifting provision. 29 U.S.C. § 216(b) 17 (“The court in such action shall, in addition to any judgment awarded to the plaintiff or 18 plaintiffs, allow a reasonable attorney’s fee to be paid by the defendant, and the costs of the 19 action”); accord Dent v. Cox Comms. Las Vegas, Inc., 502 F.3d 1141, 1143 (9th Cir. 2007). 20 Because settlement of a FLSA claim results in a stipulated judgment (at least when in district 21 court), Lynn’s Food Stores, 679 F.2d at 1354, this provision applies even where parties settle 22 an individual action, Yue Zhou, 2007 WL 2298046 at *1. 23 The resolution of this case “is a privately negotiated settlement.” Campanelli, 2011 24 WL 3583597, at *1. Plaintiff affirmatively chose to be represented by Plaintiff’s counsel. 25 Plaintiff’s counsel took this case on a contingency basis. Therefore, counsel did not receive 26 any payment for their time spent litigating the case, nor did they receive reimbursement for 27 their out-of-pocket costs during the litigation. Plaintiff’s counsel alone undertook the financial 1 || which provides for payment of attorneys’ fees to counsel in the amount of forty percent (40%) 2 || of any settlement, but Plaintiffs counsel has waived costs and reduced his fees to only 33 and 3 1/3%. Moreover, Plaintiff was advised of the amount of fees paid on her behalf as part of the 4 || settlement, and signed a release agreeing to the terms of the settlement. See Scott v. Memory 5 || Co., LLC, 2010 WL 4683621 (M.D. Ala. Nov. 10, 2010) (settlement approved with attorneys’ 6 || fees paid according to plaintiff's contingency agreement with his attorney). The Court’s 7 || obligation on approval of an FLSA settlement is to determine that attorneys’ fees are 8 || reasonable. Campanelli, supra, 2011 WL 3583597, at *1. Plaintiffs counsel litigated this 9 || case aggressively and effectively, which resulted in substantial monetary relief for Plaintiff. 10 The Court finds that the agreed-upon fees and costs amount is reasonable. 11 IV. CONCLUSION 12 For the foregoing reasons, the Court GRANTS the Parties’ joint motion for settlement 13 || approval. The Court further: 14 1. DIRECTS the Parties to perform their obligations in accordance with the terms 15 || of the settlement agreement; and 16 2. DIRECTS the Parties to submit a status report within 30 days indicating that the 17 || payments under the Settlement Agreement and Release have been tendered. Simultaneously 18 || with that status report the Parties are DIRECTED to submit a stipulated judgment and 19 || dismissal. 20 IT IS SO ORDERED. 21 Dated: 10/20/2023 7 Maspy Tat A). Adl_)). □ United States District Court Judge 23 Haywood S. Gilliam, Jr. 24 25 26 27 28 _6-