Salinas v. Nestle Purina PetCare Company

• Court: District Court, E.D. California
• Decided: April 19, 2024
• Docket: 1:21-cv-01140
• Status: Unknown

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10

11 EMMAUEL SALINAS, on behalf of himself ) Case No.: 1:21-cv-01140 JLT CDB and the Class Members, ) 12 ) ORDER DENYING PLAINTIFF’S MOTION FOR Plaintiff, ) PRELIMINARY APPROVAL OF CLASS 13 ) ACTION SETTLEMENT ) 14 v. ) (Doc. 51) ) 15 NESTLÉ PURINA PETCARE COMPANY, ) ) 16 Defendant. ) ) 17

18 Emmanuel Salinas asserts Nestlé Purina PetCare Company failed to comply with wage and hour 19 laws arising under the California Labor Code, California Business & Professions Code, and Fair Labor 20 Standards Act. (See generally Doc. 50.) Salinas seeks preliminary approval of the settlement reached 21 in this action. Specifically, Salinas seeks: (1) conditional certification of the proposed settlement class, 22 (2) preliminary approval of the settlement terms, including approval of an FLSA Collective; (3) 23 appointment as the class representative; (4) appointment of the firm of Schneider Wallace Cottrell 24 Konecky LLP as class counsel; (5) preliminary approval of the request for attorneys’ fees and costs; (6) 25 approval of the class notice; (7) appointment of the settlement administrator; and (8) scheduling for 26 final approval. (Doc. 51.) For the following reasons, the motion for preliminary approval of the 27 settlement is DENIED. 28 /// 1 I. Background 2 Salinas began working for Nestlé Purina PetCare Company in February 2015, and is currently 3 employed as a forklift operator in Maricopa, California. (Doc. 50 at 4, ¶ 13.) He reports his “primary 4 duties” involve moving products within a warehouse “in a safe and efficient manner by forklift 5 operation and physically uploading/unloading [the] trucks.” (Id.) Salinas “is also responsible for 6 maintaining proper inventory, good housekeeping, and upholding warehouse standards.” (Id.) Salinas 7 asserts he is classified as an hourly, non-exempt employee and is paid an hourly rate of $25.46.” (Id.) 8 He reports that “Nestlé Purina employs hundreds of hourly, non-exempt workers similarly situated to 9 Plaintiff in California.” (Id., ¶ 12.) 10 Salinas alleges Nestlé Purina “routinely requires” employees “to perform substantial work off- 11 the-clock and without compensation.” (Doc. 50 at 4, ¶ 16.) According to Salinas, “prior to clocking in 12 for the start of [a] shift,” he and the putative class members were required “to wait in line, to go 13 through temperature checks and to answer COVID-19 screening questionnaires.” (Id.) Salinas asserts 14 it takes “several minutes to go through the line, to undergo such temperature checks, and to answer the 15 COVID-19 screening questionnaires,” and this time “goes unrecorded and therefore uncompensated.” 16 (Id.) Salinas asserts Nestlé Purina also requires donning and doffing personal protective equipment 17 “before the shift and after their shift, i.e., before clocking in and after clocking out.” (Id. at 4-5, ¶ 17, 18 emphasis omitted.) He reports that even if employees clock in early and then don the protective 19 equipment, Nestlé Purina “still does not compensate them until the actual starting time of their 20 scheduled shift.” (Id. at 5, ¶ 17.) Consequently, Salinas contends the “time spent donning and doffing 21 also goes unrecorded and therefore uncompensated.” (Id.) He asserts that Nestlé Purina applies these 22 COVID-19 and “donning and doffing” practices “across all [of its] facilities throughout California.” 23 (Id. at 5-6, ¶ 22.) 24 In addition, Salinas alleges that Nestlé Purina “engaged in a policy and/or practice of rounding 25 time worked.” (Doc. 50 at 5, ¶ 19.) He asserts Nestlé Purina “implemented a policy and/or practice 26 until approximately August 2022 of requiring [Salinas] and putative Class members to arrive and 27 clock in for work 15 minutes in advance of their start times, but automatically rounded up such clock 28 in times to … [their] start times for purposes of pay.” (Id.) Salinas contends “this rounding policy 1 and/or practice resulted in the underpayment of wages….” (Id.) 2 He contends Nestlé Purina also “regularly fail to provide … complaint meal breaks.” (Doc. 50 3 at 6, ¶ 24.) Salinas alleges Nestlé Purina “routinely denied meal breaks” because: (1) the company 4 “does not authorize, permit, and/or make available timely and full off-duty meal breaks” and (2) the 5 employees “are often too busy with work during the day to have time to take bona fide meal breaks.” 6 (Id., ¶ 25.) Salinas asserts: 7 When Plaintiff and putative Class members do attempt a meal break, such are untimely and/or shortened, i.e., after the end of the fifth hour of work 8 and/or less than thirty minutes. As a result, Plaintiff and Class members are not provided duty-free, uninterrupted, and timely thirty- minute meal 9 periods during which they should be completely relieved of any duty, by the end of the fifth hour of work. 10 Further, for each day Plaintiff and putative Class members work shifts of 11 more than ten hours, Defendants systematically deny Plaintiff and putative Class members a second meal break. Similarly, Plaintiff and putative 12 Class members do not receive requisite timely and full premium payments at the regular rate for these missed second meal breaks. 13 14 (Id., ¶¶ 26-27.) He asserts that on “the rare occasions” when Nestlé Purina paid the premium 15 payments, they were “not paid timely or at Plaintiff’s and Class members’ regular rate of pay.” (Id., ¶ 16 24.) Similarly, he contends Nestlé Purina does not “provide[] the timely, full, and required rest breaks 17 required by California law,” and “fails to make the full, required premium pay at the employee’s 18 regular rate.” (Id. at 6-7, ¶ 28.) Salinas asserts Nestlé Purina applies these meal and rest breaks 19 policies at all of its facilities in California. (Id. at 7, ¶ 29.) 20 According to Salinas, Nestlé Purina suffered “a breach that affected the Kronos payroll system 21 between approximately December 2021 to April 2021 that [Nestlé Purina] used to record hours and 22 wages.” (Doc. 50 at 5, ¶ 18.) Salinas contends that as a result of the breach, he and the putative class 23 members were underpaid, and Nestlé Purina “failed to timely and accurately issue its employees— 24 including Salinas and the putative class—the correct payment for the hours of work that they have 25 labored. (Id.) Salinas asserts the wage statements were inaccurate as they “do not include payment for 26 all hours worked, including minimum wages and overtime, and premium pay for missed meal breaks.” 27 (Id. at 7, ¶ 31.) 28 Further, Salinas contends that Nestlé Purina “failed to pay all owed wages to departing putative 1 Class members within the time limits imposed by Labor Code §§ 201-203.” (Doc. 50 at 20, ¶ 101; see 2 also id. at 7, ¶ 32.) 3 On July 26, 2021, Salinas initiated this action by filing a complaint against Nestlé Purina and 4 Nestlé USA, Inc. alleging violations under California wage and hour laws on behalf of a putative 5 California Class. (Doc. 1.) He also filed a complaint against Nestlé Purina PetCare Company and 6 Nestlé USA, Inc. in Alameda Superior Court, Case No. 21CV000112.1,2 (Doc. 51-1 at 6-7, Cottrell 7 Decl. ¶ 9.) In the state action, Salinas “alleged claims under the Private Attorneys’ General Act, Cal. 8 Lab. Code §§ 2698.” (Doc. 50 at 12-13.) 9 The Court issued a Scheduling Order governing the action—including any briefing on a motion 10 for class certification—on May 4, 2022. (Doc. 30.) The parties engaged in discovery, including both 11 an informal exchange of information and propounding written discovery requests. (Doc. 51 at 13.) 12 Salinas reports that Nestlé Purina “produced over 4,240 documents, which include a 20% sampling of 13 contact information, pay records, and time records for putative Class members; general policies; and 14 job descriptions.” (Id.) In addition, he asserts Nestlé Purina “provided class-wide figures, including 15 the total number of putative Class members, separated putative Class members, putative Class members 16 who signed a $1,500 release …, as well as their associated workweeks and pay periods.” (Id.) 17 On April 19, 2022, the parties participated in a mediation session with Scott Slater Markus. 18 (Doc. 51 at 14, citing Cottrell Decl. ¶ 15 [Doc 51-1 at 7].) After the mediation was unsuccessful, the 19 parties continued with discovery and Nestlé Purina pursed individual settlements with putative class 20 members, obtaining 54 individual “releases of all claims in this Action along with a Section 1542 21 waiver, in exchange for $1,500 minus taxes and other wage withholdings.” (Id.) 22 23 1 Although counsel identified the case number of the state action as 21CV0012, this appears to be a typographical error. The 24 Court’s review of the docket of the Alameda Superior Court identifies Salinas v. Nestle Purina PetCare Company, et al., as Case No. 21CV000112. 25 2 The Court may take notice of facts that are capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned. Fed. R. Evid. 201(b); United States v. Bernal-Obeso, 989 F.2d 331, 333 (9th Cir. 26 1993). The accuracy of the official records of Alameda Superior Court—as contained on the court’s official website— cannot be questioned, and judicial notice may be taken of the court docket. See Porter v. Ollison, 620 F.3d 952, 954-55 (9th 27 Cir. 2010) (observing “it is proper to take judicial notice” of “any state court dockets”); see also Burbank-Glendale- Pasadena Airport Auth. v. City of Burbank, 136 F.3d 1360, 1364 (9th Cir. 1998) (taking judicial notice of court filings in a 28 related state court case). Accordingly, the Court takes judicial notice of the docket of Case No. 21CV000112, including the 1 On November 4, 2022, the parties participated in a second mediation session, with mediator 2 Deborah Crandall Saxe. (Doc. 51 at 14.) Although the action did not settle that day, the parties later 3 accepted the mediator’s proposal “and executed a memorandum of understanding regarding the major 4 terms” on December 5, 2022. (Id., citing Cottrell Decl. ¶¶ 17-18 [Doc. 51-1 at 8].) After this 5 agreement, the parties engaged in additional discovery, including “the contact information of putative 6 Class members, exemplars and documents regarding putative Class members who were paid salaries 7 but classified by Defendant as non-exempt, and the Rule 30(b)(6) deposition of Chord Fonvielle, the 8 Human Resources Manager for Defendant’s Maricopa, California facility.” (Id.) 9 The parties filed a stipulation with this Court, reporting: “pursuant to the Parties’ agreement, the 10 Parties agreed that Plaintiff would file a stipulation… for an order granting [him] leave to amend the 11 operative complaint to add factual allegations and California PAGA claims for the alleged violations of 12 California labor laws asserted in the PAGA Action, to facilitate the settlement of this Action and the 13 PAGA action.” (Doc. 48 at 2.) In addition, Salinas indicated he intended to add an FLSA claim and 14 “other allegations agreed to be settled.” (Id. at 3.) The Court approved the stipulation, after which 15 Salinas filed his First Amended Complaint. (Docs. 49, 50.) 16 In the FAC, Salinas identified the following causes of action against Nestlé Purina3: (1) failure 17 to pay all hours worked in violation of Cal. Lab. Code § 204; (2) failure to pay minimum wages in 18 violation of Cal. Lab. Code §§ 1182.11, 1182.12, 1194, 1197, and 1197.1; (3) failure to pay overtime 19 wages in violation of Cal. Lab. Code § 510; (4) failure to authorize and permit meal and rest periods in 20 violation of Cal. Lab. Code §§ 226.7 and 512; (5) failure to provide timely and accurate itemized wage 21 statements in violation of Cal. Lab. Code § 226; (6) failure to provide timely pay to departed employees 22 in violation of Cal. Lab. Code §§201-203; (7) unlawful business practices, in violation of Cal. Bus. & 23 Prof. Code §§ 17200 et. seq.; (8) penalties pursuant to Section 2699(a) of the Private Attorney Generals 24 Act; (9) penalties pursuant to Section 2699(f) of the Private Attorneys General Act; and (10) violations 25 of the Fair Labor Standards Act. (Doc. 50 at 1; see also id. at 11-27.) 26 The parties executed the “Joint Stipulation of Settlement and Release” on March 27, 2023. 27

28 3 Based upon the stipulation of the parties, the Court dismissed Nestlé USA, Inc., as a defendant prior to the filing of the 1 (Doc. 51-1 at 24-54.) The same date, the parties stipulated to dismiss the state court action due to the 2 pending settlement, including the filing of the FAC. The Alameda Superior Court approved the 3 stipulation and dismissed the complaint without prejudice. Salinas now seeks approval of the 4 settlement terms. (Doc. 51.) Nestlé Purina did not oppose or otherwise respond to the motion.4 5 II. The Proposed Settlement 6 Pursuant to the “Joint Stipulation of Settlement and Release” (“the Settlement”), the parties 7 agree to a gross settlement amount of $3,000,000.00 for the class including: “[a]ll persons employed by 8 Defendant in a Job Position at any time during the Class Period.” (Doc. 51-1 at 29-30 §§ III-IV.) The 9 Settlement defines a “Job Position” as “any non-exempt hourly or non-exempt salaried California job 10 position” with Nestlé Purina, and the “Class Period” runs from January 29, 2017 through February 5, 11 2023. (Id. at 28, § II(4), (10).) Thus, the Settlement Class includes all persons employed by Nestlé 12 Purina in the state of California in any non-exempt hourly or non-exempt salaried position from 13 January 29, 2017 through February 5, 2023. 14 In addition, the Settlement includes an escalator clause, under which the gross settlement 15 amount nay be increased. (Doc. 51-1 at 30.) The parties agreed the Settlement amount was “based on 16 approximately 25,075 pay periods for Settlement Class Members from January 29, 2017 through 17 November 4, 2022.” (Id.) Pursuant to the Settlement, “If it is determined that the number of pay 18 periods for Settlement Class Members between January 29, 2017 and the end of the Class Period 19 exceeds 29,583, the Maximum Settlement Amount will be increased by the same number of percentage 20 points above ten percent (10%) by which the actual number of pay periods exceeds 25,075.” (Id.) For 21 example, if the actual number of pay periods in the Class Period totals 29,583—which is approximately 22 18% higher than 25,075— the settlement amount would be increased by 8%. (Id.) 23 Nestlé Purina agrees to pay the settlement amount to the Settlement Administrator after final 24 approval of the Settlement and judgment. (Doc. 51-1 at 28, § III(8); id. at 38, § X.) 25 /// 26

27 4 The Settlement indicated: “the Parties agree that Plaintiff and Defendant will jointly request that the District Court enter the Preliminary Approval Order.” (Doc. 51-1 at 44, § XV [emphasis added].) However, the “Notice of Motion” clearly 28 indicates that “Salinas… moves the Court for preliminary approval of the Joint Stipulation of Settlement.” (Doc. 51 at 2.) 1 A. Payment Terms 2 The “Maximum Settlement Amount” will cover payments to class members with additional 3 compensation to Salinas as the class representative. (Doc. 51-1 at 30, §§ IV-V.) In addition, the 4 Settlement provides for payments to Class Counsel for attorneys’ fees and expenses, to the Settlement 5 Administrator, and the California Labor & Workforce Development Agency. (Id.) Specifically, the 6 Settlement provides for the following payments from the gross settlement amount: 7 • The Class Representative will receive an enhancement fee up to $7,500;

8 • Class counsel will receive up to $1,050,000 for attorneys’ fees, which equals 35% of the gross settlement, and actual costs up to $30,000; 9 • The California Labor and Workforce Development Agency shall 10 receive $75,000 from the total PAGA payment of $100,000; and

11 • The Settlement Administrator will receive up to $10,050 for fees and expenses. 12

13 (Id. at 29-34, §§ V-VIII.) After these payments, the remaining money (“Net Settlement Amount”) — 14 which is currently estimated to be $1,802,450— will be distributed to class members. (Id.; see also 15 Doc. 51 at 16.) If the Court approves payments that are less than the amounts designated above for the 16 class representative or counsel, the money will not revert to Nestlé Purina. (Doc. 51-1 at 31-32, §§ V- 17 VI.) Instead, the funds will instead be retained in the Net Settlement Amount and distributed to Class 18 Members. (Id.) 19 Class members are not required to submit a claim to receive a share from the Net Settlement 20 Amount. (See Doc. 51-1 at 56 [proposed notice informing the class members that “[t]o receive a 21 settlement check under the Settlement, you need not take any action”]; id. at 61 [“You are not required 22 to take any action to receive a check”].) Class members’ shares will be distributed on a pro rata basis, 23 with two allocation amounts based upon the number of pay periods worked during the relevant period. 24 (Id. at 34, § IX(2).) The Settlement provides: 25 [E]ach Participating Class Member shall receive a “First Pro Rata Allocation Amount” and a “Second Pro Rata Allocation Amount.” The 26 combined payments of the First Pro Rata Allocation Amount and Second Pro Rata Allocation Amount to be paid to each Participating Class 27 Member is such Participating Class Member’s “Class Member Allocation Amount.” The pro rata payments for the First and Second Pro Rata 28 Allocation Amounts shall be calculated as follows: 1 a. A preliminary pro rata share, the First Pro Rata Allocation Amount, will be calculated for each Participating Class Member as 2 follows: (i) the number of pay periods each respective Participating Class Member worked in a Job Position during the Class Period; divided by (ii) 3 the aggregate number of pay periods worked by all Participating Class Members in a Job Position during the Class Period; then multiplied by 4 (iii) the Net Settlement Amount, and (iv) if applicable, then subtracting $1,500. Certain Settlement Class Members signed releases solicited by 5 Defendant in exchange for a payment of One Thousand Five Hundred Dollars and No Cents ($1,500.00) each. For such Participating Class 6 Member who signed such a release, step (iv) in this subparagraph (a) will be performed. If after performing step (iv) in this subparagraph (a), such 7 a Participating Class Member has a preliminary pro rata calculation of $0 or less, Such Participating Class Member’s First Pro Rata Allocation 8 Amount shall be $0.

9 b. A second preliminary pro rata share, the Second Pro Rata Allocation Amount, will be calculated for each Participating Class 10 Member as follows: (i) the number of pay periods each respective Participating Class Member worked in a Job Position during the Class 11 Period; divided by (ii) the aggregate number of pay periods worked by all Participating Class Members in a Job Position during the Class Period; 12 and then multiplied by (iii) the Net Settlement Amount less the total First Pro Rata Allocation Amount calculated for all Participating Class 13 Members pursuant to subparagraph (a) above.

14 (Doc. 51-1 at 34-35, § IX(2).) Further, the Settlement indicates that individuals shall receive PAGA 15 payments—whether or not participating class members—based upon the number of pay periods 16 worked. (Id. at 35, § IX(3).) The “Individual PAGA Payment” will be calculated as follows: 17 (a) the number of pay periods each PAGA Employee worked in a Job Position during the PAGA Period; divided by (b) the aggregate number of 18 pay periods worked by all PAGA Employees in a Job Position during the PAGA Period; and then multiplied by (c) the PAGA Portion. 19 20 (Id.) Thus, the exact amount settlement class members receives depends upon how long they worked 21 for Nestlé Purina, and whether they are entitled to a portion allocated for the release of PAGA claims. 22 Salinas reports that if the Court approves of the proposed payments from the gross fund—including 23 the maximum attorney fees and class representative enhancement award under the Settlement—the 24 average settlement payment is expected to be $13,071. (Doc. 50 at 26.) 25 The appointed Settlement Administrator will distribute payments by mailing checks to all 26 Participating Class Members and PAGA Employees. (See Doc. 51-1 at 37, § IX(11).) Checks must be 27 cashed within 180 days of the mailing. (Id., § IX(10).) If any check remains uncashed after the 180- 28 period, the money does not revert to Nestlé Purina. (Id.) Rather, “the Settlement Administrator shall 1 stop payment on such check and remit the funds to the Unclaimed Property Fund maintained by the 2 State Controller’s Office in the name of the Participating Class Member and/or PAGA Employee who 3 failed to cash his or her check.” (Id.) 4 B. Releases 5 The Settlement provides that Salinas and class members, other than those who elect not to 6 participate in the Settlement, release Nestlé Purina and Nestle USA, Inc.5 from claims arising in the 7 relevant period. Specifically, the release for Class Members provides: 8 As of the Effective Date, each Participating Class Member hereby fully, finally, and forever releases and discharges each and every one of the 9 Released Parties from all claims, demands, rights, liabilities, and causes of action arising in whole or in part, for any of the following arising from 10 employment by Defendant during the Class Period: (a) any alleged or actual failure to provide proper, accurate, timely, adequately descriptive, 11 or complete wage statements or pay stubs; any alleged or actual failure to timely, properly, or fully or completely pay, or any alleged or actual 12 failure to properly calculate, any wages including but not limited to any minimum wages, regular wages, overtime premium wages, or meal or 13 rest period premium wages; any alleged or actual failure to comply with meal or rest period requirements or requirements for recording meal or 14 rest periods or work hours; any actual or alleged failure to timely pay all wages or compensation owed to a fired, quitting, or otherwise departing 15 employee; or any alleged or actual failure to pay any interest or penalties owed as a result of any of the foregoing; or (b) in any manner arising out 16 of any of the other facts or legal theories alleged or asserted in: (i) the original complaints in the Action or PAGA Action or in the Amended 17 Complaint to be filed under this Settlement, including, but not limited to, claims arising under or out of any unfair competition laws as defined in 18 California Business and Professions Code Section 17200 et seq., and claims for declaratory or injunctive relief or for monetary compensation, 19 whether in the form of wages, damages, liquidated damages, penalties, restitution, costs, attorneys’ fees, interest, or otherwise; or (ii) Plaintiff’s 20 PAGA letters to the LWDA, including the amended PAGA Letter to be sent under this Settlement (the “Released Class Claims”). 21

22 (Doc. 51-1 at 38-39, § XII.) 23

24 5 The Settlement defines “Released Parties” as including: “(a) Defendant Nestle Purina PetCare Co. and each and all past or present partners, parents, subsidiaries, or affiliates (regardless whether such partners, parents, subsidiaries, or affiliates 25 are individuals, corporations, partnerships, limited partnerships, limited liability companies, or other forms of entity) of Nestle Purina PetCare Co., including but not limited to Nestle USA, Inc.; (b) each and all of the predecessor or successor 26 entities of any of those entities identified in subparagraph (a); (c) any other individuals or entities of any kind, including but not limited to any payroll companies, which have been or could be alleged to be in any manner responsible (whether on 27 an alter ego, joint employer, integrated enterprise, or any other theory) for any violations described in the “Released Claims” (defined below) and occurring as a result of employment by Defendant; and (d) all past and present directors, 28 officers, representatives, insurers, agents, shareholders, limited or general partners, members, lawyers, and employees of 1 The Settlement provides that by cashing the payment check, class members opt-in to the FLSA 2 collective and release those claims: 3 Participating Class Members who cash, deposit, or otherwise negotiate checks or otherwise obtain the proceeds for their Class Member Allocation 4 Amount shall be deemed to have opted into a collective action under the Fair Labor Standards Act, 29 U.S.C. §§ 201, et seq. (“FLSA”), and to have 5 released each of the Released Parties from any and all claims, penalties, costs, expenses, attorneys’ fees, liabilities, damages, and actions or causes 6 of action of whatever kind or nature under the FLSA, known and unknown, which derive from any of the foregoing Released Class Claims. 7 Checks to Participating Class Members shall include a notation that the cashing of the checks constitutes such an opt-in and effectuates these 8 FLSA releases.

9 (Doc. 51-1 at 39, § VII.) 10 In addition, the Settlement provide a release for “PAGA Employees,” which includes class 11 members—including those who request exclusion from the Settlement— employed in a relevant job 12 position from January 29, 2020 through February 5, 2023 (“the PAGA Period”). (Doc. 51-1 at 28, § 13 II(15); id. at 34 § VIII.) The Settlement provides: 14 As of the Effective Date, each PAGA Employee hereby fully, finally, and forever releases and discharges each and every one of the Released 15 Parties on behalf of the LWDA from all Labor Code or Wage Order violations under the PAGA, arising in whole or in part, during the PAGA 16 Period, which in any manner which (a) derive from any of the foregoing Released Class Claims; or (b) are or could have been alleged or asserted 17 under the PAGA in: (i) the original complaints in the Action or PAGA Action, or in the Amended Complaint to be filed pursuant to this 18 Settlement; or (ii) Plaintiff’s PAGA letters to the LWDA, including the amended PAGA Letter to be sent under this Settlement (the “Released 19 PAGA Claims”).

20 (Id. at 39-40, § XII.) There is no right to request exclusion from the Released PAGA Claims. (Id.) 21 The “Released Class Claims” and “Released PAGA Claims” defined above are collectively the 22 “Released Claims” under the Settlement. (Doc. 51-1 at 40, § XII.) The Settlement provides that 23 Participating Class Members and PAGA Employees, “upon the Effective Date, shall be deemed to 24 have, and by operation of the Final Class Judgment in the Action shall have, fully, finally, and forever 25 settled and released any and all Released Claims known or unknown, suspected or unsuspected, 26 described above.” (Id.) The releases in the Settlement are full and complete, even if “different or 27 additional facts” from those known at this time are discovered in the future. (Id.) 28 The release for Salinas encompasses more than those identified for class members, because he 1 agreed to release claims that could have arisen during the course of his employment with Nestlé Purina, 2 not just those claims constrained to the facts alleged in the FAC. (Doc. 51-1 at 40-41, § XIII.) The 3 Settlement indicates: 4 In partial consideration for the Class Representative Enhancement Fee and other benefits under this Joint Stipulation of Settlement, Plaintiff provides 5 the following additional releases: as of the Effective Date, Plaintiff shall fully, finally, and forever release and discharge each and every one of the 6 Released Parties from all claims, demands, rights, liabilities, and causes of action of every nature and description whatsoever, whether known or 7 unknown, whether sounding in tort, in contract, in law, in equity or otherwise, and including but not limited to all claims for violation of any 8 local, state, or federal statute, rule, or regulation, which Plaintiff now has, owns, or holds, or claims to have, own, or hold, or which he ever had, 9 owned or held, whether known or unknown, suspected or unsuspected, at any time prior to the date he executes this Joint Stipulation of Settlement 10 (collectively “Plaintiff’s Released Claims”).

11 (Id.) Thus, the claims released by Salinas—but not class members— include any claims for violations 12 of Title VII of the Civil Rights Act, fraud, promises without intent to perform, breach of contract, 13 breach of the implied covenant of good faith and fair dealing, wrongful termination, retaliatory 14 discharge, negligent or intentional infliction of emotional distress, misrepresentation, and violations of 15 California’s Fair Employment and Housing Act. (See id.) However, the Settlement also provides: 16 Plaintiff’s Released Claims do not include the release of claims as prohibited by law, the Fair Credit Reporting Act, the Older Workers 17 Benefit Protection Act, the Worker Adjustment and Retraining Notification Act, the Family and Medical Leave Act, the Sarbanes-Oxley 18 Act of 2002, the Uniformed Services Employment and Reemployment Rights Act, as well as claims Plaintiff may have for: (a) unemployment, 19 state disability and/or paid family leave insurance benefits pursuant to the terms of applicable law; (b) workers’ compensation insurance benefits 20 pursuant to applicable state law under the terms of any workers’ compensation insurance policy or fund; (c) continued participation in 21 Defendant’s group medical benefits plans, if any, at Plaintiff’s own expense pursuant to the terms and conditions of the federal law known as 22 “COBRA” and/or any applicable state law counterpart; (d) benefits, to which Plaintiff would be entitled under any Released Parties’ benefit plan 23 subject to the provisions of the Employee Retirement Income Security Act of 1974 otherwise known as “ERISA” in which they participated during 24 their employment with Defendant, such as any pension plans; (e) violation of any federal, state, or local statutory and/or public policy right or 25 entitlement that, by applicable law, is not waivable; and (f) any wrongful act or omission occurring after the Effective Date. 26

27 (Id. at 42.) Nevertheless, Salinas indicates that his release is intended to be “a full and complete release 28 to the maximum extent allowed by law except for the limited express exclusions above.” (Id.) 1 C. Objections and Opt-Out Procedure 2 The proposed “Notice of Class Action and PAGA Representative Action Settlement” explains 3 to class members: “You are not required to take any action to receive a check.” (Doc. 51-1 at 61.) 4 However, any class member who wishes may file objections or request exclusion from the Settlement. 5 (Id. at 45-47, § XVI.) 6 Individuals who wish to be excluded from the Settlement Class must submit a written “Opt-Out 7 Letter” or “Request for Exclusion” to the Settlement Administrator within 15 days of the Notice post- 8 marked date. (Id. at 46.) To be deemed proper, an exclusion must: 9 (1) make the following statement or a similar statement: “I wish to exclude myself from the settlement reached in the matter of Salinas v. Nestlé 10 Purina PetCare Company. I understand that, by excluding myself, I will not receive any money (other than the Individual PAGA Amount [if 11 applicable]) from the settlement reached in this matter”; (2) contain the name, address, and the last four digits of the Social Security number of the 12 person requesting exclusion; (3) be signed by the Settlement Class Member; and (4) be postmarked or fax stamped by the Deadline Date and 13 returned to the Settlement Administrator at the specified address or fax telephone number stated in the Class Notice. 14

15 (Id., § XVI(A)(4).) However, such a request does not exclude an individual from the PAGA release. 16 (Id. at 46-47; see also id. at 40, § XII.) 17 Class members may also object to the settlement terms by mailing a written statement to the 18 Settlement Administrator. (Doc. 51-1 at 47-48, § XVI(B)(1).) A proper objection must: 19 (1) contain the name, address, and the last four digits of the Social Security number of the objector; (2) set forth the legal and factual grounds 20 for the objections; and (3) be signed by the Settlement Class Member;. Such written objections should be mailed and postmarked on or before the 21 Deadline Date, or within fifteen (15) calendar days after the postmark of a Class Notice re-mailed to a corrected address for that Settlement Class 22 Member or the Deadline Date, whichever is later.

23 (Id.) The proposed notice also explains these requirements. (Id. at 56, 61-62.) 24 III. Preliminary Approval of a Class Settlement 25 When parties settle the action prior to class certification, the Court has an obligation to “peruse 26 the proposed compromise to ratify both the propriety of the certification and the fairness of the 27 settlement.” Staton v. Boeing Co., 327 F.3d 938, 952 (9th Cir. 2003). Preliminary approval of a class 28 settlement is generally a two-step process. First, the Court must assess whether a class exists. Id. 1 (citing Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 620 (1997)). Second, the Court must “determine 2 whether the proposed settlement is fundamentally fair, adequate, and reasonable.” Id. (citing Hanlon v. 3 Chrysler Corp., 150 F.3d 1011, 1026 (9th Cir. 2998)). The decision to approve or reject a settlement is 4 within the Court’s discretion. Hanlon, 150 F.3d at 1026. 5 A. Conditional Certification of a Settlement Class 6 Class certification is governed by Rule 23 of the Federal Rules of Civil Procedure, which 7 provides that “[o]ne or more members of a class may sue or be sued as representative parties on behalf 8 of all.” Fed. R. Civ. P. 23(a). Salinas seeks certification of a Settlement Class defined as: “all persons 9 employed by Defendant in any non-exempt hourly or non-exempt salaried California job position at 10 any time during the time period from and including January 29, 2017, through and including February 11 5, 2023.” (Doc. 51 at 17, see also Doc. 51-1 at 28-30 §§ II(4), II(10), III-IV.) 12 1. Rule 23(a) Requirements 13 Parties seeking class certification bear the burden of demonstrating the elements of Rule 23(a) 14 are satisfied, and “must affirmatively demonstrate … compliance with the Rule.” Wal-Mart Stores, 15 Inc. v. Dukes, 564 U.S. 338, 350 (2011); Doninger v. Pacific Northwest Bell, Inc., 563 F.2d 1304, 16 1308 (9th Cir. 1977). The prerequisites of Rule 23(a) “effectively limit the class claims to those fairly 17 encompassed by the named plaintiff’s claims.” General Telephone Co. of the Southwest. v. Falcon, 18 457 U.S. 147, 155-56 (1982). Certification of a class is proper if: 19 (1) the class is so numerous that joinder of all members is impracticable; (2) there are questions of law or fact common to the class; (3) the claims 20 or defenses of the representative parties are typical of the claims or defenses of the class; and (4) the representative parties will fairly and 21 adequately protect the interests of the class.

22 Fed. R. Civ. P. 23(a). These prerequisites are generally referred to as numerosity, commonality, 23 typicality, and adequacy of representation. Falcon, 457 U.S. at 156. 24 2. Numerosity 25 This prerequisite requires the Court to consider “specific facts of each case and imposes no 26 absolute limitations.” General Telephone Co. v. EEOC, 446 U.S. 318, 330 (1980). Although there is 27 not a specific threshold, joining more than one hundred plaintiffs is impracticable. See Immigrant 28 Assistance Project of Los Angeles Cnt. Fed’n of Labor v. INS, 306 F.3d 842, 869 (9th Cir. 2002) 1 (finding the requirement “satisfied solely on the basis of the number of ascertained class members”); 2 see also Gay v. Waiters’ & Dairy Lunchmen’s Union, 549 F.2d 1330, 1332 n.7 (9th Cir. 1977) (a 3 proposed class with 110 members “clearly [included] a sufficient number to meet the numerosity 4 requirements”). Salinas reports, “there are approximately 146 putative Class members who are readily 5 identified from Defendant’s payroll records.” (Doc. 51 at 21.) Therefore, the joinder of all identified 6 as plaintiffs is impracticable, and the numerosity requirement is satisfied. 7 3. Commonality 8 Rule 23(a) requires “questions of law or fact common to the class.” Fed. R. Civ. P. 23(a)(2). 9 To satisfy the commonality requirement, the plaintiff must demonstrate common points of facts and 10 law. See Wal-Mart Stores, 564 U.S. at 350. Thus, “commonality requires that the class members’ 11 claims depend upon a common contention such that determination of its truth or falsity will resolve an 12 issue that is central to the validity of each claim in one stroke,” and the “plaintiff must demonstrate the 13 capacity of classwide proceedings to generate common answers to common questions of law or fact 14 that are apt to drive the resolution of the litigation.” Mazza v. Am. Honda Motor Co., 666 F.3d 581, 15 588 (9th Cir. 2012) (internal quotation marks, citations omitted). 16 Salinas asserts the commonality requirement is satisfied because Nestlé Purina “has uniform 17 policies applicable to all Class members.” (Doc. 51 at 21.) Salinas contends such policies—and 18 common facts—include: 19 the requirement that all non-exempt employees use the Kronos timekeeping system, Defendant’s policy of paying 30 minutes each day for meal breaks, 20 Defendant’s failure to track meal periods until April 2021, Defendant’s policy of COVID-19 checks following March 2020, Defendant’s policy of 21 requiring employees to use written time sheets during the Kronos breach in late 2021 to early 2022, Defendant’s policy that employees don PPE, and 22 Defendant’s policy of not providing off-duty meal periods or rest breaks.

23 (Id., citing Cottrell Decl.¶ 35 [Doc. 51-1 at 13].) In addition, Salinas identifies the following legal 24 issues as common to the class: 25 whether Defendant’s practice prior to August 2022, of not paying employees for undergoing COVID-19 checks and donning PPE among 26 other job duties, was improper; whether Defendant’s failure to track meal breaks until April 2021 was improper; whether Defendant provided 27 compliant meal and rest breaks; and whether Defendant’s payment of 30 minutes each day were sufficient to satisfy Defendant’s meal and rest 28 break violations. 1 (Id.) Because it appears resolution of the identified issues—such whether Nestlé Purina’s practices and 2 policies violated wage and hour laws—apply to the claims of each of the Class Members, the Court 3 finds the commonality requirement is satisfied for purposes of settlement. 4 4. Typicality 5 This requirement demands that the “claims or defenses of the representative parties are typical 6 of the claims or defenses of the class.” Fed. R. Civ. P. 23(a)(3). A claim or defense is not required to 7 be identical, but rather “reasonably coextensive” with those of the absent class members. Hanlon, 150 8 F.3d at 1020. “The test of typicality is whether other members have the same or similar injury, 9 whether the action is based on conduct which is not unique to the named plaintiffs, and whether other 10 class members have been injured by the same course of conduct.” Hanon v. Dataproducts Corp., 976 11 F.2d 497, 508 (9th Cir. 1992) (internal quotation marks, citation omitted). Importantly, a named 12 plaintiff does not satisfy the typicality requirement when “there is a danger that absent class members 13 will suffer if their representative is preoccupied with defenses unique to [him].” Id. (quoting Gary 14 Plastic Packaging Corp. v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 903 F.2d 176, 180 (2d Cir. 15 1990)); see also Kayes v. Pac. Lumber Co., 51 F.3d 1449, 1463 (9th Cir. 1995) (the typicality 16 requirement is satisfied when named plaintiffs are not subject to unique defenses). 17 Salinas contends the typicality requirement is satisfied because his “claims are typical of those 18 of all other Class Members.” (Doc. 51 at 22.) He asserts, “Interviews with putative Class members and 19 review of timekeeping and payroll data further confirm that Plaintiff and other putative Class members 20 were subjected to the same alleged illegal policies and practices to which Plaintiff was subjected.” (Id.) 21 Thus, Salinas concludes that “[t]hey were subject to the alleged illegal policies and practices that form 22 the basis of the claims asserted in this case.” (Id.) 23 Importantly, however, a review of the operative pleading indicates Salinas includes a claim for 24 which he did not suffer any injury and lacks standing. Salinas asserts that he “is currently employed” 25 by Nestlé Purina, yet his sixth cause of action “on behalf of the class” is for failure “to pay all owed 26 wages” under Labor Code Sections 201-203. (See Doc. 50 at 2 and 20, ¶¶ 4, 100-102 [emphasis 27 omitted].) Salinas also requested PAGA penalties for the alleged violations of Labor Code Sections 28 201-203. (Id. at 21, ¶ 107(e).) To have standing for a claim under either Section 201 or Section 202— 1 which set deadlines for paying employees unpaid wages after termination or resignation—Salinas must 2 no longer be employed by Nestlé Purina.6 See McDowell v. Penske Truck Leasing Co., L.P., 2024 WL 3 1354261, at *4 (C.D. Cal. Mar. 29, 2024) (finding that where “none of the named plaintiffs resigned or 4 were discharged …at the time that they filed this action, they lack[] standing for their claims under both 5 section 201 and 202”). 6 A plaintiff “must demonstrate standing for each claim []he seeks to press.” Mays v. Wal-Mart 7 Stores, Inc., 804 Fed. App’x 641, 643 (9th Cir. 2020); see also Hawkins v. Comparet-Cassani, 251 8 F.3d 1230, 1238 (9th Cir. 2001) (“A named plaintiff cannot represent a class alleging … claims that 9 the named plaintiff does not have standing to raise”). Salinas fails to meet this requirement with his 10 sixth cause of action, as he did not suffer any injury under Labor Code Sections 201 and 202 and is not 11 entitled to the penalties sought under Section 203. Because Salinas states a claim on behalf of the 12 class for which he did not personally suffer an injury, it appears Salinas is subject to a unique defense. 13 See Schlesinger v. Reservists Comm. to Stop the War, 418 U.S. 208, 216 (1974) (indicating that to be a 14 proper class representative, a plaintiff must “suffer the same injury shared by all members of the class 15 he represents”); Westways World Travel, Inc. v. AMR Corp., 218 F.R.D. 223, 235 (C.D. Cal. 2003) 16 (“typicality may not be established unless the named representative has individual standing to raise the 17 legal claims of the class”); McDowell, 2024 WL 1354261, at *4 (“a named plaintiff may pursue a 18 claim on behalf of a class only for statutory injuries that he himself suffered”). This issue was not 19 addressed by Salinas—or even acknowledged—and the Court is unable to find at this time that Salinas 20 satisfies the typicality requirement of Rule 23.7 21 22 6 Moreover, even if his employment ended, Salinas is unable to state a claim under both Sections 201 and 202. Section 201 23 provides that “[i]f an employer discharges an employee, the wages earned and unpaid at the time of discharge are due and payable immediately.” Cal. Lab. Code § 201 (emphasis added). Section 202 states “[i]f an employee ... quits his or her 24 employment, his or her wages shall become due and payable not later than 72 hours thereafter...” Cal. Lab. Code § 202 (emphasis added). As this Court previously observed, “plaintiff could not have both resigned and been terminated at the 25 same time.” Perez v. DNC Parks & Resorts at Sequoia, 2020 WL 4344911 *8 (E.D. Cal. July 29, 2020). Thus, an employee who was discharged is unable to state a claim under Section 202, and an employee who quits cannot state a claim under Section 201. See id.; see also Pineda v. Bank of Am., N.A., 50 Cal. 4th 1389, 1394 (2010) (explaining Section 26 202 applies only “to employees who quit”). It follows that a plaintiff who lacks standing under either section is unable to obtain penalties under Cal. Lab. Code § 203 for the failure to comply with the deadlines identified in Sections 201 and 202. 27 7 The identified claim was clearly not abandoned, as the Settlement release for class members includes claims for “any actual or alleged failure to timely pay all wages or compensation owed to a fired, quitting, or otherwise departing 28 employee; or any alleged or actual failure to pay any interest or penalties owed as a result of any of the foregoing…” (Doc. 1 5. Adequate Representation 2 Absentee class members must be adequately represented for judgment to be binding upon 3 them. Hansberry v. Lee, 311 U.S. 32, 42-43 (1940). Accordingly, this prerequisite is satisfied if the 4 representative party “will fairly and adequately protect the interests of the class.” Fed. R. Civ. P. 5 23(a)(4). “[R]esolution of this issue requires that two questions be addressed: (a) do the named 6 plaintiffs and their counsel have any conflicts of interest with other class members and (b) will the 7 named plaintiffs and their counsel prosecute the action vigorously on behalf of the class?” In re Mego 8 Fin. Corp. Sec. Litig., 213 F.3d 454, 462 (9th Cir. 2000) (citing Hanlon, 150 F.3d at 1020). 9 Importantly, when a named plaintiff lacks standing to assert a claim “that may be available and 10 advantageous to the absent putative class members,” there is a conflict of interest between the plaintiff 11 and the class. See In re Stec Inc. Securities Litig., No. 09-1304, 2012 WL 6965372, at *6 (C.D. Cal. 12 Mar. 7, 2012); see also Valentino v. Carter-Wallace, Inc., 97 F.3d 1227, 1234 (9th Cir. 1996) (“named 13 plaintiffs …may not be able to provide adequate representation for those who have suffered different 14 injuries”); William B. Rubenstein, Newberg on Class Actions § 3:59 (5th ed. 2011) (“If a court finds 15 that standing is lacking, then adequacy will be as well, for a plaintiff cannot be an adequate 16 representative for claims []he does not have standing to pursue”). Because Salinas lacks standing for 17 all claims he states on behalf of the class, there is a conflict of interest between Salinas and the class. 18 Thus, Salinas fails to demonstrate he satisfies the adequacy requirement. 19 B. Conclusion 20 Salinas fails to carry his burden to show the prerequisites of Rule 23(a) are satisfied for the 21 proposed settlement class, and the Court is unable to certify the class. See Dukes, 564 U.S. at 350. 22 Accordingly, the Court declines to consider whether the Settlement satisfies the requirements of Rule 23 23(e)(2) of the Federal Rules of Civil Procedure. See Staton, 327 F.3d at 952. 24 IV. The FLSA Collective8 25 The principal purpose of the Fair Labor Standards Act “was to protect all covered workers from 26

27 8 Because the Court finds the Settlement Class may not be certified and declines to approve the Settlement on this basis, it need not evaluate the FLSA Collective. Nevertheless, the Court also takes this opportunity to identify concerns related to 28 settlement of the FLSA claim, which also prevent preliminary approval. 1 substandard wages and oppressive working hours….” Barrentine v. Arkansas-Best Freight Sys., 450 2 U.S. 728, 739 (1981). To accomplish that goal, the FLSA precludes employees from waiving their 3 rights to minimum wage or overtime pay and authorizes employees to bring suit to recover back wages, 4 liquidated damages, and injunctive relief. Id. at 740. Employees may bring collective actions under the 5 FLSA, representing all “similarly situated” employees, but “each employee [must] opt-in to the suit by 6 filing a consent to sue with the district court.” Does I thru XXIII v. Advanced Textile Corp., 214 F.3d 7 1058, 1064 (9th Cir. 2000). Accordingly, when employees settle an FLSA action with their employer, 8 the settlement must be evaluated for fairness and approved by the Court. 29 U.S.C. § 216(b); see also 9 Barrentine, 450 U.S. at 740. 10 The Ninth Circuit has not established criteria for district courts to consider in determining 11 whether an FLSA settlement should be approved. See Kerzich v. County of Tuolumne, 335 F. Supp. 12 3d 1179, 1184 (E.D. Cal. 2018). However, Ninth Circuit district courts have applied a widely-used 13 standard adopted by the Eleventh Circuit, which considers whether the settlement is a fair and 14 reasonable resolution of a bona fide dispute. Id.; see also Lynn’s Food Stores, Inc. v. United States, 15 679 F.2d 1350, 1352-55 (11th Cir. 1982); Selk v. Pioneers Mem’l Healthcare Dist., 159 F. Supp. 3d 16 1164, 1172 (S.D. Cal. 2016) (following the Eleventh Circuit’s decision in Lynn’s Foods); Yue Zhou v. 17 Wang’s Restaurant, 2007 WL 2298046, at *1 (N.D. Cal. Aug. 8, 2007) (same). “A bona fide dispute 18 exists when there are legitimate questions about the existence and extent of Defendant’s FLSA 19 liability.” Selk, 159 F. Supp. 3d at 1172 (internal quotation marks, citation omitted). 20 A. Inclusion of FLSA claim in the settlement 21 The “district court must ultimately be satisfied that the settlement’s overall effect is to 22 vindicate, rather than frustrate, the purposes of the FLSA.” See Kerzich, 335 F. Supp. 3d at 1185. The 23 district court’s role “is not to act as caretaker[,] but as gatekeeper,” to ensure a settlement does not 24 frustrate the purpose of the FSLA. Id. (quoting Goodwin v. Citywide Home Loans, Inc., 2015 WL 25 12868143, at *2 (C.D. Cal. Nov. 2, 2015). 26 The purpose of the FLSA may be frustrated where a plaintiff amends his complaint “to add an 27 FLSA claim for purposes of settling it.” See Gonzalez v. CoreCivic of Tenn., LLC, 2018 WL 4388425, 28 at *4-6 (E.D. Cal. Sept. 12, 2018). In Gonzalez, the Court observed at a hearing on the plaintiff’s 1 motion for preliminary approval that the proposed settlement included a release of FLSA claims, 2 though no such claim was alleged in the initial complaint. Id. at *4. In response, the plaintiff requested 3 leave “to amend the complaint to add an FLSA claim for the purpose of settling it.” Id. The parties 4 then “lodged a proposed first amended complaint as an exhibit to their amended settlement agreement 5 in which a FLSA claim [was] alleged for the first time.” Id. Thus, the Court noted that “the first 6 reference to FLSA claims in this litigation was in the waiver set forth in the original settlement 7 agreement.” Id. at *5. The Court observed that amending a complaint under such circumstances “raises 8 red flags in large part because it appears plaintiff agreed to settle the FLSA claim before he ever 9 considered litigating it.” Id. at *4. The Court explained the “sequence of events raises a substantial 10 concern … that it was defendants who insisted these claims be included as part of this settlement, and 11 [the] plaintiff merely acquiesced to this request because he never intended to litigate the FLSA claims.” 12 Id. at *5. In addition, the “atypical circumstances create a potentially indelible stain for the settlement 13 agreement as drafted, because they point toward collusion between the parties.” Id. 14 Similarly, the first mention of Salinas making an FLSA claim in this action was made after the 15 parties notified the Court that they reached a settlement. The initial complaint filed in this action on 16 July 26, 2021, did not include a claim under the FLSA, and instead included only claims arising under 17 state law. (See generally Doc. 1.) After engaging in discovery and two mediation sessions, the parties 18 filed a joint report on January 30, 2023, informing the Court that they “executed a term sheet settling 19 this case and the State Action on a class-wide basis.” (Doc. 42 at 2.) The parties indicated: “As part of 20 the settlement, the Parties agreed to dismiss the State Action without prejudice and add the PAGA 21 claims in that action to this action,” and Salinas was in the process of “finalizing a stipulation and 22 amended complaint.” (Id.) In a status report the following month, the parties again indicated an 23 amended complaint would be filed “to add the PAGA claims in [the state] action to this Action.” (Doc. 24 44 at 2.) On March 22, 2023, the parties filed a stipulation for Salinas to file the FAC, reporting for the 25 first time that the FAC would also include “FLSA claims [and] other allegations agreed to be settled.” 26 (Doc. 48 at 3.) The parties then executed the agreement, which includes provisions for class members 27 to opt-in the FSLA collective action and the release FLSA claims and filed the proposed settlement on 28 March 27, 2023. (Doc. 51.) This sequence of events—as in Gonzalez—indicates that Salinas agreed to 1 settle FLSA claims without a prior intent to litigate claims on behalf of a collective. Without any 2 explanation from Salinas, this agreement casts doubt upon the fairness of the settlement for an FLSA 3 collective. See Gonzalez, 2018 WL 4388425, at*4-6. 4 B. Valuation and payment of the FLSA claim 5 FLSA settlements must comprise “a fair and reasonable resolution of a bona fide dispute.” 6 Kerzich, 335 F. Supp. 3d at 1184. A dispute is “bona fide” if there are “legitimate questions” about the 7 existence and extent of a defendant’s FLSA liability. Id.; see also Selk v. Pioneers Mem'l Healthcare 8 Dist., 159 F. Supp. 3d 1164, 1172 (S.D. Cal. 2016). Importantly, “[a] court will not approve a 9 settlement of an action in which there is certainty that the FLSA entitles plaintiffs to the compensation 10 they seek, because it would shield employers from the full cost of complying with the statute.” Kerzich, 11 335 F. Supp. 3d at 1184. However, if a bona fide dispute between the parties exists, courts will often 12 consider many of the same factors that guide preliminary certification of Rule 23 class actions in 13 evaluating the fairness of the FLSA settlement. See Maciel v. Bar 20 Dairy, LLC, 2018 WL 5291969, 14 at *4 (E.D. Cal. Oct. 23, 2018). 15 Notably, “courts that have approved settlements releasing both FLSA and Rule 23 claims 16 generally do so only when the parties expressly allocate settlement payments to FLSA claims.” 17 Anderson v. Safe Streets USA, LLC, 2022 WL 17821702, at *6 (E.D. Cal. Dec. 20, 2022) (quoting 18 Thompson v. Costco Wholesale Corp., 2017 WL 697895, at *8 (S.D. Cal. Feb. 22, 2017)); see also 19 Priyanka Khanna v. Intercon Sec. Sys., 2014 WL 1379861, at *2 (E.D. Cal. Apr. 8, 2014) (approving a 20 hybrid settlement that allocated two-thirds of net settlement amount to the state claims and one-third of 21 the settlement to FLSA claims). 22 Carolyn Cottrell, an attorney for Salinas, reports that counsel determined the value “for unpaid 23 meal and rest premiums and unpaid wages” claims to be $3,625,283.75. (Doc. 51-1 at 16, Cottrell 24 Decl. ¶ 49.) She asserts that “[w]hen adding the calculated derivative penalties, this settlement amount 25 represents approximately 61% of Defendant’s total potential exposure of $5,050,460.81.” (Id.) 26 However, counsel does not identify any specific values for the claims, including the claim under the 27 FLSA. In addition, counsel does not specify what percentage, if any, of the settlement is for the 28 resolution of the FLSA claims in this action. (Id.; see also Doc. 50.) Without such additional 1 information, the Court cannot find the release of FLSA claim is “a fair and reasonable resolution” in 2 this action. See Gonzalez, 2018 WL 4388425, at *6 (finding it was “impossible for the court to analyze 3 whether the settlement amount is a fair and reasonable compromise of [the FLSA] claims” where the 4 plaintiff failed to supply “any information about what the potential damages for the FLSA claims are or 5 whether liquidated damages were available”); see also Maciel v. Bar 20 Dairy, LLC, 2018 WL 6 5291969, at *6 (E.D. Cal. Oct. 23, 2018) (a settlement calling “for a release of the FLSA claim in 7 exchange for no consideration does not appear to be a fair and reasonable resolution of a bona fide 8 dispute over FLSA provisions” [internal quotation marks, citation omitted]). Thus, the lack of 9 information from Salinas regarding the value of the FLSA claim weighs against approval. 10 C. Opt-in procedure 11 The FLSA requires written consent from members who wish to opt-in to an FLSA collective, 12 stating: “No employee shall be a party plaintiff to any [collective] action unless he gives his consent in 13 writing to become such a party and such consent is filed in the court in which such action is brought.” 14 29 U.S.C. § 216(b); see also Genesis HealthCare Corp. v. Symczyk, 569 U.S. 66, 75 (2013). In general, 15 “[c]ourts require a separate opt-in procedure for FLSA claims when the settlement includes both Rule 16 23 and FLSA claims.” Brown v. Tetra Tech., Inc., 2024 WL 1462764, at *14 (E.D. Cal. Apr. 4, 2024) 17 (citing Hudson v. Libre Tech., Inc., WL 5963648, at *9 (S.D. Cal. Nov. 13, 2019) (collecting authority). 18 The parties agreed that class members opt-in to the FLSA collective and release those claims 19 by cashing or depositing their payment checks. (Doc. 51-1 at 39, § VII.) Specifically, the Settlement 20 indicates: 21 Participating Class Members who cash, deposit, or otherwise negotiate checks or otherwise obtain the proceeds for their Class Member Allocation 22 Amount shall be deemed to have opted into a collective action under the Fair Labor Standards Act, 29 U.S.C. §§ 201, et seq. (“FLSA”), and to have 23 released each of the Released Parties from any and all claims, penalties, costs, expenses, attorneys’ fees, liabilities, damages, and actions or causes 24 of action of whatever kind or nature under the FLSA, known and unknown, which derive from any of the foregoing Released Class Claims. 25

26 (Id.) The parties also agreed: “Checks to Participating Class Members shall include a notation that the 27 cashing of the checks constitutes such an opt-in and effectuates these FLSA releases.” (Id.) However, 28 Salinas does not address how this satisfies the FLSA’s requirement of written consent to opt-in to a 1 || collective. (See Doc. 51 at 17, 34.) 2 Courts have repeatedly determined the cashing of a check to opt-in to an FLSA collective fail: 3 || to satisfy the FLSA’s requirement of written consent. See, e.g., Smothers v. Northstar Alarm Servs., 4 || LLC, 2019 WL 280294, at *11 (E.D. Cal. Jan. 22, 2019) (holding the written consent requirement of 5 || Section 216(b) was not satisfied where parties proposed FLSA opt-in procedure by endorsing back of 6 || check); Chen v. Western Digital Corp., 2020 WL 13587954, at *9 (C.D. Cal. Apr. 3, 2020) (“the chec 7 || cashing opt-in mechanism, without more, does not comply with the plain language of the FLSA” 8 || [internal quotation marks, citation omitted]); Johnson vy. Quantum Learning Network, Inc., 2016 WL 9 8729941, at *1 (N.D. Cal. Aug. 12, 2016) (finding that a settlement provision allowing FLSA membe 10 || to opt-in by cashing or depositing settlement checks “does not comply with the plain language of the 11 || FLSA” and constitutes a “deficiency” that precluded settlement approval); Van Kempen v. Matheson 12 || Tri-Gas, Inc., 2016 WL 4073336, at *9 (N.D. Cal. Aug. 1, 2016) (finding the provision that FLSA cl: 13 ||members “opt-in to the class by cashing or depositing their settlement check... violates the FLSA” 14 [internal citation omitted]); see also Coleman v. Amazon.com, Inc., 2023 WL 4408713, at *2 (W.D. 15 || Tenn. July 7, 2023) (“Courts have recently and repeatedly refused to endorse settlements that premis« 16 || the release of FLSA claims merely on the deposit of a check”). Because there is no showing that the 17 || cashing or depositing of checks by a class member constitutes proper written consent, the consent 18 || mechanism identified in the Settlement fails to comply with the requirements of the FLSA. 19 || V. Conclusion and Order 20 For the reasons set forth above, the Court ORDERS: The motion for preliminary approval of 21 || the class action settlement (Doc. 51) is DENIED without prejudice to a renewed motion addressing t! 22 || Court’s concerns. 23 24 IT IS SO ORDERED. 25 |! Dated: _ April 19, 2024 ( LAW pA LU. wan 26 TED STATES DISTRICT JUDGE 27 28 22