Bernal v. Graham Packaging Pet Technologies Inc. ( 2021 )

1 2 3 4 UNITED STATES DISTRICT COURT 5 EASTERN DISTRICT OF CALIFORNIA 6 7 SUAVECITA BERNAL, individually, and CASE NO. 1:20-CV-1045 AWI EPG on behalf of other members of the general 8 public similarly situated, ORDER ON REQUEST FOR 9 Plaintiff, DISMISSAL AND APPROVAL OF SETTLEMENT 10 v. 11 GRAHAM PACKAGING PET (Doc. No. 17) TECHNOLOGIES INC., et al., 12 Defendants 13 14 15 This is a labor related dispute between Plaintiff Suavecita Bernal and her former employer 16 Graham Packaging, Inc., et al. Bernal alleges multiple violations of the California Labor Code, 17 the California Business & Professions Code, and one claim under California Labor Gov. Code § 18 2698 a.k.a. the Private Attorney General Act (“PAGA”) based on violations of other Labor Code 19 provisions. The parties have filed a stipulation with the Court in which they explain a settlement 20 has been reached and request that the Court dismiss all of Plaintiff’s claims and approve the 21 settlement for purposes of PAGA. 22 In relevant part, the parties represent that they signed a non-PAGA settlement agreement 23 whereby all of Plaintiff’s individual claims (be they alleged, known, or undiscovered) have settled 24 for approximately $25,000.00, inclusive of attorney’s fees. See Doc. No. 14. No payment of any 25 kind appears to have been agreed with respect to the PAGA cause of action. However, the parties 26 state that Plaintiff has agreed to waive her ability to recover in her capacity as an affected 27 employee under PAGA. See id. The parties request that the Court approve the settlement, dismiss 28 1 Plaintiff’s PAGA claim with prejudice with respect to her individual capacity as an affected 2 employee, and dismiss the PAGA claims of all other potential claimants without prejudice. See 3 id. 4 PAGA actions are in the nature of qui tam claims in which a private party acts as a proxy 5 for the State of California. Sakkab v. Luxottica Retail N. Am., 803 F.3d 425, 435-36 (9th Cir. 6 2015). In relevant part, PAGA requires that a court “review and approve any settlement of any 7 civil action filed pursuant to [Cal. Labor Code § 2699].” Cal. Lab. Code § 2699(l)(2). Federal 8 District Courts often review PAGA settlements for approval. E.g. Eisenacher v. Vitas Hospice 9 Servs., 2021 U.S. Dist. LEXIS 65065 (N.D. Cal. Apr. 2, 2021); Maciel v. Bar 20 Dairy, LLC, 10 2020 U.S. Dist. LEXIS 156961 (E.D. Cal. Aug. 28, 2020); Callahan v. Brookdale Senior Living 11 Communities, 2020 U.S. Dist. LEXIS 153378 (C.D. Cal. May 20, 2020); Hudson v. Libre Tech. 12 Inc., 2020 U.S. Dist. LEXIS 84576 (S.D. Cal. May 12, 2020). However, there is no established 13 standard for evaluating PAGA settlements. Mejia v. Walgreen Co., 2021 U.S. Dist. LEXIS 14 56150, *8 n.3 (E.D. Cal. Mar. 23, 2021); Eisenacher, 2021 U.S. Dist. LEXIS 65065 at *4; Maciel, 15 2020 U.S. Dist. LEXIS 156961 at * 13. 16 Here, despite the parties’ stipulation, it does not appear to the Court that the PAGA claims 17 have been “settled” as that term is traditionally understood. There is no payment provided for the 18 PAGA cause of action and there are no meaningful terms that address PAGA other than to dismiss 19 the cause of action without prejudice as to all potential claimants except Plaintiff. What the 20 parties have addressed is merely Plaintiff’s ability to recover based on her status as an aggrieved 21 employee, i.e. an individual capacity matter. Therefore, it appears that what has happened is that 22 Plaintiff and Defendant have agreed to settle all of the numerous individual claims alleged or 23 potentially possessed by Plaintiff, and as a result, Plaintiff wants to completely end this case and 24 no longer act as California’s proxy for the PAGA claim. In other words, the stipulation is actually 25 a request that the Court utilize § 2699(l)(2) to permit Plaintiff to dismiss her PAGA cause of 26 action (without prejudice to all other potential PAGA claimants) in the absence of any recovery or 27 any substantive terms relating to PAGA and in light of the actual settlement of the remainder of 28 Plaintiff’s individual claims. 1 There is nothing inappropriate about Plaintiff settling her non-PAGA individual claims. 2 | Further, the Court is unaware of any requirement that an unwilling Plaintiff continue to maintain a 3 |PAGA claim or of any prohibition against a party simply dismissing lawsuits that include PAGA 4 |claims pursuant to Rule 41(a) in the absence of a settlement that substantively addresses a PAGA 5 of action. Nevertheless, the parties’ stipulation cites no relevant case law in which a court 6 | has indicated that it is required to view the settlement of all private claims and the essential 7 | abandonment of a PAGA claim without any recovery as a “PAGA settlement” for purposes of § 8 |2699(/)(2). Cf. Reyes-Aguilar v. Wells Fargo Bank, N.A., 2020 U.S. Dist. LEXIS 199973, *2 n.1 9 | (finding that approval of a settlement under § 2699(/)(2) was unnecessary where the plaintiff had 10 | stipulated that she had no valid PAGA claim). In the absence of authority and additional 11 | explanation/information from the parties, the Court will not grant the parties’ stipulated request to 12 approve the settlement. Simply put, it does not appear that there is actually a settlement of a 13 |PAGA cause of action as envisioned by § 2699(/)(2); there is merely the settlement of all potential 14 | individual capacity claims and a desire to dismiss the entire case. 15 16 ORDER 17 Accordingly, IT IS HEREBY ORDERED that: 18 } 1. The parties’ stipulated request for approval of a purported PAGA settlement (Doc. No. 17) 19 is DENIED without prejudice; 20 The parties may file an additional stipulated request for approval of a settlement that is 21 supported by relevant authority and that addresses the Court’s concerns as expressed 22 above.! 23 IT IS SO ORDERED. 95 | Dated: _ May 5, 2021 □□ 7 S □ Z Cb Led — SENIOR DISTRICT JUDGE 26 27 2g |! If this case has truly settled, and if a Rule 41(a) dismissal appears appropriate, the parties remain free to file a stipulation for dismissal under Rule 41(a). 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28