Flores v. Dart Container Corporation ( 2021 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 ----oo0oo---- 11 12 ANGELA FLORES, individually and No. 2:19-cv-00083 WBS JDP on behalf of other similarly 13 situated current and former employees, 14 MEMORANDUM AND ORDER RE: Plaintiff, MOTION FOR FINAL APPROVAL OF 15 CLASS ACTION SETTLEMENT AND v. MOTION FOR ATTORNEYS’ FEES, 16 COSTS, AND REPRESENTATIVE DART CONTAINER CORPORATION, a SERVICE PAYMENT 17 Nevada corporation; DART CONTAINER CORPORATION OF 18 CALIFORNIA, a Michigan corporation; and DOES 1-100, 19 inclusive, 20 Defendants. 21 22 ----oo0oo---- 23 Plaintiff Angela Flores, individually and on behalf of 24 all other similarly situated employees, brought this putative 25 class action against defendants Dart Container Corporation and 26 Dart Container Corporation of California (collectively, 27 “defendants”), alleging violations of the California Labor Code, 28 Cal. Lab. Code §§ 201-203, 226, 218, 233, 246, the California 1 Business and Professions Code, Cal. Bus. Prof. Code § 17200, and 2 the California Private Attorneys General Act of 2004 (“PAGA”), 3 Cal. Lab. Code § 2698, et seq. (See First Am. Compl. (“FAC”) 4 (Docket No. 23).) On January 12, 2021, the court granted 5 plaintiff’s unopposed motion for preliminary approval of class 6 action settlement. (See Order Granting Preliminary Approval 7 (Docket No. 38).) Plaintiff now moves unopposed for final 8 approval of the parties’ class action settlement and attorneys’ 9 fees, costs, and a class representative service payment. (See 10 Docket Nos. 39-40.) 11 I. Discussion1 12 The Ninth Circuit has declared a strong judicial policy 13 favoring settlement of class actions. Class Plaintiffs v. City 14 of Seattle, 955 F.2d 1268, 1276 (9th Cir. 1992); see also 15 Rodriguez v. W. Publ’g Corp., 563 F.3d 948, 965 (9th Cir. 2009) 16 (“We put a good deal of stock in the product of an arms-length, 17 non-collusive, negotiated resolution[.]”) (citation omitted). 18 Rule 23(e) provides that “[t]he claims, issues, or defenses of a 19 certified class may be settled . . . only with the court’s 20 approval.” Fed. R. Civ. P. 23(e). 21 “Approval under 23(e) involves a two-step process in 22 which the Court first determines whether a proposed class action 23 settlement deserves preliminary approval and then, after notice 24 is given to class members, whether final approval is warranted.” 25 26 1 The court already recited the factual and procedural background in its order granting plaintiff’s unopposed motion for 27 preliminary approval of the class action settlement. (See Order Granting Preliminary Approval at 2-5.) Accordingly, the court 28 will refrain from doing so again. 1 Nat’l Rural Telecomms. Coop. v. DIRECTV, Inc., 221 F.R.D. 523, 2 525 (C.D. Cal. 2004) (citing Manual for Complex Litig. (Third), 3 § 30.41 (1995)). This court satisfied step one by granting 4 plaintiff’s unopposed motion for preliminary approval of class 5 action settlement on January 12, 2021. (Docket No. 38.) Now, 6 following notice to the class members, the court will consider 7 whether final approval is merited by evaluating: (1) the 8 treatment of this litigation as a class action and (2) the terms 9 of the settlement. See Diaz v. Tr. Territory of Pac. Islands, 10 876 F.2d 1401, 1408 (9th Cir. 1989). 11 A. Class Certification 12 A class action will be certified only if it meets the 13 requirements of Rule 23(a)’s four prerequisites and fits within 14 one of Rule 23(b)’s three subdivisions. Fed. R. Civ. P. 23(a)- 15 (b). Although a district court has discretion in determining 16 whether the moving party has satisfied each Rule 23 requirement, 17 the court must conduct a rigorous inquiry before certifying a 18 class. See Califano v. Yamasaki, 442 U.S. 682, 701 (1979); Gen. 19 Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 161 (1982). 20 1. Rule 23(a) 21 Rule 23(a) restricts class actions to cases where: (1) the class is so numerous that joinder of all 22 members is impracticable; (2) there are questions 23 of law or fact common to the class; (3) the claims or defenses of the representative parties are 24 typical of the claims or defenses of the class; and (4) the representative parties will fairly and 25 adequately protect the interests of the class. 26 Fed. R. Civ. P. 23(a). These requirements are commonly referred 27 to as numerosity, commonality, typicality, and adequacy of 28 1 representation. In the court’s order granting preliminary 2 approval of the settlement, the court found that the putative 3 class satisfied the Rule 23(a) requirements. (See Order Granting 4 Preliminary Approval at 5-15.) The court is unaware of any 5 changes that would affect its conclusion that the putative class 6 satisfies the Rule 23(a) requirements, and the parties have not 7 indicated that they are aware of any such developments. (Mot. 8 for Final Approval at 8-11.) The court therefore finds that the 9 class definition proposed by plaintiff meets the requirements of 10 Rule 23(a). 11 2. Rule 23(b) 12 An action that meets all the prerequisites of Rule 13 23(a) may be certified as a class action only if it also 14 satisfies the requirements of one of the three subdivisions of 15 Rule 23(b). Leyva v. Medline Indus. Inc., 716 F.3d 510, 512 (9th 16 Cir. 2013). In its order granting preliminary approval of the 17 settlement, the court found that both the predominance and 18 superiority prerequisites of Rule 23(b)(3) were satisfied. 19 (Order Granting Preliminary Approval at 16-21.) Given counsel’s 20 representations that no class members in the Alvarado action, 21 Alvarado v. Dart Container Corp. of California, Riverside 22 Superior Court No. RIC1211707, opted out of the settlement before 23 the Riverside Superior Court granted final approval of the 24 settlement, and that class members in this case were adequately 25 informed of the existence of the Prado matter, Prado v. Dart 26 Container Corporation of California, et al., Santa Clara Superior 27 Court No. No. 18CV336217, and that remaining a member of the 28 class could affect their ability to pursue claims as part of the 1 Prado class, as discussed further below, the court remains 2 satisfied that a class action is superior to other methods of 3 fairly and adjudicating the controversy between the parties in 4 this case under Rule 23(b)(3). The court is unaware of any 5 changes that would affect its conclusion that Rule 23(b)(3) is 6 satisfied. Because the settlement class satisfies both Rule 7 23(a) and 23(b)(3), the court will grant final class 8 certification of this action. 9 3. Rule 23(c)(2) Notice Requirements 10 If the court certifies a class under Rule 23(b)(3), it 11 “must direct to class members the best notice that is practicable 12 under the circumstances, including individual notice to all 13 members who can be identified through reasonable effort.” Fed. 14 R. Civ. P. 23(c)(2)(B). Rule 23(c)(2) governs both the form and 15 content of a proposed notice. See Ravens v. Iftikar, 174 F.R.D. 16 651, 658 (N.D. Cal. 1997) (citing Eisen v. Carlisle & Jacquelin, 17 417 U.S. 156, 172–77 (1974)). Although that notice must be 18 “reasonably certain to inform the absent members of the plaintiff 19 class,” actual notice is not required. Silber v. Mabon, 18 F.3d 20 1449, 1454 (9th Cir. 1994) (citation omitted). 21 The parties selected Phoenix Settlement Administrators 22 (“PSA”) to serve as the Settlement Administrator. (Decl. of 23 Taylor Mitzner in Supp. of Final Approval (“Mitzner Decl.”) ¶¶ 1- 24 2 (Docket No. 39-4).) Defendants timely provided PSA with the 25 class list, including the class members’ first and last names, 26 social security numbers, last known mailing addresses, telephone 27 numbers, hire and termination dates, and relevant sub-class 28 1 information during the class period.2 (Id. at ¶¶ 3-4.) PSA 2 mailed (on behalf of defendants) notice that included all 3 applicable court documents in this matter to the state Attorney 4 Generals of the four states in which class members reside and to 5 the United States Attorney General, as required by the Class 6 Action Fairness Act. (Id. at ¶ 5); see also 28 U.S.C. § 1715(a). 7 PSA refined class members’ contact information by 8 conducting a United States Postal Service National Change of 9 Address Database search. (Id. at ¶ 6.) Notice packets were 10 mailed to all 612 class members by First Class Mail on February 11 10, 2021. (Id. at ¶ 8.) Sixteen notices were returned to PSA as 12 undeliverable, with no forwarding address. (Id. at ¶ 9.) PSA 13 was able to locate mailing addresses for the 16 class members by 14 performing a TransUnion TLOxp skip trace search. (Id.) PSA 15 promptly re-mailed notice packets to those 16 class members using 16 the new addresses. (Id.) None of those notices were returned as 17 undeliverable; as of the date of this Order, PSA represents that 18 zero notices are considered undeliverable. (Id. at ¶ 10.) 19 The notice packet mailed to class members contained, 20 among other things, a description of the case; the terms of the 21 Settlement Agreement, including the total settlement amount and 22 how it will be allocated; information about plaintiff’s 23 24 2 Plaintiff originally anticipated there would be 423 Non-Exempt Wage Statement Class Members, 502 Sick Pay Class 25 Members, and 131 Former Employee Sub-Class Members identifiable from defendants’ records. (See Order Granting Preliminary 26 Approval at 3.) Following the preliminary approval motion, 27 defendants confirmed 422 Non-Exempt Wage Statement Class Members, 501 Sick Pay Class Members, and 131 Former Employee Sub-Class 28 Members. (Mitzner Decl. ¶ 4.) 1 attorneys’ fees; the procedures for requesting exclusion from the 2 settlement or objecting to the settlement; an estimate of the 3 individual class members’ share; and notice that Flores settled 4 her individual FEHA claims with defendants for a separate, 5 confidential amount. (See Mitzner Decl., Ex. B.) The notice 6 also informed class members of the parallel class action, Prado 7 v. Dart Container Corporation of California, et al., Santa Clara 8 County Superior Court Case No. 18CV336217, that some of their 9 claims may overlap with the claims alleged in Prado, and that, to 10 the extent any claims overlap, they will be resolved with the 11 class claims in this action if the class member remains a member 12 of the class. (See id.) 13 The deadline to request exclusion from the settlement 14 has passed without any class member opting out, objecting, or 15 disputing his or her calculated number of workweeks. (Id. at 16 ¶¶ 11-13.) 17 “Notice is satisfactory if it ‘generally describes the 18 terms of the settlement in sufficient detail to alert those with 19 adverse viewpoints to investigate and to come forward and be 20 heard.’” Churchill Vill., L.L.C. v. Gen. Elec., 361 F.3d 566, 21 575 (9th Cir. 2004) (quoting Mendoza v. Tucson Sch. Dist. No. 1, 22 623 F.2d 1338, 1352 (9th Cir. 1980)). The notice identifies the 23 parties, explains the nature of the proceedings, defines the 24 class, provides the terms of the settlement, and explains the 25 procedure for objecting or opting out of the class. (Mitzner 26 Decl., Ex. B.) The notice also explains how class members’ 27 individual settlement awards will be calculated and the amount 28 that class members can expect to receive. (Id.) Accordingly, 1 the notice complies with Rule 23(c)(2)(B)’s requirements. 2 B. Rule 23(e): Fairness, Adequacy, and Reasonableness of Proposed Settlement 3 4 Having determined that class treatment is warranted, 5 the court must now address whether the terms of the parties’ 6 settlement appear fair, adequate, and reasonable. See Fed. R. 7 Civ. P. 23(e)(2). To determine the fairness, adequacy, and 8 reasonableness of the agreement, Rule 23(e) requires the court to 9 consider four factors: “(1) the class representatives and class 10 counsel have adequately represented the class; (2) the proposal 11 was negotiated at arm's length; (3) the relief provided for the 12 class is adequate; and (4) the proposal treats class members 13 equitably relative to each other.” Id. The Ninth Circuit has 14 also identified eight additional factors the court may consider, 15 many of which overlap substantially with Rule 23(e)’s four 16 factors: The strength of the plaintiff’s case; the risk, 17 expense, complexity, and likely duration of further litigation; the risk of maintaining class 18 action status throughout the trial; the amount offered in settlement; the extent of discovery 19 completed and the stage of the proceedings; the experience and views of counsel; the presence of 20 a governmental participant; and the reaction of the class members to the proposed settlement. 21 22 Hanlon v. Chrysler Corp., 150 F.3d 1011, 1026 (9th Cir. 1998).3 23 3 Because claims under PAGA are “a type of qui tam action” in which an employee brings a claim as an agent or proxy 24 of the state’s labor law enforcement agencies, the court must also “review and approve” settlement of plaintiff’s and other 25 class members’ PAGA claims along with their class claims. See Cal. Lab. Code § 2669(k)(2); Sakkab v. Luxottica Retail N. Am., 26 Inc., 803 F.3d 425, 435-36 (9th Cir. 2015). 27 Though “[the] PAGA does not establish a standard for evaluating PAGA settlements,” Rodriguez, 2019 WL 331159 at *4 28 (citing Smith v. H.F.D. No. 55, Inc., No. 2:15-CV-01293 KJM KJN, 1 1. Adequate Representation 2 The court must first consider whether “the class 3 representatives and class counsel have adequately represented the 4 class.” Fed. R. Civ. P. 23(e)(2)(A). This analysis is 5 “redundant of the requirements of Rule 23(a)(4) . . . .” Hudson 6 v. Libre Tech., Inc., No. 3:18-cv-1371-GPC-KSC, 2020 WL 2467060, 7 at *5 (S.D. Cal. May 13, 2020) (quoting Rubenstein, 4 Newberg on 8 Class Actions § 13:48 (5th ed.)) see also In re GSE Bonds Antitr. 9 Litig., 414 F. Supp. 3d 686, 701 (S.D.N.Y. 2019) (noting 10 similarity of inquiry under Rule 23(a)(4) and Rule 23(e)(2)(A)). 11 Because the Court has found that the proposed class 12 satisfies Rule 23(a)(4) for purposes of class certification, the 13 adequacy factor under Rule 23(e)(2)(A) is also met. See Hudson, 14 2020 WL 2467060, at *5. 15 2. Negotiation of the Settlement Agreement 16 Counsel for both sides appear to have diligently 17 pursued settlement after thoughtfully considering the strength of 18 their arguments and potential defenses. The parties participated 19 in an arms-length mediation before an experienced employment 20 litigation mediator, Kim Deck, Esq., on August 31, 2020, 21 ultimately agreeing to the mediator’s proposal and executing a 22 23 2018 WL 1899912, at *2 (E.D. Cal. Apr. 20, 2018)), a number of district courts have applied the eight Hanlon factors, listed 24 above, to evaluate PAGA settlements. See, e.g., Smith, 2018 WL 1899912, at *2; Ramirez, 2017 WL 3670794, at *3; O’Connor v. Uber 25 Techs., 201 F. Supp. 3d 1110, 1134 (N.D. Cal. 2016). “Many of these factors are not unique to class action lawsuits and bear on 26 whether a settlement is fair and has been reached through an 27 adequate adversarial process.” See Ramirez, 2017 WL 3670794, at *3. Thus, the court finds that these factors will also govern 28 its review of the PAGA settlement. See id. 1 Memorandum of Understanding to memorialize the agreement at the 2 close of the full-day mediation. (Decl. of Jenny D. Baysinger in 3 Support of Motion for Final Approval (“Baysinger Decl.”) ¶¶ 33-37 4 (Docket No. 39-2).) Given the sophistication and experience of 5 plaintiff’s counsel and the parties’ representation that the 6 settlement reached was the product of arms-length bargaining, the 7 court does not question that the proposed settlement is in the 8 best interest of the class. See Fraley v. Facebook, Inc., 966 F. 9 Supp. 2d 939, 942 (N.D. Cal. 2013) (holding that a settlement 10 reached after informed negotiations “is entitled to a degree of 11 deference as the private consensual decision of the parties” 12 (citing Hanlon, 150 F.3d at 1027)). 13 3. Adequate Relief 14 In determining whether a settlement agreement provides 15 adequate relief for the class, the court must “take into account 16 (i) the costs, risks, and delay of trial and appeal; (ii) the 17 effectiveness of any proposed method of distributing relief to 18 the class, including the method of processing class-member 19 claims; (iii) the terms of any proposed award of attorney's fees, 20 including timing of payment; and (iv) any [other] agreement[s]” 21 made in connection with the proposal. See Fed. R. Civ. P. 22 23(e)(2)(C); Baker v. SeaWorld Entm’t, Inc., No. 14-cv-02129-MMA- 23 AGS, 2020 WL 4260712, at *6-8 (S.D. Cal. Jul. 24, 2020). 24 The court notes that, in evaluating whether the 25 settlement provides adequate relief, it must consider 26 several of the same factors as outlined in Hanlon, 27 including the strength of the plaintiff’s case, the risk, 28 expense, complexity, and likely duration of further 1 litigation, the risk of maintaining class action status 2 throughout the trial, and the amount offered in settlement. 3 See Hanlon, 150 F.3d at 1026. 4 In determining whether a settlement agreement is 5 substantively fair to class members, the court must balance 6 the value of expected recovery against the value of the 7 settlement offer. See In re Tableware Antitrust Litig., 8 484 F. Supp. 2d 1078, 1080 (N.D. Cal. 2007). Here, 9 plaintiff’s counsel estimates that the portion of the 10 Maximum Settlement Amount (“MSA”) allocated to class 11 claims, $396,000, represents 34.6% of the class’ maximum 12 recovery. (Baysinger Decl. ¶¶ 45-61.) Given that 100% 13 success in litigation is uncommon, and based on defendants’ 14 contentions that (1) a California court decision could come 15 down holding that redeemed sick pay cannot underscore a 16 waiting time penalty claim under California law; (2) that 17 defendants’ failure to properly calculate and pay redeemed 18 sick leave was not willful; (3) that Flores lacks standing; 19 (4) that the wage statements actually identify a number 20 that corresponds to total hours worked (though not labeled 21 as such); (5) that Flores and the other Non-Exempt Wage 22 Statement Class Members were not injured by any technical 23 omission on the wage statements; and (6) that any 24 omissions/errors were not “knowing and intentional,” class 25 counsel developed a more realistic estimate of what the 26 class could have expected to receive had it proceeded to 27 trial. (Id. at ¶ 62.) Under this more measured approach, 28 counsel estimates that the MSA provides 68.72% of the 1 class’ potential recovery. (Id. at ¶¶ 63-64.) 2 Each Former Employee Sub-Class Member will 3 receive $835.50, in addition to any proportional shares 4 based on the number of pay periods that he/she is entitled 5 to as a member of the Sick Pay Class and/or the Non-Exempt 6 Wage Statement Class. (Baysinger Decl., Ex. A (“Settlement 7 Agreement”) ¶ 32; Mitzner Decl. ¶ 18.) Each Sick Pay Class 8 Member and Non-Exempt Wage Statement Class Members’ 9 compensation has been calculated based on the ratio of the 10 number of pay periods each individual worked during the 11 class period divided by the total number of pay periods 12 worked by all participating class members in each 13 respective sub-class. (See id.) The average distribution 14 to each Sick Pay Class Member is $49.90, and the average 15 distribution to each Non-Exempt Wage Statement Class Member 16 is $259.00. (Mitzner Decl. ¶¶ 16-19; Baysinger Decl. 17 ¶ 69.) The overall average gross settlement payment will 18 be $398.53, and the highest individual gross payment will 19 be $1,268.00. (Id.) 20 Because the amount class members receive is based on 21 the number of workweeks each class member worked for defendants 22 during the period covered by the Settlement Agreement and 23 accounts for the relative strength of each class member’s claim, 24 the court finds that it is an effective method of distributing 25 relief to the class. See Fed. R. Civ. P. 23(e)(2)(C); Baker, 26 2020 WL 4260712, at *6-8. 27 The Settlement Agreement also sets aside $15,000 28 of the common fund for civil penalties under PAGA, $3,750 1 of which will be distributed to class members as part of 2 the NSA. (See Settlement Agreement ¶ 19.) While 3 plaintiff’s counsel remained confident and committed to the 4 merits of plaintiffs’ case throughout litigation, counsel 5 indicates that defendants had legitimate defenses to these 6 claims that risked reducing the amount plaintiff and the 7 class could recover at trial, listed above. (See 8 Baysinger Decl. ¶ 62.) Because the amount of penalties 9 plaintiff would be entitled to under the PAGA depends on 10 how many violations of the California Labor Code defendants 11 committed, these defenses would apply to plaintiff’s PAGA 12 claim to the same extent they apply to plaintiff’s other 13 claims. 14 Plaintiff’s counsel represents that, absent 15 settlement, further litigation--likely including class 16 certification and summary judgment--would be costly, time 17 consuming, and uncertain in outcome. (See id. at ¶ 71.) 18 Defendants would likely appeal any favorable judgment for 19 plaintiff, resulting in further expense and jeopardy for 20 class members. (Id.) Given the strength of plaintiff’s 21 claims and defendants’ potential exposure, as well as the 22 risk, expense, and complexity involved in further 23 litigation, the court is satisfied that the settlement and 24 resulting distribution provides a strong result for the 25 class and is fair to class members, and thereby “falls 26 within the range of possible approval.” See Tableware, 484 27 F. Supp. 2d at 1079. 28 The Settlement Agreement further provides for an award 1 of attorney’s fees totaling 33% of the $396,000 MSA. (See 2 Baysinger Decl. ¶ 92.) If a negotiated class action settlement 3 includes an award of attorney’s fees, then the court “ha[s] an 4 independent obligation to ensure that the award, like the 5 settlement itself, is reasonable, even if the parties have 6 already agreed to an amount.” In re Bluetooth Headset Prods. 7 Liab. Litig., 654 F.3d 935, 941 (9th Cir. 2011). 8 Plaintiff’s counsel has filed a separate motion for 9 attorneys’ fees and costs pursuant to Federal Rule 23(h). (Mot. 10 for Attorneys’ Fees (Docket No. 40-1).) Though the court will 11 address the reasonableness of counsel’s fees in additional detail 12 below, in Section C, the court is satisfied that counsel’s fees 13 are reasonable and support approval of the settlement. 14 In light of all of these considerations, the court 15 finds that Rule 23(e)’s third factor is satisfied. See Fed. R. 16 Civ. P. 23(e)(C). 17 4. Equitable Treatment of Class Members 18 Finally, the court must consider whether the Settlement 19 Agreement “treats class members equitably relative to each 20 other.” See Fed. R. Civ. P. 23(e)(2)(D). In doing so, the Court 21 determines whether the settlement “improperly grant[s] 22 preferential treatment to class representatives or segments of 23 the class.” Hudson, 2020 WL 2467060, at *9 (quoting Tableware, 24 484 F. Supp. at 1079. 25 Here, the Settlement Agreement does not improperly 26 discriminate between any segments of the class. All Non-Exempt 27 Wage Statement Class Members and Sick Pay Class Members are 28 entitled to monetary relief in proportion to the number of 1 compensable workweeks they spent working for defendants, and all 2 Former Employee Sub-Class are equally entitled to monetary relief 3 based on the fact that they are entitled to waiting time 4 penalties. (See Settlement Agreement ¶ 32; Baysinger Decl. ¶¶ 5 48-55.) No class members have objected to the parties’ workweek 6 calculations. (Mitzner Decl. ¶¶ 10-13.) 7 While the Settlement Agreement allows plaintiff to seek 8 an incentive award of $2,500 (Settlement Agreement ¶ 16), 9 plaintiff has submitted additional evidence documenting her time 10 and effort spent on this case, which, as discussed further below, 11 in Section E, has satisfied the court that her additional 12 compensation above other class members is justified. See Hudson, 13 2020 WL 2467060, at *9. The court therefore finds that the 14 Settlement Agreement treats class members equitably. See Fed. R. 15 Civ. P. 23(e)(D). 16 5. Remaining Hanlon Factors 17 In addition to the Hanlon factors already considered as 18 part of the court’s analysis under Rule 23(e)(A)-(D), the court 19 must also take into account “the extent of the discovery 20 completed . . . the presence of government participation, and the 21 reaction of class members to the proposed settlement.” Hanlon, 22 150 F.3d at 1026 23 Through formal and informal discovery, defendants 24 provided a substantial amount of information that appears to have 25 allowed the parties to adequately assess the value of plaintiff’s 26 and the class’ claims. (See Baysinger Decl. ¶¶ 27-29. ) 27 Defendants provided plaintiff with data that showed the 28 approximate size of each sub-class, the number of wage statements 1 issued, the number of pay periods in the PAGA period, hundreds of 2 pages of documents related to defendants’ policies, practices, 3 and procedures, as well as more than 150,000 line items of 4 payroll data relating to 685 individuals between September 25, 5 2015 and August 7, 2020. (Id.) This factor weighs in favor of 6 final approval of the settlement. 7 The seventh Hanlon factor, pertaining to government 8 participation, also weighs in favor of approval. Hanlon, 150 9 F.3d at 1026. Under PAGA, “[t]he proposed settlement [must be] 10 submitted to the [LWDA] at the same time that it is submitted to 11 the court.” Cal. Lab. Code § 2669(k)(2). Here, plaintiff’s 12 counsel provided a copy of the proposed settlement agreement to 13 the LWDA on November 16, 2020. (Baysinger Decl. ¶ 110.) As of 14 the date of this Order, the LWDA has not sought to intervene or 15 otherwise objected to the PAGA settlement. (See id. at ¶ 111.) 16 This factor therefore weights in favor of final approval of the 17 settlement. 18 The eighth Hanlon factor, the reaction of the class 19 members to the proposed settlement, also weighs in favor of final 20 approval. See Hanlon, 150 F.3d at 1026. No class members have 21 objected to or sought to opt out of the settlement. See id. 22 The court therefore finds that the remaining Hanlon 23 factors weigh in favor of preliminary approval of the Settlement 24 Agreement. See Ramirez, 2017 WL 3670794, at *3. 25 In sum, the four factors that the court must evaluate 26 under Rule 23(e) and the eight Hanlon factors, taken as a whole, 27 appear to weigh in favor of the settlement. The court will 28 therefore grant final approval of the Settlement Agreement. 1 C. Attorneys’ Fees 2 Federal Rule of Civil Procedure 23(h) provides, “[i]n a 3 certified class action, the court may award reasonable attorney’s 4 fees and nontaxable costs that are authorized by law or by the 5 parties’ agreement.” Fed. R. Civ. P. 23(h). If a negotiated 6 class action settlement includes an award of attorneys’ fees, 7 that fee award must be evaluated in the overall context of the 8 settlement. Knisley v. Network Assocs., 312 F.3d 1123, 1126 (9th 9 Cir. 2002); Monterrubio v. Best Buy Stores, L.P., 291 F.R.D. 443, 10 455 (E.D. Cal. 2013) (England, J.). The court “ha[s] an 11 independent obligation to ensure that the award, like the 12 settlement itself, is reasonable, even if the parties have 13 already agreed to an amount.” Bluetooth Headset, 654 F.3d at 14 941. 15 “Under the ‘common fund’ doctrine, ‘a litigant or a 16 lawyer who recovers a common fund for the benefit of persons 17 other than himself or his client is entitled to a reasonable 18 [attorneys’] fee from the fund as a whole.’” Staton v. Boeing 19 Co., 327 F.3d 938, 969 (9th Cir. 2003) (quoting Boeing Co. v. Van 20 Gemert, 444 U.S. 472, 478 (1980)). In common fund cases, the 21 district court has discretion to determine the amount of 22 attorneys’ fees to be drawn from the fund by employing either the 23 percentage method or the lodestar method. Id. The court may 24 also use one method as a “cross-check[ ]” upon the other method. 25 See Bluetooth Headset, 654 F.3d at 944. 26 As part of the settlement, the parties agreed to an 27 award of attorneys’ fees of $137,000, which constitutes 33% of 28 the MSA. (Settlement Agreement ¶ 16(v).) Once attorneys’ fees 1 and costs, the plaintiff’s service award, the PAGA allocation, 2 and the estimated costs of settlement have been distributed, an 3 estimated Net Settlement Amount of approximately $243,900 will be 4 distributed to the members of the settlement classes. This works 5 out to an average net share of $835.50 for each Former Employee 6 Sub-Class Member, $49.90 for each Sick Pay Class Member, and 7 $259.00 for each Non-Exempt Wage Statement Class Member. 8 (Settlement Agreement ¶ 32; Mitzner Decl. ¶¶ 16-19; Baysinger 9 Decl. ¶ 69.) Counsel represents that this award represents a 10 “substantial” result for the class that will bring meaningful 11 relief. (Mot. for Attorneys’ Fees and Costs at 9 (Docket No. 40- 12 1); Baysinger Decl. ¶ 46.) A review of wage and hour class 13 action settlements in this district confirms that this appears to 14 be a favorable recovery for class members that will be available 15 without further delay. See, e.g., Cooley v. Indian River Transp. 16 Co., No. 1:18-cv-00491 WBS, 2019 WL 2077029 (E.D. Cal. May 10, 17 2019) (finding that $450.14 recovery per truck driver class 18 member was a “favorable” result); Ontiveros v. Zamora, No. 2:08- 19 cv-00567 WBS DAD, 2014 WL 3057506 (E.D. Cal. July 7, 2014) 20 (observing that an average recovery of $6,000 was “a generous 21 amount” and citing cases approving lower per-class-member 22 averages $601.91 and $1,000.00). 23 Like other complex wage and hour class actions, this 24 case presented both counsel and the class with a risk of no 25 recovery at all. (Baysinger Decl. ¶ 93.) Plaintiff’s counsel 26 represents that, because her firm works on contingency, it 27 sometimes recovers very little to nothing at all, even for cases 28 that may be meritorious, and that the potential costs that must 1 be expended in such cases are often substantial. (See id.) 2 Where counsel do succeed in vindicating statutory and employment 3 rights on behalf of a class of employees, they depend on 4 recovering a reasonable percentage-of-the-fund fee award to 5 enable them to take on similar risks in future cases. (See id.) 6 Plaintiff’s counsel argues that, in light of the strong result 7 and substantial risk taken in this case, a 33% fee, as requested 8 here, is reasonable. 9 The Ninth Circuit has established 25% of the fund as 10 the “benchmark” award that should be given in common fund cases. 11 Six (6) Mexican Workers v. Ariz. Citrus Growers, 904 F.2d 1301, 12 1311 (9th Cir. 1990). As this court recently noted, “a review of 13 California cases . . . reveals that courts usually award 14 attorneys’ fees in the 30-40% range in wage and hour class 15 actions that result in recovery of a common fun[d] under $10 16 million.” Watson v. Tennant Co., No. 2:18-cv-02462 WBS DB, 2020 17 WL 5502318, at *7 (E.D. Cal. Sep. 11, 2020) (awarding 33.33% of 18 settlement fund); see also Osegueda v. N. Cal. Inalliance, No. 19 18-cv-00835 WBS EFB, 2020 WL 4194055, at *16 (E.D. Cal. July 21, 20 2020) (same); Cooley, 2019 WL 2077029, at *20 (fee award of 33% 21 of the common fund in class action alleging missed meal and rest 22 breaks for class of truck drivers). Given that the requested fee 23 is in line with amounts the Ninth Circuit has indicated are 24 reasonable in common fund cases totaling less than $10 million, 25 the court agrees that plaintiff’s counsel’s requested percentage 26 of the common fund is reasonable, especially when viewed in light 27 of the recovery obtained on behalf of class members and the risks 28 undertaken by plaintiff’s counsel in this case. 1 A “lodestar-multiplier” cross-check confirms the 2 reasonableness of the requested award. Plaintiff’s counsel has 3 calculated a lodestar figure in this case of $165,107.45.4 (See 4 Baysinger Decl. ¶ 99.) According to contemporaneous billing logs 5 kept by plaintiff’s counsel, attorneys at her firm have, over the 6 span of almost two and a half years, dedicated 220.65 hours of 7 work to this case.5 (Id. at ¶¶ 97-99.) The firm is highly 8 specialized in wage and hour matters and class action cases, and 9 the firm’s hourly rates have been approved by a number of federal 10 and state courts in California. (Id. at ¶¶ 98; 104-108.) 11 Based on plaintiff’s counsel’s calculated lodestar 12 figure, plaintiff seeks a lodestar multiplier of approximately 13 0.83--in other words, plaintiff’s counsel seeks less than the 14 lodestar cross-check would indicate she and her firm are entitled 15 to. In class actions, “[m]ultipliers can range from 2 to 4 or 16 even higher.” Wershba v. Apple Computer, Inc., 91 Cal. App. 4th 17 224, 255 (2001).6 “Indeed, ‘courts have routinely enhanced the 18 lodestar to reflect the risk of non-payment in common fund 19 cases.’” Vizcaino, 290 F.3d at 1051 (approving fee award where 20 lodestar cross-check resulted in multiplier of 3.65); see also 21 id. at 1052 n.6, appx. (collecting cases and finding that risk 22 4 The court expresses no opinion as to the proper 23 lodestar amount in this case. 24 5 The firm’s hourly rate for partners is $759 per hour. (Baysinger Decl. ¶ 99.) The hourly rate for associates is $368 25 per hour. (Id.) 26 6 Federal courts incorporate California state law on 27 deciding an appropriate multiplier when the claims are brought under California state law. Vizcaino v. Microsoft Corp., 290 28 F.3d 1043, 1047 (9th Cir. 2002). 1 multiplier fell between 1.0 and 4.0 in 83% of cases); In re 2 NASDAQ Market-Makers Antitrust Litig., 187 F.R.D. 465, 489 3 (S.D.N.Y. 1998) (awarding 3.97 multiplier and observing that 4 “[i]n recent years multipliers of between 3 and 4.5 have become 5 more common”). 6 Factors considered in determining the appropriate 7 lodestar multiplier generally include: (1) the risks presented by 8 the contingent nature of the case; (2) the difficulty of the 9 questions involved and the skill requisite to perform the legal 10 service properly; (3) the nature of the opposition; (4) the 11 preclusion of other employment by the attorney from accepting the 12 case; and (5) the result obtained. Ketchum v. Moses, 24 Cal. 4th 13 1122, 1132 (Cal. 2001); Graham v. DaimlerChrysler Corp., 34 Cal. 14 4th 553, 582 (Cal. 2004); Serrano v. Priest, 20 Cal.3d 25, 48-49 15 (Cal. 1977). Given the risks undertaken by plaintiff’s counsel, 16 the defenses likely to be raised by defendant, the strong result 17 for the class, and the fact that courts routinely approve fee 18 awards corresponding with a lodestar of well over 1.0, the court 19 finds that a multiplier of 0.83 is justified this case. See 20 Johnson v. Fujitsu Tech. & Bus. of Am., Inc., No. 16-cv-03698-NC, 21 2018 U.S. Dist. LEXIS 80219, at *20 (N.D. Cal. May 11, 2018) 22 (finding multiplier of 4.37 to be reasonable); In re NCAA Ath. 23 Grant-In-Aid Cap Antitrust Litig., 2017 U.S. Dist. LEXIS 201108, 24 at *21 (N.D. Cal. Dec. 6, 2017) (finding multiplier of 3.66 to be 25 “well within the range of awards in other cases.”). 26 Accordingly, the court finds the requested fees to be 27 reasonable and will approve counsel’s motion for attorneys’ fees. 28 D. Costs 1 “There is no doubt that an attorney who has created a 2 common fund for the benefit of the class is entitled to 3 reimbursement of reasonable litigation expenses from that fund.” 4 In re Heritage Bond Litig., Civ. No. 02-1475, 2005 WL 1594403, at 5 *23 (C.D. Cal. June 10, 2005). The appropriate analysis is 6 whether the particular costs are of the type billed by attorneys 7 to paying clients in the marketplace. Harris v. Marhoefer, 24 8 F.3d 16, 19 (9th Cir. 1994). “Thus, [reimbursement of] 9 reasonable expenses, though greater than taxable costs, may be 10 proper.” Id. at 20. 11 Here, the parties agreed that plaintiff’s counsel shall 12 be entitled to recover reasonable litigation costs, not to exceed 13 $7,500. (Settlement Agreement ¶ 16(iv).) Counsel states that 14 her firm has incurred expenses and costs to date in the amount of 15 $7,618.17. (Baysinger Decl. ¶ 103.) These expenses include 16 filing fees, copy/mailing costs, mediation fees, and expert fees. 17 (Id.) The court finds that these are reasonable litigation 18 expenses, see Heritage, 2005 WL 1594403, at *23, and will 19 therefore grant class counsel’s request for costs up to the 20 amount authorized by the Settlement Agreement, $7,500. 21 E. Representative Service Award 22 “Incentive awards are fairly typical in class action 23 cases.” Rodriguez, 563 F.3d at 958. “[They] are intended to 24 compensate class representatives for work done on behalf of the 25 class, to make up for financial or reputational risk undertaken 26 in bringing the action, and, sometimes, to recognize their 27 willingness to act as a private attorney general.” Id. at 958- 28 59. 1 Nevertheless, the Ninth Circuit has cautioned that 2 “district courts must be vigilant in scrutinizing all incentive 3 awards to determine whether they destroy the adequacy of the 4 class representatives . . . .” Radcliffe v. Experian Info. 5 Solutions, Inc., 715 F.3d 1157, 1164 (9th Cir. 2013). In 6 assessing the reasonableness of incentive payments, the court 7 should consider “the actions the plaintiff has taken to protect 8 the interests of the class, the degree to which the class has 9 benefitted from those actions” and “the amount of time and effort 10 the plaintiff expended in pursuing the litigation.” Staton, 327 11 F.3d at 977 (citation omitted). The court must balance “the 12 number of named plaintiffs receiving incentive payments, the 13 proportion of the payments relative to the settlement amount, and 14 the size of each payment.” Id. 15 In the Ninth Circuit, an incentive award of $5,000 is 16 presumptively reasonable. Davis v. Brown Shoe Co., Inc., No. 17 1:13-01211 LJO BAM, 2015 WL 6697929, at *11 (E.D. Cal. Nov. 3, 18 2015) (citing Harris v. Vector Marketing Corp., No. C-08-5198 19 EMC, 2012 WL 381202, at *7 (N.D. Cal. Feb. 6, 2012) (collecting 20 cases). The single named plaintiff, Angela Flores, seeks an 21 incentive payment of $2,500. (Baysinger Decl. ¶ 90.) Flores 22 represents that she has devoted significant time and resources to 23 the case over a period of three years. (Decl. of Angela Flores 24 (“Flores Decl.”) ¶¶ 13-17 (Docket No. 39-3).) As set forth in 25 her declaration, Flores provided information and assisted counsel 26 in preparing the complaint and responding to discovery. (Id. at 27 ¶¶ 12-13.) She participated in a number of phone calls to 28 discuss the class’ claims and litigation strategy, and 1 participated in the August 31, 2020 mediation via Zoom. (Id.) 2 These efforts by Flores support awarding her with an incentive 3 payment. See Staton, 327 F.3d at 977. 4 Flores also states that she has participated in this 5 litigation as class representative despite the attendant risks to 6 her finances and reputation. Both Flores and her counsel 7 represent that a Google search of “Flores” and “Dart” results in 8 this lawsuit being listed on the first page. (Flores Decl. ¶ 15; 9 Baysinger Decl. ¶ 90.) Future potential employers need only 10 search for Flores and her former employer’s name to learn that 11 she has pursued wage and hour claims against her former employer. 12 (See id.) Flores further declares that she was aware that, had 13 this case not settled and had she not prevailed in this suit, she 14 could have been responsible for defendants’ litigation costs, 15 which likely would have exceeded $25,000. (See Flores Decl. 16 ¶ 16.) The court finds that these risks were real and 17 substantial, and further warrant awarding an incentive payment to 18 Flores for her participation as class representative. See 19 Staton, 327 F.3d at 977. 20 This conclusion is not altered by the fact that Flores 21 has also separately settled her own claims against defendants for 22 sexual harassment, retaliation, and failure to prevent harassment 23 and discrimination under the California Fair Employment and 24 Housing Act (“FEHA”). Though the existence of separate FEHA 25 claims against defendants means that Flores would have been 26 required to put her name on a lawsuit against her former employer 27 regardless of whether she acted as class representative, a class 28 action alleging systemic wage and hour violations necessarily 1 involves a widespread notice campaign that is designed to bring 2 additional attention to the claims at issue. Accordingly, the 3 decision to act as a named plaintiff in a class action carries 4 risks to one’s reputation and future employment prospects that 5 are distinct from those associated with an individual FEHA case. 6 The court therefore finds that awarding Flores with a service 7 payment in this case would still act to incentivize class members 8 to act as named plaintiffs in future class actions, even if those 9 class members have separate, individual claims against their 10 employer. See Staton, 327 F.3d at 977. 11 The court will therefore authorize payment of a $2,500 12 service award. 13 II. Conclusion 14 Based on the foregoing, the court will grant final 15 certification of the settlement class and will approve the 16 settlement set forth in the settlement agreement as fair, 17 reasonable, and adequate. The settlement agreement shall be 18 binding upon all participating class members who did not exclude 19 themselves. 20 IT IS THEREFORE ORDERED that plaintiff’s unopposed 21 motions for final approval of the parties’ class action 22 settlement and attorneys’ fees, costs, and a class representative 23 service payment (Docket Nos. 39-40) be, and the same hereby are, 24 GRANTED. 25 IT IS FURTHER ORDERED THAT: 26 (1) Solely for the purpose of this settlement, and 27 pursuant to Federal Rule of Civil Procedure 23, the court hereby 28 certifies the following class: 1 (a) all current and non-exempt California 2 employees of defendants who were eligible for and used paid sick 3 leave during a workweek when he/she also earned shift 4 differentials, non-discretionary bonuses, commissions, or other 5 remuneration between January 11, 2015 and November 30, 2020 (the 6 “Sick Pay Class”); 7 (b) all Sick Pay Class Members who separated from 8 employment at any time between January 11, 2016 and November 30, 9 2020, and who did not participate in the class action settlement 10 in Alvarado v. Dart Container Corp., Riverside County Superior 11 Court Case No. RIC1211707 (“Former Employee Sub-Class”); and 12 (c) all current and former hourly, nonexempt 13 California employees of defendants who received a wage statement 14 between January 11, 2018 and November 30, 2020, and did not 15 participate in the class action settlement in Alvarado v. Dart 16 Container Corp., Riverside County Superior Court Case No. 17 RIC1211707 (“Non-Exempt Wage Statement Class”); 18 (2) The court appoints the named plaintiff Angela 19 Flores as class representative and finds that she meets the 20 requirements of Rule 23; 21 (3) The court appoints law firm of Mayall Hurley P.C., 22 by and through Jenny D. Basinger and Robert J. Wasserman, as 23 class counsel and finds that it meets the requirements of Rule 24 23; 25 (4) The Settlement Agreement’s plan for class notice is 26 the best notice practicable under the circumstances and satisfies 27 the requirements of due process and Rule 23. The plan is 28 approved and adopted. The notice to the class complies with Rule 1 23(c)(2) and Rule 23(e) and is approved and adopted; 2 (5) The court finds that the parties and their counsel 3 took appropriate efforts to locate and inform all class members 4 of the settlement. Given that no class member filed an objection 5 to the settlement, the court finds that no additional notice to 6 the class is necessary; 7 (6) As of the date of the entry of this order, 8 plaintiff and all class members who have not timely opted out of 9 this settlement herby do and shall be deemed to have fully, 10 finally, and forever released, settled, compromised, 11 relinquished, and discharged defendants of and from any and all 12 settled claims, pursuant to the release provisions stated in the 13 parties’ settlement agreement; 14 (7) Plaintiff’s counsel is entitled to fees in the 15 amount of $137,000, and litigation costs in the amount of $7,500; 16 (8) Phoenix Settlement Administrators is entitled to 17 administration costs in the amount of $8,850; 18 (9) Plaintiff Angela Flores is entitled to an 19 inventive award in the amount of $2,500; 20 (10) $11,250 from the gross settlement amount shall be 21 paid to the California Labor and Workforce Development Agency in 22 satisfaction of defendants’ alleged penalties under the Labor 23 Code Private Attorneys General Act; 24 (11) The remaining settlement funds shall be paid to 25 participating class members in accordance with the terms of the 26 Settlement Agreement; and 27 (12) This action is dismissed with prejudice. However, 28 without affecting the finality of this Order, the court shall 1 retain continuing jurisdiction over the interpretation, 2 implementation, and enforcement of the Settlement Agreement with 3 respect to all parties to this action and their counsel of 4 record. 5 The clerk is instructed to enter judgment accordingly. 6 Dated: May 17, 2021 - ak. WILLIAM B. SHUBB g UNITED STATES DISTRICT JUDGE 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 28