Stonecypher v. Iasco Flight Training, Inc. ( 2021 )

1 Rob Hennig (SBN 174646) rob@employmentattorneyla.com 2 Brandon Ruiz (SBN 264603) brandon@employmentattorneyla.com 3 Dat Tommy Phan (SBN 316813) dat@employmentattorneyla.com 4 HENNIG KRAMER RUIZ & SINGH, LLP 3600 Wilshire Blvd., Suite 1908 5 Los Angeles, CA 90010 Telephone: (213) 310-8301 6 Fax: (213) 310-8302 7 Attorneys for Plaintiff MATTHEW STONECYPHER 8 Michael D. Bruno (SBN 166805) 9 mbruno@grsm.com Joseph P. Breen (SBN 124330) 10 jbreen@grsm.com Natalie B. Fujikawa (SBN 258724) 11 nfujikawa@grsm.com GORDON REES SCULLY MANSUKHANI, LLP 12 275 Battery Street, Suite 2000 San Francisco, CA 94111 13 Telephone: (415) 875-4242 Fax: (415) 986-8054 14 Attorneys for Defendant IASCO FLIGHT TRAINING, INC. 15 16 UNITED STATES DISTRICT COURT 17 EASTERN DISTRICT OF CALIFORNIA 18 19 MATTHEW STONECYPHER, an CASE NO. 2:17-cv-02409-MCE-JDP 20 individual, JOINT STIPULATION AND ORDER 21 Plaintiff, APPROVING PAGA SETTLEMENT AND DISMISSING FIFTH CAUSE OF ACTION 22 v. Judge: Hon. Morrison C. England, Jr. 23 IASCO FLIGHT TRAINING INC., a Courtroom: 7 California corporation, Mag. Judge: Hon. Jeremy D. Peterson 24 Courtroom: 9 Defendant. 25 26 27 28 1 PROCEDURAL HISTORY 2 1) Plaintiff Matthew Stonecypher (“Stonecypher” or “Plaintiff”) filed this action 3 against Defendant IASCO Flight Training, Inc. (“IASCO”), including his allegations under 4 the Private Attorneys General Act, Cal. Lab. Code §§ 2698, et seq. (“PAGA”), on or 5 about November 15, 2017, in the United States District Court for the Eastern District of 6 California (the “Action”). The “Covered Period” for the Action is November 16, 2016 7 through the effective date of this Stipulation. 8 2) On or about November 16, 2017, Plaintiff filed an administrative PAGA 9 complaint (“PAGA Notice”) with the California Labor and Workforce Development 10 Agency (“LWDA”) via online submission and served the PAGA Notice on IASCO via U.S. 11 Certified Mail. 12 3) On October 5, 2018, Plaintiff filed a First Amended Complaint to add 13 Plaintiff’s claim for civil penalties under the PAGA. 14 4) On May 4, 2020, Plaintiff filed a Second Amended Complaint to add claims 15 that had previously been filed with OSHA, but which had been dismissed due to lack of 16 jurisdiction on or about November 22, 2019. 17 5) The Parties participated in a private mediation on March 8, 2021 with the 18 Hon. John Leo Wagner (Ret.), a well-reputed mediator with specific expertise in 19 California employment law, wage and hour actions, as well as PAGA actions. The 20 Parties reached a settlement for Plaintiff’s PAGA claims at mediation (the “Settlement”). 21 6) The Parties understand that the Court must approve the Settlement for it to 22 be binding, and request such approval in this Stipulation. See Lab. Code, § 2699(l)(2) 23 (requiring Court approval for “any penalties sought as a part of a proposed settlement” of 24 a PAGA action on a representative basis); see also Arias v. Superior Court (2009) 46 25 Cal.4th 969 (parties are not obligated to follow class action procedure in PAGA cases 26 and therefore need not obtain approval of the PAGA settlement thorough a motion for 27 preliminary or final approval). Accordingly, the Settlement is contingent upon the 28 1 approval by the Court and shall be void if the Court does not grant the approval 2 requested. 3 7) Plaintiff and Plaintiff’s counsel have diligently pursued an investigation of 4 Plaintiff’s PAGA claim against Defendant. Based on their own independent 5 investigations and evaluations, the Parties and their respective counsel are of the 6 opinion that the amount of consideration and terms set forth in this Settlement are fair, 7 reasonable and adequate and are in the best interests of the Plaintiff, the PAGA 8 aggrieved employees, and Defendant in light of all known facts and circumstances and 9 the risks inherent in litigation, including potential appellate issues. 10 8) The parties reached a Settlement on March 8, 2021 at approximately 7:49 11 p.m., after a full day of mediation with Judge Wagner after accepting his mediator’s 12 proposal including, in pertinent part, that Defendant will pay the total sum of $40,000 to 13 resolve Plaintiff’s PAGA claim. The Parties’ acceptance of Judge Wagner’s mediator’s 14 proposal also resolved Plaintiff’s individual claims asserted in the Action. 15 APPROVAL OF PAGA PENALTIES 16 9) This Settlement meets the various standards for approval required by 17 Labor Code Section 2699(l)(2), which states: “The superior court shall review and 18 approve any settlement of any civil action filed pursuant to this part. The proposed 19 settlement shall be submitted to the agency at the same time that it is submitted to the 20 court.” 21 10) Although there is no dispositive case law establishing a standard for the 22 Court’s review and approval of PAGA penalties, Senator Joseph L. Dunn stated with 23 regard to the Legislature’s intent that, “The purpose of the court review of penalties in 24 subdivision (l) is to ensure that settlements involving penalties arising under Labor Code 25 Section 2699 do not undercut the dual statutory purposes of punishment and deterrence, 26 or result in unjust, arbitrary and oppressive, or confiscatory settlements.” See Senate 27 Daily Journal, 2003-2004 Regular Session, Letter dated July 29, 2004, pp. 4754-55, 28 attached hereto as Exhibit A. 1 11) In the PAGA claim, Plaintiff seeks civil penalties arising from the general 2 allegation that Defendant misclassified Certified Flight Instructors (“CFI”) as exempt 3 employees, and thus failed to pay minimum and overtime wages, provide proper meal 4 and rest breaks, furnish accurate itemized wage statements, and timely pay all wages 5 due and owing upon separation of employment. 6 12) Under the recent California Supreme Court case Z.B., NA v. Superior Court 7 (2019) 8 Cal.5th 175, 241, unpaid wages may not be collected as part of an action under 8 the PAGA for remedies under Cal. Lab. Code § 558. 9 13) Against this backdrop, the parties have agreed to settle Plaintiff’s PAGA 10 claim for the total sum of $40,000. Plaintiff requests that Seven Thousand Six Hundred 11 Dollars ($7,600) be allocated as attorneys’ fees to compensate Plaintiff’s counsel for the 12 time and effort of prosecuting the PAGA claim, and that a maximum of Two Thousand 13 Dollars ($2,000) be allocated to PAGA administration fees, with any excess fees to be 14 distributed to the PAGA aggrieved employees. Of the Thirty Thousand Four Hundred 15 Dollars ($30,400) (the “PAGA Amount”), seventy-five percent (75%) shall be payable to 16 the LWDA in the amount of Twenty-Two Thousand Eight Hundred Dollars ($22,800), and 17 twenty-five percent (25%) shall be payable to the PAGA aggrieved employees in the 18 amount of Seven Thousand Six Hundred Dollars ($7,600). See PAGA Settlement 19 Agreement attached hereto as Exhibit B. 20 14) The PAGA Amount shall be allocated proportionately based upon the total 21 number of workweeks for each aggrieved employee during the period between 22 November 16, 2016, and March 8, 2021 (the “Covered Period”), divided by the total 23 number of weeks worked by all CFIs during the Covered Period. The Parties shall 24 engage a Settlement Administrator to distribute payment to aggrieved employees with an 25 accompanying notice. In the event that any settlement check is not cashed within 180 26 days of the date of payment, the Settlement Administrator will pay such funds, cy pres, 27 to California Rural Legal Assistance. 28 1 15) The proposed PAGA settlement was submitted to the LWDA on June 3, 2 2021 in compliance with Labor Code section 2699(l)(2). See attached Exhibit C. 3 REASONABLE ATTORNEYS’ FEES AND COSTS 4 16) Labor Code section 2699(g)(1) allows for an award of reasonable 5 attorney’s fees and costs to a prevailing plaintiff in an action under the PAGA. Plaintiff 6 requests attorneys’ fees in the amount of $7,600 to compensate Plaintiff’s counsel for 7 the time and expense of litigating Plaintiff’s PAGA claim for nearly 3.5 years, including 8 multiple rounds of discovery, motion practice, and depositions. The scheduling order was 9 amended several times to allow for additional time to conduct discovery. Therefore, the 10 amount of attorneys’ fees sought in connection with Plaintiff’s PAGA claim are 11 reasonable and fair in light of this extensive litigation. 12 Dated: July 1, 2021 Hennig Kramer Ruiz & Singh, LLP 13 14 By:_/s/________________________ Rob Hennig 15 Dat Tommy Phan Attorneys for Plaintiffs 16 17 18 19 Dated: July 1, 2021 Gordon Rees Scully Mansukhani, LLP 20 21 By:__ /s/______________________ 22 Joseph P. Breen Natalie B. Fujikawa 23 Attorneys for Defendant 24 25 26 27 28 1 ORDER 2 Having considered JOINT STIPULATION APPROVING PAGA SETTLEMENT, 3 IT IS HEREBY ORDERED, 4 1. Pursuant to Labor Code § 2699(I)(2), Defendants shall pay $40,000 in civil 5 penalties under the PAGA. 6 2. The Court approves the payment of $2,000 toward the cost of administering 7 the payments to the aggrieved employees under the PAGA; g 3. Pursuant to Labor Code § 2699(g)(1), Defendant shall pay $7,600 in attorneys’ 9 fees and costs to Plaintiff's counsel, Hennig Kramer Ruiz & Singh, LLP; and 10 4. Of the $30,400 PAGA settlement amount, Defendant shall pay 75% (or 11 $22,800) to the State of California and 25% (or $7,600) to the PAGA 12 aggrieved employees. 13 5. Plaintiff's Fifth Cause of Action, only, is hereby dismissed, without prejudice. 14 The case proceeds on Plaintiff's remaining claims. 15 IT |S SO ORDERED. 16 | Dated: July 1, 2021 ly J 17 tp AOA, 18 MORO UNITED ORR T JUDGE 19 20 21 22 23 24 25 26 27 28