Judge: Andrew E. Cooper, Case: 22STCV37123, Date: 2025-02-10 Tentative Ruling

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Case Number: 22STCV37123    Hearing Date: February 10, 2025    Dept: F51

LOS ANGELES SUPERIOR COURT

NORTH VALLEY DISTRICT

DEPARTMENT F-51

MOTION FOR APPROVAL OF PAGA SETTLEMENT

Motion Filed: 1/7/25

MOVING PARTY: Plaintiff Guillermina Monroy, individually and on behalf of all other aggrieved employees (“Plaintiff”)

RESPONDING PARTY: None

NOTICE: OK

RELIEF REQUESTED: An order and judgment approving the parties’ Private Attorneys’ General Act (“PAGA”) settlement pursuant to the California Labor Code section 2699(a)(2).

TENTATIVE RULING: The unopposed motion is granted.

BACKGROUND 

 This is an employment action in which Plaintiff alleges wage-and-hour Labor Code violations against Defendants. On 11/22/22, Plaintiff filed her class action complaint, alleging against five named Defendants the following causes of action: (1) Failure to Pay Overtime; (2) Failure to Provide Meal and Rest Periods; (3) Failure to Provide Accurate Itemized Wage Statements; (4) Civil Penalties Pursuant to Labor Code Private Attorneys General Act of 2004; and (5) Unlawful, Unfair and Fraudulent Business Practices.

On 3/13/23, the parties entered into a stipulation and order to submit Plaintiff’s individual claims to binding arbitration, dismiss Plaintiff’s class claims, and proceed with litigating Plaintiff’s representative PAGA claim. On 11/8/23, Defendants filed their answers to Plaintiff’s complaint.

On 6/5/24, the parties participated in mediation, and subsequently drafted and negotiated a long-form settlement agreement. (Decl. of Alexei Kuchinsky ¶ 9.) On 1/7/25, Plaintiff filed the instant motion. No opposition has been filed to date.

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ANALYSIS

Labor Code section 2699, subdivision (s)(2) states:¿“The superior court shall review and approve any settlement of any civil action filed pursuant to this part. The proposed settlement shall be submitted to the agency at the same time that it is submitted to the court.” (Lab. Code § 2699, subd. (s)(2).) “A copy of the superior court’s judgment in any civil action filed pursuant to this part and any other order in that action that either provides for or denies an award of civil penalties under this code shall be submitted to the agency within 10 days after entry of the judgment or order.” (Id. at subd. (s)(3).)

While PAGA requires court review and approval of settlements, it does not specify the standard or criteria for such review. (Moniz v. Adecco USA, Inc. (2021) 72 Cal.App.5th 56, 75.) Thus, courts have generally applied the same review standards used for class actions, which inquire “independently whether a PAGA settlement is fair and reasonable.” (Id. at 77.) To determine if a PAGA settlement is fair and reasonable, courts consider factors “including the strength of the plaintiff’s case, the risk, the stage of the proceeding, the complexity and likely duration of further litigation, and the settlement amount.” (Ibid.) Lastly, courts will also consider if the settlement is “adequate in view of PAGA’s purposes to remediate present labor law violations, deter future ones, and to maximize enforcement of state labor laws.” (Ibid.)

In this case, Defendants have agreed to settle the present matter with Plaintiff for the gross amount of $125,000.00. (Ex. 3 to Kuchinsky Decl., p. 4, § 3.1.) From this, the following would be deducted: attorney fees ($41,666.67 or one-third of gross settlement amount); litigation expenses ($2,457.35); settlement administration costs ($2,650.00); and a representative enhancement award ($5,000.00). (Kuchinsky Decl. ¶ 15.) This leaves a net settlement amount of $67,333.33. “It is estimated that Defendant will pay a total of $73,225.98 as civil penalties recoverable under the PAGA, Labor Code section 2698 et seq. $54,919.49 or 75% of this sum shall be distributed to the LWDA and $18,306.50 or 25% to the PAGA Settlement Members.” (Ibid.)

A.    Civil Penalties

Here, Plaintiff seeks civil penalties for four different violations of the Labor Code: (1) Failure to Pay Overtime (Cal. Lab. Code §§510, 558 and Wage Order No. 9); (2) Failure to Provide Meal Periods (Cal. Lab. Code §§512, 558 And Wage Order No. 4); (3) Failure to Provide Rest Periods (Cal. Lab. Code §§512, 558 and Wage Order No. 4); and (4) Failure to Provide Accurate Wage Statements (Cal. Lab. Code §§226 (a) and Wage Order No. 4). (Compl. ¶¶ 56–102.)

In analyzing the strengths, risks, and complexity of this case, Plaintiff’s counsel believes there is sufficient evidence to support the allegations that Defendants violated the Labor Code. (Kuchinsky Decl. ¶¶ 25–36.) Plaintiff’s counsel estimates the total value of all stacked civil penalties are $867,750.00, including $173,550.00 for failure to pay overtime wages, $173,550.00 for failure to provide compliant meal periods; $173,550.00 for failure to provide compliant rest periods, and $347,100.00 for failure to provide compliant wage statements. (Id. at ¶ 22.) Realistically, Plaintiff’s counsel estimates the total value of the civil penalties would be reduced to $188,822.00. (Ibid.)

Ultimately, the Court finds that the civil penalties agreed upon are fair and reasonable. While the total award is only 21% of the maximum amount of civil penalties available, this amount takes into account the legal issues in this case and the risk to the parties in proceeding.

B.     Attorney Fees and Costs

Pursuant to Labor Code section 2699, an employee who prevails in a PAGA action is entitled to an award of attorney fees and costs. (Lab. Code § 2699, subd. (k)(1).) Here, Plaintiff requests attorney fees in the amount of $41,666.67 (one-third of gross settlement amount) and litigation costs in the amount of $2,457.35. (Kuchinsky Decl. ¶ 15.) In support of this request, Plaintiff’s counsel provides a declaration outlining counsel’s experience and qualifications. (Id. at ¶¶ 40–53.) Crawford’s counsel also provided an overview of the work performed by counsel in the present action. (Ibid.) Considering counsel’s experience and work performed as well as the contingent risk borne by counsel, the requested attorney fees are fair and reasonable. Plaintiff’s requested litigation costs also appear to be proper. (Ex. 5 to Kuchinsky Decl.; Decl. of Matthew S. Parnet ¶ 30.) Thus, the requested award of attorney fees and costs is granted.

C.    Representative Enhancement Award

While a plaintiff may receive reasonable enhancement payments as a class representative, courts must balance such an award between the interests of compensating the plaintiff for the expense or risk they incurred in bringing the suit while avoiding creating a perverse incentive for the plaintiff to accept suboptimal settlements in exchange for a higher enhancement payment. (Munoz v. BCI Coca-Cola Bottling Co. of Los Angeles (2010) 186 Cal.App.4th 399, 412.)

Here, the settlement agreement awards Plaintiff a general release fee of $5,000.00. (Ex. 3 to Kuchinsky Decl., p. 5, § 3.2.1.) In support of this request, Plaintiff submitted a declaration outlining her involvement in the present action. (Decl. of Guillermina Monroy, ¶¶ 3–9.) Considering Plaintiff’s involvement and the risks taken, the Court finds that a representative enhancement award of $5,000.00 is reasonable.

D.    Settlement Administration Costs

Plaintiff requests $2,650.00 to be set aside for settlement claims administration costs. (Kuchinsky Decl. ¶ 15.) The parties have agreed to retain Phoenix Class Action Administration Solutions as the settlement administrator. (Kuchinsky Decl. ¶ 19.) This allocation appears fair and reasonable. 

CONCLUSION 

The unopposed motion is granted.