Judge Bruce G. Iwasaki, Case 21STCV20904 2023-03-15 Tentative Ruling

Tentative Ruling: The Court grants the motion for final approval of the class action settlement and PAGA settlement.

On June 4, 2021, Plaintiff Alexander Gnaedig filed the Complaint against Defendant Favorite Healthcare Staffing, Inc. (Favorite) under the Private Attorneys General Act (PAGA) for numerous Labor Code violations including failure to pay overtime wages, provide meal/rest periods, and failure to maintain accurate payroll records. On November 18, 2022, the parties stipulated to Plaintiff filing a First Amended Complaint to add in additional individual plaintiffs, Akimasia Walker, Amy Weston, and Janet Clifford.

On July 18, 2022, the Court granted preliminary approval of the class and PAGA settlement. The Gross Settlement Amount was $3,650,000 and after fees, costs, and service awards, the Net Settlement Amount was projected to be $2,173,333.33.

Plaintiffs now move for final approval. The figures are the same, with Plaintiffs now providing a reduced actual litigation costs figure of $27,441.60 (down from the originally expected costs of $40,000), resulting in an increased Net Settlement Amount of $2,185,891.73.

The Court has previously considered the fairness of the settlement through evaluating whether the agreement was the result of arm’s length bargaining, sufficient investigation and discovery, and the experience of counsel. The only remaining factor is the number of objectors.

Since the preliminary approval, the Settlement Administrator, ILYM Group, Inc., mailed out the “Notice of Pendency of Class Action Settlement and Hearing Date for Final Court Approval” to 7,290 class members, of which 557 were returned as undeliverable. (Nava Decl., ¶¶ 7-8.) After performing additional skip traces to locate update addresses, a total of 289 were re-mailed and 268 were undeliverable. (Id. at ¶¶ 8-10.) No objections were received and only one member requested to be excluded. (Id. at ¶¶ 11-12.)[1] Thus, this is a 99.98% representation of the class members. (Id. at ¶ 13.) The average net individual settlement payment is $309.99, with the maximum being $2,492.21. (Id. at ¶ 14.)

Based upon its prior finding that the Settlement was fair, adequate, and reasonable, and given the lack of objections, the Court grants final approval of the settlement.

The Court preliminarily approved one-third of the Gross Settlement Amount and costs not to exceed $40,000.00. The final request is for $1,216,666.67 and a total of $27,441.60 in costs. (Genish Decl., ¶ 43.)

Counsel provides declarations detailing the lodestar amounts for each of Plaintiffs’ firms: $97,829 for Blackstone Law, APC, $227,626 for Graham Hollis, APC, $198,450 for the Shakouri Law Firm, and $150,333 for Schneider Wallace Cottrell Konecky LLP. (Schimmel Decl., ¶ 10; Anderson Decl., ¶ 18; Shakouri Decl., ¶ 21; Konecky Decl., Ex. 2.)

“[W]hen class action litigation establishes a monetary fund for the benefit of the class members, and the trial court in its equitable powers awards class counsel a fee out of that fund, the court may determine the amount of a reasonable fee by choosing an appropriate percentage of the fund created. The recognized advantages of the percentage method—including relative ease of calculation, alignment of incentives between counsel and the class, a better approximation of market conditions in a contingency case, and the encouragement it provides counsel to seek an early settlement and avoid unnecessarily prolonging the litigation [citations]—convince us the percentage method is a valuable tool that should not be denied our trial courts.” (Laffitte v. Robert Half Internat. Inc. (2016) 1 Cal.5th 480, 503.) “[T]rial courts . . . retain the discretion to forgo a lodestar cross-check and use other means to evaluate the reasonableness of a requested percentage fee.” (Id. at p. 506.) However, courts have adopted a practice of cross-checking the lodestar against the value of the class recovery because the award is then “anchored” in the time spent by counsel. (Lealao v. Beneficial California, Inc. (2000) 82 Cal.App.4th 19, 45.) In this case it appears that the one-third of gross settlement calculation of attorney’s fees represents an approximate 1.8 multiplier to lodestar. As discussed below, the Court is satisfied that this is reasonable.

Here, all four of Plaintiffs’ counsel have set forth their extensive experience and actions taken in litigating this case. (Schimmel Decl., ¶¶ 6-7; Anderson Decl., ¶ 4; Shakouri Decl., ¶¶ 3-5; Konecky Decl., ¶¶ 3-15.) A detailed itemization is provided from each firm. The work conducted includes pre-litigation investigation, drafting pleadings, communications between parties, interviews, extensive legal research and analysis, and preparing and hearings. Counsel also obtained a significant monetary recovery for the class, no objections were received, and the average individual settlement is reasonable based on the number of months of liability.

The Court finds that the one-third fee award is consistent with fee awards in class action cases, and the itemized billing entries are reasonable.¿ (See¿Chavez v. Netflix, Inc.¿(2008) 162 Cal.App.4th 43, 66, fn. 11; see also Consumer Privacy Cases (2009) 175 Cal.App.4th 545, 557, n.13 [“ ‘ “Empirical studies show that . . . fee awards in class actions average around one-third of the recovery” ’ ” with 25% being the benchmark]; Alson v. NCAA (In re NCAA Athletic Grant-in-Aid Cap Antitrust Litigation) (9th Cir. 2019) 768 F.App’x 651, 653 [“We have permitted awards of attorney’s fees ranging from 20 to 30 percent of settlement funds, with 25 percent as the benchmark award”].) Accordingly, the fees are reasonable, and the request is granted.

In addition, counsel seeks a total of $27,441.60, representing $5,446.36 from Blackstone Law, APC (Genish Decl., Ex. E), $10,535.92 from Graham Hollis, APC (Anderson Decl., ¶ 22), $4,986 from Shakouri Law Firm (Shakouri Decl., ¶ 22), and $6,473.32 from Schneider Wallace Cottrell Konecky LLP (Konecky Decl., ¶ 17). The preliminary request was for $40,000.00. The request is granted. The declarations and itemized ledger sufficiently justify these costs.

The Court preliminarily approved $30,000.00 for settlement administration costs. Plaintiffs now submit a declaration from Madely Nava, a case manager for ILYM, who attests to the work and incurred costs. (Nava Decl., ¶ 15.) The Court grants the requested amount of $30,000.00.

The Court approves the motion for final approval of class action settlement and PAGA settlement.

[1] The Declaration indicates the deadline to file an objection and to request exclusion was February 18, 2020. The Court will assume this is a typographical error and the correct year should be 2023.