Judge Daniel M. Crowley, Case Number: 22STCV27750, Date: 2024-11-27 Tentative Ruling

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Plaintiff Ferney Pinto Santander’s unopposed motion for an order approving a PAGA Settlement reached in this case is denied, without prejudice.

Plaintiff Ferney Pinto Santander (“Pinto Santander”) (“Plaintiff”) moves unopposed for an order approving the Joint Stipulation of PAGA Representative Action Settlement and Release (“Settlement Agreement”) between Plaintiff on

behalf of himself and as a representative of the State of California on one hand and Defendant JPMorgan Chase Bank, National Association (“JP Morgan Chase”) (“Defendant”) reached in this case. (Notice Motion, pg. 2; Lab. Code §2699(l)(2).)[1]

On November 11, 2024, Non-party Jonathan De La Cerda (“De La Cerda”) filed an amicus brief in this matter after requesting leave of this Court to do so. Plaintiff filed a response to De La Cerda’s amicus brief on November 15, 2024. JP Morgan Chase also filed its response to De La Cerda’s amicus brief on November 15, 2024.

Labor Code §2699(s)(2) provides, as follows: “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 [Labor & Workforce Development Agency (“LWDA”)] at the same time that it is submitted to the court.” (Labor Code §2699(s)(2), emphasis added.)

As a threshold matter, Plaintiff submitted evidence he substantially complied with Labor Code §2699(s)(2). Plaintiff submitted a copy of the Settlement and instant motion to the LWDA on July 3, 2024. (Decl. of Bradley ¶72, Exh. 3.) The statute requires that “[t]he proposed settlement shall be submitted to the agency at the same time that it is submitted to the court,” and the settlement was filed with this Court on August 28, 2024. (See Labor Code §2699(s)(2).) Regardless, the Court considers Plaintiff’s motion to comply with this requirement.

On June 7, 2022, prior to commencing his lawsuit, as required by California Labor Code section 2699.3, Plaintiff provided the LWDA and Defendant with written notice of his intent to assert claims under PAGA and the basis for those claims. (Decl. of Grodan ¶3, Exh. A.) On August 25, 2022, Plaintiff filed the operative complaint against Defendant asserting a single cause of action under PAGA.

On April 15, 2024, before Plaintiff initiated arbitration of his individual claims, the parties engaged in mediation before Michael Dickstein, Esq. (Decl. of Bradley ¶6.) At the conclusion of the mediation, Dickstein issued a “mediator’s proposal” which was accepted by the Parties on April 17, 2024. (Decl. of Bradley ¶8.) After acceptance of the mediator’s proposal, the Parties agreed on the principal terms of a settlement and thereafter executed a memorandum of understanding. (Decl. of Bradley ¶8.) The Settlement Agreement was fully executed on July 3, 2024. (See Decl. of Bradley ¶70, Exh. 1 [“Settlement Agreement”].)

The Settlement defines “Representative Action Member(s)” means all non-exempt employees employed by Defendant in California during the period of June 21, 2021, through Date of Court Approval.” (Settlement Agreement ¶15.) “Estimated Covered PAGA Pay Periods” means the estimated total of 670,802 Covered PAGA Pay Periods at issue between June 21, 2021, and April 15, 2024, provided by Defendant in connection with the execution of the Parties’ Memorandum of Understanding. (Settlement Agreement ¶8.) The definitions are proper pursuant to the statute of limitations and the date of notice to the LWDA.

The Settlement includes a provision, “Release of Claims by Plaintiff, the LWDA, and All Representative Action Members,” which bars Plaintiff, in his individual capacity and as proxy and private attorney general for the State of California, the LWDA, and Representative Action Members from pursuing any action against Defendant for from all claims, demands, rights, obligations, liabilities, actions, and causes of action (including attorneys’ fees and costs) for PAGA civil penalties under the California Labor Code, Industrial Welfare Commission Wage Orders, regulations, and/or any other provisions of law for alleged violations of California Labor Code Sections 200, 204, 203, 226, 227.3, 246, 248, 221, 223, 226, 510, 1174, 1182.11, 1182.12, 1197, 1194, 1198, and 2802, with respect to Representative Action Members during the period from June 21, 2021 through the Date of Court Approval (“Released Claims”).” (Settlement Agreement ¶54.)

De La Cerda objects to this section in the Settlement Agreement on the basis this provision sweeps too broadly and is not limited to claims based on the facts and theories asserted in Plaintiff’s PAGA letter. As the California Supreme Court explained in Turrieta v. Lyft, Inc., PAGA is silent regarding a PAGA plaintiff’s authority to object to a proposed settlement in another PAGA plaintiff’s action. (Turrieta v. Lyft, Inc. (2024) 16 Cal.5th 664, 713.) The Turrieta Court stated,

Courts, in evaluating the adequacy and fairness of proposed PAGA settlements, remain free to exercise discretion to consider arguments and evidence informally offered by plaintiffs pursuing overlapping PAGA claims in separate actions. Indeed, Turrieta and Lyft concede that such plaintiffs may offer objections to courts and that “courts have discretion to consider [those] objections.”

(Id. at pg. 707.) This Court exercises its discretion to consider De La Cerda’s objection. Despite the narrow allegations in Plaintiff’s PAGA letter, ¶54 of the Settlement Agreement purports to release Defendant from all liability for PAGA penalties arising from any violation of Labor Code §2802.

The Court finds the amicus brief’s suggestion to add the following sentence to the end of ¶54 to be in the best interest of Representative Action Members: “Notwithstanding anything in this Paragraph 54 to the contrary, the release of PAGA penalty claims arising from the Settling Defendants’ alleged violations of Labor Code section 2802 is limited to claims based on the facts and theories asserted in Plaintiff’s June 7, 2022 PAGA Letter.” (Amius Brief, pg. 11.)

Accordingly, Plaintiff’s motion for approval of the PAGA Settlement Agreement is denied, without prejudice.

Hon. Daniel M. Crowley

Judge of the Superior Court

[1] The Court notes the Labor Code has been amended, effective July 1, 2024, such that the text and citation included in Plaintiff’s notice of motion, formerly Labor Code §2699(l)(2), has been relabeled Labor Code §2699(s)(2).