Judge Elaine Lu, Case Number: 20STCV41622, Date: 2025-02-05 Tentative Ruling

Judge: Elaine Lu, Case: 20STCV41622, Date: 2025-02-05 Tentative Ruling

Case Number: 20STCV41622 Hearing Date: February 5, 2025 Dept: 9

Final Approval of Class Action Settlement

Department SSC-9

Hon. Elaine Lu

Noriega V. Vista Veranda Village Corp.

Case No.: 20STCV41622

Hearing: February 5, 2025

TENTATIVE RULING

The Parties’ Motion for Final Approval of class action settlement is GRANTED as the settlement is fair, adequate, and reasonable.

The essential terms are:

A. The Gross Settlement Amount (“GSA”) is $175,000, non-reversionary. (¶3.1)

B. The Net Settlement Amount (“Net”) is the GSA minus the following:

o $58,333.33 (33%) for attorney fees to Class Counsel, Aegis Law Firm, PC (¶3.2.2);

o $15,197.47 for litigation costs to Class Counsel, Aegis Law Firm, PC (Ibid.);

o $7,500 for a Service Payment to Named Plaintiff Ruth Noriega (¶3.2.1);

o $6,995 for settlement administration costs to Phoenix Settlement Administrators (¶3.2.3); and

o $15,000 (75% of $20,000 PAGA penalty) to the LWDA and $5,000 (25% of $20,000 PAGA penalty) to Aggrieved Employees. (¶3.2.5)

C. Employer’s share of the payroll taxes on the taxable portion of the settlement payments shall be paid separately from the GSA by Defendant. (¶3.1)

D. Plaintiffs’ release of Defendants from claims described herein.

No later than February 14, 2025, Plaintiff’s counsel shall file a single document that constitutes both a proposed Order and Judgment, consistent with this ruling containing all requisite terms, including the class definition, release language, and a statement of the number and identity of class members who requested exclusion.

By April 4, 2025, Class Counsel must give notice to the class members pursuant to California Rules of Court, Rule 3.771(b) (which may be effected by posting on the Administrator’s website if consistent with the parties’ Class Action Settlement) and to the LWDA, if applicable, pursuant to Labor Code §2699 (1)(3).

By May 11, 2026, Class Counsel must file a Final Report re: Distribution of the settlement funds.

The Court hereby sets a Non-Appearance Case Review for May 18, 2026, 8:30 a.m., Department 9.

BACKGROUND

This is a wage and hour class action. Defendant is a California corporation providing medical services and assisted living facilities.

On October 28, 2020, Plaintiff Ruth Noriega filed this action on behalf of Defendant’s non-exempt employees. Plaintiff alleged the following causes of action in the original Complaint: (1) failure to pay minimum wages; (2) failure to pay overtime wages; (3) failure to provide meal periods; (4) failure to permit rest breaks; (5) failure to provide accurate itemized wage statement; (6) failure to pay all wages due upon separation of employment; (7) failure to reimburse business expenses; and (8) violation of Business and Professions Code §§ 17200, et seq. based on the preceding claims. On May 21, 2021, Plaintiff filed a First Amended Complaint adding a PAGA cause of action.

On October 20, 2022, the Parties attended a full-day mediation session with mediator Marc Feder, where the parties reached a settlement and executed a Memorandum of Understanding with the material terms the parties had agreed to. The Parties spent the next few months negotiating the terms of the Settlement, which was finalized in December of 2022. A fully executed copy of the “Stipulation and Settlement of Class Action Claims” (“Settlement”) is attached to the Declaration of Jessica L. Campbell (“Campbell Decl.”) as Exhibit 1.

On June 14, 2023, the Court issued a checklist of items for counsel to address. In response, on October 5, 2023, counsel filed a fully executed Amended Settlement Agreement (“Amended Settlement”) attached to Declaration of Jamie M. Loos (“Loos Decl.”) as Exhibit 2.

On October 23, 2023, the Court continued Preliminary Approval for Counsel to address the settlement’s escalator clause and class period. In response, on April 23, 2024, Counsel filed a fully executed Second Amended Settlement Agreement attached to Supplemental Declaration of Jamie M. Loos (“Loos Supp. Decl.”). All references below are to this version of the settlement.

The Court granted Preliminary Approval on May 29, 2024. Notice was given to the Class Members as ordered (see Declaration of Yami Burns (“Burns Decl.”).) Now before the Court is the Motion for Final Approval of the proposed class action settlement.

SETTLEMENT CLASS DEFINITION

· “Class” means all current and former non-exempt employees who are or were employed by Defendant in California at any time during the Class Period. (Settlement, ¶1.4)

o “Class Period” means the period from May 1, 2016 through October 30, 2023. (¶1.11)

· “PAGA Group Members” means all current and former non-exempt employees who are or were employed by Defendant in California at any time between May 1, 2019 through October 30, 2023 (“PAGA Period”). (¶1.31)

o The “PAGA Period” is between May 1, 2019, through October 30, 2023. (Ibid.)

· Based on its records, Defendant estimated that, as of the date of the original Settlement Agreement, (1) there were 175 Class Members and 16,206 Total Workweeks during the Class period. If the number of weeks worked by Class Members increased by more than 10% (e.g. if there are more than 17,827 workweeks) as of October 22, 2022, then, at Defendant’s election, either (a) the Gross Settlement Amount will increase in proportion to the percentage by which the actual number of workweeks worked by Class Members during the Class Period exceeds 17,827, or (b) the end date of the Class Period will be adjusted to an earlier date by which the number of workweeks worked by Class Members during the Class Period had not exceeded 17,827. Defendant elected the latter option, thereby adjusting the end date of the Class Period to October 30, 2023. (¶8)

o At Final Approval, the administrator confirms that there are one hundred eighty-nine (189) Class Members who worked a total of seventeen thousand eight hundred (17,800) workweeks during the Class period. The Escalator Clause is triggered only if the total exceeds 17,827 workweeks (a 10% increase). Since this threshold was not met, the Escalator was not triggered. (Supplemental Declaration of Yami Burns, ¶¶3-4.)

· The parties stipulate to class certification for settlement purposes only. (¶12.1.)

/ / /

TERMS OF SETTLEMENT AGREEMENT

The essential terms are as follows:

· The Gross Settlement Amount (“GSA”) is $175,000, non-reversionary. (¶3.1)

· The Net Settlement Amount (“Net”) ($56,755) is the GSA minus the following:

o Up to $61,250 (35%) for attorney fees (¶3.2.2);

o Up to $25,000 for litigation costs (Ibid.);

o Up to $10,000 for a Service Payment to the Named Plaintiff (¶3.2.1);

o Up to $6,995 for settlement administration costs (¶3.2.3); and

o Payment of $15,000 (75% of $20,000 PAGA penalty) to the LWDA. (¶3.2.5)

· Defendants will pay their share of taxes separate from the GSA. (¶3.1)

· Funding of Settlement: Defendant shall fully fund the Gross Settlement Amount, and also fund the amounts necessary to fully pay Defendant’s share of payroll taxes by transmitting the funds to the Administrator no later than 60 days after the Effective Date. (¶4.3)

· There is no claim form requirement. (¶3.1)

· Individual Settlement Payment Calculation: An Individual Class Payment calculated by (a) dividing the Net Settlement Amount by the total number of Workweeks worked by all Participating Class Members during the Class Period and (b)multiplying the result by each Participating Class Member’s Workweeks. (¶3.2.4)

o Tax Allocation: 20% as wages and 80% as interest and penalties. (¶3.2.4.1)

· PAGA Payments: The portion of the PAGA Settlement Amount to be distributed to PAGA Group Members shall be divided between all PAGA Group Members in proportion to the number of pay periods that each PAGA Group Member worked during the PAGA Period. To calculate the minimum amount each PAGA Group Member will receive based on their individual pay periods, 25% of the PAGA Settlement Amount (or $5,000) will be divided by the total number of pay periods by all PAGA Group Members during the PAGA Period and then allocated on a pro rata basis. Pay periods will be rounded up to the next whole integer. Each PAGA Group Member’s approximate Individual PAGA Settlement Payment Amount will be included in his or her Notice Packet. After final approval by the Court, 25% of the PAGA Settlement Amount will be dispersed to all PAGA Group Members on a pro rata basis based on the number of pay periods worked during the PAGA Period by each PAGA Group Member. Class Members who were employed during the PAGA Period will receive their share of the PAGA Payment regardless of whether they opt out of the settlement. (¶4.4.2)

o Tax Allocation: 100% as penalties. (¶3.2.5)

· "Response Deadline" means [e.g., 45] days after the Administrator mails Notice to Class Members, and shall be the last date on which Class Members may: (a) fax, email, or mail Requests for Exclusion from the Settlement, or (b) fax, email, or mail his or her Objection to the Settlement. Class Members to whom Notice Packets are resent after having been returned undeliverable to the Administrator shall have an additional 14 calendar days beyond the Response Deadline has expired. (¶1.39) This deadline also applies to Challenges to Calculation of Workweeks. (¶7.6)

o If the number of valid Requests for Exclusion identified in the Exclusion List exceeds 10% of the total of all Class Members, Defendant may, but is not obligated to, elect to withdraw from the Settlement. (¶9.)

· Uncashed Settlement Checks: For any Class Member whose Individual Class Payment check is uncashed and cancelled after the void date, the Administrator shall transmit the funds represented by such checks to the California Controller's Unclaimed Property Fund in the name of the Class Member thereby leaving no "unpaid residue" subject to the requirements of California Code of Civil Procedure Section 384, subd. (b). (¶4.4.4)

· The settlement administrator will be Phoenix Settlement Administrators. (¶7.1)

Notice of Final Judgment will be posted on the Settlement Administrator’s website. (¶7.8.1)
The proposed settlement was submitted to the LWDA on December 21, 2022. (Campbell Decl., Exhibit 2.)

Scope of the release: Effective on the date when Defendant fully funds the entire Gross Settlement Amount and funds all employer payroll taxes owed on the Wage Portion of the Individual Class Payments, Plaintiff, Class Members, and Class Counsel will release claims against all Released Parties as follows: (¶5)

o Release by Participating Class Members: All Participating Class Members, on behalf of themselves and their respective former and present representatives, agents, attorneys, heirs, administrators, successors, and assigns, release Released Parties from (i) all claims that were alleged, or reasonably could have been alleged, based on the Class Period facts stated in the Operative Complaint and ascertained in the course of the Action including, e.g., “(a) any and all claims involving any alleged failure to pay minimum wages; failure to pay overtime wages; failure to provide meal periods; failure to permit rest breaks; failure to provide accurate itemized wage statements; failure to pay all wages due upon the separation of employment; and failure to reimburse necessary business expenses. Participating Class Members do not release any other claims, including claims for vested benefits, wrongful termination, violation of the Fair Employment and Housing Act, unemployment insurance, disability, social security, workers’ compensation, or claims based on facts occurring outside the Class Period. (¶5.2)

o Release by PAGA Group Members: Upon the date the settlement is funded, the State of California and PAGA Group Members release the Released Parties from all claims exhausted in Plaintiff’s notice(s) sent to the LWDA and alleged in the operative complaint, which arose during the PAGA Period, regardless of whether PAGA Group Members opt out of the Class Settlement. (¶5.3)

o “Released Parties” means: Defendant and each of its former and present directors, officers, shareholders, owners, members, attorneys, insurers, predecessors, successors, assigns, subsidiaries, and affiliates. (¶1.37)

o Named Plaintiff will also provide a general release and CC § 1542 waiver. (¶5.1)

ANALYSIS OF SETTLEMENT AGREEMENT

A. Does a presumption of fairness exist?

The Court preliminarily found in its Order of May 29, 2024 that the presumption of fairness should be applied. No facts have come to the Court’s attention that would alter that preliminary conclusion. Accordingly, the settlement is entitled to a presumption of fairness as set forth in the preliminary approval order.

B. Is the settlement fair, adequate, and reasonable?

The settlement was preliminarily found to be fair, adequate and reasonable. Notice has now been given to the Class and the LWDA.

Reaction of the class members to the proposed settlement.

Number of class members: 189 (Burns Decl. ¶3.)

Number of notice packets mailed: 189 (Id. at ¶5.)

Number of undeliverable notices: 2 (Id. at ¶6.)

Number of opt-outs: 0 (Id. at ¶7.)

Number of objections: 0 (Id. at ¶8.)

Number of participating class members: 189 (Id. at ¶10.)

Average individual payment: $327.43 (Id. at ¶12.)

Highest individual payment: $1,296.86 (Ibid.)

Lowest individual payment: $3.46 (Ibid.)

Average PAGA Payment: $74.63 (Id. at ¶13.)

Highest PAGA Payment: $106.95 (Ibid.)

The Court finds that the notice was given as directed and conforms to due process requirements. Given the reactions of the Class Members and the LWDA to the proposed settlement and for the reasons set forth in the Preliminary Approval order, the Court finds the settlement to be fair, adequate, and reasonable.

C. Attorney Fees and Costs

Class Counsel requests an award of $61,250 (35%) in fees and $15,197.47 in costs. (MFA at 8:19-21, 11:23-25.) The Settlement Agreement provides for up to $61,250 (35%) of the settlement amount in fees and $25,000 in costs (¶3.2.3).

“Courts recognize two methods for calculating attorney fees in civil class actions: the lodestar/multiplier method and the percentage of recovery method.” (Wershba v. Apple Computer, Inc. (2001) 91 Cal.App.4th 224, 254.) Here, class counsel request attorney fees using the percentage method, as crosschecked by lodestar. (MFA at pp. 8-11.)

In common fund cases, the Court may employ a percentage of the benefit method, as cross-checked against the lodestar. (Laffitte v. Robert Half Int’l, Inc. (2016) 1 Cal.5th 480, 503.) The fee request represents approximately 35% of the gross settlement amount, which is above the average one-third generally awarded in class actions. (See In re Consumer Privacy Cases (2009) 175 Cal.App.4th 545, 558, fn. 13 [“Empirical studies show that, regardless whether the percentage method or the lodestar method is used, fee awards in class actions average around one-third of the recovery.”].)

Class Counsel has provided information, summarized below, from which the lodestar may be calculated:

Attorney	Rate	Hours	Totals
Kashif Haque	$950.00	25	$23,750.00
Jessica L. Campbell	$800.00	15	$12,000.00
Joseph Szilagyi	$625.00	115.6	$72,250.00
Jamie M. Loos	$450.00	31.8	$14,310.00
Totals		187.4	$122,310.00

(Decl. of Jamie M. Loos ISO Final ¶¶34-.)

Counsel’s percentage-based fee request is lower than the unadjusted lodestar, and would represent application of a negative multiplier of approximately 0.5x.

Here, a reduced fee of $58,333.33 (1/3) would represent a reasonable percentage of the total funds paid by Defendant. Notice of the fee request was provided to class members in the Notice, and no one objected. (Burns Decl. ¶8, Exhibit A thereto.)

As for costs, Class Counsel is requesting a cost amount of $15,197.47. This is less than the $25,000 cap estimated at preliminary approval, which was disclosed to Class Members and not objected to. (Burns Decl. ¶8, Exhibit A thereto.) Costs include, but are not limited to: Mediation ($7,000), Filing Fees ($2,288.90), Case Anywhere ($1,527.60), Copies/Scans/Postage ($1,452.25) and Expert Fees [Berger Consulting Group, LLC] ($2,800). (Loos Decl. ISO Final ¶38 and Exhibit 3 thereto.) The costs appear to be reasonable in amount and reasonably necessary to this litigation.

Based on the above, the Court hereby awards $58,333.33 (1/3) [reduced] in fees and $15,197.47 in costs.

D. Incentive Award

The class representative, Ruth Noriega, seeks an enhancement payment of $10,000 for her contributions to the action. (MFA at 1:19.)

In connection with the final fairness hearing, named Plaintiffs must submit declarations attesting to why they should be entitled to an enhancement award in the proposed amount. The named Plaintiffs must explain why they “should be compensated for the expense or risk he has incurred in conferring a benefit on other members of the class.” (Clark v. American Residential Services LLC (2009) 175 Cal.App.4th 785, 806.) Trial courts should not sanction enhancement awards of thousands of dollars with “nothing more than pro forma claims as to ‘countless’ hours expended, ‘potential stigma’ and ‘potential risk.’ Significantly more specificity, in the form of quantification of time and effort expended on the litigation, and in the form of reasoned explanation of financial or other risks incurred by the named plaintiffs, is required in order for the trial court to conclude that an enhancement was ‘necessary to induce [the named plaintiff] to participate in the suit . . . .’” (Id. at 806-807, italics and ellipsis in original.)

Plaintiff Ruth Noriega represents that her contributions to this litigation include: communicating with her attorneys, searching for documents, and reviewing the settlement. She estimates spending 50 hours on the case. (Declaration of Ruth Noriega ¶¶4-14.)

Plaintiff’s contributions are commendable but not exceptional. Based on the above, as well as the benefits obtained on behalf of the class, the Court hereby grants the enhancement payment in the reduced amount of $7,500 to Plaintiff.

E. Settlement Administration Costs

The settlement administrator, Phoenix Settlement Administrators, is requesting $6,995 for the costs of settlement administration. (Burns Decl. ¶15.) This equals the cost of $6,995 provided for in the Settlement Agreement (¶3.2.3) and disclosed to class members in the Notice, to which there were no objections. (Burns Decl. ¶8, Exhibit A thereto.) Based on the above, the Court hereby awards costs in the requested amount of $6,995.

CONCLUSION AND ORDER