Judge: Joseph Lipner, Case: 20STCV22269, Date: 2025-05-15 Tentative Ruling
Case Number: 20STCV22269 Hearing Date: May 15, 2025 Dept: 72
SUPERIOR COURT OF CALIFORNIA
COUNTY OF LOS ANGELES
DEPARTMENT 72
TENTATIVE
RULING
|
LUIS GARCIA, Plaintiff, v. CAR AROMA SUPPLIES, INC., Defendant. |
Case No:
20STCV22269 Hearing Date: May 15, 2025 Calendar Number: 1 |
Plaintiff Luis Garcia (“Plaintiff”) requests final approval
of the class action and PAGA settlement with Defendant Car Aroma Supplies, Inc.
(“Defendant”) in this matter.
The Court GRANTS the motion for final approval. The Court will enter the proposed order
submitted by Plaintiff on April 16, 2025.
This is an employment law class action and Private Attorney
General Act (“PAGA”) case.
Plaintiff and the Class Members were employed by Defendant.
Plaintiff alleges a collection of wage and hour violations by Defendant against
the Class Members.
Plaintiff filed this action on June 12, 2020. The operative
complaint is now the First Amended Complaint (“FAC”), which raises claims for
(1) failure to pay all wages including minimum wage and overtime wages; (2)
failure to provide rest periods; (3) failure to provide meal periods; (4)
failure to provide accurate itemized wage statements; (5) failure to pay wages
upon ending employment; (6) failure to reimburse employees for necessary
business expenditures; (7) unfair competition; and (8) violation of PAGA, Labor
Code, section 2699.
On November 24, 2021, Plaintiff filed a notice of
settlement.
On April 27, 2023, the Court granted Plaintiff’s motion for
preliminary approval of the class settlement.
On August 15, 2024, the Court signed and entered a Third
Amended Order Granting Preliminary Approval of Settlement (the “Third Amended
Order”), which is the operative order regarding preliminary approval.
On April 16, 2025, Plaintiff moved for final approval of the
settlement. No party has filed an opposition.
As a “fiduciary” of the absent class members, the trial
court’s duty is to have before it sufficient information to determine if the
settlement is fair, adequate, and reasonable. (7-Eleven Owners for Fair
Franchising v. The Southland Corp. (2000) 85 Cal.App.4th 1135, 1151 [citing
Dunk v. Ford Motor Co. (1996) 48 Cal.App.4th 1794, 1801, 1802 (“Dunk”)].)
California Rules of Court, Rule 3.769 governs settlements of
class actions. Any party to a settlement agreement may submit a written notice
for preliminary approval of the settlement. The settlement agreement and
proposed notice to class members must be filed with the motion, and the
proposed order must be lodged with the motion. (CRC Rule 3.769(c).)
In determining whether to approve a class settlement, the
court’s responsibility is to “prevent fraud, collusion or unfairness to the
class” through settlement and dismissal of the class action because the rights
of the class members, and even named plaintiffs, “may not have been given due
regard by the negotiating parties.” (Consumer Advocacy Group, Inc. v.
Kintetsu Enterprises of America (2006) 141 Cal.App.4th 46, 60.)
“(a) Court
approval after hearing
A
settlement or compromise of an entire class action, or of a cause of action in
a class action, or as to a party, requires the approval of the court after
hearing.
(b) Attorney's
fees
Any
agreement, express or implied, that has been entered into with respect to the
payment of attorney's fees or the submission of an application for the approval
of attorney's fees must be set forth in full in any application for approval of
the dismissal or settlement of an action that has been certified as a class
action.
(c) Preliminary
approval of settlement
Any
party to a settlement agreement may serve and file a written notice of motion
for preliminary approval of the settlement. The settlement agreement and
proposed notice to class members must be filed with the motion, and the
proposed order must be lodged with the motion.
(d) Order
certifying provisional settlement class
The
court may make an order approving or denying certification of a provisional
settlement class after the preliminary settlement hearing.
(e) Order for
final approval hearing
If
the court grants preliminary approval, its order must include the time, date,
and place of the final approval hearing; the notice to be given to the class;
and any other matters deemed necessary for the proper conduct of a settlement
hearing.
(f) Notice to
class of final approval hearing
If
the court has certified the action as a class action, notice of the final
approval hearing must be given to the class members in the manner specified by
the court. The notice must contain an explanation of the proposed settlement
and procedures for class members to follow in filing written objections to it
and in arranging to appear at the settlement hearing and state any objections
to the proposed settlement.
(g) Conduct of
final approval hearing
Before
final approval, the court must conduct an inquiry into the fairness of the
proposed settlement.
(h) Judgment
and retention of jurisdiction to enforce
If
the court approves the settlement agreement after the final approval hearing,
the court must make and enter judgment. The judgment must include a provision
for the retention of the court's jurisdiction over the parties to enforce the
terms of the judgment. The court may not enter an order dismissing the action
at the same time as, or after, entry of judgment.”
(Cal. Rules of Court, rule
3.769(a).)
The settlement class consists of all current and former
non-exempt, hourly-paid employees and Sales Driver employees who worked for
Defendant in the State of California at any time from March 19, 2019 through
September 25, 2021 (“Settlement Class”).
The Court found that this class was appropriate in the Third
Amended Order. There have been no changes in circumstances or challenges to
that finding that would warrant revisiting it.
Defendant agrees to pay a Maximum Settlement Amount of
$225,000.00, of which the entire Net Settlement Amount will be paid to class
members who do not file a timely request for exclusion from the Settlement.
Defendant will fund the Settlement in (1) an initial
installment of $112,500.00 to be paid on the later of 12 months from April 16,
2025 or 30 days form final approval, and (2) $112,500.00 to be paid 6 months
after the initial payment.
Kevin Mahoney and Katherine J. Odenbreit of Mahoney Law
Group, APC will be appointed as Class Counsel for the Settlement Class members.
Phoenix Class Action Administration (the “Administrator”)
will serve as the settlement administrator.
Class members were notified of the Settlement via U.S. Mail
at their last known address. The Administrator will take reasonable steps prior
to mailing to verify the last known address. The Notice, which was previously
approved by the Court, provided Class Members with an explanation of the
Settlement, their anticipated recovery, and the procedures for filing written
objections and arranging to appear at the hearing.
Plaintiff seeks an Enhancement Award of $5,000.00, unopposed
by Defendant, for his participation and assistance in the litigation, payable
from the Maximum Settlement Amount.
Class Counsel seeks an award of attorney’s fees in the
amount of $75,000.00, which represents one third of the Maximum Settlement
Amount, for all past and future attorney’s fees, payable from the Maximum
Settlement Amount upon approval by the Court. Defendant does not oppose.
Class Counsel seeks litigation costs of up to $10,000.00,
payable from the Maximum Settlement Amount, unopposed by Defendant.
From the Maximum Settlement Amount, $15,000.00 is allocated
to PAGA claims. Of this amount, 75 percent ($11,250.00) will be paid by the
Administrator to the California Labor Workforce Development Agency (“LWDA”). 25
percent will remain in the Net Settlement amount to be paid to the Class
Members.
In an effort to aid the Court in the determination of the
fairness of the settlement, Wershba v. Apple Computer, Inc. (2001) 91
Cal.App.4th 224, 244-45 (“Wershba”), discusses factors that the Court should
consider when testing the reasonableness of the settlement.
A presumption of fairness exists where: (1) the settlement
is reached through arm’s length bargaining; (2) investigation and discovery are
sufficient to allow counsel and the Court to act intelligently; (3) counsel is
experienced in similar litigation; and (4) the percentage of objectors is
small. (Wershba at 245, citing Dunk, at 1802.) The test is
not the maximum amount plaintiff might have obtained at trial on the complaint
but, rather, whether the settlement is reasonable under all of the
circumstances. (Wershba at 250.)
In making this determination, the Court considers all
relevant factors including “the strength of [the] plaintiffs’ case, the risk,
expense, complexity and likely duration of further litigation, the risk of
maintaining class action status through trial, the amount offered in
settlement, the extent of discovery completed and the stage of the proceedings,
the experience and views of counsel, the presence of a governmental
participant, and the reaction of the class members to the proposed
settlement.’” (Kullar v. Foot Locker Retail, Inc. (2008) 168 Cal.App.4th
116, 128 (“Kullar”), citing Dunk at 1801.)
“The fact that a proposed settlement may only amount to a
fraction of the potential recovery does not, in and of itself, mean that the
proposed settlement is grossly inadequate and should be disapproved.” (City
of Detroit v. Grinnell Corp. (2d Cir. 1974) 495 F.2d 448, 455; see also Linney
v. Cellular Alaska Partnership (9th Cir. 1998) 151 F.3d 1234, 1242 [“[I]t
is the very uncertainty of outcome in litigation and avoidance of wasteful and
expensive litigation that induce consensual settlements. The proposed
settlement is not to be judged against a hypothetical or speculative measure of
what might have been achieved by the negotiators.”].)
1. Was the settlement reached
through arm’s-length bargaining? Here, the Settlement resulted from
arm’s-length negotiations between the parties at a mediation on July 27, 2021.
(Odenbreit Decl. ¶ 4; Settlement, § 2.2.)
2. Were investigation and
discovery sufficient to allow counsel and the court to act intelligently? The
parties exchanged substantial discovery, including time and payroll records. (Odenbreit
Decl. ¶ 4, Settlement, § 2.2.)
3. Is counsel experienced in
similar litigation? Yes. Class Counsel is experienced in class action
litigation, including wage and hour class actions. (Odenbreit Decl. ¶¶ 7-15.)
4. What percentage of the class
has objected? As of the filing of this motion,
there are zero opt-outs of the Settlement, zero workweek disputes, and zero
objections to the Settlement. (Gonzalez Decl. ¶¶ 8-10.)
CONCLUSION: The settlement is entitled to a presumption
of fairness.
1. Strength of Plaintiff’s case.
“The most important factor is the strength of the case for plaintiff on the merits, balanced against the amount offered in
settlement.” (Kullar v. Foot Locker Retail, Inc. (2008) 168 Cal.App.4th 116,
130.) Here, Defendant vigorously disputes all of Plaintiff’s claims. The
Maximum Settlement Amount is equal to $225,000.00. Once accounting for the risks of litigation, the realistic expected
recovery would be significantly lower. The Court determines that this amount is
reasonable.
2. Risk, expense, complexity and
likely duration of further litigation. Given the nature of the class
claims, the case is likely to be expensive and lengthy to try. Procedural
hurdles (e.g., motion practice and appeals) are also likely to prolong the
litigation as well as any recovery by the class members. Because these claims
involve off-the-clock work, there are significant challenges regarding class
certification and evaluation of damages. (Odenbreit Decl. ¶ 5.)
3. Risk of maintaining class
action status through trial. Even if a class is certified, there is always
a risk of decertification. (See Weinstat v. Dentsply Intern., Inc. (2010) 180 Cal.App.4th 1213, 1226
[“Our Supreme Court has recognized that trial courts
should retain some flexibility in conducting class
actions, which means, under suitable circumstances,
entertaining successive motions on certification if the court subsequently
discovers that the propriety of a class action is not appropriate.”].)
4. Amount offered in settlement.
The Maximum Settlement Amount is $225,000.00. This amount is to be distributed
among 42 class members (Gonzalez Decl. ¶ 3) for the class period of roughly two
and a half years. The Court determines that the amount offered is reasonable.
5. Extent of discovery completed
and stage of the proceedings. As indicated above, at the time of the
settlement, Class Counsel had conducted sufficient discovery.
6. Experience and views of
counsel. The settlement was negotiated and endorsed by Class Counsel who,
as indicated above, is experienced in class action litigation, including wage
and hour class actions.
7. Presence of a governmental
participant. LWDA has not participated in this action.
8. Reaction of the class members
to the proposed settlement. No Settlement Class members have objected,
disputed the number of workweeks, or opted out.
CONCLUSION:
The settlement recovery appears reasonable. The class was competently
represented and no class members have objected. The Court determines that the
Settlement is fair, adequate, and reasonable.
Release by All Participating
Class Members. “ ‘Plaintiffs General Released Claims’ means, in addition to
the releases made by Participating Class Members, and Plaintiff, on behalf of
himself, his heirs, successors, assigns, executors, trustees, and estates, in
exchange for the terms and conditions of this Agreement, including the Class
Representative Enhancement Award requested or as otherwise authorized by the
Court, shall also, as of the Effective Date, fully and forever release the
Released Parties, to the fullest extent permitted by law, of and from any and
all claims, known and unknown, asserted and unasserted, which Plaintiff had or
may have had against the Released Parties, including without limitation the
Released Claims, whether sounding in tort, in contract, in law, in equity or
otherwise, and including but not limited to all claims for violation of any
local, state, or federal statute, rule, or regulation.” (Settlement § 1.31.)
·
“Released Claims” means any and all claims for
recovery of any kind which could have been pled based on the factual
allegations in this action. (Settlement § 1.34.)
·
“Released Parties” means Defendant, and all of
its current, former, and future parents, owners, subsidiaries, partners,
affiliated entities, predecessors and successors, and each of their respective
agents, employees, officers, directors, spouses, partners, shareholders,
agents, and any other successors, assigns, or legal representatives, as well as
any other individual or entity which could be jointly liable with any of the
Released Claims. (Settlement § 1.35.)
·
Plaintiff additionally provides general release
of his claims against Defendant. (Settlement § 3.2.2.) Plaintiff provides a Civil Code, section 1542
waiver. (Settlement § 3.2.2.)
1. Standards
A detailed analysis of the elements required for class
certification is not required, but it is advisable to review each element when
a class is being conditionally certified. (Amchem
Products, Inc. v. Winsor (1997) 521 U.S. 620, 622-627.) The trial court can appropriately utilize a
different standard to determine the propriety of a settlement class as opposed
to a litigation class certification. Specifically, a lesser standard of
scrutiny is used for settlement cases. (Dunk
v. Ford Motor Co. (1996) 48
Cal.App.4th 2794, 1807 fn. 19.) Finally, the Court is under no “ironclad
requirement” to conduct an evidentiary hearing to consider whether the
prerequisites for class certification have been satisfied. (Wershba v. Apple
Computer, Inc. (2001) 91 Cal.App.4th 224, 240, disapproved on
other grounds by Hernandez v. Restoration Hardware, Inc. (2018) 4 Cal.5th
260.)
2. Analysis
a. Numerosity. The parties state and estimate that
there are 42 class members.
b. Ascertainability. The proposed class is defined
above. The class definition is “precise, objective and presently
ascertainable.” (Sevidal v. Target Corp.
(2010) 189 Cal.App.4th 905, 919.) The class members are identifiable from
Defendant’s records.
c. Community of interest. “The community of interest
requirement involves three factors: ‘(1) predominant common questions of law or
fact; (2) class representatives with claims or defenses typical of the class;
and (3) class representatives who can adequately represent the class.’” (Linder
v. Thrifty Oil Co. (2000) 23 Cal.4th 429, 435.)
d. Adequacy of class counsel. As indicated above,
Class Counsel has shown experience in class action litigation, including wage
and hour class actions.
e. Superiority. Given the relatively small size of
the individual claims, a class action appears to be superior to separate
actions by the class members.
CONCLUSION: In its ruling preliminarily approving the
Settlement, the Court considered the factors for conditional class
certification and granted class certification for the purposes of settlement. (Third
Amended Order ¶ 3.) No facts regarding the class have changed since then. The
Court determines that class certification is proper.
1. Content of class notice.
The Court determined in the Third Amended Order that the
proposed Notice is the best notice practicable. (Third Amended Order ¶ 6.) No
facts regarding the Notice have changed since then.
2. Method of class notice.
The
Court determined in the Third Amended Order that the method of notice is
proper. (Third Amended Order ¶¶ 6-8.) The Administrator has issued the Notices.
(Gonzalez Decl. ¶¶ 3-6.) The Court determines that notice has been properly
conducted.
3. Cost of class notice.
As indicated above, settlement
administration costs are estimated not to exceed $5,000.00. (Gonzalez
Decl. ¶ 16, Ex. C.)
California Rules of Court, rule 3.769(b) states: “Any
agreement, express or implied, that has been entered into with respect to the
payment of attorney fees or the submission of an application for the approval
of attorney fees must be set forth in full in any application for approval of
the dismissal or settlement of an action that has been certified as a class
action.”
Ultimately,
the award of attorney fees is made by the court at the fairness hearing, using
the lodestar method with a multiplier, if appropriate. (PLCM Group, Inc. v. Drexler (2000) 22 Cal.4th 1084, 1095-1096; Ramos v. Countrywide Home Loans, Inc.
(2000) 82 Cal.App.4th 615, 625-626; Ketchum
III v. Moses (2000) 24 Cal.4th 1122, 1132-1136.) Despite any agreement by the parties to the
contrary, “the court ha[s] an independent right and responsibility to review
the attorney fee provision of the settlement agreement and award only so much
as it determined reasonable.” (Garabedian
v. Los Angeles Cellular Telephone Company (2004) 118 Cal.App.4th 123, 128.)
In
the Third Amended Order, the Court instructed Class Counsel to file a request
for approval of its fees and costs. (Third Amended Order ¶ 11.) The Court
requested that Class Counsel provide a lodestar calculation to support its fee
request. (04/27/2023 Minute Order at p. 2.)
Class
counsel requests attorney’s fees in the amount of $75,000.00, which represents
one third of the Maximum Settlement Amount.
Plaintiff
contends in the motion that the lodestar amount is $68,138.50, based on 117.40
hours of work. (Motion at 18:13-15.) Class Counsel provides billing records
showing that this is the lodestar amount. (See Odenbreit Decl. ¶ 20, Ex. C.)
The
Court determines that the requested fee of $75,000.00 has a reasonable relation
to the amount of work performed, especially when considering the contingent
risk incurred by Class Counsel.
Class
Counsel provides records showing that the actual costs of litigation were
$8,951.82. (See Odenbreit Decl. ¶ 20, Ex. D.) The Court approves costs in this
amount.
The Settlement Agreement provides for an enhancement award
of to $5,000 to Plaintiff. The Court requested that Plaintiff submit a
declaration explaining why he should be compensated for the expense and risk of
participating in this action, and quantifying the time and effort spent on this
litigation. (04/27/2023 Minute Order at p. 2.)
Named plaintiffs in class actions and PAGA cases necessarily
run the risk of jeopardizing future employment opportunities if an employer
declines to hire them after discovering their participation in a class action.
Such a plaintiff may never discover the actual basis for their denial of
employment. The California Supreme Court has noted that retaliation against
employees for asserting statutory rights is widespread and frequently causes
immediate economic injury. (Gentry v. Superior Court (2007) 42 Cal.4th
443, 461.)
The Court determines that the requested $5,000.00
enhancement is reasonable in light of Plaintiff’s participation and the risk
incurred as a class representative.