Judge Lon F. Hurwitz, Case 19-01098120 2023-08-11 Tentative Ruling

Judge: Lon F. Hurwitz, Case: 19-01098120, Date: 2023-08-11 Tentative Ruling

1. Motion for Approval of PAGA Settlement

2. Order to Show Cause re: Monetary Sanctions

3. Status Conference

1. Motion for Approval of PAGA Settlement

FACTS/OVERVIEW: This is a PAGA only action. On September 18, 2019, Plaintiff Felicia Mills, on behalf of herself and all others similarly situated (“Plaintiff”), filed the original Complaint against Defendant Advantage Sales & Marketing, LLC dba Advantage Solutions (“Defendant”) alleging various wage-and-hour class claims. (ROA 2). On November 22, 2019, Plaintiff filed the operative First Amended Complaint (“FAC”) adding a PAGA claim. (ROA 12). Subsequently, Plaintiff requested the dismissal of the class claims, without prejudice. (ROA 39). No party has filed a motion to compel arbitration. There is no discovery order or stipulation for discovery.

MOTION FOR APPROVAL OF PAGA SETTLEMENT:

This hearing was originally continued on March 3, 2023, so that counsel could address several issues. (ROA 120). At that time, the Court ordered counsel to file supplemental papers, including red-lined versions of all revised papers, no later than 10 calendar days prior to the continued hearing date of June 2, 2023. (Ibid.)

On May 23, 2023, counsel filed a “Joint Supplement” to the motion (ROA 123), and one declaration in support (ROA 127). However, counsel did not provide any red-lined versions of the revised papers. Nevertheless, the Court reached the following determinations on the outstanding issues:

1. The Notice(s) to the LWDA must be provided for the Court’s review.

RESOLVED. The Notice is dated 09-18-19 and attached the proposed complaint which asserts the relevant labor code violations. Arguably, simply attaching a proposed complaint is insufficient notice as it requires an analysis of a document, which itself does NOT contain an actual PAGA claim, but I am not aware of authority on this particular point.

2. The Declaration provides there are 871 aggrieved employees. As of what date does that number reflect? How many such individuals are there as of the date of this order?

RESOLVED. Counsel’s “Joint Supplement” provides there are 985 “Covered Employees” as of 03-03-23 This represents an increase of just over 13% of the prior estimate of 871 for which approval was sought. Given the open-ended closing date of “Covered Employees”, this number is sure to increase by the time an order is entered. NOTE: the Administrator’s invoice dated 05-03-23 (ROA 127 Ex. B) contemplates 1,020 “Covered Employees

Additionally, the 985 number was not provided via sworn declaration, so it is not in the form of admissible evidence and is somewhat problematic. Nonetheless, rather than another continuance, which would further dilute the settlement, the recommendation is to reduce attorney’s fees to no more than 30%, which reflects the mediocre result here.”

3. An invoice reflecting the actual amount sought in administration costs must be provided.

RESOLVED. Administrator estimates $8,195. (ROA 127 Ex. B.)

4. As to the Notice, upon approval, it must include the amount of the settlement and all distributions therefrom. For now, the Notice should be revised and include blanks for the final disbursement amounts. Additionally, the following sentence is unnecessary and should be deleted: “This means that you are not able to pursue a PAGA lawsuit against Advantage or any other released party based on such claims.”

ISSUE. There is nothing attached to any of the Proposed Orders, including ROA 121. The revised Notice should be provided in redline and clean form and attached to a declaration for the Court’s review, in addition to being attached to the Notice.

5. The Proposed Order (ROA 105) must identify the operative settlement by ROA number, include the amount of the Gross Settlement, and, upon approval, all the disbursements and amounts. The Notice should be attached as Exhibit 1. The Order should state the action will be “dismissed with prejudice” at the final accounting hearing. This assumes full compliance with this Order and all distributions are complete by that date.

ISSUE. There is no reference to the Notice as an Exhibit and the Notice is not itself attached thereto.

In its Tentative Ruling issued on June 1, 2023, the Court continued the hearing to August 11, 2023, so that counsel could address the following outstanding issues:

1. There is nothing attached to any of the Proposed Orders, including ROA 121. The revised Notice should be provided in redline and clean form and attached to a declaration for the Court’s review, in addition to being attached to the Notice. (RESOLVED – see below)

2. The Proposed Order contains no reference to the Notice as an Exhibit and, as stated above, the Notice is not itself attached thereto. (NOT RESOLVED – see below)

The Court also set an OSC re monetary sanctions for counsel’s failure to provide the red-lined versions as ordered at the March 3, 2023 hearing, and for failing to fully address the issues identified by the Court.

Apparently, after reading the Court’s tentative ruling on June 1, 2023, counsel attempted to correct the issues by filing a declaration on June 2, 2023—the day of the continued hearing. (ROA 136, Declaration of Anthony L. Draper). The declaration purportedly included:

1. Redlined Notice to Covered Employees (Exhibit A)

2. “Clean” Notice to Covered Employees (Exhibit B)

3. Redlined [Proposed] Order Approving PAGA Settlement, reflecting changes made as of May 23, 2023, pursuant to the Court’s March 3, 2023 Tentative Ruling (Exhibit C)

4. Further redlined [Proposed] Order Approving PAGA Settlement, reflecting changes made as of June 2, 2023, in light of the Court’s June 1, 2023 Tentative Ruling (Exhibit D)

5. “Clean” [Proposed] Order Approving PAGA Settlement, with a “clean” Notice to Covered Employees attached as Exh. 1, in accordance with the Court’s March 3, 2023, and June 1, 2023 Tentative Rulings (ROA 132).

ISSUE: It is noted that although the revised Notice (in clean form) is attached to the Proposed Order (ROA 132), the Proposed Order still does not contain any reference to the Notice as an Exhibit. Therefore, although counsel resolved Issue No. 1 above, he did not resolve Issue No. 2.

On August 1, 2023, counsel filed another declaration. (ROA 146). The declaration simply states that as of June 9, 2023, there are 1,024 Covered Employees and 15,598 pay periods, and that these numbers “have not notably increased since June 9, 2023.” (ROA 146, Draper Decl., ¶¶ 2, 3.)

RESOLVED: Apparently counsel filed this declaration because the number of “Covered Employees” previously stated in the May 23, 2023 filings, was not provided in a sworn declaration. Therefore, it was not in the form of admissible evidence. In addition, the Court noted that since the closing date to determine the number of “Covered Employees” was open-ended, the number was sure to increase by the time an order approving the settlement was entered. Plaintiff previously stated that there were 985 Covered Employees, but the Administrator’s May 3, 2023 Invoice (ROA 127, Exh. B) contemplated 1,020 Covered Employees. Counsel’s August 1, 2023 declaration comports with the Administrator’s estimate.

2. OSC re Monetary Sanctions

On August 1, 2023, counsel filed a declaration in response to the OSC re sanctions. (ROA 148). Counsel attests that on May 23, 2023, Plaintiff submitted a Supplement to her Motion for Approval of PAGA Settlement. (ROA 121-129). Counsel attests that at that time, it was believed the supplement addressed all of the issues identified by the Court in its March 2, 2023 Tentative Ruling. (ROA 148, Draper Decl., ¶ 4.) However, after the Court issued is Tentative Ruling on June 1, 2023, setting an OSC re sanctions and identifying the two issues that were the basis for the OSC, counsel, per Declaration, “immediately and diligently” addressed those issues and filed corrected papers on June 1, 2023. (Id. at ¶ 6.) On June 2, 2023, Counsel filed a declaration (ROA 136) and a revised Proposed Order (ROA 132). (Ibid.)

Counsel attests that at the June 2, 2023 hearing on the PAGA settlement approval, the Court indicated that the corrected papers had been received, but additional time was needed to review them. As a result, the OSC re sanctions remained on calendar. (ROA 148, Draper Decl., ¶ 7.) Counsel attests that as attorney of record, he takes responsibility for the matter and apologizes to the Court for any confusion and inconvenience. Counsel then asks the Court not to issue any monetary sanctions. (Id. at ¶ 8.)

Code of Civil Procedure section 177.5 provides in relevant part:

A judicial officer shall have the power to impose reasonable money sanctions, not to exceed fifteen hundred dollars ($1,500), notwithstanding any other provision of law, payable to the court, for any violation of a lawful court order by a person, done without good cause or substantial justification. Sanctions pursuant to this section shall not be imposed except … on the court’s own motion, after notice and opportunity to be heard. An order imposing sanctions shall be in writing and shall recite in detail the conduct or circumstances justifying the order.

Counsel has not provided any substantial justification for the failure to comply with this Court’s orders. As noted above, in its March 3, 2023 Ruling, the Court ordered counsel to “provide red-lined versions of all revised papers.” (ROA 120). In addition, the Court stated that the Notice to Covered Employees had to be included as an exhibit to the Proposed Order. (Ibid.) Therefore, the supplemental papers filed on May 23, 2023 did not address all of the issues identified by the Court. The supplemental papers did not provide the red-lined and “clean” revised versions as ordered by the Court, and the revised Notice was not attached to the Proposed Order. As a result, it is difficult to imagine that counsel could have been surprised by the deficiencies identified in the Court’s June 1, 2023 Tentative Ruling.

Yet, counsel’s declaration addressing the OSC re sanctions does not explain how or why the supplemental papers failed to comport with the Court’s March 3, 2023 Ruling. (See, ROA 148, Draper Decl.) Indeed, counsel’s claim of “immediately and diligently” addressing the issues after reading the June 1, 2023 Tentative Ruling rings hollow. Moreover, counsel still has not addressed the second of the issues identified in the June 2, 2023 Ruling—namely, a reference in the Proposed Order to the Notice as an exhibit. As a result, this Motion must be continued, yet again.

RULING:

The hearing on the Motion for Approval of Private Attorneys General Act (PAGA) Settlement is CONTINUED to 9/29/23, at 1:30 p.m. in Department CX103 so that Plaintiff may address the issues identified below:

The Proposed Order still does not contain a reference to the Notice to Covered Employees that is attached as an exhibit. The Proposed Order MUST contain an express reference to the Notice as “Exhibit 1.”

Counsel must file a revised Proposed Order no later than ten (10) calendar days prior to the continued hearing date. Counsel must also provide a red-lined version of the Proposed Order.

In response to the OSC re Monetary Sanctions pursuant to CCP section 177.5, counsel has failed to provide substantial justification for the failure to fully comply with this Court’s orders of March 3, 2023, and June 3, 2023. Therefore, sanctions in the amount of $750.00 are imposed against James Hawking, APLC, payable to the Court within ten (10) calendar days.

Clerk to give Notice.

Please inform the clerk by emailing her before 12:00 p.m. on the day of the hearing at CX103@occourts.org if both parties intend to submit on the tentative.