Judge Lynne M. Hobbs, Case Number: 21STCV27379, Date: 2025-01-09 Tentative Ruling

Judge: Lynne M. Hobbs, Case: 21STCV27379, Date: 2025-01-09 Tentative Ruling

Case Number: 21STCV27379 Hearing Date: January 9, 2025 Dept: 61

KEITH LUPER, AN INDIVIDUAL, vs DR HORTON, INC., A DELAWARE CORPORATION, et al.

Tentative

Plaintiff Keith Luper’s Motion to Approve PAGA Settlement is GRANTED.

Moving party to provide notice.

Analysis:

MOTION TO APPROVE SETTLEMENT

Under PAGA, “t[t]he 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 agency at the same time that it is submitted to the court.” (Lab. Code, § 2699, subd. (l)(2).) “[A] trial court should evaluate a PAGA settlement to determine whether it is fair, reasonable, and adequate in view of PAGA's purposes to remediate present labor law violations, deter future ones, and to maximize enforcement of state labor laws.” (Moniz v. Adecco USA, Inc. (2021) 72 Cal.App.5th 56, 77.)

Federal courts have compared and contrasted PAGA settlements to class action settlements:

In the class action context, where PAGA claims often also appear, a district court must independently determine that a proposed settlement agreement is “fundamentally fair, adequate and reasonable” before granting approval. [Citations.] However, as the parties rightly point out and as noted above, this is not a class action lawsuit, and PAGA claims are intended to serve a decidedly different purpose-namely to protect the public rather than for the benefit of private parties. [Citation.] In one recent district court case, the LWDA provided some guidance regarding court approval of PAGA settlements. [Citations.] In that case, where both class action and PAGA claims were covered by a proposed settlement, the LWDA stressed that “when a PAGA claim is settled, the relief provided for under the PAGA be genuine and meaningful, consistent with the underlying purpose of the statute to benefit the public and, in the context of a class action, the court evaluate whether the settlement meets the standards of being “fundamentally fair, reasonable, and adequate” with reference to the public policies underlying the PAGA.” (Salazar, supra, 2017 WL 1135801 at pp. 3–4.) A number of these factors, “including the strength of the plaintiff's case, the risk, the stage of the proceeding, the complexity and likely duration of further litigation, and the settlement amount,” have been recognized as useful in the analysis of PAGA settlements. (Moniz, supra, 72 Cal.App.5th at p. 77.)

Plaintiff Keith Luper (Plaintiff) presents the terms of a proposed PAGA settlement here as follows. Defendant Dr. Horton, Inc. and Diane Simmons (defendant) are to pay a gross settlement amount of $45,000.00. (Robinson Decl. Exh. B, § 3(a).) Plaintiff’s counsel is to be paid attorney fees and costs not exceeding $10,000.00, representing roughly 22.2% of the gross settlement amount. (Id. at § 3(a)(1).) Up to $6,500.00 is apportioned for the costs of settlement administration. (Id. at § 3(a)2); Robinson Decl. ¶ 12.)

These deductions leave a net settlement amount of $28,500.00, which will be distributed 75% ($21,375.00) to the California Labor Workforce Development Agency (LWDA), and 25% ($7,125.00) to be distributed to aggrieved employees on a pro-rata, per-pay-period basis. (Robinson Decl. Exh. B, § 3(a)(3), 3(a)(4).) Plaintiff’s counsel estimates the class of aggrieved employees to number 705 employees, with 40,036 pay periods shared among them. (Robinson Decl. ¶ 11.) If each employee worked the same number of pay periods, each would receive roughly $10.11 from the settlement.

This court previously continued the hearing on this motion to permit Plaintiff to submit more detailed valuations of the claims to be settled. Plaintiff has done so, submitting a declaration of counsel outlining various evidentiary hurdles in the case, including Defendant’s evidence that it consistently paid overtime, Plaintiff’s admission that he did not record his own off-the-clock work according to his own volition, and the limitation of the number of employees who were subject to “on-call” work to a small subset of the aggrieved employee class. (Supp. Robinson Decl. ¶¶ 1–17.)

In light of the above, the overall settlement amount furthers the purposes of PAGA. The settlement is reasonable in light of the strength and complexity of Plaintiff’s claims, and the risks posed by litigation. Plaintiff’s request for fees, representing 22.2% of the gross settlement amount, is reasonable, as the calculation of attorney fees from a percentage of a common fund created by a settlement agreement is a permissible mode of fee calculation. (See Laffitte v. Robert Half Internat. Inc. (2016) 1 Cal.5th 480, 503.)

The motion is therefore GRANTED.