Judge Lynne M. Hobbs, Case Number: 21STCV40242, Date: 2025-03-17 Tentative Ruling

Judge: Lynne M. Hobbs, Case: 21STCV40242, Date: 2025-03-17 Tentative Ruling

Case Number: 21STCV40242 Hearing Date: March 17, 2025 Dept: 61

SILVIA LEMUS, INDIVIDUALLY AND ON BEHALF OF ALL OTHER AGGRIEVED EMPLOYEES vs TARNIK, INC., et al.

Tentative:

Plaintiff Silvia Lemus’ Motion to Approve PAGA Settlement is GRANTED.

Moving party to provide notice.

Analysis:

I. 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 Silvia Lemus (Plaintiff) presents the terms of a proposed PAGA settlement here as follows. Defendants Tarnik, Inc., Real Time Staffing Services, LLC, and Employbridge, LLC (Defendants) are to pay a gross settlement amount of $100,000.0. (Mooradian Decl. ¶ 12.) From this amount, $40,000 are to be allocated as attorney fees, with $3,926.97 as costs. (Ibid.) Administration costs are afforded $6,000.00, while Plaintiff is to be paid a $10,000.00 enhancement award for bringing the present case. (Ibid.)

This leaves a net PAGA award of $40,073.03, of which 75% ($30,054.78) is to be paid to the Labor Workforce Development Agency, while 25% ($10,018.25) is to be apportioned among the aggrieved employees on a pro-rata per-pay-period basis. (Ibid.) The estimated number of aggrieved employees is 122, which yields an average per-employee payment of $82.12. (Ibid.)

Plaintiff estimates the maximum potential valuation of the PAGA claims at $200,000, with 2,000 total pay periods and assuming a violation is found for each. (Mooradian Decl. ¶ 19.) Plaintiff’s counsel discusses the potential strengths of the defenses to Plaintiff’s claims, including the regimented assembly line nature of the work and the regularly scheduled breaks. (Mooradian Decl. ¶¶ 15–18.)

Plaintiff’s counsel also presents a proposed lodestar figure to justify the fees incurred, noting that at a minimum of 100 hours worked, with 50 hours each at $650 and 450 per hour, yields a lodestar figure of at least $55,000, which is greater than the $40,000 fee award requested. (Mooradian Decl. ¶ 27.)

The settlement comports with the purposes of PAGA and is fair and reasonable. Plaintiff makes a persuasive showing for the amount and allocation of the settlement award, and presents evidence showing the reasonableness of the attorney fee request, calculated as a percentage of the settlement. 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.) Courts may evaluate the reasonableness of any percentage-based attorney fee award through a “cross-check” with a lodestar calculation, as Plaintiff presents here. (See Laffitte v. Robert Half Internat. Inc. (2016) 1 Cal.5th 480, 505.)

The motion is GRANTED.