Judge: Marcella O. Mclaughlin, Case: 37-2023-00007892-CU-OE-CTL, Date: 2024-03-01 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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HALL OF JUSTICE

TENTATIVE RULINGS - February 29, 2024

03/01/2024  01:30:00 PM  C-72 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Marcella O McLaughlin

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Civil - Unlimited  Other employment Motion Hearing (Civil) 37-2023-00007892-CU-OE-CTL PENETRANTE VS PRESIDIO COMPONENTS INC [IMAGED] CAUSAL DOCUMENT/DATE FILED: Motion for Approval of Class Settlement, 02/02/2024

The unopposed motion for final approval of class action settlement is GRANTED.

A. The court finds that the settlement is fair, reasonable, and adequate. Accordingly, the court approves the parties' proposed settlement, subject to some qualifications discussed below.

B. The litigation costs of $15,000, payable to class counsel, and the claims administration costs of $7,250, payable to Phoenix, are reasonable for a case of this type. The costs are therefore approved.

C. The proposed the service award of $10,000 to plaintiff is reasonable under the circumstances and is hereby approved.

D. Finally, the attorneys' fees proposal of $250,000 represents one-third of the gross settlement fund.

At first blush, the requested amount – which includes a multiplier of 1.64 – is not out of line with class action fee awards calculated using the percentage-of-the-benefit method. See Chavez v. Netflix, Inc.

(2008) 162 Cal.App.4th 43, 66 fn. 11. However, '[w]here the class settlement is for a very large amount, a percentage fee may be criticized as providing counsel a windfall in relation to the amount of work performed.' Laffitte v. Robert Half Internat. Inc. (2016) 1 Cal.5th 480, 490. Such is the case here. The court has performed the 'cross-check' using the lodestar method and finds that the requested attorneys' fees are not reasonable.

According to the declaration of class counsel, the nine attorneys assigned to this matter billed a total of 227.7 hours. (Perez Decl., ¶ 18.) This results in a blended hourly rate of approximately $1,097.94 per hour ($250,000 divided by 227.7 hours), which is significantly higher than what is reasonable for similar work in San Diego County. The fact that nine attorneys were utilized strongly suggests to the court that this matter was not properly staffed. No explanation is provided as to why the services of so many attorneys were necessary on a case that was filed a year ago, settled within six months, and involved no law and motion work. In sum, a blended rate of over $1,000 per hour is hard to justify in these circumstances.

By contrast, the blended hourly rate without the requested multiplier is a much more reasonable $668.47 (lodestar fees of $152,210 divided by 227.7 hours). (See id.) Based on the court's experience, such an hourly rate is commensurate with the typical billing rates for junior and senior attorneys working on wage and hour cases in the San Diego legal community during the relevant time period. See Cordero-Sacks v. Housing Authority of City of Los Angeles (2011) 200 Cal.App.4th 1267, 1286 ('The trial court is in the best position to determine the reasonableness of the hourly rate of an attorney appearing before the Calendar No.: Event ID:  TENTATIVE RULINGS

3049788  37 CASE NUMBER: CASE TITLE:  PENETRANTE VS PRESIDIO COMPONENTS INC [IMAGED]  37-2023-00007892-CU-OE-CTL court and the value of the attorney's professional services.').

The classic situation justifying an upward adjustment of the lodestar figure was seen in a trilogy of California Supreme Court cases from the 1970s. See Serrano v. Priest (1971) 5 Cal. 3d 584; Serrano v. Priest (1976) 18 Cal. 3d 728; Serrano v. Priest (1977) 20 Cal.3d 25. The litigation there revolved around California's system for financing public schools. The plaintiffs succeeded in overturning the existing system, but the litigation resulted in no fund of money from which attorney fees might be paid, nor did it result in any monetary recovery by the plaintiffs. The plaintiffs were also under no obligation to pay their attorneys for their efforts and there was no clear statutory authority for shifting attorney fees to the defendant. Accordingly, application of a multiplier was appropriate.

Two decades later, the Court of Appeal in Weeks v. Baker & McKenzie (1998) 63 Cal.App.4th 1128 declined to award a multiplier and distinguished Serrano as follows: '[T]he present case is in essence a personal injury action, brought by a single plaintiff to recover her own economic damages. Weeks and her attorneys had a fee agreement by which her attorneys were assured of a portion of any recovery. In addition, because of the availability of attorney fees under the FEHA, the attorneys had reason to assume that the amount of Weeks's recovery would not limit the amount of fees they ultimately received. Thus, the risk that Weeks's attorneys would not be compensated for their work was no greater than the risk of loss inherent in any contingency fee case; however, because of the availability of statutory fees the possibility of receiving full compensation for litigating the case was greater than that inherent in most contingency fee actions.' Weeks, 63 Cal.App.4th at 1174. The court finds this case is more like Weeks than Serrano, and therefore declines to award the requested multiplier. The action was neither novel nor particularly complex. Although Mr. Perez's firm took the case on a contingency basis, there is no evidence suggesting that the firm's representation of plaintiff precluded other employment. Moreover, given the fee-shifting provisions in the Labor Code, the case was not risky from the standpoint of Mr. Perez having a source for payment. Accordingly, the attorneys' fee request is granted, but only to the extent of $152,210. The remainder ($250,000 minus $152,210 equals $97,790) is poured over into the net settlement fund for distribution to the class members.

E. Class counsel must prepare and submit a revised proposed order and proposed final judgment consistent with the foregoing.

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