Judge Randolph M. Hammock, Case Number: 23STCV07682, Date: 2023-09-14 Tentative Ruling

Judge: Randolph M. Hammock, Case: 23STCV07682, Date: 2023-09-14 Tentative Ruling

Plaintiff Cornelo Busby brings this action on behalf of himself and all other aggrieved employees against Defendants Mission Loans, LLC, and Residential Bancorp. Plaintiff alleges Defendants violated the Labor Code by failing to pay overtime and failure to provide meal and rest periods, among other things.

Labor Code § 2699(l)(2) states: “The superior court shall review and approve any settlement of any civil action filed pursuant to this part [Labor Code Private Attorneys General Act of 2004 (“PAGA”)]. The proposed settlement shall be submitted to the [Labor and Workforce Development Agency (“LWDA”)] at the same time that it is submitted to the court.” Any settlement of any civil action filed under PAGA must be “fair and adequate in view of the purposes and policies of the statute.” (Flores v. Starwood Hotels & Resorts Worldwide, Inc. (C.D. Cal. 2017) 253 F.Supp.3d 1074, 1077, quoting O’Connor v. Uber Technologies, Inc. (N.D. Cal. 2016) 201 F.Supp.3d 1110, 1135.)

Seventy-five percent of all PAGA penalties must be paid to the LWDA. (See Lab. Code, § 2699(i) [“Except as provided in subdivision (j), civil penalties recovered by aggrieved employees shall be distributed as follows: 75 percent to the Labor and Workforce Development Agency for enforcement of labor laws and education of employers and employees about their rights and responsibilities under this code, to be continuously appropriated to supplement and not supplant the funding to the agency for those purposes; and 25 percent to the aggrieved employees.”].) Courts have discretion to approve settlements that do not allocate any penalty amount. (Nordstrom Com. Cases (2010) 186 Cal.App.4th 576, 589). Labor Code § 2699(g)(1) provides, in relevant part: “Any employee who prevails in any action shall be entitled to an award of reasonable attorney’s fees and costs . . . .” (Lab. Code, § 2699(g)(1).)

Plaintiff moves for approval of a PAGA settlement entered between the parties. Plaintiff has agreed to settle the PAGA penalties for a Gross Settlement Fund of $125,000. (Bartz Decl. ¶ 3.) The Gross Settlement Fund includes all attorneys’ fees and costs, settlement administration expenses, and penalties payments to the aggrieved employees and the Labor and Workforce Development Agency (LWDA).

The Net Settlement Amount to be distributed to the aggrieved employees and the LWDA is approximately $76,566. The Net Settlement Amount will be distributed 75% to the LWDA ($57,425), and 25% to the aggrieved employees ($19,141). The number of aggrieved employees is 292. (Bartz Decl. ¶ 8.) As such, each of the aggrieved employees will receive, on average, approximately $65 in penalties.

With respect to the distribution of the PAGA settlement, the Court finds the parties’ agreement is proper. The settlement follows thorough discovery. Based on data furnished by Plaintiff, and this court’s review and analysis, the gross settlement amount is reasonable based on all the circumstances in this case and the uncertainties of achieving full PAGA penalties. (Bartz Decl. ¶¶ 9, 10.) The Court finds that the distribution of civil penalties complies with Labor Code section 2699(i), which requires 75 percent of the amount to be paid to the LWDA and 25 percent of the amount to be paid to the aggrieved employees.

Plaintiff’s counsel also seeks $41,666 as compensation for reasonable attorneys’ fees, $1,767.43 for reimbursement of litigation costs and expenses, and $5,000 for Settlement Administration Costs.

The Court finds the requested attorney’s fees and costs are reasonable based on the time spent, counsel’s experience, and the results achieved by this litigation. (See Bartz Decl. ¶ 13.)

Finally, the court finds the general release is fair and reasonable under the statute. The released claims include “[a]ll claims for PAGA penalties that were alleged, or reasonably could have been alleged, based on the PAGA Period facts stated in the Operative Complaint, and the PAGA Notice.” (Bartz Decl., Exh. 1, 5.1, 5.2.)

Any party may submit on the tentative ruling by contacting the courtroom via email at Smcdept49@lacourt.org by no later than 4:00 p.m. the day before the hearing. All interested parties must be copied on the email. It should be noted that if you submit on a tentative ruling the court will still conduct a hearing if any party appears. By submitting on the tentative you have, in essence, waived your right to be present at the hearing, and you should be aware that the court may not adopt the tentative, and may issue an order which modifies the tentative ruling in whole or in part.