Judge Ronald F. Frank, Case Number: 21TRCV00813, Date: 2024-07-19 Tentative Ruling

Judge: Ronald F. Frank, Case: 21TRCV00813, Date: 2024-07-19 Tentative Ruling

Case Number: 21TRCV00813 Hearing Date: July 19, 2024 Dept: 8

Tentative Ruling¿

¿¿

HEARING DATE: July 19, 2024

¿¿

CASE NUMBER: 21TRCV00813

¿¿

CASE NAME: Jorge Garcia v. US Best Ingredients, Inc., et al.

¿¿

MOVING PARTY: Plaintiff, Roberto Rivera, et al

¿¿

RESPONDING PARTY: Defendant, US Best Ingredients, Inc. (No Opposition – Stipulation Regarding Settlement)

¿¿

TRIAL DATE: Not Set.

¿¿

MOTION:¿ (1) Motion for Stipulation Regarding Amendment of Settlement

Tentative Rulings: (1) GRANTED, but discuss whether notice has already been received by the class members that did not include the subtraction of the $10,000 to Plaintiff, and if so, whether the parties intend to inform the class members of the amendment.

I. BACKGROUNG

A. Factual

On November 3, 2023, Plaintiff, Jorge Garcia, individually and on behalf of himself and all others similarly situated (“Plaintiff”), filed a Complaint against Defendant, US Best Foods Ingredients, Inc., and DOES 1 through 50. The Complaint alleging a cause of action for: (1) Penalties Under the Private Attorneys’ General Act, Labor Code § 2698, et seq. Plaintiff alleges that Defendant failed to pay minimum wages; failed to pay overtime owed; failed to provide lawful meal periods; failed to authorize and permit lawful rest periods; failed to pay wages owed at separation; and knowingly and intentionally failed to comply with itemized employee wage statement provisions.

On May 17, 2023, Plaintiff filed a Motion for Approval of PAGA Representative Action Settlement. On June 14, 2023, this Court GRANTED that motion.

Now, Defendant files a stipulation for final approval of settlement.

B. Procedural

On June 27, 2024, Defendant filed a stipulation regarding settlement. To date, no opposition has been filed.

II. ANALYSIS¿

A. Approval of Class Action Settlement¿¿

The court has broad powers to determine whether a proposed settlement is fair. (Mallick v. Superior Court (1979) 89 Cal.App.3d 434, 438.) The California standard for approval of class settlements is similar to the federal requirement that the settlement be fair, reasonable, and adequate for class members overall. (Dunk v. Ford Motor Co. (1996) 48 Cal.App.4th 1794, 1801.) California Rules of Court, rule 3.769(g), provides for an inquiry into the fairness of the proposed settlement prior to the final approval hearing. After this, the court must make and enter judgment, including a provision for the retention of the court's jurisdiction over the parties to enforce the terms of the judgment. (See California Rules of Court, rule 3.769(h).) The class action may not be dismissed once judgment is entered. (See id., rule 3.770.)

B. Terms of Joint Stipulation of Class Settlement and Release Agreement

A copy of the executed joint stipulation of class settlement and release agreement is attached to the motion as Exhibit 2. Defendant notes that the parties engaged in formal settlement negotiations, including a full day of mediation occurring on August 2, 2022. (Motion, ¶ 2.) Defendant contends that the parties negotiated a total maximum settlement of $225,000. (Motion, ¶ 4.) The amount includes $10,000 of the Total Settlement Payment being provided to plaintiff as an individual settlement in exchange for a general release, to secure a waiver and dismissal of any individual claims he has or may have against Defendant, and to serve as a service award relating to his role as the lead/sole plaintiff in the lawsuit. (Motion, ¶ 4.) Defendant also asserts that the parties’ intention that Plaintiff’s individual settlement payment be paid through the settlement funds is confirmed in the Memorandum of Understanding (“MOU”) executed by the parties on September 20, 2022. (Motion, ¶ 5, Exhibit 1.)

Following the MOU, Defendant notes that the parties drafted and executed an individual settlement agreement relating to Plaintiff’s claims. (Motion, ¶ 6, Exhibit 2.) Defendant clarifies that due to an error in drafting, the joint settlement and release of claims did not reference the fact that Plaintiff’s payment would be funded from the total settlement payment. (Motion, ¶ 7.) However, as Defendant notes, this Court granted approval of the PAGA settlement on June 14, 2023. (Motion, ¶ 8, Exhibit 4.) Defendant further asserts that Plaintiff and Defendant seek and argue to correct these errors via the stipulation of this motion to ensure the settlement funds be properly allocated and distributed. (Motion, ¶ 9.) As such, Defendant contends that the parties agree and have stipulated to modify the Court’s order as follows:

1. The Joint Settlement and Release of Claims agreement shall be modified to reference the fact that $10,000 of the Total Settlement Payment shall be paid to Plaintiff as his individual settlement payment/service award;

2. The Court’s Order shall be amended to indicated that Plaintiff shall be paid $10,000 of the Total Settlement Payment as his individual settlement payment/enhancement award;

3. Paragraph 8 of the Court’s Order is modified as follows: “The remaining PAGA Settlement Amount of $124,911.38 shall be allocated as follows: 75% of the PAGA Settlement Amount, or $93,683.53, will be paid to the LWDA, and the remaining 25%, or $31,227.85, will be paid to all PAGA Settlement Members pursuant to the calculation set forth in the Settlement Agreement for calculating Individual Settlement Payments.”

4. The Court’s Order triggered the funding obligations of Defendant contemplated in the Settlement. Defendant shall continue making payments in accordance with the timelines set forth in the Settlement Agreement. Nothing contained in this Stipulation or the requested modification to the Court’s Order modifies, delays, or otherwise impacts said timelines.

5. A (proposed) amendment to the Court’s Order (Motion, Exhibit 5.)

The courts have a strong policy of allowing motions for leave to amend. “If the motion to amend is timely made and the granting of the motion will not prejudice the opposing party, it is error to refuse permission to amend….” (Morgan v. Super. Ct. (1959) 172 Cal.App.2d 527.) Here, because the parties have stipulated to these amendments, the Court finds this stipulated amendment can be completed without prejudice to the parties. The Court is tentatively inclined to GRANT this motion, however, the Court seeks information at the hearing as to whether notice has already been received by the class members that did not include the subtraction of the $10,000 to Plaintiff, and if so, whether the parties intend to inform the class members of the amendment.

III. CONCLUSION

Based on the foregoing, the Motion for Stipulation of Final Approval of Settlement, including the stipulated amendment, is tentatively GRANTED pending discussion on the Court’s questions above.