Judge: Thomas D. Long, Case: 23STCV13080, Date: 2024-10-15 Tentative Ruling

Case Number: 23STCV13080    Hearing Date: October 15, 2024    Dept: 48

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES - CENTRAL DISTRICT

On June 8, 2023, Plaintiff Kortine Hawkins filed this action against Defendant PLS Check Cashers of California Inc. for penalties under the Private Attorney General Act (“PAGA”).

The parties have agreed on the terms of a settlement.  Under the proposed settlement, Defendant will pay a PAGA Settlement Amount of $425,000.00.  Of that amount, $148,750.00 will be paid as attorney fees, $15,323.86 will be paid as costs, and $6,250.00 will be paid to a settlement administrator.  (See Mashiri Decl., Ex. 1 [“Settlement”].)  Of the remaining amount, 75-percent will be paid to the Labor and Workforce Development Agency (“LWDA”) and 25-percent will be paid to the aggrieved employees on a pro rata basis. 

A court must review and approve any penalties sought as part of a proposed settlement agreement pursuant to Labor Code section 2699.  (Lab. Code, § 2699, subd. (l).)  “[C]ivil 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.”  (Lab. Code, § 2699, subd. (i).)

A.        Plaintiff Has Provided Notice of the Settlement to LWDA.

A proposed PAGA settlement must be submitted to LWDA at the same time that it is submitted to the court for review and approval.  (Lab. Code, § 2699, subd. (l)(2).)  Plaintiff’s counsel attaches proof that the settlement was submitted to the LWDA at the same time the motion was filed.  (Mashiri Decl., Ex. 2.)

Accordingly, the Court finds that this requirement is satisfied.

B.        The Settlement is Entitled to a Presumption of Fairness.

A presumption of fairness¿for a settlement agreement exists where: (1) the settlement is reached through arm’s-length bargaining; (2) investigation and discovery are sufficient to allow counsel and the court to act intelligently; (3) counsel is experienced in similar litigation; and (4) the percentage of objectors is small.  (Dunk v. Ford Motor Co.¿(1996) 48 Cal.App.4th 1794, 1802.)  The final factor does not apply to PAGA.  (See Arias v. Superior Court (2009) 46 Cal.4th 969, 984 [representative actions under PAGA do not violate the due process rights of “nonparty aggrieved employees who are not given notice of, and an opportunity to be heard”].)

The settlement was reached after a mediator’s proposal following a mediation session with Mr. Tripper Ortman, where the parties “agreed, based on the facts and evidence discussed, there could potentially be close to 11,772 covered pay periods during the PAGA Period.”  (Mashiri Decl. ¶¶ 11, 15, 18.)  Before mediation, Plaintiff’s counsel “had multiple telephone conversations with defense counsel where we discussed the alleged claims, potential defenses, and Defendant’s contention that Plaintiff’s claims are subject to arbitration.”  (Mashiri Decl. ¶ 11.)  Counsel for both parties also “reviewed, analyzed, and discussed the time and payroll records for all 742 Aggrieved Employees to determine the viability of the claims and any anticipated defenses.”  (Mashiri Decl. ¶ 14.)  Counsel is very experienced in employment litigation, including PAGA cases.  (See Mashiri Decl. ¶¶ 25-30.)

The Court finds that the settlement is entitled to a presumption of fairness.

C.        The Release is Permissible.

If the Court approves the PAGA settlement, “all PAGA Members, through Plaintiff acting as a proxy for the State of California and the LWDA and as a Private Attorney General acting on behalf of all other PAGA Members, will be deemed to have fully, finally, and forever released the PLS Releasees from all Released Claims.”  (Settlement at p. 7.)  The “Released Claims” are “any and all claims, obligations, demands, rights, causes of action, and liabilities, for penalties under PAGA, that were asserted or could have reasonably been asserted against PLS Releasees based on the factual allegations contained in the complaint filed in the Action (see Section 24 below), the PAGA letter to the LWDA (see Section 23 below), and any amendments thereto.  The Released Claims do not extend beyond claims under PAGA.”  (Id. at p. 2.)

This release is limited to PAGA claims that arise from or relate to allegations in Plaintiff’s Complaint in this action, and it is permissible.

D.        The Attorney Fees and Costs Are Reasonable.

A prevailing employee is entitled to an award of reasonable attorney fees and costs incurred in the action.  (Lab. Code, § 2699, subd. (g)(1).)  Plaintiff’s counsel will receive up to $148,750.00 (35% of the total) and actual litigation costs up to $20,000.00.

The Court finds that the attorney fees and costs are reasonable.

E.        Conclusion

The motion for approval of PAGA settlement is GRANTED.

Moving party to give notice.

Parties who intend to submit on this tentative must send an email to the Court at SMCDEPT48@lacourt.org indicating intention to submit.  If all parties in the case submit on the tentative ruling, no appearances before the Court are required unless a companion hearing (for example, a Case Management Conference) is also on calendar.

         Dated this 15th day of October 2024