Judge: Timothy B. Taylor, Case: 37-2022-00001960-CU-OE-CTL, Date: 2023-08-04 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

DEPT.:

EVENT DATE:

EVENT TIME:

HALL OF JUSTICE

TENTATIVE RULINGS - August 03, 2023

08/04/2023  01:30:00 PM  C-72 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Timothy Taylor

CASE NO.:

CASE CATEGORY:

EVENT TYPE:

CASE TITLE: CASE TYPE:

Civil - Unlimited  Other employment Motion Hearing (Civil) 37-2022-00001960-CU-OE-CTL BERGARA VS BREAD & CIE INC [IMAGED] CAUSAL DOCUMENT/DATE FILED: Motion for Approval of Class Settlement, 05/26/2023

Tentative Ruling on Renewed Motion for Preliminary Approval of Class Action Settlement Bergara v. Bread & Cie, Case No. 2022-1960 August 4, 2023, 1:30 p.m., Dept. 72 1. Overview and Procedural Posture.

This case began as a PAGA action challenging the wage and hour practices of defendants, which own and operate a local bakery. The complaint was filed in January 2022; the case was assigned to Judge Meyer, but plaintiff challenged him and the case was reassigned to Dept. 72. ROA 9-10.

The FAC, adding a claim under B&P Code section 17200, was filed in March 2022. ROA 15.

Defendants answered in May, 2022. ROA 16.

Defendants filed an initial delay motion (ROA 19-24), then a motion seeking an order compelling arbitration based on the decision of the US Supreme Court in the Viking River Cruises, Inc. v. Moriana (2022) __U.S.__, 142 S.Ct. 1906. ROA 36-43. This motion was set for hearing on Sept. 30, 2022. The arbitration motion was later abandoned by defendant. ROA 46. At the continued CMC, the court was advised of a settlement. ROA 50, 51. The parties later stipulated to the filing of the SAC, adding class claims. ROA 53, 55. The court was expecting papers seeking preliminary approval of a class/PAGA settlement. Instead, a paralegal for one side called the clerk on December 15, 2022, indicating there was no settlement and asking to take the preliminary approval hearing off calendar. The court set an OSC re sanctions instead. ROA 54. Both sides filed a response to the OSC. ROA 57-59. The court heard the OSC on January 20, 2023, and discharged it with no sanctions in a detailed ruling. ROA 63.

The court was to have taken up the long-awaited motion for preliminary approval of the proposed class action and for approval of the PAGA settlement (ROA 66-70) on May 5, 2023. The court was instead obliged to take that motion off calendar because the moving papers were so fundamentally flawed that there is no reason to go forward with the preliminary approval hearing, as neither preliminary approval nor PAGA approval could ever be granted. ROA 75. At a subsequent hearing the court was assured counsel would re-file the preliminary approval motion, and it was re-calendared for today (10 months after the parties first said the case was settled). ROA 80-81.

The renewed moving papers have now been filed. ROA 83-86. The court has reviewed them. By Calendar No.: Event ID:  TENTATIVE RULINGS

2973321  44 CASE NUMBER: CASE TITLE:  BERGARA VS BREAD & CIE INC [IMAGED]  37-2022-00001960-CU-OE-CTL design, there is no opposition.

2. Applicable Standards.

A. CRC 3.769 sets forth the procedure to be followed when a class action is provisionally settled prior to class certification. First the court preliminarily approves the settlement and the class members are notified as directed by the court. CRC 3.769(c)-(f). Second, the court conducts a final approval hearing to inquire into the fairness of the proposed settlement. CRC 3.769(g). The court must determine whether the settlement is fair, adequate, and reasonable. Dunk v. Ford Motor Co. (1996) 48 Cal.App.4th 1794, 1801.

B. When evaluating the reasonableness of a class action settlement, the trial court should consider the following non-exhaustive list of factors: - Strength of plaintiff's case. This is the most important factor.

- Expense associated with taking the case to trial, i.e., the avoided cost of further litigation.

- Amount or value offered in settlement.

- Extent of discovery completed and state of proceedings.

- Experience and views of counsel.

- Presence of a governmental participant.

- Reaction of class members to proposed settlement.

Id. at 1801. Though the burden is on the proponents of the settlement, 'a presumption of fairness 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.' Id. at 1802.

C. Like class actions, PAGA settlements are subject to trial court review and approval. Lab. Code § 2699(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. Many of the same factors used to evaluate the fairness of a class action settlement – i.e., 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 – can be 'useful' in evaluating the fairness of a PAGA settlement. Id. 3. Discussion of Fairness of Settlement.

A. Strength of Case: Excluding PAGA penalties, plaintiff estimates that the potential exposure would be around $8 million. (Han Decl., ¶ 51.) However, given the risks of obtaining class certification and prevailing on the merits, the realistic recovery for this case was calculated to be only $770,872.70. (Id.

at ¶ 59.) The very essence of a settlement is compromise, i.e., the 'yielding of absolutes and an abandoning of highest hopes.' Linney v. Cellular Alaska Partnership (9th Cir. 1998) 151 F.3d 1234, 1242.

B. Avoided Expenses and Other Risks: This is not monetized in the moving papers, but the court can well imagine at least $100,000.00 being spent by plaintiff's counsel getting the case teed up for an opposed class certification motion, and potentially much more.

C. Amount Offered in Settlement: The total amount offered in settlement is $400,000, with no reversion.

The parties intend to allocate these funds as follows: -Attorneys' fees: $133,333.33 to plaintiff's counsel (one-third of gross settlement) -Litigation costs: $10,000.00 to plaintiff's counsel -Costs of administration: $15,000.00 to CPT Group Calendar No.: Event ID:  TENTATIVE RULINGS

2973321  44 CASE NUMBER: CASE TITLE:  BERGARA VS BREAD & CIE INC [IMAGED]  37-2022-00001960-CU-OE-CTL -Class representative incentive payment: $7,500.00 -PAGA payment: $10,000.00, of which $7,500.00 (75%) will go the LWDA, and $2,500.00 (25%) will go to the aggrieved employees The foregoing deductions result in a net settlement of amount of approximately $226,666.67 to be distributed among the 1,047 class members. This comes out to an average settlement share per class member of around $216.49 (not including the PAGA allocation to the aggrieved employees). All of this the court will have another opportunity to review at the final approval/fairness hearing. Counsel should file declarations establishing their hours and hourly rate (so the court may calculate a lodestar), and justifying the requested costs.

D. Extent of Discovery: Written discovery and informal exchange of information and data. (Han Decl., ¶ 13.) E. Experience and View of Counsel: Counsel is experienced in cases of this type and recommends the settlement. (Han Decl., ¶¶ 4, 36.) F. Presence of a governmental participant: On May 26, 2023, plaintiff's counsel submitted a copy of the settlement to the LWDA. (Donnelly Decl., ¶ 3.) G. Reaction of class members to proposed settlement: This, of course, will not be fully known until notice of the proposed settlement has been given to the class.

H. Form of Notice. First class U.S. mail.

4. Ruling.

The court finds it is more likely than not that, if preliminary approval is granted, the settlement will meet with approbation of the class. The court further finds that the PAGA settlement is fair, adequate, and reasonable in light of PAGA's policies and purposes. Accordingly, the court grants the unopposed preliminary approval motion and will sign the proposed order (ROA 85) submitted with the moving papers.

The fees sought by counsel will be the subject of additional scrutiny at the fairness hearing. As noted above, counsel should submit declarations establishing their hours and hourly rate (so the court may calculate a lodestar), and justifying the anticipated costs.

Counsel should attend the hearing prepared to discuss future dates to be filled in on the proposed order.

Calendar No.: Event ID:  TENTATIVE RULINGS

2973321  44