Judge: Timothy B. Taylor, Case: 37-2022-00030477-CU-OE-CTL, Date: 2023-08-04 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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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

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Civil - Unlimited  Other employment Motion Hearing (Civil) 37-2022-00030477-CU-OE-CTL ROBERTS VS ENCONTRO NORTH PARK LLC [IMAGED] CAUSAL DOCUMENT/DATE FILED: Motion - Other, 07/07/2023

Tentative Ruling on Motion for Preliminary Approval of Class Action Settlement Roberts v. Encontro North Park LLC, Case No. 2022-30477 August 4, 2023, 1:30 p.m., Dept. 72 1. Overview and Procedural Posture.

This wage and hour matter arises out of plaintiff's employment at defendant's restaurant between September of 2021 and March of 2022. The case was filed as a PAGA-only action in August of 2022.

Defendant answered in September of 2022. ROA 7.

At the due-course CMC in early 2023, the court granted a continuance, and then granted another by stipulation in May. ROA 15-22. The parties subsequently announced a settlement. ROA 28. The settlement included a stipulation to amend the complaint to add class claims. ROA 37. To date, the FAC has not been filed.

Presently, the parties seek conditional certification of the settlement class, preliminary approval of a class action settlement, and approval of the settlement of the PAGA claims as well. ROA 31-36. By design, there is no opposition.

The case is also set for a continued CMC. ROA 30.

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: Calendar No.: Event ID:  TENTATIVE RULINGS

2979901  54 CASE NUMBER: CASE TITLE:  ROBERTS VS ENCONTRO NORTH PARK LLC [IMAGED]  37-2022-00030477-CU-OE-CTL - 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 and Ruling.

A. Strength of Case: Plaintiff's counsel estimates that a 'best case recovery' would be around $1.6 million. (Yaeckel Decl., ¶ 17.) However, he acknowledges that such a recovery would be 'highly unlikely' because the majority of the damages are derivative penalties under PAGA. (Id. at ¶ 18.) Thus, a realistic 'best case' recovery would be approximately $368,905. (Id. at ¶ 23.) 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 $120,000, with no reversion.

The parties intend to allocate these funds as follows: -Attorneys' fees: $40,000.00 to plaintiff's counsel (one-third of gross settlement) -Litigation costs: $11,000.00 to plaintiff's counsel -Costs of administration: $10,000.00 to CAC Services -Class representative incentive payment: $5,000.00 -LWDA payment: $7,500 (75% of $10,000 PAGA allocation) The foregoing deductions result in a net settlement amount of approximately $46,500.00 to be distributed among the 400 class members. This comes out to an average settlement share per class member of approximately $116.25. 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 documents and information.

(Yaeckel Decl., ¶¶ 4-7.) E. Experience and View of Counsel: Counsel is experienced in cases of this type and recommends the settlement. (Yaeckel Decl., ¶¶ 43-44.) Calendar No.: Event ID:  TENTATIVE RULINGS

2979901  54 CASE NUMBER: CASE TITLE:  ROBERTS VS ENCONTRO NORTH PARK LLC [IMAGED]  37-2022-00030477-CU-OE-CTL F. Presence of a governmental participant: The proof of service filed with the moving papers shows that plaintiff's counsel submitted a copy of the settlement to the LWDA concurrently with filing the instant motion. See ROA 36.

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 34) submitted with the moving papers. Plaintiff is directed to file the FAC forthwith.

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.

The CMC set for today is hereby ordered off calendar.

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