LAW & MOTION CALENDAR

TENTATIVE RULINGS

 

January 21, 2022

 

9:00 a.m.

 

CX-104

                                                                                                                             

JUDGE WILLIAM D. CLASTER

 

Department CX104 Phone Number: (657) 622-5304

 

 

The Court will hear oral argument on all matters at the time noticed for the hearing.  If you would prefer to submit the matter on your papers without oral argument, please advise the clerk by calling (657) 622-5304. The Court will not entertain a request for continuance nor filing of further documents once the ruling has been posted.

 

APPEARANCES:  Appearances, whether remote or in person, must be in compliance with new Code of Civil Procedure §367.75, California Rules of Court, Rule 3.672, and Superior Court of California, County of Orange, Appearance Procedure and Information, Civil Unlimited and Complex, located at https://www.occourts.org/media-relations/covid/Civil_Unlimited_and_Complex_Appearance_Procedure_and_Information.pdf

Parties preferring to be heard in person, instead of remotely, should provide notice of their intent to appear in person to the court and to all other parties at least five days before the hearing.

 

All remote appearances will be telephonic through CourtCall, unless otherwise ordered/specified by the Court.  Contact CourtCall at 888-882-6878 or CourtCall.  Requests for fee waivers may be submitted to CivilSRL@occourts.org or the drop box outside the Central Justice Center courthouse

 

COURT REPORTERS:  Official court reporters (i.e. court reporters employed by the Court) are NOT provided for any matters in this department.  If a party desires a record of a law and motion proceeding, it will be the party’s responsibility to provide a court reporter.  Parties must comply with the Court’s policy on the use of privately retained court reporters which can be found at:

 

·         Civil Court Reporter Pooling; and

 

·         For additional information, please see the court’s website at  Court Reporter Interpreter Services for additional information regarding the availability of court reporters.

 

 

PUBLIC ACCESS:  The public may listen to remote court hearings at no cost by calling the public access number (657-231-1414) and entering the access code for this Department (12129801#) and PIN for this Department (12129801#).  The public will be able to listen, but not participate in the proceedings.  The public access number and the access code for a particular unlimited civil courtroom can be obtained at:

 

·         Civil Limited, Unlimited and Complex (Updated June 11, 2020)

 

 

#

CASE NAME

MATTER

1

19-01062763

 

Faasua vs. Eagle Home Mortgage, LLC

Plaintiff Laurie Faasua's Motion to Approve Settlement ROA #166

 

The Court has reviewed the supplemental briefing filed in response to the October 29, 2021 minute order.  Plaintiff’s motion for approval of the parties’ PAGA settlement is GRANTED, contingent upon the parties confirming either in writing before the hearing or on the record at the hearing that the settlement is not intended to cover any PAGA claims against Movement Mortgage that may have arisen after December 31, 2018.  This condition is based on the parties’ representation that Defendant sold the business division at issue to Movement Mortgage effective January 2019, and that none of the aggrieved employees covered by this settlement worked for Defendant after December 31, 2018. Assuming this point is confirmed, it should be included in the final order submitted to the Court for signature.

Assuming the parties confirm as much on the record, the Court finds settlement 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; 287 Cal.Rptr.3d 107, 127.)

The Court approves the following distributions:

  1. Attorney’s fees in the amount of $13,333.33, or 1/3 of the GSA.  The Court finds this to be a reasonable amount in light of the result obtained, the quality of the work performed by counsel, a review of the billing records provided, and the estimated lodestar.  In approving this amount and examining the billing and cost records as a cross-check on the overall reasonableness of the fees and costs, the Court is not approving any particular hourly rates proposed by counsel.

 

  1. Litigation costs in the amount of $13,643, representing the full amount sought.

 

  1. Administration costs in the amount of $2,700, per the updated estimate from the administrator.

 

  1. An enhancement to Plaintiff of $2,500.

 

  1. Taking the above distributions into account, from the GSA of $40,000, $7,823.67 remains to be distributed as provided under PAGA.  This amount shall be allocated as follows:

 

    1. $5,867.75 (75%) to the LWDA.
    2. $1,955.92 (25%) to the aggrieved employees.

 

The administrator is to file a declaration no later than September 23, 2022 to confirm that the distribution of funds to aggrieved employees is complete.  Upon receipt of the administrator’s declaration, the Court will determine whether further briefing or a hearing is necessary.

Please submit a revised proposed order that conforms to the foregoing for the Court’s signature.

2

20-01126373

 

Vasquez vs. FM Restaurants HQ, LLC

Plaintiff Alejandro Vazquez and Maria Juaregui's Motion to Approve Private Attorney General Act Settlement  ROA # 92

Plaintiff’s motion for approval of PAGA settlement is CONTINUED to March 25, 2022 at 9:00 a.m. in Department CX104 to permit the supplemental briefing described below.  The Court has reviewed all submissions of Plaintiffs, Defendant, Bautista and the LWDA.  Upon review of these filings, the Court finds there are items of concern that must be addressed by Plaintiffs or Defendants before approval can be granted.  However, on the present record, the Court does not believe the motion should be denied.

Bautista’s and Defendant’s requests for judicial notice are GRANTED, but only as to the existence of the exhibits, not to the truth of anything asserted therein. 

The Court proposes on its own motion to take judicial notice of the Small Business Administration’s April 2020 interim final rule regarding Paycheck Protection Program loans, found at 85 Fed. Reg. 20811.  Plaintiffs discuss this rule in their briefing, but a copy is not included in their papers.

I.            Ability to Hear Bautista’s Objections

The parties dispute whether the Court may consider Bautista’s objections.  Bautista and Plaintiff appear to agree that under Moniz v. Adecco USA, Inc. (2021) 72 Cal.App.5th 56, 287 Cal.Rptr.3d 107, the Court may—but is not required to—consider her objections.  Defendant, on the other hand, argues that the Court lacks even the inherent power to consider her objections.

The Court agrees with Plaintiffs and Bautista.  Moniz most directly concerned a competing PAGA plaintiff’s ability to appeal the approval of a settlement she believed was unfair.  As the Court of Appeal explained, competing plaintiffs have a “role as an effective advocate for the state” that enables them to take such appeals.  (Id., at p. 123.)  The Court believes Bautista’s role as an advocate for the state is a sufficient reason for considering her objections now.  Furthermore, the Court notes that as a complex court, it has a responsibility to use “exceptional judicial management to . . . promote effective decision making.”  (CRC 3.400(a).)  The Court finds that consideration of Bautista’s objections would promote effective decision making.  For these reasons, the Court will consider her objections.

II.          Adequacy of Notice

Both the LWDA and Bautista contest the adequacy of the settling Plaintiffs’ pre-filing notices (and amended notices).  Plaintiffs and Defendant argue the notices were sufficient, and Defendant further argues that administrative exhaustion is an affirmative defense that it can waive.  The Court agrees that Defendant can waive the defense of exhaustion, but this isn’t responsive to the LWDA’s concerns as a real party in interest.  The purpose of the notice requirement is to provide both the employer and the LWDA information before a PAGA claim is filed.  (See Williams v. Superior Court (2017) 3 Cal.5th 531, 545-46 [discussing “evident purpose” of notice].)  The LWDA has interests in the notice requirement separate from those of Defendant.

As to the Plaintiffs’ filing of amended complaints before the expiration of the 65-day period for LWDA review of PAGA notices of violations, it is undisputed that the LWDA never objected to the filing of these amended pleadings within the 65-day time frame. Indeed, the LWDA did not raise this issue until it was asked for briefing on other settlement issues by this Court. Neither the LWDA nor Bautista cite any authority for overturning the settlement on this basis—particularly where the LWDA could have raised this issue in a timely fashion if it thought it was problematic. Accordingly, the arguably premature filing of amended complaints does not amount to a failure to exhaust.

In terms of the substance of the numerous notices and amended notices filed by the parties, the Court finds as follows regarding adequacy of notice.  As the Court understands the papers, these specific violations are disputed by the parties.

First, the retaliation claim (Labor Code § 1102.5) is not adequately described.  “[B]are allegations” that “simply paraphrase[] the allegedly violated statutes” are “insufficient.”  (Brown v. Ralphs Grocery Co. (2018) 28 Cal.App.5th 824, 837.)  Plaintiffs’ description of the § 1102.5 violation in their June 3, 2021 notice simply paraphrases a portion of the statute. 

Second, some of the tip pooling claims (Labor Code §§ 351, 353, 354, and 356) are adequately described.  Plaintiff Santos’s original prefiling letter (ROA 239, Ex. 4), says “Plaintiff and others were unlawfully forced to share tips.”  This “minimal fact” is enough to “support[] the alleged violation.”  (Brown, supra, 28 Cal.App.5th at  838.)

Third, the remaining tip pooling claims (Labor Code §§ 432, 432.5) are not adequately described.  The Court cannot even determine why they are listed as tip pooling claims in the June 3, 2021 letter.  Section 432 requires an employer to provide a copy of an employee’s contract on request, and section 432.5 prohibits employers from requiring employees to agree in writing to terms of employment that would violate the law.  The factual basis for these claims is mentioned nowhere in the letter.

Fourth, the cell phone-based reimbursement claim (Labor Code § 2802) is adequately described in the June 3 letter.  Bautista argues that the statute of limitations has run on Plaintiffs’ attempt to add detail to this claim, but the statute of limitations is an affirmative defense that Defendant can waive.  Bautista cites no authority for the proposition that the statute of limitations plays a role in whether a PAGA notice adequately describes the violations.

As a result of the foregoing, the claims for violation of §§ 432, 432.5, and 1102.5 are not adequately described.  Accordingly, Plaintiffs have “no basis to sue on [those] ground[s].”  (Uribe v. Crown Building Maintenance Co. (2021) 70 Cal.App.5th 986, 1006.)  Because Plaintiffs have no basis to sue for these violations, any settlement Plaintiffs reach with Defendant cannot include settlement of PAGA claims based upon them.  (Ibid.)  The Court will therefore deny approval of the settlement insofar as it is based on these statutes.

 

III.       Evaluation of Settlement

“[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, supra, 287 Cal.Rptr.3d at p. 127.)  Factors such as “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” inform this evaluation.  (Id., at p. 126.) 

A.           Potential Collusion

 

Bautista contends approval should be denied because the settlement is collusive.  The LWDA shares her concerns about collusion.  As discussed in a prior minute order, after Bautista amended her prefiling notice to add retaliation as a predicate Labor Code violation, Plaintiffs added it to their own amended notice and updated the settlement to cover retaliation as a PAGA predicate.  Bautista argues that this has the effect of wiping out her claims, and that Plaintiffs and Defendant colluded to achieve this result.  (The Court expresses no opinion on the effect approval of this settlement might have on Bautista’s claims.  As Moniz explains, the res judicata effect of a judgment is determined by the court where res judicata is raised as a defense.  Id., at p. 132.)

The Court shares Bautista’s and the LWDA’s concerns that the settlement was reached in a collusive manner designed to cut out Bautista.  But in evaluating a PAGA settlement, the Court’s focus is on whether the settlement “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.”  (Id., at p. 127.)  A collusive settlement could still provide sufficient value to serve PAGA’s purpose of remediating present labor law violations and deterring future ones.

Even though the Court concludes that the § 1102.5 claim was not the subject of an adequate LWDA notice and should not be included in the settlement, the valuation of that claim is addressed here inasmuch as it is a primary basis of the collusion argument. Plaintiffs’ co-counsel Petronelli explains his investigation and valuation of the retaliation claim in his supplemental declaration (ROA 258).  He declares that Plaintiffs and Defendants agreed to produce contact information for a random sampling of 195 aggrieved employees, or roughly 3.4% of the employees at issue.  Counsel contacted these 195 employees and found a total of three who had arguably been retaliated against for complaining about Labor Code violations.  Extrapolating this to the entire set of aggrieved employees, and using Labor Code § 1102.5’s $10,000 penalty, counsel estimates maximum exposure of $850,000 in penalties for retaliation as a PAGA predicate.  But Counsel also notes potential defenses that made maximum recovery unlikely.  Most importantly, counsel notes that retaliation claims tend to be highly individualized, so a PAGA claim based on retaliation could be found unmanageable.  (See Wesson v. Staples the Office Superstore, LLC (2021) 68 Cal.App.5th 746, 283 Cal.Rptr.3d 846, 860 [“courts have inherent authority to ensure that PAGA claims can be fairly and efficiently tried and, if necessary, may strike a claim that cannot be rendered manageable”].)   Petronelli further notes that the $100,000 settlement amount for the retaliation claim was arrived at with the assistance of a mediator, suggesting arms-length negotiation.

The Court finds Petronelli’s explanation sufficient to demonstrate that the retaliation claim was properly investigated and valued, and that it represents a realistic potential recovery sufficient to serve PAGA’s purposes.  The Court will not deny approval of the settlement on grounds of collusion.

B.           Scope of PAGA Release

 

The “Released Claims” are defined at ¶ 17.  They are “all claims . . . that were, or could have been asserted in the Actions, pursuant to [PAGA],” followed by a laundry list of predicate statutes and descriptions of claims.  It appears that all predicate statutes and descriptions of claims are mentioned in the operative 2AC.  Moniz makes clear that an “all PAGA claims that could have been pled based on the facts alleged” release is permissible, regardless of whether all such claims were listed in the prefiling letter.  (Moniz, 287 Cal.Rptr.3d at pp. 131-132.) 

That said, Bautista raises several meritorious objections to the scope of the PAGA release.  First, the Released Claims are not limited to claims that arose during the PAGA Period as defined.  That is, the release as written appears to have no temporal limit.  Second, the Released Claims are claims “that were, or could have been asserted in the Actions” under PAGA.  The definition is not limited to PAGA claims that could have been asserted based on the allegations of the complaints in the Actions.  Since any number of PAGA claims could have been brought in the Actions, the definition of Released Claims effectively releases all possible PAGA claims.  The Court will not permit this.  Third, Bautista points out that Labor Code §§ 354 and 433 impose criminal liability.  The Court will not permit a release of criminal liability through a PAGA settlement.

In addition, the LWDA raises a concern not addressed by Plaintiffs or Defendant in their responsive briefs.  Section 98.6, one of the two retaliation statutes at issue, provides for a civil penalty of $10,000.  But the statute expressly provides that this penalty is to be paid to the employee who was retaliated against.  (Lab. Code, § 98.6(b)(3).)  The LWDA argues this may not be subject to PAGA because it is a penalty paid directly to the employee.  The Court agrees.  Section 1102.5(f), in contrast, provides for a civil penalty of $10,000 for retaliation, but says nothing about this penalty being paid to the employee.  This indicates an employee has a substantive right to recover penalties under § 98.6, unlike penalties under § 1102.5.  Because a PAGA settlement cannot release claims that actually belong to employees, the settlement cannot release claims for penalties under § 98.6.

Subject to these changes, the PAGA release is otherwise appropriate.

C.            Global Concerns Regarding Valuation

 

Bautista raises two global arguments regarding Plaintiffs’ valuation of the PAGA claims.  First, Plaintiffs assumed no stacking of penalties when determining a maximum value.  (ROA 217, ¶ 28.)  Bautista asserts the stacked value is $151,250,200.  (ROA 229, ¶ 9.)  Her papers fault Plaintiffs for not using the stacked value.  The LWDA also faults Plaintiffs for not stacking.  The Court is not persuaded by this argument because the Court would be unlikely to stack penalties in the event the case proceeded to trial and judgment.  Plaintiffs’ maximum valuation is adequate on this point.

Bautista also faults Plaintiffs for taking into account Defendant’s financial condition as a discretionary reason to reduce penalties (in that Defendant operates restaurants during COVID), but not accounting for Defendant apparently getting a $20 million PPP loan.  (ROA 228, p. 20.)  But as Plaintiffs point out in response (ROA 253, p. 10), per the SBA’s April 2020 interim final rule, PPP loans could only be spent for limited purposes.  These purposes include things like meeting payroll, mortgage, and lease obligations.  They don’t include paying judgments.  (See 85 Fed. Reg. at p. 20814.)  The PPP loan proceeds are not available to pay to the aggrieved employees as penalties.

IV.         Items of Concern and Supplemental Briefing

Based upon its review of the papers, the Court has identified a number of items of concern that must be addressed before it can grant approval of the settlement.  These items of concern are to be addressed by Plaintiffs and/or Defendant in supplemental briefing filed by March 4, 2022.  If a revised settlement agreement and/or proposed notice is submitted, a redline version showing all changes, deletions, and additions must be submitted as well.  In addition, Plaintiff must provide proof of service of any revised settlement agreement and supplemental papers on the LWDA.

As to the Settlement:

1.            Apart from Vasquez, Juraegui, Santos, and Bautista, are there any other matters, whether individual, class, or PAGA, pending or in the pre-filing LWDA stage, that could be affected by approval of this settlement?

 

2.            Paragraph 35.b of the settlement provides that the aggrieved employees release certain claims relating to maladministration of the settlement.  The aggrieved employees are not, and never will be, party to this case.  The court will not approve any release that binds them beyond the extent to which they are bound by operation of PAGA.

 

3.            The initial installment of settlement funding is due after the “Effective Date,” which could be years away if appeals are taken.  But the second and third installments are due on specific dates in 2022 rather than dates calculated in reference to the Effective Date.  Does the settlement require the second and third installments to be made regardless of whether the Effective Date has passed?  The Court has a similar concern about the date for disbursements from the settlement fund.

 

4.            How large a sample of time and pay records did Defendant turn over?  What steps were taken to ensure it was representative of the aggrieved employees?

 

5.            Counsel declares: ““Further, Plaintiffs pled claims for failure to pay wages on a biweekly basis, illegal tip-sharing, illegal tip withholding or pooling, failure to keep payroll records, failure to pay vested vacation time, failure to provide paid sick leave, and failure to provide at the time of hiring, written notice containing the information regarding rates of pay, the regular payday, and the name of the employer’s workers’ compensation insurance carrier. [¶] After investigating data, and documents provided by Defendant, there was not enough evidence to substantiate these claims on a PAGA basis.”  (ROA 257, ¶¶ 16-17.)  A simple reference to investigation and documents is not sufficient information for the Court to fulfill its duties under Moniz.  Please explain the strengths and weaknesses of these claims, the evidence supporting the parties’ positions, etc.

 

6.            What investigation did counsel undertake of the rest break claims?  The Court notes that rest break claims ordinarily cannot be proven from record review.  What did the evidence indicate regarding the strengths and weaknesses of this claim?

 

7.            Regarding the reimbursement claim, counsel states: “Defendant represented that its non-exempt staff had no reason to be using their personal cell phones or equipment for any work-related purposes, which claim appeared credible based upon Plaintiff’s investigation.”  (ROA 257, ¶ 31.)  Please describe the investigation.  Did counsel conduct interviews of the aggrieved employees?  Review cell phone bills?  Etc.

 

8.            Please provide contemporaneous attorney billing records for the Court to perform a lodestar cross-check.

 

9.            Please provide supporting documents (e.g., a costs ledger) for claimed litigation costs.

 

10.         Please ensure the above-mentioned changes to the PAGA release are made.

 

11.         If the named Plaintiffs wish to receive enhancement payments, they must provide declarations that address the factors set forth in Golba v. Dick’s Sporting Goods, Inc. (2015) 238 Cal.App.4th 1251 and Clark v. Am. Residential Servs. LLC (2009) 175 Cal.App.4th 785, including the amount of time and effort spent on the litigation.

 

As to the Notice:

1.            Please describe the predicate Labor Code violations in straightforward language.

 

2.            Please describe the release in straightforward language.

 

3.            Should notice be given in any languages other than English and Spanish?

 

4.            If any changes are made to the settlement agreement, please make corresponding changes to the notice.

5.            The font size in the actual notice may not be smaller than the font size in the proposed notice provided to the Court.

 

3

19-01079324

 

Glass vs. Bay-Mortgage Group

1. Plaintiff Inessa Babalyan and Melissa Hernandez's Motion for Attorneys' Fees and Costs, Administration Costs, and Class Representative Enhancement fees ROA # 180

2. Motion for Final Approval

 

Plaintiff’s motion for final approval of class action settlement is GRANTED contingent upon Plaintiffs providing the Court with their individual settlement shares prior to the hearing or on the record at the hearing.  The Court requested this information in its minute order of June 4, 2021, but the administrator’s declaration does not contain it.

Assuming this concern is addressed, the Court will approve the following distributions:

1.    Attorney’s fees in the amount of $255,000, or 30% of the GSA, to be split between counsel per their agreement.  The Court finds this amount to be a reasonable result in light of the quality of the result obtained, the work performed by class counsel, a review of the billing records provided, and the estimated lodestar.  In approving these amounts and examining the billing records provided, the Court is not approving any particular hourly billing rates proposed by class counsel. 

 

2.    Litigation costs in the amount of $17,992, the full amount sought.

 

3.    Administration costs in the amount of $9,000, per the administrator’s declaration.

 

4.    Enhancements of $5,000 apiece to Plaintiffs, for a total of $10,000.  In making this award, the Court has considered only the factors set forth in Golba v. Dick’s Sporting Goods, Inc. (2015) 238 Cal.App.4th 1251 and Clark v. Am. Residential Servs. LLC (2009) 175 Cal.App.4th 785.

 

5.    A payment to the LWDA in the amount of $37,500, representing the LWDA’s share of the $50,000 allocated to the PAGA claim.

 

Please submit a revised proposed order that conforms to the foregoing for the Court’s signature.

Pursuant to CCP § 384(b), Plaintiff shall submit to the Court a final report on or before September 23, 2022 setting forth the actual amounts paid to class members and other amounts disbursed pursuant to the settlement.  Upon receiving the report, the Court will determine whether further reports and/or a hearing will be necessary.

4

21-01227097

 

Marston-Kelly vs. Optum Services, Inc.

Defendant Optum Services, Inc.'s Special Demurrer to Plaintiff Michelle Ann Marston-Kelly's Unverified Complaint ROA # 43

This case was dismissed on 01/14/2022.

5

19-01105044

 

Hong vs. Polaris Dental Lab Group, Inc.

1.Plaintiff Dae Won Hong's Motion for Approval of Representative Settlement of Private Attorneys General Act of 2004 ("PAGA") Cause of Action ROA # 102

2. Status Conference

Plaintiff’s motion for approval of PAGA settlement is CONTINUED to March 4, 2022 at 9:00 a.m. in Department CX104 to permit the parties to respond to the following items of concern.   Any supplemental briefing shall be filed on or before February 18, 2022.  If a revised settlement agreement and/or proposed notice is submitted, a redline version showing all changes, deletions and additions must be submitted as well.  In addition, Plaintiff must provide proof of service of any revised settlement agreement and supplemental papers on the LWDA.

  1. Are there any other matters, whether individual, class or PAGA, pending or in the pre-filing LWDA stage, that could be affected by approval of this settlement?

 

2.            In order to evaluate the fairness of the PAGA settlement, the Court must be provided with a copy of Plaintiff’s individual settlement agreement.

 

3.            Is Plaintiff’s counsel to be paid from Plaintiff’s individual settlement?  If so, what amount does counsel expect to recover?  The Court requires this amount in order to determine whether the requested fee here is appropriate.

 

4.            Counsel declares that he has spent over 100 hours on this matter.  The Court is concerned that this figure may include time spent on Plaintiff’s individual claims, which should not be recovered from a PAGA common fund.  Please provide contemporaneous billing records to aid the Court’s evaluation of the fee request.

 

5.            Is the group of aggrieved employees covered by this settlement all non-exempt employees of Defendants, or some subset?  If the settlement covers all non-exempt employees, is there evidence that all employees were subject to the same treatment?  For example, Plaintiff claims he worked 14-hour days but was only paid at the straight time rate.  Is the same true not just of other dental technicians like Plaintiff, but also of clerical workers like receptionists?

 

6.            How many pay periods are at issue?  Paragraph 1.b of the agreement states there are 2,627 pay periods at issue, and that the accuracy of this number is a material term of the settlement.  On the other hand, the brief and counsel’s declaration both state there are 1,332 pay periods at issue, and the settlement amount is calculated in reference to 1,332 pay periods.

 

7.            The parties propose that defense counsel will administer the settlement.  What experience does counsel have in settlement administration?  How does counsel propose to distribute checks—by mail, in person, etc.?  If address information is incorrect and checks are returned, does counsel propose to run a skip trace and remail them?  Will counsel prepare the 1099s for the aggrieved employees, since the settlement funds will be in the form of a check from counsel?

 

8.            Please provide for 180 days to cash settlement checks instead of 120.

 

9.            Did Defendants turn over time and pay records for the aggrieved employees prior to mediation?  If so, were all records turned over, or only a sample?  If a sample, how large a sample, and what steps were taken to ensure it was representative of the aggrieved employees as a whole?

 

10.         “[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, 287 Cal.Rptr.3d 107, 127.)  Factors such as “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” inform this evaluation.  (Id., at p. 126.)  The current discussion of valuation, which accounts only for the Court’s discretion to reduce penalties, is insufficient.  For each predicate Labor Code violation, please provide further information about the strengths and weaknesses of Plaintiff’s claims and Defendants’ expected defenses, including the evidence supporting both sides’ cases.  In addition, insofar as the valuation depends on the Court’s discretion to reduce penalties across the board, please provide reasons why Plaintiff believes it realistic that the Court would reduce penalties by over 96% from the asserted maximum of $132,000.

 

11.         The agreement states that a form of notice will be submitted for the Court’s approval.  No form of notice is included with the moving papers.  In addition, should notice be given in any languages other than English?

 

6

20-01161559

 

Marquez vs. Hixson Metal Finishing

Plaintiff Rafael Marquez's Motion to Approve Private Attorneys General Act Settlement and Enter Final Judgment ROA # 53

Plaintiff’s motion for approval of PAGA settlement is CONTINUED to March 4, 2022 at 9:00 a.m. in Department CX104 to permit the parties to respond to the following items of concern.   Any supplemental briefing shall be filed on or before February 18, 2022.  If a revised settlement agreement and/or proposed notice is submitted, a redline version showing all changes, deletions and additions must be submitted as well.  In addition, Plaintiff must provide proof of service of any revised settlement agreement and supplemental papers on the LWDA.

  1. Counsel states that Plaintiff has separately settled his individual claims and is willing to provide a copy of the agreement for the Court’s in camera review.  Please provide a copy of the individual settlement.  If the parties wish it to remain confidential, they may temporarily lodge it under seal and move to permanently seal it per CRC 2.551.

 

  1. The Court is confused by counsel’s discussion of the unpaid wage claim.  Based on the prefiling letter to the LWDA, the Court understood the unpaid wage claim to be based on off-the-clock work.  Counsel now describes a failure to pay for nonproductive time in a piece work compensation scheme.  Please explain how the aggrieved employees were compensated and clarify the nature of the unpaid wage claim.

7

18-01019235

 

McNair vs. Impac Mortgage Corp.

Plaintiff Inga McNair's Motion for Preliminary Approval of Class and Representtive Action Settlement  ROA # 246

Plaintiff’s motion for preliminary approval of class action and PAGA settlement is CONTINUED to March 4, 2022 at 9:00 a.m. in Department CX104 to permit the parties to respond to the following items of concern.  Any supplemental briefing shall be filed on or before February 18, 2022.  If a revised settlement agreement and/or class notice is submitted, a redline showing all changes, deletions and additions must be submitted as well.  In addition, Plaintiffs must provide proof of service of any revised settlement agreement and supporting papers on the LWDA.

As to the Settlement:

1.            Counsel states there are three other PAGA notices that have been filed against Defendant.  What is the status of those matters?  Are those employees or their counsel aware of this settlement?

 

2.            Please provide copies of Plaintiffs’ prefiling letters to the LWDA.

 

3.            The First Amended Consolidated Complaint pleads a class that begins four years before filing, or September 18, 2014.  The settlement agreement defines a class that begins October 22, 2017.  What is the reason for this discrepancy?  Note that the UCL statute of limitations has now run on all claims accruing prior to January 2018.  The Court is unlikely to approve a settlement that effectively extinguishes three years of claims without compensation. 

 

4.            Additionally, the class release at ¶ 61 describes the class period as beginning October 22, 2011.  Which date is correct?

 

5.            The unpaid wage claim is based on two separate theories that ultimately sound in commissions and bonuses: first, that employees were incentivized to work off the clock to get commissions and bonuses by the structure of Defendant’s overtime policy, and second, that Defendant failed to include bonuses and commissions in the regular rate for overtime purposes.  The class consists of all non-exempt hourly employees, some of whom presumably are not subject to the compensation scheme applicable to commissioned employees.  How do the theories of the unpaid wage claim play out for employees not compensated on a commission or bonus basis?

 

6.            In discussing the regular rate claim, counsel explains that Defendant would have raised Labor Code § 204.1 as a defense.  Section 204.1 applies to “an employer licensed as a vehicle dealer by the Department of Motor Vehicles.”  How would this statute apply to a mortgage company?  Is Defendant a licensed vehicle dealer?

 

7.            Does the UCL claim have any independent value?  Note that as the class is currently defined, the UCL statute of limitations does not extend the class period back four years.

 

8.    Paragraph 44 of the settlement agreement contains the following language that needs to be deleted: the class members “agree to indemnify and hold harmless the Released Parties, Class Counsel, and Defendant’s Counsel for any tax liability, including penalties and interest, arising out of or relating to the Settlement Class Members’ failure to pay taxes on any amounts paid pursuant to this Agreement.”  The Court does not believe indemnity obligations should be imposed on absent class members.

9.            At final approval, please submit billing records for attorney’s fees and costs.  The Court will not be inclined to award an amount of fees and costs greater than the amount stated in the notice.

 

10.         At final approval, please submit billing records for administrative costs.  The Court will not be inclined to award administrative costs in an amount greater than the amount stated in the notice.

 

11.         At final approval, plaintiffs are to provide declarations addressing the enhancement factors set forth in Golba v. Dick’s Sporting Goods, Inc. (2015) 238 Cal.App.4th 1251 and Clark v. Am. Residential Servs. LLC (2009) 175 Cal.App.4th 785, including the amount of time and effort spent on the litigation.  In addition, the administrator is to provide a high, low, and average for individual settlement payments, along with plaintiffs’ individual payouts.

 

As to the Notice:

  1. Does notice need to be given in any languages other than English?

 

2.            If any changes are made to the settlement agreement, please make corresponding changes to the notice.

 

3.            The font size in the actual notice may not be smaller than the font size in the proposed notice provided to the Court.

 

8

19-01121146

 

Miller vs. Corcept Therapeutics Inc.

Plaintiff Maren S. Miller's Unopposed verified Application of Vincent J Moccio Appear Pro Hac Vice  ROA 161

 

The unopposed application of Vincent J. Moccio for pro hac vice admission is GRANTED.  The application complies with the requirements of CRC 9.40.