2010-00093814-CU-OE

Deanna Yates vs. Healthcare Uniform Company, Inc.

Nature of Proceeding:   Motion for Final Approval of Class Action Settlement

Filed By:  Lunde, Michelle M.

Plaintiff Deanna Yates’ unopposed motion for final approval of class action settlement
is tentatively granted pending the final fairness hearing. C.C.P., sec. 382, California
Rules of Court, Rule 3.769.

This matter was previously set to be heard on June 27, 2013, but the tentative ruling
approving the settlement was vacated after a notice of stay due to Defendant’s
bankruptcy was filed.  Plaintiff has since obtained relief from the stay.

The law favors settlement, particularly in class actions and other complex cases where
substantial resources can be conserved by avoiding the time, cost, and rigors of formal
litigation. See Newberg on Class Actions 4th (4th ed. 2002) § 11.41 (and cases cited
therein); Class Plaintiffs v. City of Seattle (9th Cir. 1992) 955 F.2d 1268, 1276; Van
Bronkhorst v. Safeco Corp. (9th Cir. 1976) 529 F.2d 943, 950; see also. Potter v.
Pacific Coast Lumber Co. (1951) 37 Cal.2d 592, 602. In approving a class action
settlement, the Court must “satisfy itself that the class settlement is within the ‘ballpark’
of reasonableness.” Kullar v. Foot Locker Retail, Inc., (2008) 168 Cal.App.4th 116,
133.  In making its fairness determination, the Court should consider the relevant
factors, such as the strength of the Plaintiffs’ case, the risk, expenses, complexity and
likely duration of further litigation, the risk of maintaining class action status through
trial, the amount offered in settlement, the extent of discovery completed and the stage
of the proceedings, and the experience and views of counsel. Dunk v. Ford Motor Co.
(1996)  48 Cal. App. 4th 1794,1801.

While the Court’s ruling indicates that it will give its final approval to the class action
settlement and approve class counsel’s fee requests and the class representative
service fee, the Court must still hold the final fairness hearing to allow potential class
members the opportunity to be heard. Dunk, supra, at p. 1802.

In this action, Plaintiff filed a class action on behalf of herself and other similarly
situated individuals employed as store managers by Defendant Healthcare Uniform
Company, Inc.  Plaintiff alleged causes of action for Labor Code violations related to
failures to provide meal and rest breaks, failures to pay required wages for all time
worked, itemized wage statement violations, and failures to pay wages upon
termination.  Plaintiff also alleged Defendant violated Business and Professions Code
§ 17200.  Finally, Plaintiff sought remedies pursuant to the Private Attorney General
Act (“PAGA”).  The parties ultimately reached a settlement following mediation.

The Court preliminarily approved the class action settlement and the class notice on
March 19, 2013.  Consistent with the Court’s order, notice of the settlement was  provided to approximately 61 class members.  Defendant has agreed to pay a total of
$80,000 to establish a gross settlement amount.  From that amount, attorneys’ fees
(up to 30% of the settlement), costs up to $4,100, claims administration costs of
approximately $7,000, a $2,500 service award to Plaintiff and $1,000 payment under
PAGA will be deducted resulting in a net settlement amount of approximately $41,650.
The net settlement amount will be distributed to settlement class members in a manner
commensurate with the number of weeks they worked during the class period.  On
average, class members will receive approximately $1,286.

Before finally approving a class action settlement, the Court must find that the
settlement is “fair, adequate, and reasonable.”  ( Wershba v. Apple Computer (2001) 91
th
Cal.App.4   224, 244, 245.)  “[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.”  (Dunk v.
th
Ford Motor Company (1996) 48 Cal.App.4   1794, 1802.)  The Court considers such
factors as “the strength of plaintiffs’ case, the risk, expense, complexity and likely
duration of further litigation, the risk of maintaining class action status through trial, the
amount offered in settlement, the extent of discovery completed and the stage of the
proceedings, the experience and views of counsel, the presence of a governmental
participant, and the reaction of class members to the proposed settlement.”  (Id. at
1801.)

Here, the Court finds that the settlement is entitled to a presumption of fairness and
that all relevant factors support final approval.  The moving papers demonstrate that
the settlement was the product of arms-length bargaining between the parties and was
reached after sufficient discovery which allowed the parties, and therefore, this Court,
to act intelligently with respect to the settlement.  (Carver Decl. ¶¶ 4, 12-14)  Further,
class counsel is experienced in this type of wage and hour class action litigation,
having litigated over one hundred wage and hour class actions, and views the
settlement as favorable to the class.  (Id. ¶ 12.)  Moreover, the class reaction is
overwhelmingly positive as no objections were received from the approximately 61
class members to whom notice was provided.  (Id. ¶ 11.)  The settlement is entitled to
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a presumption of fairness.  (Dunk, supra, 48 Cal.App.4   at 1802.)

The above described settlement provides value to the class members as it provides
them with monetary compensation in a manner approximately commensurate with the
potential value of their individual claims in light of the risks of continued litigation.

Moreover, as already discussed, the settlement was reached after sufficient discovery
was completed such that the parties were in a position to intelligently evaluate and
settle the action.  (Carver Decl. ¶¶ 4, 12-14)  Class counsel is experienced in
employment and labor class action and in his view, the settlement is favorable for the
class.  (Id. ¶ 12.)  Finally, out of the approximately 61 class members to whom notice
was provided, no objections were received and to date, 30 valid claims have been
submitted.  Four opt-outs were received.  (Pourhashem Decl. ¶ 10.)  Thus, after
consideration of all relevant factors, and subject to the final fairness hearing, the Court
concludes that the settlement is fair, adequate, and reasonable and entitled to final
approval.

In addition, the Court approves Plaintiff counsel’s request for attorneys’ fees in the
amount of $24,000 which represents 30% of the gross settlement fund.  Given the
contingent nature of class counsel’s representation and the associated risks, the Court
finds this to be an appropriate fee award.  The Court also approves class counsel’s
request for litigation costs in the amount of $4,100.  In addition, the Court tentatively
approves the claims administration fees in the amount of $7,000.  Finally, the Court
approves the $2,500 incentive award to Plaintiff for her time and efforts serving as the
class representative.  This is an appropriate award.

In sum, and subject to the final fairness hearing, the Court concludes that the
settlement is entitled to final approval and that the various fee requests are appropriate
and also approved.

The Court anticipates that it will sign the proposed order of final approval and judgment
at the conclusion of the final fairness hearing in the event that it adopts the findings set
forth above which given the lack of objections to the settlement the Court anticipates it
will do.