Case Number: BC632995 Hearing Date: March 26, 2018 Dept: 32

Carmen Kroll,

Plaintiff,

v.

Stephen hamel, et al.,

Defendants.

Case No.: BC632995

Hearing Date: March 26, 2018

[TENTATIVE] order RE:

Motion for determination of good faith settlement

BACKGROUND

In the complaint, Plaintiff Carmen Kroll (“Plaintiff”) alleges that she was hired by Defendants Stephen Hamel (“Stephen”) and Leslie Hamel (“Leslie”) as a caregiver for their mother Marilyn Hamel (“Marilyn”) on January 4, 2014. Plaintiff alleges that she was terminated without explanation on February 10, 2015. Plaintiff further alleges that during her employment, Defendants failed to pay overtime, provide meal breaks, and otherwise engaged in various Labor Code violations. Plaintiff asserts causes of action for (1) retaliation in violation of FEHA; (2) failure to prevent discrimination, harassment, and retaliation in violation of FEHA; (3) wrongful termination in violation of public policy; (4) failure to pay wages; (5) failure to pay minimum wages; (6) failure to pay overtime compensation; (7) failure to provide meal and rest breaks; (8) failure to provide itemized wage statements; (9) waiting time penalties; (10) unfair competition; and (11) extortion.

On January 9, 2018, Leslie’s motion for summary judgment was denied, and motion for summary adjudication was granted as to the first, second, and eleventh causes of action. On January 26, 2018 Stephen’s motion for summary judgment was denied, and motion for summary adjudication was granted as to the first, second, seventh, eighth, and eleventh causes of action and as to punitive damages.

DISCUSSION

Any party to an action in which it is alleged that two or more parties are joint tortfeasors or co-obligors on a contract debt shall be entitled to a hearing on the issue of the good faith of a settlement entered into by the plaintiff or other claimant and one or more alleged tortfeasors or co-obligors upon giving notice in the manner provided in Code of Civil Procedure, section 1005(b). (CCP § 877.6(a)(1).) A determination by the court that the settlement was made in good faith shall bar any other joint tortfeasor or co-obligor from any further claims against the settling tortfeasor or co-obligor for equitable comparative contribution, or partial or comparative indemnity, based on comparative negligence or comparative fault. (CCP § 877.6 (c).) The party contesting the settlement bears the burden of proving that the settlement is in bad faith. (CCP § 877.6 (d).)

The Tech-Bilt decision sets out factors to apply when determining good faith of a settlement when a tortfeasor challenges the good faith of that settlement. These factors include (1) a rough approximation of the plaintiff’s total recovery and the settlors’ proportionate liability, (2) the amount paid in settlement, (3) a recognition that a settlor should pay less in settlement than if found liable after a trial, (4) the allocation of the settlement proceeds among plaintiffs, (5) the settlor’s financial condition and insurance policy limits, if any, and (6) evidence of any collusion, fraud, or tortious conduct between the settlor and plaintiffs aimed at making the nonsettling parties pay more than their fair share. (Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499.)

“[A] defendant’s settlement figure must not be grossly disproportionate to what a reasonable person, at the time of the settlement, would estimate the settling defendant’s liability to be. . . . The party asserting the lack of good faith, who has the burden of proof on that issue (§ 877.6, subd. (d)), should be permitted to demonstrate, if he can, that the settlement is so far ‘out of the ballpark’ in relation to these factors as to be inconsistent with the equitable objectives of the statute.” (Id. at 499–500.)

Leslie moves for an order deeming the proposed settlement between Plaintiff and Leslie to be in good faith. The terms of the settlement are as follows: (1) payment by Leslie in the sum of $10,000; (2) Plaintiff and Leslie enter into a mutual release; and (3) each party shall bear its own fees and costs.

Although at summary judgment, the Court ultimately found that there was a triable issue of fact as to whether Leslie was Plaintiff’s employer, the evidence submitted with the motion for summary judgment and with this motion show a strong likelihood that Leslie would not be found to be Plaintiff’s employer. On balance, Leslie’s offer to settle for $10,000 is reasonable in light of the likelihood that her liability would be zero.

In his sur-reply, Stephen argues that if the settlement agreement is inadmissible as evidence at trial, then the agreement is collusive in that Plaintiff and Defendant have agreed to preclude co-defendant Stephen from proving accord and satisfaction of the wage and hour claims. Paragraph 14 of the settlement agreement provides: “It is understood and agreed that this Agreement may be offered into evidence solely to enforce the terms of this Agreement. In such event, the party seeking to admit this Agreement into evidence shall take all steps necessary to obtain permission of the tribunal for this Agreement to be placed under seal and to otherwise protect its confidentiality.” Even if this clause were construed as a confidentiality agreement, the settlement agreement is no longer confidential as it is now part of the public record. Issues of admissibility will be determined later at trial. Furthermore, given that Stephen is not a party to the settlement agreement, he is under no obligation to adhere to Paragraph 14 and may thus submit the agreement into evidence for other purposes. Based on the foregoing, Stephen’s concern regarding the admissibility of the settlement agreements is a non-issue. Stephen does not otherwise object to the settlement agreement. Accordingly, the motion is GRANTED.