Case Name: Matthew Sottile v. Motion Recruitment Partners LLC, et al.
Case No.: 18-CV-321677

This is a putative wage and hour class action on behalf of employees of defendant Motion Recruitment Partners LLC. The parties have reached a settlement, which the Court preliminarily approved in an order filed on November 20, 2018. The factual and procedural background of the action and the Court’s analysis of the settlement and settlement class are set forth in that order.

Before the Court are plaintiff’s motions for final approval of the settlement and for approval of his attorney fees, costs, and service award. Plaintiff’s motions are unopposed.

I. Legal Standards for Approving a Class Action/PAGA Settlement

Generally, “questions whether a settlement was fair and reasonable, whether notice to the class was adequate, whether certification of the class was proper, and whether the attorney fee award was proper are matters addressed to the trial court’s broad discretion.” (Wershba v. Apple Computer, Inc. (2001) 91 Cal.App.4th 224, 234-235, citing Dunk v. Ford Motor Co. (1996) 48 Cal.App.4th 1794, disapproved of on other grounds by Hernandez v. Restoration Hardware, Inc. (2018) 4 Cal.5th 260.)

In determining whether a class settlement is fair, adequate and reasonable, the trial court should consider relevant factors, such 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 the class members to the proposed settlement.

(Wershba v. Apple Computer, Inc., supra, 91 Cal.App.4th at pp. 244-245, internal citations and quotations omitted.)

The list of factors is not exclusive and the court is free to engage in a balancing and weighing of factors depending on the circumstances of each case. (Wershba v. Apple Computer, Inc., supra, 91 Cal.App.4th at p. 245.) The court must examine the “proposed settlement agreement to the extent necessary to reach a reasoned judgment that the agreement is not the product of fraud or overreaching by, or collusion between, the negotiating parties, and that the settlement, taken as a whole, is fair, reasonable and adequate to all concerned.” (Ibid., quoting Dunk v. Ford Motor Co., supra, 48 Cal.App.4th at p. 1801, internal quotation marks omitted.)

The burden is on the proponent of the settlement to show that it is fair and reasonable. However “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.”

(Wershba v. Apple Computer, Inc., supra, 91 Cal.App.4th at p. 245, citing Dunk v. Ford Motor Co., supra, 48 Cal.App.4th at p. 1802.) The presumption does not permit the Court to “give rubber-stamp approval” to a settlement; in all cases, it must “independently and objectively analyze the evidence and circumstances before it in order to determine whether the settlement is in the best interests of those whose claims will be extinguished,” based on a sufficiently developed factual record. (Kullar v. Foot Locker Retail, Inc. (2008) 168 Cal.App.4th 116, 130.)

Finally, Labor Code section 2699, subdivision (l) provides that “[t]he superior court shall review and approve any penalties sought as part of a proposed settlement agreement pursuant to” PAGA. 75 percent of any penalties recovered under PAGA go to the Labor and Workforce Development Agency (“LWDA”), leaving the remaining 25 percent for the aggrieved employees. (Iskanian v. CLS Transportation Los Angeles, LLC (2014) 59 Cal.4th 348, 380.) “[T]here is no requirement that the Court certify a PAGA claim for representative treatment” as in a class action. (Villalobos v. Calandri Sonrise Farm LP (C.D. Cal., July 22, 2015, No. CV122615PSGJEMX) 2015 WL 12732709, at *5.) “[W]hen a PAGA claim is settled, the relief provided … [should] be genuine and meaningful, consistent with the underlying purpose of the statute to benefit the public ….” (Id. at *13.) The settlement must be reasonable in light of the potential verdict value (see O’Connor v. Uber Technologies, Inc. (N.D. Cal. 2016) 201 F.Supp.3d 1110, 1135 [rejecting settlement of less than one percent of the potential verdict]); however, it may be substantially discounted given that courts often exercise their discretion to award PAGA penalties below the statutory maximum even where a claim succeeds at trial (see Viceral v. Mistras Group, Inc. (N.D. Cal., Oct. 11, 2016, No. 15-CV-02198-EMC) 2016 WL 5907869, at *8-9).

II. Terms and Administration of the Settlement

The non-reversionary $754,264 settlement includes a $18,750 payment to the California Labor and Workforce Development Agency associated with plaintiff’s PAGA claim (seventy-five percent of the $25,000 allocated to PAGA penalties). Attorney fees of up to $251,421.33 (one-third of the gross settlement), litigation costs not to exceed $12,000, and administration costs not to exceed $7,500 will also be paid from the gross settlement. The named plaintiff will seek an enhancement award of $10,000.

The net settlement fund will be divided among participating class members pro rata based on their weeks worked during the settlement class period. Class members will not be required to submit a claim to receive their payments. Settlement awards will be allocated 33 percent to wages and 67 percent to expense reimbursements, interest, and penalties. Defendant will separately pay the employer’s share of payroll taxes. Funds associated with checks uncashed after 180 days will be issued to the California Department of Industrial Relations Unclaimed Wages Fund in the class member’s name.

Class members who do not opt out of the settlement will release all claims, demands, etc., “which were alleged or could have been alleged in the Action based upon the facts and theories alleged in the Complaint which occurred during the Class Period,” including unknown claims and specified wage and hour claims.

The notice process has now been completed. There were no objections or requests for exclusion from the class. Of 64 notice packets, 4 were re-mailed to updated addresses and 4 were ultimately undeliverable. The administrator estimates that the average class member payment will be $7,103.01, with a maximum payment of $19,784.46.

At preliminary approval, the Court found that the proposed settlement provides a fair and reasonable compromise to plaintiff’s claims. It finds no reason to deviate from this finding now, especially considering that there are no objections. The Court consequently finds that the settlement is fair and reasonable for purposes of final approval.

III. Attorney Fees, Costs, and Incentive Award

Plaintiff seeks a fee award of $251,421.33, or 1/3 of the gross settlement, which is not an uncommon contingency fee allocation. This award is facially reasonable under the “common fund” doctrine, which allows a party recovering a fund for the benefit of others to recover attorney fees from the fund itself. Plaintiff also provides a lodestar figure of $156,546.25, based on 232.35 hours spent on the case by attorneys with billing rates of $475 to $795 per hour. The fee request results in a reasonable multiplier of 1.6. As a cross-check, the lodestar supports the 1/3 percentage fee requested, particularly given the lack of objections to the attorney fee request. (See Laffitte v. Robert Half Intern. Inc. (Cal. 2016) 1 Cal.5th 480, 488, 503-504 [trial court did not abuse its discretion in approving fee award of 1/3 of the common fund, cross-checked against a lodestar resulting in a multiplier of 2.03 to 2.13].) Plaintiff’s attorney fee request is accordingly approved.

Plaintiff also requests $12,000 in costs, equal to the estimate provided at preliminary approval and below the $13,776.61 actually incurred. The costs are reasonable based on the summaries provided and are approved. The $7,500 in administrative costs are also approved.

Finally, plaintiff requests a service award of $10,000. To support his request, he submits a declaration in which he describes his efforts on the case and estimates that he spent between 30 and 40 hours on the matter. The Court finds that the class representative is entitled to an enhancement award and the amount requested is reasonable.

IV. Conclusion and Order

Plaintiff’s motions are GRANTED.

The following class is certified for settlement purposes:

All individuals who worked for Defendant Motion Recruitment Partners, LLC as Practice Managers in California, classified as exempt, from January 10, 2014 to September 30, 2018.

The Court sets a compliance hearing for December 6, 2019 at 10:00 A.M. in Department 1. At least ten court days before the hearing, class counsel and the settlement administrator shall submit a summary accounting of the net settlement fund identifying distributions made as ordered herein, the number and value of any uncashed checks, amounts remitted to the Unclaimed Wages Fund, the status of any unresolved issues, and any other matters appropriate to bring to the Court’s attention. Counsel shall also submit an amended judgment as described in Code of Civil Procedure section 384, subdivision (b). Counsel may appear at the compliance hearing telephonically.

The Court will prepare the order.