Case Name: Francisco Carrasco v. West Valley Engineering, Inc., et al.
Case No.: 17-CV-310816

This is a putative wage and hour class action by employees of defendant West Valley Engineering, Inc., alleging that defendant omitted required information from employees’ wage statements. The parties have reached a settlement, which the Court preliminarily approved on June 21, 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.

Plaintiff now moves for final approval of the settlement and approval of his attorney fees, costs, and enhancement award. Plaintiff’s motion is unopposed.

I. Legal Standard for Approving a Class Action 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.)
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.)

II. Terms and Administration of the Settlement

The $370,000 non-reversionary settlement includes a $3,750 payment to the California Labor and Workforce Development Agency associated with plaintiff’s PAGA claim (seventy-five percent of the $5,000 allocated to PAGA penalties). Attorney fees of up to $123,333.33 (approximately one-third of the gross settlement), litigation costs not to exceed $15,000, and administration costs of $12,500 will also be paid from the gross settlement. The named plaintiff will seek an enhancement award of $10,000. The parties agree that all payments to settlement class members shall be treated as penalties not subject to tax withholdings.

The net settlement, approximately $205,416.67, will be distributed to class members pro rata based on their qualifying wage statements issued during the class period. Class members will not be required to submit a claim to receive their payments. If a class member fails to cash his or her settlement check within 180 days of mailing, the check will be voided and the associated funds will be deposited with the Department of Industrial Relations Unclaimed Wages fund in the class member’s name.

The settlement will be funded in three payments of $123,333.33: one within thirty days of preliminary approval, one within ten days of the Effective Date of the settlement (the date of final approval, unless objections are pursued), and one within forty days of the Effective Date.

Class members who do not opt out of the settlement will release all claims, etc. “that are alleged in, or that could have been alleged in, Plaintiffs’ notice letter to the LWDA … or the Complaint …, arising out of wage statements furnished by Defendant to individuals that did not show the name and address of the employer.”

The notice process has now been completed. There were no objections or timely requests for exclusion from the class. Of 1,438 notice packets, 71 were re-mailed to updated addresses and 29 were ultimately undeliverable. The claims administrator

estimates that the average class member payment will be $142.85, with a minimum payment of $14.55 and a maximum payment of $800.14.

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.

On October 3, the claims administrator filed a declaration notifying the Court that one untimely request for exclusion was received and was rejected by the defendant. The Court questions why a request submitted within two weeks of the opt-out deadline and before the final fairness hearing cannot be honored. If the parties maintain that they will not accept this request, they must appear at the final fairness hearing to explain their reasoning.

III. Attorney Fees, Costs, and Incentive Award

Plaintiff seeks a fee award of $123,333.33, 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 $91,065, based on 130.1 hours spent on the case by attorneys with billing rates of $650 per hour. The fee request results in a modest multiplier of 1.35. 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 also requests $4,100.43 in costs, below the $15,000 estimate provided at preliminary approval. The costs are reasonable based on the summaries provided and are approved. The $12,500 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. 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 motion for final approval is GRANTED.

The following class is certified for settlement purposes:

All individuals who worked for Defendant in California at any time from May 23, 2016, through the date of the Court’s preliminary approval of the class action settlement, and who were paid wages by Defendant for hours worked during that time period but did not receive a corresponding wage statement that showed the name and address of the employer.

The Court intends to approve the one request for exclusion from the class that was received by the administrator on September 28. If the parties maintain that they will not accept this request, they must appear at the final fairness hearing to explain their reasoning.

The Court will prepare the order.