SUPERIOR COURT OF CALIFORNIA

COUNTY OF SANTA CLARA

PETRA GODINEZ; JOSE RODRIGUEZ; FLORENTINO GAYOSO, Individually and on Behalf of All Other Similarly Situated Employees of Defendants,

Plaintiffs,

vs.

EL POLLO LOCO, INC.; W.K.S. RESTAURANT GROUP, INC.; SUNNYVALE/SANTA CLARA EL POLLO LOCO, LLC; W.K.S. RESTAURANT CORPORATION; and DOES 1 to 100, inclusive,

Defendants.

Case No. 17CV317828

TENTATIVE RULING RE: MOTION FOR FINAL APPROVAL OF CLASS ACTION SETTLEMENT; JUDGMENT

The above-entitled action comes on for hearing before the Honorable Thomas E. Kuhnle on January 17, 2020, at 9:00 a.m. in Department 5. The Court now issues its tentative ruling as follows:

I. INTRODUCTION
II.
This is a putative class action. Plaintiffs Petra Godinez, Jose Rodriguez, and Florentino Gayoso (collectively, “Plaintiffs”) allege various Labor Code violations in the First Amended Class Action Complaint (“FAC”), filed on November 1, 2017.

The FAC sets forth causes of action titled: (1) Unpaid Wages (Violation of Labor Code §§ 216, 1194, 1197); (2) Failure to Pay Overtime Wages (Violation of Labor Code §§ 204, 510, 1198); (3) Failure to Pay Wages for Rest Periods (Violation of Labor Code § 226.7); (4) Failure to Pay Wages for Meal Periods (Violation of Labor Code §§ 226.7, 512); (5) Failure to Properly Report Pay (Labor Code §§ 226, 1174); (6) Waiting Time Penalties (Labor Code §§ 201, 202, 203); (7) Violation of the UCL – Unlawful Business Acts and Practices (Bus. & Prof. Code § 17200, et seq.); (8) Violation of the UCL – Unfair Business Acts and Practices (Bus. & Prof. Code § 17200, et seq.); (9) Violation of the UCL – Fraudulent Business Acts and Practices (Bus. & Prof. Code § 17200, et seq.); (10) Fraud/Intentional Misrepresentation; and (11) Civil Penalties (Labor Code § 2699).

The parties have reached a settlement. On September 9, 2019, the Court granted preliminary approval of the settlement. Plaintiffs now move for final approval of the settlement.

III. LEGAL STANDARD
IV.
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, citing Dunk, supra, 48 Cal.App.4th at p. 1801 and Officers for Justice v. Civil Service Com’n, etc. (9th Cir. 1982) 688 F.2d 615, 624.)

“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, supra, 48 Cal.App.4th at p. 1801 and Officers for Justice v. Civil Service Com’n, etc., supra, 688 F.2d at p. 625, 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, supra, 48 Cal.App.4th at p. 1802.)

V. DISCUSSION
VI.
The case has been settled on behalf of the following class:

All employees who were employed as exempt General Managers in the restaurants owned and/or operated by Defendants in the state of California during the Class Period (October 20, 2013 up to and including the date of Preliminary Approval), and who have not already released the Settled Claims.

The class is split into two sub-classes. Sub-class 1 includes all class members who worked as General Managers after October 20, 2014 through the date of preliminary approval. Sub-class 2 includes all class members, other than those in Sub-class 1, who worked as exempt General Managers from October 20, 2013 up to and including, but not after, October 20, 2014.

As discussed in connection with preliminary approval, defendants Sunnyvale/Santa Clara El Pollo Loco, LLC and W.K.S. Restaurant Corporation (collectively, “Defendants”) will pay a total amount of $285,000. The settlement amount includes attorneys’ fees and costs of $94,990.50, a PAGA payment of $10,000 ($7,500 of which will be paid to the LWDA), and claims administration fees of $9,000. Of the remaining net amount of $171,009.50, the parties plan to allocate $150,488.36 (88%) plus the $2,500 PAGA payment to Sub-class 1. The parties plan to allocate $20,521.14 (12%) to Sub-class 2.

For tax purposes, 40% of the payments will be considered wages and 60% will be considered statutory interest and other miscellaneous income, not subject to income tax withholding and payroll taxes. Checks not cashed within 150 days after mailing will be given to a cy pres recipient – Legal Aid at Work.

On October 22, 2019, the settlement administrator mailed notice packets to all 43 class members. (Declaration of Abigail Schwartz for Rust Consulting, Inc. (“Schwartz Decl.”), ¶ 8.) There are no undeliverable class notices. (Id. at ¶ 9.) There are no requests for exclusion. (Id. at ¶ 11.)

There is one objection. (Id. at ¶ 12.) The objection is from Maria Isabel Ontiveros. (Schwartz Decl., Ex. B.) Ms. Ontiveros asserts “[t]he settlement is unfair because [she] worked more than they paid [her].” (Ibid.) While the Court understands this perspective, it is to be expected that recovery through settlement will be less than the full amount sought because settlement is a compromise.

The Court previously found that the proposed settlement is fair and the Court continues to make that finding for purposes of final approval.

The Court also has an independent right and responsibility to review the requested attorneys’ fees and only award so much as it determines reasonable. (See Garabedian v. Los Angeles Cellular Telephone Co. (2004) 118 Cal.App.4th 123, 127-128.) Plaintiffs’ counsel requests attorneys’ fees in the amount of $94,990.50 (approximately one-third of the total settlement fund). Plaintiffs’ counsel provides evidence demonstrating a lodestar of $135,815, which results in a negative multiplier. (Declaration of Robert S. Arns in Support of Motion for Award of Attorneys’ Fees, Costs, and Service Awards, ¶ 22.) The attorneys’ fees are approved.

The motion for final approval of class action settlement is GRANTED.

Pursuant to Rule 3.769, subdivision (h), of the California Rules of Court, this Court retains jurisdiction over the parties to enforce the terms of the Settlement Agreement, and the final Order and Judgment.

The Court now sets a compliance hearing on October 2, 2020 at 10:00 a.m. in Department 5. 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 Defendant, the status of any unresolved issues, and any other matters appropriate to bring to the Court’s attention. Counsel may appear at the compliance hearing telephonically.

The Court will prepare the final order if this tentative ruling is not contested.

NOTICE: The Court does not provide court reporters for proceedings in the complex civil litigation departments. Parties may arrange for a private court reporter to provide services, but those arrangements must be consistent with the local rules and policies posted on the Court’s website.