Hale v. Perrin Construction, Inc.

The list of factors is not exhaustive and should be tailored to each case. Id.

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. (2001) 91 Cal. App. 4th 224, 225 (disapproved on other grounds by Hernandez v. Restoration Hardware (2018) 4 Cal. 5th 260).

Class Certification and Approval of Class Representative. A class action may be maintained “when the question is one of common or general interest, of many persons, or when the parties are numerous, and it is impracticable to bring them all before the court.” CCP § 382. “The ‘community of interest’ requirement embodies three factors: (1) predominant common questions of law or fact; (2) class representatives with claims or defenses typical of the class; and (3) class representatives who can adequately represent the class.” Gattuso v. Harte-Hanks Shoppers, Inc. (2007) 42 Cal. 4th 554, 575. The Class consists of persons employed by Defendant in California and classified as an hourly, non-exempt employee who worked for Defendant during the Class Period. The Class Period is August 26, 2021 through March 15, 2026. The PAGA period is August 26, 2024 through March 15, 2026.

Here, there appears to be a community of interest. There are common questions of law and fact because the proposed class members all worked for the same employer and were subject to the same employment practices and policies and same wage and hour laws. The class was readily identified through employment records and stands currently at approximately 125 individuals.

The class members have a representative who appears to be similarly situated as former employee of Defendant during the class period and within the class member designation. Counsel has provided evidence that there are no conflicts and Plaintiff’s claims are typical of the class. The Court certifies the class for the purpose of settlement and confirms Shawn Hale as the class representative.

Approval of Class Counsel. Plaintiff’s counsel has demonstrated their experience and familiarity with class action cases, including employment and wage-and-hour disputes. Plaintiff’s counsel has provided evidence that the firm is well versed in class actions, particularly of this nature, and has the competence to be appointed as Class Counsel. The Court appoints Joseph Lavi, Vincent C. Granberry, and Margaux Gundzik as Class Counsel. Monique N. 10

Toby is not listed as Class Counsel in the proposed Order. If this was an oversight, Plaintiff should raise the issue at the hearing and the Court can modify the Order to also appoint Monique N. Toby as Class Counsel.

Approval of Settlement Administrator. Phoenix Class Action Administration is proposed as the settlement administrator. While no evidence was provided in this regard, the Court is familiar with this settlement administrator and confirms appointment.

Fairness of Settlement and Plan of Allocation. Preliminary approval of a class action settlement constitutes a conditional finding that the settlement appears to be in the range of acceptable settlements. The Court has broad discretion to determine whether the settlement is fair. Dunk v. Ford Motor Company, supra, 48 Cal. App. 4th at 1801. As noted above, factors relevant to the court’s determination include, but are not limited to, 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, and the experience and views of counsel.

Id. There is a presumption of fairness 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; and (3) counsel is experienced in similar litigation. Id. at 1802.

The settlement here was the result of arm’s-length bargaining and mediation with an experienced mediator. Plaintiff’s counsel declared that the parties have exchanged extensive discovery and expert review of timekeeping records and other records of Defendant’s allowed both parties to adequately analyze the claims. The Declaration of Monique N. Toby provides analysis of each claim that included the maximum exposure, discounts applied, and the realistic exposure. The class settlement is 30.1% of the realistic recovery. Settling avoids the added costs of litigation to certify the class and to try the matter. It also avoids the possibility that putative class members will have no recovery at all. The Court finds the settlement of $578,000.00 to be fair, adequate, and reasonable.

Within the settlement, various fees and costs are apportioned prior to the net settlement amount, which is distributed to class members. The overall proposed breakdown of the settlement is as follows:

Total Settlement Amount $578,000.00 Proposed Attorneys’ Fees (up to 33 1/3%) -$192,666.67 Litigation Costs and Expenses (up to) -$20,000.00 Settlement Administration Costs (up to) -$7,000.00 Proposed Class Representative Enhancement -$5,000.00 PAGA Claim Settlement Allocation $50,000.00 Payment to Labor and Workforce Development Agency (LWDA) (65%) (-$32,500.00) Payment to Class Members (25%) ($17,500.00) Net Settlement to be Disbursed to Class Members and Aggrieved Employees $320,833.33

Attorneys’ Fees and Costs: Counsel seeks up to 33 1/3% in attorneys' fees and up to $20,000.00 in litigation costs. Counsel has provided evidence of their expertise in the area, the risk of taking the case given that no payment is provided until settlement, and efforts put forth to prosecute the case. The Court will not approve the amount of attorneys' fees until the final approval hearing. The court cannot award attorneys' fees without reviewing information about counsel's hourly rate and the time spent on the case.

This is the law even if the parties have agreed to the fees. Robbins v. Alibrandi (2005) 127 Cal. App. 4th 438, 450-451. At the time of the final approval hearing, the Court will review the evidence provided by Class Counsel. In addition to the hourly rate and hours spent on the case, Class Counsel should provide admissible evidence supporting the hourly fee requested including, if applicable, whether Class Counsel charges fee-paying clients the same rates. The Court will likewise not approve final costs until the final hearing as that is when Counsel can provide evidence of the specific costs incurred as part of this litigation.

Enhancement Award: The settlement provides for an enhancement award of $5,000.00 to the named Plaintiff Shawn Hale as the Class Representative. The Court will not approve the amount of the Plaintiff's enhancement award until the final approval hearing. With the final approval motion, Plaintiff should provide admissible evidence to support the request, e.g. the number of hours of service provided, the nature of the work performed, the risks Plaintiff faced in prosecuting this lawsuit, including any actual retaliation, and/or other evidence demonstrating the need for an incentive payment. See Clark v. American Residential Services, LLC (2009) 175 Cal. App. 4th 785, 804-807. Plaintiff should also provide information regarding how the proposed service award relates to Plaintiff’s anticipated individual settlement award and the average expected individual settlement awards for class members.

Settlement Administration Costs: Settlement administration costs have been requested in an amount up to $7,000.00. The Court will not approve the amount of the costs awarded to the settlement administrator until the final approval hearing. An invoice from Phoenix showing the actual costs incurred will need to be filed for the final approval hearing. If there is a possibility that settlement administration costs may be higher than $7,000, the dollar amount attributed this needs to be increased in the Class Notice. It is Plaintiff’s obligation to raise this issue at the hearing should there be a possibility of more than $7,000 in settlement administration costs.

PAGA: Under the Private Attorney General Act, private parties can assert claims for penalties that otherwise can be recovered only by the Labor and Workforce Development Agency ("LWDA"). Labor Code 2699(a). See also Dunlap v. Superior Court (2006) 142 Cal. App. 4th 330, 336. An employee who, through the PAGA, asserts a claim for civil penalties on behalf of the LWDA is acting as an agent of the LWDA. This is evident from the requirement that before initiating a PAGA claim, an employee must provide notice to the LWDA per Labor Code 2699.3(a), and the requirement that that 65% of any recovered civil penalties must be distributed to the LWDA, Labor Code 2699(i).

In settling the LWDA's claims, Class Counsel are settling and releasing claims for penalties that belong to the People of the State of California acting through the LWDA. A settlement of LWDA claims should, therefore, provide a reasonable benefit to the state for the settlement of the released claims. The reasonable benefit may be based on the potential value of the recoverable civil penalties discounted by the risk and expense of litigation. In Nordstrom Com’ Cases (2010) 186 Cal. App. 4th 576, 589, the Court of Appeal held that the Court can approve a settlement even when no money is allocated to the PAGA claims.

The Declaration of Monique N. Toby provides evidence that the LWDA was notified of the settlement prior to the motion being filed and how the PAGA portion of the settlement was determined. The Court notes that no objection was received from the LWDA. The Court finds that the $50,000 PAGA portion of the settlement is reasonable and confers a substantial benefit on both the State of California and aggrieved employees.

Notice and Notice Procedure. Plaintiff requests approval of Class Notice attached as Exhibit A to Exhibit 1 contained in the Declaration of Monique N. Toby. If a class notice is to be effective, "members of the class must receive the best notice practicable under the circumstances, including individual notice to all members who can be identified through reasonable effort." Home Sav. & Loan Ass'n v. Sup. Ct. (1975) 42 Cal. App. 3d 1006, 1012, citing Fed. R. Civ. P. 23(b)(2). The standard in California is whether the notice "has a reasonable chance of reaching a substantial percentage of class members." Wershba v. Apple Computer (2001) 91 Cal. App. 4th 224, 251. The Court notes the following issues with the Class Notice that will need to be corrected prior to mailing:

 Page 1, opening paragraph – Shawn Hale should be listed by name.  Page 2, bottom box – add that a participating class member can also object to litigation and settlement administration costs.  Page 3, top box – the only method to appear remotely is via CourtCall. All other appearances must be in person.  Page 8, Section 6 – social security number should not be required.

 Page 8, Section 7 – documents are not viewable on the court website so “or the Court’s website.” should be deleted.

Following the changes noted above, the Class Notice is approved for mailing in the manner described in the Settlement Agreement. The deadlines listed in the proposed Order are approved with the exception of the deadline for class members to postmark requests for exclusions, written objections, and workweek/pay period challenges which shall be 60 days instead of the proposed 45 days.

The Motion for Preliminarily Approval is GRANTED as outlined above. Based on the timeline, it appears that a Final Approval Hearing on Monday, November 23 2026 at 8:30 a.m. in Department 63 would provide sufficient time. Absent a request for a different date, the Court will calendar the Final Approval Hearing as noted. Plaintiff submitted a proposed Order that will be modified to reflect the Court’s ruling.

HAM, ET AL. VS. FCA US, LLC, ET AL.