Lee v. Vista Point Mortgage, LLC

The Court has identified several issues with the Settlement Agreement and moving papers. Accordingly, the following issues must be addressed by Class Counsel before preliminary approval can be granted:

1. Paragraph 60 of the Settlement Agreement provides that Class Counsel will file applications with the Court for the requested Service Award and Attorneys’ Fees, Costs, and Expenses Award in connection with their Motion for Final Approval no later than 21 Days prior to the Final Approval Hearing. The application or motion for these awards shall be heard concurrently with the Motion for Final Approval, and the application or motion must be filed per Code.

2. Paragraph 23 of the Settlement Agreement provides that all Settlement Class members who submit a valid claim form will receive a pro rata share of the PRSF. Pro rata share is defined in ¶ 33.a. However, ¶ 23 refers to ¶ 34, instead of ¶ 33.a., for the method of allocation by proration.

3. Paragraph 34 provides for a 90-day deadline for Claimants to negotiate their Claim Payment check or the check will be voided. The Court typically prefers a 180-day check-cashing period. The parties must justify shorter periods.

4. Moreover, ¶ 36 provides that for any Claim Check returned to the Settlement Administrator as undeliverable (including, but not limited to, when the intended recipient is no longer located at the address), the Settlement Administrator shall make reasonable efforts to find a valid address and resend the Claim Check within 30 Days after the check is returned to the Settlement Administrator as undeliverable; and the Settlement Administrator shall only make one attempt to resend a Claim Check. Even under a 90-day deadline to negotiate Claim Payment checks, ¶ 34, when read in conjunction with ¶ 36, means a Claimant may have less than 60 days to negotiate their Claim Check, given how much time the administrator has to resend the Claim Check.

So that all Claimants have the same number days from the date of payment issue to negotiate their Claim Check, when a Claim Check is returned as undeliverable, the administrator should not just re-send the Claim Check but should re-issue the Claim Check so that there is a new issue date from which the negotiation deadline may be calculated.

5. Paragraph 35 provides that the distribution of any remaining PRSF from unnegotiated Claim Payment checks shall continue pro rata until the average payment amount in a distribution is less [than] $3.00, whereupon the amount remaining in the PRSF, if any, shall be distributed by mutual agreement of the Parties and the Court. The parties should agree now as to how to distribute such remaining funds (e.g., identify an appropriate cy pres recipient pursuant to Code of Civil Procedure section 384).

6. Paragraph 24 provides that enrollment codes for creditor monitoring services will be included with the Short-Form Class Notice. However, ¶ 38 states that “[i]nstructions for how to enroll in the Financial Shield product will be sent within 30 days of the Effective Date.” This delay is fine so as to ensure that activation instructions are sent only to Settlement Class Members who do not opt out after receiving class notice. However, the enrollment code should be included again when the activation instructions are sent so that Class Members do not have to hold onto the initial Short-Form Class Notice to be able to remember and use the code.

7. Paragraphs 58-59 specify when the administrator will make payments of attorneys’ fees and costs. The Settlement Agreement should also specify the deadline by which the Claims Administration Costs will be paid to the administrator out of the Attorneys’ Fees, Costs and Expense Award in accordance with ¶ 16.c.

8. The Settlement Agreement provides that “[u]pon entry of the Final Approval Order, the Litigation shall be dismissed with prejudice” (Settlement, ¶ 69); that “[t]he Final Approval Order and Final Judgment shall provide that the Litigation is dismissed with prejudice as to the Plaintiffs and all Settlement Class Members” (id. at ¶ 77); and that “upon entry of the Final Approval Order, . . . the Settlement Class Release and all of Plaintiff’s Released Claims and the Released Class Claims shall be dismissed with prejudice” (id. at ¶ 81). The action may not be “dismissed” in light of the requirements of California Rule of Court, rule 3.769(h), which requires that all final approvals result in entry of judgment.

9. Paragraph 83 of the Settlement Agreement provides that “[o]n entry of the Final Approval Order and Final Judgment, the Plaintiffs and Settlement Class Members shall be enjoined from prosecuting, respectively, the Plaintiffs’ Released Claims and the Released Class Claims, in any proceeding in any forum against any of the Released Persons or based on any actions taken by any Released Persons authorized or required by this Settlement Agreement or the Court or an appellate court as part of this Settlement.” (Emphasis added.) The Court will not issue an injunction. The parties may, however, rely on the effects of res judicata/collateral estoppel of the judgment to be issued upon final approval of the settlement.

10. Although Class Counsel attests that a bidding process occurred before selecting Simpluris (Counsel Decl., ¶ 25), no bid/estimate for administration costs has been provided.

11. “Claims Deadline” is 90 days from the Notice Date.” (Settlement, ¶ 9.c.) Notice Date is defined as “within 60 Days following entry of the Preliminary Approval Order and is the last day by which the Settlement Administrator shall provide Email Notice or Postcard Notice to all Settlement Class Members.” (Id. at ¶ 9.w.) The deadline for submitting Claims should not be calculated based on the last day by which the administrator may provide notice but should instead be calculated from the date on which the administrator actually provides notice.

12. The Settlement Agreement should also provide that, for any re-sent notices, whether by email or by mail, the Claims Deadline shall be calculated from the date of the re-sent notice.

13. The “Objection Deadline” is “no later than 60 days after the Notice Date.” (Settlement, ¶¶ 26, 52.) The deadline for objections should be the same as for Claims—i.e., 90 days.

14. Again, “Notice Date” is defined as “within 60 Days following entry of the Preliminary Approval Order and is the last day by which the Settlement Administrator shall provide Email Notice or Postcard Notice to all Settlement Class Members.” (Settlement, ¶ 9.w.) Again, the deadline to object should also not be calculated based on the last day by which the administrator may provide notice but should instead be calculated from the date on which the administrator actually provides notice.

15. The Settlement Agreement should also provide that, for any re-sent notices, whether by email or by mail, the Objection Deadline shall be calculated from the date of the re-sent notice.

16. Paragraph 50 of the Settlement Agreement states that objections must be “postmarked or submitted electronically,” but does not specify what “electronically” means. (Emphasis added.) Is this only via the administrator’s website or also by email? Notably, ¶¶ 46 and 48 permit Claims to be submitted online via the administrator’s website, while ¶ 56 mentions that opt outs may be submitted by email but not via the administrator’s website. Ultimately, the acceptable methods for submitting Claims, Objections, and Opt Outs should be the same.

17. Paragraph 51 of the Settlement Agreement sets forth numerous requirements for a written objection. Requirements (iii) and (ix) are too onerous. As to requirement (iii), Settlement Class Members should not be required to provide independent proof that their PII was compromised. Indeed, the Long-Form Class Notice even states, “You do not have to provide any proof or explanation to claim this payment.” Defendant has knowledge of who is a member of the Settlement Class based on its records relating to the Data Incident. So once an objection is submitted, the administrator should verify the objector’s name with Defendant to ensure the objector is Settlement Class Member. As to requirement (ix), the requested case information should not be required.

18. Paragraph 54 requires that “[i]f an objecting Settlement Class Member intends to appear at the Final Approval Hearing, either with or without counsel, he or she must also file a notice of appearance with the Court (as well as serve the notice on Class Counsel and Defendant’s Counsel) by the Objection Deadline.” Paragraph 54.a requires that “[i]f the objecting Settlement Class Member intends to appear at the Final Approval Hearing through counsel, he or she must also identify the attorney(s) representing the objecting Settlement Class Member who will appear at the Final Approval Hearing and include the attorney(s) name, address, phone number, email address, state bar(s) to which counsel is admitted, as well as associated state bar numbers.”

These pre-hearing requirements are also too onerous. An objecting Settlement Class Member, whether in pro per or represented by counsel, may simply appear at the hearing on the day of the hearing, and the Court will still hear from that objector or counsel. Counsel may identify themselves at the hearing.

19. At ¶ 67, the Settlement Agreement also provides that “[a]ny Settlement Class Member who wishes to appear at the Final Approval Hearing, whether pro se or through counsel, must, by the Objection Deadline, either mail or hand-deliver to the Court or file a notice of appearance in the Litigation, take all other actions or make any additional submissions as may be required in the Long-Form Notice, this Settlement Agreement, or as otherwise ordered by the Court, and mail that notice and any other such pleadings to Class Counsel and Defendant’s Counsel as provided in the Long-Form Notice.” This requirement should also be deleted.

20. The Settlement Agreement further provides that “[t]he Parties may file a response to any objections and a Motion for Final Approval no later than 21 Days prior to the Final Approval Hearing.” (Id. at ¶ 66.) All written objections submitted to the administrator shall be submitted to the Court as part of the Motion for Final Approval, which must be filed per Code. The parties may respond to or address the objections as part of the moving papers.

21. The deadline to opt out is “no later than 60 Days after the Notice Date.” (Settlement, ¶ 56.) The deadline for opting out should be the same as for Claims—i.e., 90 days.

22. Again, “Notice Date” is defined as “within 60 Days following entry of the Preliminary Approval Order and is the last day by which the Settlement Administrator shall provide Email Notice or Postcard Notice to all Settlement Class Members.” (Settlement, ¶ 9.w.) Again, the deadline to opt out should also not be calculated based on the last day by which the administrator may provide notice but should instead be calculated from the date on which the administrator actually provides notice.

23. The Settlement Agreement is inconsistent as to the method permitted for opting out. In ¶ 56, the agreement initially states that “[e]ach individual wishing to opt-out of the Settlement Class shall individually sign and timely submit written notice of such intent to the designated Post Office box or email address established by the Claims Administrator,” but then ends with “[t]o be effective, written notice [of opt out] must be postmarked no later than 60 Days after the Notice Date.” (Emphases added.) Also, as noted above, ¶¶ 46 and 48 permit Claims to be submitted online via the administrator’s website but provides no email option, and it is unclear how Objections may be submitted “electronically” under ¶ 56. Again, ultimately, the acceptable methods for submitting Claims, Objections, and Opt Outs should be the same.

24. The definition of “Released Class Claims” is “any and all actual, potential, filed, known or unknown, fixed or contingent, claimed or unclaimed, suspected or unsuspected, claims, demands, liabilities, rights, causes of action, disputes, contracts or agreements, extracontractual claims, damages, punitive damages, exemplary damages, multiplied damages, expenses, costs, attorneys’ fees or obligations, whether in law or in equity, accrued or unaccrued, direct or indirect, individual or representative, of every nature and description whatsoever, regardless of whether arising out of or connected to the Data Incident, that were or could have been asserted in the Litigation or other state, federal, local, statutory or common law or any other law, rule or regulation, against the Released Parties, or any of them, arising out of any facts, transactions, events, matters, occurrences, acts, disclosures, statements, representations, omissions or failures to act regarding the alleged unauthorized access of the Settlement Class Members’ personal information by any third party, including all claims that were brought or could have been brought in the Litigation relating to the access of such information belonging to any and all Releasing Parties.” (Settlement, ¶ 80.)

This release, as worded, is too broad, to the extent it releases claims “regardless of whether arising out of or connected to the Data Incident,” “that were or could have been asserted in the Litigation,” and “arising out of any facts, [etc]., regarding the alleged unauthorized access of the Settlement Class Members’ personal information by any third party.” This release does not tether the release to only claims that were or reasonably could have been asserted in the complaint based on the facts alleged in the complaint.

Indeed, Plaintiffs’ counsel’s declaration even states: “The Releases are directly tailored to the claims that were, or could be, asserted in the lawsuit based on the facts alleged in the complaint. See Amaro v. Anaheim Arena Management, LLC (2021) 69 Cal.App.5th 521, 538‐539 (‘Releases must be appropriately tethered to the complaint’s factual allegations;’ ‘[A] court cannot release claims that are outside the scope of the allegations of the complaint.’).” (Counsel Decl., ¶ 31.) Yet the Settlement Agreement here is not worded to effect such tethering.

25. Further, the Settlement Agreement provides that the “Released Class Claims include the release of Unknown Claims. ‘Unknown Claims’ means claims that could have been raised in the Litigation and that any of the Plaintiffs or Settlement Class Members, and each of their respective heirs, executors, administrators, representatives, agents, partners, trustees, successors, attorneys, and assigns do not know to exist or suspects to exist, which, if known by him, her or it, might affect his, her, or its agreement to release Defendant and all other Released Persons, or might affect his, her, or its decision to agree to, or object or not to object to the Settlement.” (Id. at ¶ 82.) This definition of “Unknown Claims” is also too broad as it is also not tethered to only claims that were or reasonably could have been asserted in the complaint based on the facts alleged in the complaint.

26. “Plaintiffs’ Released Claims” contains essentially the same definition. While the Court will typically approve releases by the named Plaintiffs that are broader than the releases by absent Class Members, given the concerns the Court identified with respect to the broad language used in the definition of Released Class Claims, it is unclear whether the parties intended the named Plaintiffs’ releases to be broader or whether the parties’ simply included the inadvertently too-broad language to describe the named Plaintiffs’ release. Plaintiffs’ counsel must confirm with his clients that the named Plaintiffs intend to provide a broader release or re-word Plaintiffs’ Released Claims accordingly.

27. The Settlement Agreement should specify that the Court’s continuing jurisdiction is pursuant to California Code of Civil Procedure section 664.6 and California Rules of Court, rule 3.769(h).

28. Plaintiff’s counsel must attest to whether there are any concurrent pending cases involving similar claims against Defendant that may be impacted by the settlement and how, or confirm that there is none.

Plaintiffs submitted both a Long-Form Class Notice (Settlement, Exh. B) and two versions—i.e., a Postcard Notice and an Email Notice—of the Short-Form Class Notice (id., Exh. C).

The following revisions must be made to the Postcard Class Notice:

1. The Postcard notice should include the following warning, in bold: “Your legal rights are affected whether you act or not act. Read this Notice carefully. You will be deemed to have carefully read and understood it.”

2. The information provided in the Postcard and Email versions of the Short-Form notice should be the same. a. The Email version provides the option to “call 1-:XXX- XXX-XXXX” for more information. The Postcard version should also provide this option. b. The Email version of the Short-Form Notice states in the subject line: “You are Eligible to File a Claim.” The same statement should be included in the Postcard version. c. The Email version of the Short-Form Notice specifies that this action is pending in the “Superior Court for Orange County, California.”

The same statement should be included in the Postcard version. d. The Email version of the Short-Form Notice states before the “Dear” line: “Please read this Notice carefully and completely.” (Emphasis original.) The same statement should be included in the Postcard version. e. The Email version states recipients may email the administrator to receive a paper copy of the claim form. The Long-Form Class Notice states that Class Members may “download a printable Claim Form from the website” or “email” the administrator.

These same options should be included in the Postcard version. f. The Email version states that “Claims must be submitted online, mailed, or emailed by [Claims Deadline].” An email option for submitting Claims is not identified in the Settlement Agreement. If it is permissible, the parties should modify the Settlement Agreement to clarify that this submission method is acceptable, and this email option should be included in the Postcard version. g. The Postcard version uses both the terms “opt out” “exclude” at different times, while the Email version uses only the term “exclude” instead of “opt out.”

So as to avoid confusion, select either “opt out” or “exclude,” and use that one term consistently throughout all forms of Class Notice. h. The Postcard version states: “If you opt-out, you cannot get make a claim for benefits from this Settlement.” This sentence contains a typo. In fixing this typo, counsel should ensure this sentence states the same thing as the Email version.

3. To avoid ambiguity, the notice should not use two different terms, “Private Information” and “Personally Identifiable Information,” to describe the same thing.

4. In describing how to object to the Settlement, the notice should specify that the recipient “may file a written objection by [Objection Deadline] or appear at the Final Approval hearing” (italics used to denote language to be added).

5. The final sentence should read, “You may attend the hearing or enter an appearance through counsel, all at your own cost, but you do not have to” (italics used to denote language to be added).

The following revisions must be made to the Email Class Notice:

1. The Email notice should also include the following warning, in bold: “Your legal rights are affected whether you act or not act. Read this Notice carefully. You will be deemed to have carefully read and understood it.”

2. Again, the information provided in the Postcard and Email versions of the Short-Form notice should be the same. a. The Postcard version explains, in the class definition section, that “[i]n this sentence, PII means Personally Identifiable Information.” The same statement should be included in the Email version. b. The Postcard version includes this sentence in the section on “What are the Settlement benefits?”: “Full details and instructions are available online and in the Long Form Notice.”

The same statement should be included in the Email version. c. As noted above, the Long-Form Class Notice states that Class Members may “download a printable Claim Form from the website.” This same option should be included in the Email version. d. The Postcard version states in a heading, “What if I don’t want to participate in the Settlement or do not like it?” (Emphasis added.) The italicized language does not appear in the Email version. The same phrase should be included in the Email version. e.

The Postcard version states “The Long Form Notice and Settlement Agreement, available online, explains how to exclude yourself or object.” (Emphasis added.) The italicized language does not appear in the Email version. The same phrase should be included in the Email version.

3. Again, to avoid ambiguity, the notice should not use two different terms, “private information” and “Personally Identifiable Information,” to describe the same thing.

4. Again, in describing how to object to the Settlement, the notice should specify that the recipient “may file a written objection by [Objection Deadline] or appear at the Final Approval hearing” (italics used to denote language to be added).

5. Again, the final sentence should read, “You may attend the hearing or enter an appearance through counsel, all at your own cost, but you do not have to” (italics used to denote language to be added).

The following revisions must be made to the Long-Form Class Notice:

1. The notice should be revised so as to be consistent with the resolution of all issues identified above with respect to the Settlement Agreement and the Short-Form Class Notice.

2. Under the chart summarizing the options available to Settlement Class Members, the “Do Nothing” option states that “[i]f you do nothing, you will not receive benefits or payments from this Settlement.” Similarly, in Section 20, the notice states “[i]f you do nothing, you will not receive a benefit from this Settlement.” But as the Court understands the Settlement Agreement, a Settlement Class Member who does not submit a Claim Form and who does not opt out would still be entitled to credit monitoring benefits under the Settlement Agreement. Therefore, the “Do Nothing” effects must be revised to clarify the benefits the Settlement Class Member would still receive versus not receive by doing nothing versus submitting a Claim Form or Opting Out.

3. The notice states: “All Settlement Class Members were mailed a postcard that provided their enrollment code.” This is inaccurate, as the Short-Form Class Notice may have been provided by email rather than postcard.

4. The definition of the Released Class Claims from the Settlement Agreement should be set forth verbatim in Section 8. Class Members should not have to separately locate the Settlement Agreement to find the applicable definition.

5. Section 11 is titled “When will the Settlement benefits be issued?” The term “benefits” is broader than mere Class Payment. Therefore, this section should also address when the administrator will send instructions for activation of the credit monitoring service, in addition to Class Payments.

6. Also in Section 11, the notice should explain that multiple rounds of payments may be sent by the administrator in accordance with ¶ 35 of the Settlement Agreement, so that Claimants know what to expect. The notice should also provide that updates on the status of Claim Payments will be posted on the settlement website, which the administrator should also be sure to do.

7. In Sections 13 and 16, the notice should also state that any Class Member who does not request exclusion may, if the Member so desires, enter an appearance through counsel. (Cal. Rules of Court [CRC], rule 3.766(d)(5).)

8. In Section 14, the notice should explain that attorneys’ fees and costs and the Service Award payment will be paid separately and apart from the PRSF.

9. Rather than having Class Members draft their own opt-out requests and objections, separate forms for each of these processes should be provided on the administrator’s website.

10. In Section 16, the notice should make it clear that to object, the Class Member may either submit written objection or simply appear at the Final Approval hearing. Again, the Class Member does not need to submit a written objection first to be heard at the hearing.

11. In Section 16, Class Members should not be directed to send their written objections to the Court directly. Rather, all written objections should be sent to the administrator. The administrator and Class Counsel shall then compile all objections for submission along with Plaintiffs’ Motion for Final Approval of the settlement.

12. In Section 18, this Court’s address and department number can and should be filled in now so that the Court can verify accuracy.

13. In Section 20, the sentence “[y]ou will also give up the rights described in Question 8” is confusing. Section 20 should clearly specify that doing nothing means the Class Member would still be bound by the “Released Class Claims.”

14. The notice should also specify that the judgment, “whether favorable or not,” will be binding all Class Members who do not request exclusion. (CRC, rule 3.766(d)(4).)

15. In Section 21, the notice should also provide, for persons who wish to review the court’s docket for the case, the court’s URL.

Class Counsel must also provide a revised [Proposed] Order Granting Preliminary Approval with the following revisions:

1. The proposed order should be revised to incorporate all the relevant revisions identified above.

2. The caption should specify that the department number and the judge to whom the case is assigned.

3. The title of the order should be amended to read “[Proposed] Order Granting Preliminary Approval of Class Action Settlement.”

4. The date for the preliminary approval hearing should be updated to reference the continued hearing date.

5. The exact title of the Settlement Agreement should be used.

6. The proposed order should reference by name and ROA number all the declaration(s) to which the Settlement Agreement and any amendments thereto are attached.

7. The proposed order should specify the maximum amounts proposed to be paid by Defendant for attorneys’ fees and litigation costs (including administration costs) and service awards.

8. The definition for “Data Incident” should be included directly in the proposed order.

9. Counsel should not leave blank but should instead propose a realistic Final Approval hearing date, taking into account the deadlines associated with mailing and remailing the notice and responses thereto and the documentation required to support final approval (including but not limited to time records or a summary of time spent by Class Counsel so as to enable the Court to evaluate the lodestar and attorneys’ fee request; detailed litigation cost breakdowns; an Administrator declaration and invoice; and Plaintiffs’ declarations to support the enhancement request). The Court usually sets these hearings at least 4 months after preliminary approval. All supporting papers must also be filed at least sixteen (16) court days before the Final Approval hearing date.

10. Also, as indicated above, any Motion for Fees, Costs, and Service Award should be filed per Code and heard concurrently with the Motion for Final Approval.

11. The proposed order should specify the Court’s continuing jurisdiction is pursuant to both California Code of Civil Procedure section 664.6 and California Rules of Court, rule 3.769(h).

The Court further refers Class Counsel to the “Guidelines for Approval of Class Action Settlements & PAGA Settlements” posted on the Court’s website for Department CX102, available at https://voypubapps.occourts.org/complex-civil-calendar.

Class Counsel must file supplemental papers addressing the Court’s concerns no later than sixteen (16) court days prior to the continued hearing date. Counsel must also provide redlined versions of all revised papers and an explanation of how the pending issues were resolved with precise citation to any revisions. A supplemental declaration or brief that simply asserts the issues have been resolved is insufficient and will result in a further continuance. If supplemental papers addressing all of the Court’s concerns cannot be filed by the pre-hearing deadline, Class Counsel must request a continuance. Failure to do so may result in the issuance of an Order to Show Cause re Monetary Sanctions.

Plaintiff to give notice.

117 Navarro Arevalo vs. Gold Coast Baking Company, Inc.

2022-01243370 Status Conference

119 Johnson vs. Stremicks Heritage Foods, LLC

2023-01351048 Motion for Approval of PAGA Settlement

The court has reviewed and considered the papers filed in support of plaintiff’s motion for approval of a $200,000 PAGA settlement. The court has the following questions and comments:

As to the Settlement: 1. The parties must confirm the final gross settlement amount, i.e., whether the escalator provision (¶ 22) has been triggered.

2. Plaintiff should provide the estimated a high, low, and average amounts of the individual PAGA awards.

3. Plaintiff must provide an invoice or quote from the settlement administrator.

4. The release provision (¶ 8) is overbroad and/or vague. Delete “Amended” from the first sentence as no amended complaint was filed. Delete “or” between “Action” and “based” in the first sentence. Delete the last sentence in paragraph 8 in its entirety.