Orellana, et al. v. Prompt Food Service, Inc., et al.

LINE # CASE # CASE TITLE RULING LINE 1 21CV386681 Sedano v. Jalimex Food Corporation, Motion: Preliminary et al. (Class Action / PAGA) Approval is GRANTED

Click on line 1 for tentative ruling LINE 2 22CV401360 Orellana, et al. v. Prompt Food Motion: Withdraw as Service, Inc. (Class Action) attorney is GRANTED

Click on line 2 for tentative ruling LINE 3 22CV403853 Orellana, et al. v. Prompt Food Motion: Withdraw as Service, Inc. (PAGA) attorney is GRANTED LINE 4 22CV403853 Orellana, et al. v. Prompt Food Hearing: Motion For Service, Inc. (PAGA) Settlement Approval is GRANTED

Click on lines 3-4 for tentative ruling LINE 5 25CV468773 Z. G. vs Google LLC Hearing: Demurrer is OVERRULED

Click on lines 5-6 for tentative ruling LINE 6 25CV468773 Z. G. vs Google LLC Hearing: Pro Hac Vice Counsel is GRANTED LINE 7 25CV479934 VERONICA SILVA v. REYES COCA- Motion: Compel COLA BOTTLING, L.L.C. (Class Action) Arbitration is GRANTED, Request for Stay is GRANTED

Click on line 7 for tentative ruling LINE 8 26CV485245 Tammy Read vs Timothy Cook et al Motion: Seal Records is GRANTED LINE 9 26CV485245 Tammy Read vs Timothy Cook et al Motion: Seal Records is GRANTED

Click on lines 8-9 for tentative ruling

Calendar Lines 3-4

Case Name: Orellana, et al. v. Prompt Food Service, Inc., et al. Case No.: 22CV403853

This is a representative action under the Private Attorneys General Act (“PAGA Plaintiffs Francisco Duenas Orellana (“Duenas Orellana”) and Ronaldo Lopez Mendez (“Lopez Mendez”) allege defendant Prompt Food Service, Inc. (“Prompt”) committed various wage and hour violations.4

Before the Court is (1) Plaintiff Duenas Orellana’s motion for approval of PAGA settlement and (2) the motion to be relieved as counsel by Mariam Nazaretyan (“Nazaretyan”) and Wilshire Law Firm, PLC (collectively, “Counsel”), who represent Plaintiff Mendez. Both motions are unopposed.

For reasons discussed below, the Court GRANTS Counsel’s motion to be relieved as Counsel for Plaintiff Lopez Mendez and GRANTS Plaintiff Duenas Orellana’s motion for approval of PAGA settlement.

X. BACKGROUND

According to the allegations of the operative Complaint, Plaintiff Duenas Orellana worked for Defendant as an hourly-paid, non-exempt employee from November 2021 to April 2022. (Complaint, ¶ 8.) Plaintiff Lopez Mendez worked for Defendant as an hourly-paid, nonexempt employee from December 2021 to March 2022. (Complaint, ¶ 9.)

Defendant failed to: pay for all hours worked, including minimum and overtime wages; provide meal periods of compensation in lieu thereof; provide rest periods or compensation in lieu thereof; pay all earned wages twice a month; maintain accurate records; timely pay all wages at termination; furnish accurate itemized wage statements; and produce requested employment records.

On September 30, 2022, Plaintiffs initiated this action with the filing of the representative PAGA action.

XI. MOTION TO BE RELIEVED AS COUNSEL

C.

Legal Standard

Motions to be relieved as counsel are technical and governed by Rules of Court, rule 3.1362 (“Rule 3.1362”). Notice and motion must be directed to the client on Judicial Council Form MC-051. No memorandum is required. (Rule 3.1362(a) & (b)). Counsel must provide a declaration on Judicial Council Form MC-052 stating “in general terms and without compromising the confidentiality of the attorney-client relationship why a motion under Code

4 Counsel uses “Ronaldo” as Plaintiff Lopez Mendez’s first name, however, the Complaint and Odyssey state “Ronald” as his first name. Thus, the Court will use the latter to avoid any confusion or inconsistencies with its records.

of Civil Procedure section 284(2) is brought instead of filing a consent under Code of Civil Procedure section 284(1).” (Rule 3.1362(c)).

The notice of motion and motion, the declaration, and the proposed order must be served on the client and all parties “by personal service, electronic service, or mail.” (Rule 3.1362(d)).

If the notice is served on the client by mail under Code of Civil Procedure section 1013, it must be accompanied by a declaration stating facts showing that either: (A) The service address is the current residence or business address of the client; or (B) The service address is the last known residence or business address of the client and the attorney has been unable to locate a more current address after making reasonable efforts to do so within 30 days before the filing of the motion to be relieved. (Rule 3.1362(d).)

The proposed order relieving counsel must be prepared on the Order Granting Attorney’s Motion to Be Relieved as Counsel—Civil (form MC-053) and must be lodged with the court with the moving papers. The order must specify all hearing dates scheduled in the action or proceeding, including the date of trial, if known. If no hearing date is presently scheduled, the court may set one and specify the date in the order. After the order is signed, a copy of the signed order must be served on the client and on all parties that have appeared in the case.

The court may delay the effective date of the order relieving counsel until proof of service of a copy of the signed order on the client has been filed with the court.

(Rule 3.1362(e).)

D.

Discussion

Nazaretyan submitted a declaration in support of Counsel’s motion. She states that the motion is made pursuant to Rules of Professional Conduct Rule 1.16(b) and it is due to a breakdown in the attorney-client relationship with Plaintiff Lopez Mendez. She further states that Counsel will continue to represent Plaintiff Duenas Orellana and aggrieved employees in the PAGA action.

With regard to service, Nazaretyan states that Plaintiff Lopez Mendez was served by mail at his last known address with copies of the motion papers along with the declaration. She confirmed within the past 30 days that the address is current by using a skip trace. The motion papers were mailed to the last known address with a return receipt requested and the documents were emailed to Plaintiff Lopez Mendez at his last known e-mail address. This is sufficient to meet the requirements of Rule 3.1362(d)(1)(A).

Counsel has provided a proposed order on the correct judicial counsel form (MC-053). The proposed order indicates that there is a case management conference (“CMC”) on August 20, 2026 and the docket shows that the is a motion for approval of PAGA settlement and

Counsel’s motion to be relieved as counsel in the Class action. The Court’s docket does not reflect any other scheduled hearing.

Based on the foregoing, Counsel’s motion is GRANTED. Counsel is ordered to inform Plaintiff Lopez Mendez to appear at the hearing.

XII. MOTION FOR APPROVAL OF PAGA SETTLEMENT

Plaintiff Duenas Orellana moves for an order approving the PAGA Settlement (the “Settlement”) between him and Defendant.

A. LEGAL STANDARD FOR APPROVING PAGA SETTLEMENT

Under PAGA, an aggrieved employee may bring a civil action personally and on behalf of other current or former employees to recover civil penalties for Labor Code violations. (Iskanian v. CLS Transp. Los Angeles, LLC (2014) 59 Cal.4th 348, 380, overruled on other grounds by Viking River Cruises, Inc. v. Moriana (2022) ___U.S.___, 2022 U.S. LEXIS 2940.) 75 percent of any penalties recovered go to the Labor and Workforce Development Agency (LWDA), leaving the remaining 25 percent for the employees. (Ibid.) PAGA is intended “to augment the limited enforcement capability of [LWDA] by empowering employees to enforce the Labor Code as representatives of the Agency.” (Id. at p. 383.) A judgment in a PAGA action binds all those, including nonparty aggrieved employees, who would be bound by a judgment in an action brought by the government. (Id. at p. 381.)

Labor Code section 2699, subdivision (l)(2) provides that “[t]he superior court shall review and approve any settlement of any civil action filed pursuant to” PAGA. The court’s review “ensur[es] that any negotiated resolution is fair to those affected.” (Williams v. Superior Court (2017) 3 Cal.5th 531, 549.) “[C]lass certification is not required” in this context as in a class action. (Haralson v. U.S. Aviation Servs. Corp. (N.D. Cal. 2019) 383 F. Supp. 3d 959, 971 (Haralson).)

Similar to its review of class action settlements, the Court must “determine independently whether a PAGA settlement is fair and reasonable,” to protect “the interests of the public and the LWDA in the enforcement of state labor laws.” (Moniz v. Adecco USA, Inc. (2021) 72 Cal.App.5th 56, 76–77 (Moniz).) It must make this assessment “in view of PAGA’s purposes to remediate present labor law violations, deter future ones, and to maximize enforcement of state labor laws.” (Id. at p. 77; see also Haralson, supra, 383 F. Supp. 3d at p. 971 [“when a PAGA claim is settled, the relief provided for under the PAGA [should] be genuine and meaningful, consistent with the underlying purpose of the statute to benefit the public ....”], quoting LWDA guidance discussed in O’Connor v. Uber Technologies, Inc. (N.D. Cal. 2016) 201 F.Supp.3d 1110 (O’Connor).)

The settlement must be reasonable in light of the potential verdict value. (See O’Connor, supra, 201 F.Supp.3d at p. 1135 [rejecting settlement of less than one percent of the potential verdict].) But a permissible settlement 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.)

B. PLAINTIFF’S INVESTIGATION, SETTLEMENT PROCESS, AND THE PARTIES’ AGREEMENT

On September 30, 2022, Plaintiffs initiated this action on January 5, 2024, with the filing of the operative Complaint. Prior to filing the Complaint, Plaintiffs gave notice to the Labor and Workforce Development Agency (“LWDA”). The parties agreed to mediate the PAGA action with Russ Wunderli (“Wunderli”), a well-respected and experienced mediator of wage and hour and representatives PAGA actions. PAGA Counsel conducted a thorough investigation into the facts and applicable law. The parties conducted informal discovery and Defendant produced a representative sampling of time and payroll data for aggrieved employees and the necessary policy documents to properly evaluate the strengths and weaknesses of the claims and engage in meaningful settlement discussions.

On March 12, 2025, the parties engaged in an all-day mediation session with Wunderli and with his help, the parties were able to reach an agreement on general settlement terms at mediation.

Pursuant to the parties’ agreement, Defendant will pay a non-reversionary gross settlement amount $115,000, which is comprised of $38,333.33 in attorneys’ fees, litigation costs not to exceed $27,000, and $3,250 in administration costs. The $43,775.32 will be distributed 75% ($32,831.49) to the LWDA and 25% ($10,943.83) to “Aggrieved Employees,” who are defined as “all current and former hourly-paid, non-exempt employees directly employed by Defendant in the State of California during the PAGA Period [July 29, 2021 through July 12, 2025].” There are approximately 100 Aggrieved Employees and there is an estimated 3,800 pay periods in the PAGA Period. Plaintiff Orellana will seek a service award of $7,500.

In exchange for settlement, Aggrieved Employees will release: [A]ll claims for PAGA civil penalties that are alleged or reasonably could have been alleged based on the facts alleged in the PAGA Action and the PAGA Notice during the PAGA Period.5

The release is appropriately tailored to the allegations at issue, and it does not release any claims other than those for PAGA penalties. (See Amaro v. Anaheim Arena Management, LLC (2021) 69 Cal.App.5th 521, 537; Moniz, supra, 72 Cal.App.5th at p. 82 [release of “all known and unknown claims under PAGA ... that were or could have been pled based on the allegations of the Complaint” was appropriately approved].)

C. DISCUSSION

1. Potential Verdict Value

In the Complaint, Plaintiff alleges meal period violations, rest break violations, unpaid wages, failure to pay overtime wages, failure to pay timely wages, and failure to maintain records.

5 The Released PAGA Claims are those that accrued during the PAGA Period.

Plaintiff’s counsel estimated the maximum amount of statutory PAGA civil penalties as approximately $380,000 for estimated 100 employees based on 3,800 pay periods. Plaintiff states that the gross settlement amount is favorable especially in consideration of the risks associated with further litigation, Defendant’s defenses, the possibilities of appeals, and the potential reduction of any recovery.

The gross settlement represents approximately 30.2% of the maximum exposure. This is within the percentage range typically approved by courts. (See Cavazos v. Salas Concrete, Inc. (E.D. Cal., Feb. 18, 2022, No. 1:19-cv-00062-DAD-EPG) 2022 U.S.Dist. LEXIS 30201, at *41-42 [citing cases approving settlements in the range of 5 to 35 percent of the maximum potential exposure].)

Given this, as well as the risks attendant to proceeding to trial, Defendant’s defenses and the likelihood that PAGA penalties would be significantly reduced in line with numerous appellate decisions, the Court finds that the proposed settlement is fair to those affected and is genuine, meaningful, and reasonable in light of the statute’s purposes.

2. Attorney Fees

While the PAGA statute does not expressly require judicial review of claimed attorney fees, the Court believes it cannot adequately fulfill its statutory duty to review the penalties associated with PAGA settlements without also considering attorney fees. The Court thus finds that it must scrutinize the attorney fee arrangement associated with a PAGA settlement. This is consistent with the observation of many courts that PAGA claims are analogous to “qui tam” suits like those under the federal False Claims Act: when reviewing settlements of qui tam claims, courts should and do consider any associated attorney fee arrangement. (See U.S. v. Texas Instruments Corp. (9th Cir. 1994) 25 F.3d 725, 728 [attorney fee award must be considered by the trial court as part of its review of the “entire settlement arrangement”].)

As articulated above, Plaintiff seeks a fee award of $38,333.33 in attorneys’ fees. Plaintiff counsel submits a lodestar figure of $194,565 based on 224.4 hours of work at billing rates ranging from $600 to $1,500 per hour resulting in a negative multiplier of 0.20. This is below the range of multipliers that courts typically approve. (See Laffitte v. Robert Half Intern. Inc. (2016) 1 Cal.5th 480, 488, 503–504 (Laffitte) [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]; Wershba v.

Apple Computer, Inc. (2001) 91 Cal.App.4th 224, 255 [“[m]ultipliers can range from 2 to 4 or even higher”]; Vizcaino v. Microsoft Corp. (9th Cir. 2002) 290 F.3d 1043, 1051, fn. 6 [stating that multipliers ranging from one to four are typical in common fund cases and citing the court’s own survey of large settlements finding “a range of 0.6–19.6, with most (20 of 24, or 83%) from 1.0–4.0 and a bare majority (13 of 24, or 54%) in the 1.5–3.0 range”].)

Here, given the amount of work performed by PAGA Counsel, and because the requested multiplier sought by them is below the range of multipliers regularly approved by California courts in similar actions, the Court finds PAGA Counsel’s requested fee award is reasonable and therefore it is approved.

3. Other Costs and Expenses

PAGA counsel requests litigation costs in the amount of $22,141.35. This is supported by declaration of PAGA Counsel John G. Yslas and is below the $27,000 provided for in the Settlement. Thus, this amount appears reasonable and is approved.

Administration costs of $3,250 are also approved.

D. ADMINISTRATION PROCESS

The parties agreed on Apex Class Action Administration (“Apex”) as the settlement administrator. Pursuant to the terms of the Settlement, Defendant shall fully fund the gross settlement amount within 30 days after the effective date. Within 10 calendar days after Defendant funds the gross settlement amount, Apex will issue checks for the individual PAGA payments and send them to Aggrieved Employees, along with the PAGA settlement notice. Apex shall conduct an address search for all Aggrieved Employees whose checks are returned as undeliverable. Within 7 calendar days of receiving a returned check, Apex shall re-mail the checks. Funds associated with checks uncashed after 180 days will be transmitted to St. Jude’s Children’s Hospital. These administrative procedures are appropriate and are approved.

XIII. CONCLUSION

Counsel’s motion to be relieved as counsel for Plaintiff Lopez Mendez is GRANTED. Counsel is ordered to inform Plaintiff Lopez Mendez to appear at the hearing.

Plaintiff Duenas Orellana’s motion for approval of the parties’ PAGA settlement is GRANTED. The covered individuals are: all current and former hourly-paid, non-exempt employees directly employed by Defendant in the State of California during the PAGA Period.

Judgment shall be entered through the filing of this order and judgment. (Code Civ. Proc., § 668.5.) Plaintiff and the Aggrieved Employees shall take from the PAGA claim in their Complaint only the relief set forth in the parties’ settlement agreement and this order and judgment. The Court retains jurisdiction over the parties to enforce the terms of the PAGA settlement agreement and the final order and judgment.

The Court sets a compliance hearing for April 22, 2027 at 2:30 P.M. in Department 22. At least ten court days before the hearing, Plaintiff’s 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 the cy pres recipient; 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 remotely.

The Court will prepare the order.

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