Dominguez v. Tacos 2000, Inc., et al.

P.17.) This is less than the estimate of $10,000 provided for in the Settlement Agreement (P.20) and disclosed to class members in the Notice, to which there were no objections. (Polites Decl., P.10, Exhibit A.)

Based on the above, the recommendation is to award costs in the requested amount of $8,950.

Action Settlement Department SSC-1 Hon. Theresa M. Traber Dominguez v. Tacos 2000, Inc., et al. Case No.: 24STCV08507 Hearing: September 2, 2026

The Court's tentative ruling is to GRANT preliminary approval contingent on the parties addressing the following: 1. The releases in P.P. 5.2 and 5.4 are overbroad. The settlement cannot release class claims based on unidentified "related facts," but instead must be grounded in facts that were actually alleged in the Operative Complaint and/or the PAGA Notice. Further, the claims released must either be alleged or be such that they could have reasonably been alleged based on the proper scope of factual allegations.

Thus, the class claims released should be limited to "all claims that were alleged, or reasonably could have been alleged, based on the facts stated in the Operative Complaint." The same is true for the PAGA claims to be released. The settlement can only release "all claims for PAGA penalties that were alleged, or reasonably could have been alleged, based on the facts stated in the Operative Complaint and the PAGA Notice." Please revise accordingly.

2. Paragraph 11.1 contains typo "If, for any reason the Court does grant Preliminary Approval, Final Approval or enter Judgment, Defendants reserve the right to contest certification of any class for any reasons, and Defendants reserve all available defenses to the claims in the Action, and Plaintiff reserves the right to move for class certification on any grounds available and to contest Defendants' defenses." (P.11.1) This provision should be stated as "the Court does not".

3. The Notice requires the following revisions: a. The Notice should disclose the funding/distribution deadlines. b. The Notice contains the wrong tax allocation for Class Payments. While the Settlement at P.3.2.4.1 states that the tax allocation is 10% wages and 90% penalties/interest, the Notice at page 3 states the tax allocation is 20% wages and 80% penalties/interest.

The Court orders the parties to submit supplemental briefing and supporting declarations as well as revised versions of the Settlement Agreement and Class Notice to address the Court's concerns. The parties are directed to submit the revised signed Settlement Agreement along with a red-lined copy showing all changes and a revised Class Notice with a red-lined copy showing the changes to the notice. Please ensure that all revisions of the Settlement Agreement are properly incorporated into the revised Class Notice. Also review the proposed Order, revise it to conform to the final settlement terms, and file the revised proposed Order with the Court. All supplemental papers are due to be filed by _______________________________. The Court sets a non-appearance case review for _________________________________ to review the supplemental papers.

BACKGROUND

This is a wage and hour class action. On April 4, 2024, Plaintiff commenced this Action by filing a complaint alleging causes of action against Defendants for: (1) failure to pay overtime wages; (2) failure to pay minimum wages; (3) failure to provide meal periods; (4) failure to provide rest periods; (5) waiting time penalties; (6) wage statement violations; (7) failure to timely pay wages; (8) failure to indemnify; (9) violation of Labor Code section 227.3; and (10) unfair competition ("Class Action").

On April 4, 2024, Plaintiff filed with the LWDA and served on Defendants a notice under Labor Code section 2699.3 stating Plaintiff intended to serve as a proxy of the LWDA to recover civil penalties on behalf of Aggrieved Employees for alleged Labor Code violations ("PAGA Notice").

On June 11, 2024, Plaintiff filed a separate representative action under PAGA in Los Angeles Superior Court, Case No. 24STCV14642, seeking PAGA civil penalties against Defendants for Labor Code violations alleged in the PAGA Notice (the "PAGA Action").

On May 6, 2026, Plaintiff filed the Operative First Amended Complaint in the instant Action effectively consolidating the Class Action and PAGA Action, and on June 22, 2026, the PAGA Action was dismissed.

Counsel represents that prior to mediation, Plaintiff obtained, through informal discovery: (1) time and payroll records for 20% of Class Members; (2) a class list of hire dates, termination dates, and rates of pay for Class Members; (3) wage and hour policy documents; and (4) all documents concerning Plaintiff available to Defendants.

On July 22, 2025, the Parties participated in an all-day mediation presided over by Gig Kyriacou, Esq, and agreed to globally resolve all class and PAGA claims in this Action and the PAGA Action.

Counsel filed a fully executed long form settlement agreement with the Court on May 12, 2026 attached to the Declaration of Megan R. Lazar ("Lazar Decl.") as Exhibit 1.

Now before the Court is the Motion for Preliminary Approval of the Settlement Agreement.

SETTLEMENT CLASS DEFINITION

· "Class" means all persons employed by Defendants in California and classified as a non-exempt, hourly-paid employee who worked for Defendants during the Class Period. (P.1.5)

o "Class Period" means the period from July 14, 2022 through October 5, 2025. (P.1.12)

· "Aggrieved Employees" means a person employed by Defendants in California and classified as a non-exempt, hourly-paid employee who worked for Defendants during the PAGA Period. (P.1.4)

o "PAGA Period" means the period from April 7, 2023 through the end of the Class Period. (P.1.31)

· Based on a review of its records at the time of mediation, Defendants estimate there were 1,053 Class Members who collectively worked a total of 55,974 Workweeks, and 887 of Aggrieved Employees who worked a total of 21,746 PAGA Pay Periods. (P.4.1)

· The parties agree to conditional class certification for the purposes of settlement. (P.11.1)

o Paragraph 11.1 contains a typo "If, for any reason the Court does grant Preliminary Approval, Final Approval or enter Judgment, Defendants reserve the right to contest certification of any class for any reasons, and Defendants reserve all available defenses to the claims in the Action, and Plaintiff reserves the right to move for class certification on any grounds available and to contest Defendants' defenses." (P.11.1) This provision should be stated as "the Court does not grant".

TERMS OF SETTLEMENT AGREEMENT

The essential terms are as follows:

· The Gross Settlement Amount ("GSA") is $784,000, non-reversionary. (P.3.1)

o In the event the number of Workweeks worked by Class Members during the Class Period increases by more than 10%, or more than 5,598 additional Workweeks, then the Gross Settlement Amount shall be increased proportionally by the Workweeks in excess of 61,572 (55,974 Workweeks x 10%) Workweeks multiplied by the Workweek Value. The Workweek Value shall be calculated by dividing the originally agreed upon Gross Settlement Amount ($784,000.00) by 55,974, which amounts to a Workweek Value of $14.00. Thus, for example, should there be 62,000 Workweeks in the Class Period, then the Gross Settlement Amount shall be increased by $5,992.00 ((62,000 Workweeks - 61,572 Workweeks) x $14.00 per Workweek.). (P.8)

· The Net Settlement Amount ("Net") ($388,166.67) is the GSA minus the following:

o Up to $261,333.33 (33 1/3%) for attorney fees (P.3.2.2);

o Up to $30,000 for litigation costs (Ibid.);

o Up to $10,000 for a Service Payment to the Named Plaintiff (P.3.2.1);

o Up to $14,500 for settlement administration costs (P.3.2.3); and

o Payment of $80,000 PAGA penalty (75% or $60,000 to the LWDA). (P.3.2.5)

· Defendants will separately pay any and all employer payroll taxes owed on the Wage Portions of the Individual Class Payments. (P.3.1)

· There is no claim form requirement. (P.3.1)

· Funding of Settlement: Defendants shall fully fund the Gross Settlement Amount, and also fund the amounts necessary to fully pay Defendants' share of payroll taxes by transmitting the funds to the Administrator no later than 65 days after the Effective Date. (P.4.3)

· Disbursement of GSA: Within 7 days after Defendants fund the Gross Settlement Amount, the Administrator will mail checks for all Individual Class Payments, all Individual PAGA Payments, the LWDA PAGA Payment, the Administration Expenses Payment, the Class Counsel Fees Payment, the Class Counsel Litigation Expenses Payment, and the Class Representative Service Payment. Disbursement of the Class Counsel Fees Payment, the Class Counsel Litigation Expenses Payment and the Class Representative Service Payment shall not precede disbursement of Individual Class Payments, and the Individual PAGA Payments. (P.4.4)

· Individual Settlement Payment Calculation: An Individual Class Payment calculated by (a) dividing the Net Settlement Amount by the total number of Workweeks worked by all Participating Class Members during the Class Period and (b) multiplying the result by each Participating Class Member's Workweeks. (P.3.2.4)

Non-Participating Class Members will not receive any Individual Class Payments. The Administrator will retain amounts equal to their Individual Class Payments in the Net Settlement Amount for distribution to Participating Class Members on a pro rata basis. (P.3.2.4.2)

o Tax Allocation: 10% as wages, 90% as interest and penalties. (P.3.2.4.1) Sec. Contradiction: According to the Notice, 20% of each Settlement Payment to Class Members who do not opt out will be allocated as wages and reported on an IRS Form W-2, and 80% will be allocated as penalties and interest reported on IRS Form 1099. (Notice, pg. 3.) Please correct to make the figures consistent.

· PAGA Payments: The Administrator will calculate each Individual PAGA Payment by (a) dividing the amount of the Aggrieved Employees' 25% share of PAGA Penalties $20,000.00 by the total number of PAGA Period Pay Periods worked by all Aggrieved Employees during the PAGA Period and (b) multiplying the result by each Aggrieved Employee's PAGA Period Pay Periods. (P.3.2.5.1) If the Court approves PAGA Penalties of less than the amount requested, the Administrator will allocate the remainder to the Net Settlement Amount. (P.3.2.5.2)

o Tax Allocation: 100% penalties. (Ibid.)

· "Response Deadline" means forty-five (45) days after the Administrator mails Notice to Class Members and Aggrieved Employees, and shall be the last date on which Class Members may: (a) mail Requests for Exclusion from the Settlement, or (b) mail his or her Objection to the Settlement. Class Members to whom Notice Packets are resent after having been returned undeliverable to the Administrator shall have an additional 15 days beyond the Response Deadline has expired. (P.1.43) The same deadline applies to the submission of workweek disputes. (P.7.6)

o If the number of valid Requests for Exclusion exceeds 10% of the total of all Class Members, Defendants may elect to withdraw from the Settlement. (P.7.5.5)

· Uncashed Settlement Checks: The Administrator will cancel all checks not cashed by the void date (not less than 180 days after the date of mailing). (P.4.4.1) For any Class Member whose Individual Class Payment check or Individual PAGA Payment check is uncashed and cancelled after the void date, the Administrator shall transmit the funds represented by such checks to the California State Controller's Office, Unclaimed Property Division in the name of the Aggrieved Employee thereby leaving no unpaid residue pursuant to the requirements of Code of Civil Procedure section 384. (P.4.4.3)

· The settlement administrator is Phoenix Class Action Administration Solutions. (P.1.2)

· The proposed settlement was submitted to the LWDA on May 12, 2026. (Lazar Decl., P.14 and Exhibit 3 thereto.) Participating class members and the named Plaintiff will release certain claims against Defendant. (See further discussion below)

ANALYSIS OF SETTLEMENT AGREEMENT

1. Does a presumption of fairness exist?

1. Was the settlement reached through arm's-length bargaining? Yes. On July 22, 2025, the Parties participated in an all-day mediation presided over by Gig Kyriacou, Esq, and agreed to globally resolve all class and PAGA claims in this Action and the PAGA Action. (Lazar Decl., P.8.)

2. Were investigation and discovery sufficient to allow counsel and the court to act intelligently? Yes. Counsel represents that prior to mediation, Plaintiff obtained, through informal discovery: (1) time and payroll records for 20% of Class Members; (2) a class list of hire dates, termination dates, and rates of pay for Class Members; (3) wage and hour policy documents; and (4) all documents concerning Plaintiff available to Defendants. (Id. at P.6.)

3. Is counsel experienced in similar litigation? Yes. Class Counsel is experienced in class action litigation, including wage and hour class actions. (Id. at P.P.43-46; Declaration of David Bibiyan, passim.)

4. What percentage of the class has objected? This cannot be determined until the fairness hearing. See Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 2014) P. 14:139.18, ("Should the court receive objections to the proposed settlement, it will consider and either sustain or overrule them at the fairness hearing.") .

CONCLUSION: The settlement is entitled to a presumption of fairness.

2. Is the settlement fair, adequate, and reasonable?

1. Strength of Plaintiff's case. "The most important factor is the strength of the case for plaintiff on the merits, balanced against the amount offered in settlement." (Kullar v. Foot Locker Retail, Inc. (2008) 168 Cal.App.4th 116, 130.) Here, Class Counsel has provided information, summarized below, regarding the estimated values of the class claims alleged:

Counsel has provided the following exposure analysis: Violation | Maximum Exposure | Unpaid Wages | $665,138.00 | Meal Period Violations | $31,772.12 | Rest Period Violations | $800,867.64 | Wage Statement Penalties | $1,087,300.00 | Waiting Time Penalties | $3,208,560.00 | Expenses | $0 | PAGA Penalties | $766,630.00- $7,666,300.00 | Total | $6,560,267.76 - $13,459,937.76 | (Lazar Decl., P.P.18-36.)

2. Risk, expense, complexity and likely duration of further litigation. Given the nature of the class claims, the case is likely to be expensive and lengthy to try. Procedural hurdles (e.g., motion practice and appeals) are also likely to prolong the litigation as well as any recovery by the class members.

3. Risk of maintaining class action status through trial. Even if a class is certified, there is always a risk of decertification. (See Weinstat v. Dentsply Intern., Inc. (2010) 180 Cal.App.4th 1213, 1226 (" Our Supreme Court has recognized that trial courts should retain some flexibility in conducting class actions, which means, under suitable circumstances, entertaining successive motions on certification if the court subsequently discovers that the propriety of a class action is not appropriate.").)

4. Amount offered in settlement. Plaintiff's counsel obtained a $784,000 non-reversionary settlement. This is approximately 6% to 12% of Plaintiff's potential recovery which, given the uncertain outcomes, is within the "ballpark" of reasonableness. The settlement amount, if reduced by the requested deductions, leaves approximately $388,166.67 to be divided among approximately 1,053 class members. Assuming full participation, the resulting payments will average approximately $368.63 per class member. [388,166.67 /1,053 = $368.63] Additionally, there are 877 Aggrieved Employees who will receive a share of the $20,000 allocated to PAGA Penalties, and the resulting payments would average $22.55 per Aggrieved Employee. [$20,000 / 887 = $22.55]

5. Extent of discovery completed and stage of the proceedings. As indicated above, by the time of the settlement, Class Counsel had conducted sufficient discovery.

6. Experience and views of counsel. The settlement was negotiated and endorsed by Class Counsel who, as indicated above, is experienced in class action litigation, including wage and hour class actions.

7. Presence of a governmental participant. This factor is not applicable here.

8. Reaction of the class members to the proposed settlement. The class members' reactions will not be known until they receive notice and are afforded an opportunity to object, opt-out and/or submit claim forms. This factor becomes relevant during the fairness hearing.

CONCLUSION: The settlement can be preliminarily deemed "fair, adequate, and reasonable."

3. Scope of the release

· Effective upon entry of Judgment, the Order granting Final Approval of this Settlement, and on the date when Defendants fully fund the entire Gross Settlement Amount and fund all employer payroll taxes owed on the Wage Portion of the Individual Class Payments, Plaintiff, Class Members, and Class Counsel will release claims against all Released Parties as follows: (P.5)

o For the duration of the Class Period, all Participating Class Members, on behalf of themselves and their respective former and present representatives, agents, attorneys, heirs, administrators, successors, and assigns, release the Released Parties from all claims that were alleged, or could have been alleged, based on the facts, and any facts related, stated in the Operative Complaint. (P.5.2)

o Except as set forth in Section 5.2 of this Agreement, Participating Class Members do not release any other claims, including claims for vested benefits, wrongful termination, violation of the Fair Employment and Housing Act, unemployment insurance, disability, social security, workers' compensation, or claims based on facts occurring outside the Class Period. (P.5.3)

o For the duration of the PAGA Period, all Aggrieved Employees are deemed to release, on behalf of themselves and their respective former and present representatives, agents, attorneys, heirs, administrators, successors, and assigns, the Released Parties from all claims for PAGA penalties that were alleged, or could have been alleged, based on the facts stated, and related facts, in the Operative Complaint and the PAGA Notice. (P.5.4)

o Named Plaintiff will also provide a general release and CC Sec. 1542 waiver. (P.5.1)

o As noted above, the settlement cannot release class claims based on unidentified "related facts," but instead must be grounded in facts that were actually alleged in the Operative Complaint. Further, the claims released must either be alleged or be such that they could have reasonably been alleged based on the proper scope of factual allegations. Thus, the class claims released should be limited to "all claims that were alleged, or reasonably could have been alleged, based on the facts stated in the Operative Complaint." The same is true for the PAGA claims to be released. The settlement can only release "all claims for PAGA penalties that were alleged, or reasonably could have been alleged, based on the facts stated in the Operative Complaint and the PAGA Notice."

4. May conditional class certification be granted?

1. Standards

A detailed analysis of the elements required for class certification is not required, but it is advisable to review each element when a class is being conditionally certified (Amchem Products, Inc. v. Winsor (1997) 521 U.S. 620, 622-627.) The trial court can appropriately utilize a different standard to determine the propriety of a settlement class as opposed to a litigation class certification. Specifically, a lesser standard of scrutiny is used for settlement cases. (Dunk at 1807, fn 19.) Finally, the Court is under no "ironclad requirement" to conduct an evidentiary hearing to consider whether the prerequisites for class certification have been satisfied. (Wershba at 240.)

2. Analysis

a. Numerosity. There are at least 1,053 class members. (Lazar Decl., P.40.) This element is met.

b. Ascertainability. The proposed class is defined above. The class definition is "precise, objective and presently ascertainable." (Sevidal v. Target Corp. (2010) 189 Cal.App.4th 905, 919.) The class members are identifiable from Defendant's records. (Lazar Decl., P.39.)

c. Community of interest. "The community of interest requirement involves 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.'" (Linder v. Thrifty Oil Co. (2000) 23 Cal.4th 429, 435.) As to commonality, counsel contends that this litigation was brought to resolve common issues that include whether Defendants failed to pay for all hours worked; whether Defendants provided full, timely and un-interrupted meal and rest periods, whether Class Members are entitled to premium pay for incomplete, untimely or interrupted meal or rest periods, among other claims. (Lazar Decl., P.41.)

Further Counsel contends that Plaintiff's claims are typical of those of other Class Members as Plaintiff: (1) is a non-exempt, hourly paid employee like other Class Members; (2) complains of not being paid for all time under Defendants' control or suffered and/or permitted to work for Defendant; (3) did not receive full premium pay for meal periods that were not compliant with the Labor Code; (4) did not receive premium pay for rest periods that were not provided. (Id. at P.42.) As to adequacy, Class Counsel contends Plaintiff has no conflicts with the class and is represented by adequate counsel. (Id. at P.P.43-47; Declaration of Plaintiff Dominguez, passim.)

d. Adequacy of class counsel. As indicated above, Class Counsel has shown experience in class action litigation, including wage and hour class actions. (Id. at P.P.43-46.)

e. Superiority. Given the relatively small size of the individual claims, a class action appears to be superior to separate actions by the class members.

CONCLUSION: The class may be conditionally certified since the prerequisites of class certification have been satisfied.

5. Is the notice proper?

1. Content of class notice. The proposed notice is attached to the Settlement Agreement as Exhibit A. Its content appears to be generally acceptable. It includes information such as: a summary of the litigation; the nature of the settlement; the terms of the settlement agreement; the proposed deductions from the gross settlement amount (attorney fees and costs, enhancement awards, and administration costs); the procedures and deadlines for participating in, opting out of, or objecting to, the settlement; the consequences of participating in, opting out of, or objecting to, the settlement; and the date, time, and place of the final approval hearing. The Notice requires the following revisions:

· The Notice should disclose the funding/distribution deadlines.

· The Notice contains the wrong tax allocation for Class Payments. While the Settlement at P.3.2.4.1 states that the tax allocation is 10% wages and 90% penalties/interest, the Notice at page 3 states the tax allocation is 20% wages and 80% penalties/interest.

2. Method of class notice. Notice will be given via direct mail. Not later than 15 business days after the Court grants Preliminary Approval of the Settlement, Defendants will simultaneously deliver the Class Data to the Administrator, in the form of a Microsoft Excel spreadsheet. (P.4.2) Using best efforts to perform as soon as possible, and in no event later than 14 days after receiving the Class Data, the Administrator will send to all Class Members identified in the Class Data, via first-class United States Postal Service ("USPS") mail, the Class Notice with Spanish translation.

Before mailing Class Notices, the Administrator shall update Class Member addresses using the National Change of Address database. (P.7.4.2) Not later than 3 business days after the Administrator's receipt of any Class Notice returned by the USPS as undelivered, the Administrator shall re-mail the Class Notice 27 28 using any forwarding address provided by the USPS. If the USPS does not provide a forwarding address, the Administrator shall conduct a Class Member Address Search, and re-mail the Class Notice to the most current address obtained.

The Administrator has no obligation to make further attempts to locate or send Class Notice to Class Members whose Class Notice is returned by the USPS a second time. (P.7.4.3) If the Administrator, Defendants or Class Counsel is contacted by or otherwise discovers any persons who believe they should have been included in the Class Data and should have received Class Notice, the Parties will expeditiously meet and confer, in good faith, in an effort to agree on whether to include them as Class Members.

If the Parties agree, such persons will be Class Members entitled to the same rights as other Class Members, and the Administrator will send, via email or overnight delivery, a Class Notice requiring them to exercise options under this Agreement not later than 15 days after receipt of Class Notice, or the deadline dates in the Class Notice, which ever are later. (P.7.4.5) Notice of Final Judgment will be posted on the Settlement Administrator's website. (P.7.8.1)

3. Cost of class notice. As indicated above, settlement administration costs are estimated not to exceed $14,500. Prior to the time of the final fairness hearing, the administrator must submit a declaration attesting to the total costs incurred and anticipated to be incurred to finalize the settlement for approval by the Court.

6. Attorney fees and costs

CRC rule 3.769(b) states: "Any agreement, express or implied, that has been entered into with respect to the payment of attorney fees or the submission of an application for the approval of attorney fees must be set forth in full in any application for approval of the dismissal or settlement of an action that has been certified as a class action." Ultimately, the award of attorney fees is made by the court at the fairness hearing, using the lodestar method with a multiplier, if appropriate. (PLCM Group, Inc. v.

Drexler (2000) 22 Cal.4th 1084, 1095-1096; Ramos v. Countrywide Home Loans, Inc. (2000) 82 Cal.App.4th 615, 625-626; Ketchum III v. Moses (2000) 24 Cal.4th 1122, 1132-1136.) Despite any agreement by the parties to the contrary, "the court ha[s] an independent right and responsibility to review the attorney fee provision of the settlement agreement and award only so much as it determined reasonable." (Garabedian v. Los Angeles Cellular Telephone Company (2004) 118 Cal.App.4th 123, 128.) The question of whether Class Counsel is entitled to $ 261,333.33 (33 1/3%) in attorney fees will be addressed at the fairness hearing when class counsel brings a noticed motion for attorney fees.

Class counsel must provide the court with billing information so that it can properly apply the lodestar method and must indicate what multiplier (if applicable) is being sought as to each counsel. Class Counsel should also be prepared to justify the costs sought (capped at $ 30,000) by detailing how they were incurred.

7. Incentive Award

The Settlement Agreement provides for an enhancement award of up to $10,000 to the named Plaintiff. In connection with the final fairness hearing, named Plaintiffs each must submit a declaration attesting to why he or she should be entitled to an enhancement award in the proposed amount, including the work done, the amount of time devoted, and any other relevant facts. The named Plaintiff must explain why he or she "should be compensated for the expense or risk she has incurred in conferring a benefit on other members of the class." (Clark v.

American Residential Services LLC (2009) 175 Cal.App.4th 785, 806.) Trial courts should not sanction enhancement awards of thousands of dollars with "nothing more than pro forma claims as to 'countless' hours expended, 'potential stigma' and 'potential risk.' Significantly more specificity, in the form of quantification of time and effort expended on the litigation, and in the form of reasoned explanation of financial or other risks incurred by the named plaintiff, is required in order for the trial court to conclude that an enhancement was 'necessary to induce [the named plaintiff] to participate in the suit . . . .'" (Id. at 806-807, italics and ellipsis in original.)

The Court will decide the issue of the enhancement awards at the time of final approval. | Home -->)" -->