Eric Koontz vs Cisco Systems, Inc.

LINE # CASE # CASE TITLE RULING LINE 1 20CV373138 Envirodigm, Inc. v. Apple, Inc. Hearing: Motion is GRANTED

Tentative ruling under seal and provided to parties only LINE 2 20CV373138 Envirodigm, Inc. v. Apple, Inc. Motion: Seal Records LINE 3 20CV373138 Envirodigm, Inc. v. Apple, Inc. Motion: Seal Records LINE 4 20CV373138 Envirodigm, Inc. v. Apple, Inc. Motion: Seal Records LINE 5 23CV428291 Salinas v. Giuliani Construction and Motion: Enforce Restoration, Inc. (PAGA) Settlement is GRANTED and Request to Dismiss Claims in DENIED

Click on line 5 for tentative ruling LINE 6 24CV453093 Asefash Rivera vs Stanford Health Hearing: Petition for Care Coordination is GRANTED

Click on line 6 for tentative ruling LINE 7 25CV469747 Nicole Yuen vs DEPOP, INC. (Class Hearing: Pro Hac Vice Action) Application is APPROVED LINE 8 25CV474024 Eric Koontz vs Cisco Systems, Inc. Hearing: Motion For Approval of Settlement is GRANTED

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Case Name: Eric Koontz v. Cisco Systems, Inc. Case No.: 25CV474024

This is a representative action under the Private Attorneys General Act (“PAGA”). Plaintiff Eric Koontz alleges defendant Cisco Systems, Inc. committed various wage and hour violations.

Before the Court is Plaintiff’s motion for approval of PAGA settlement, which is unopposed. As discussed below, the Court GRANTS the motion.

VIII. BACKGROUND

According to the allegations of the operative Complaint, Plaintiff was employed by Defendant from 2005 to September 2024. (Complaint, ¶ 1.) As a condition of employment, Defendant required its employees to sign and abide by the terms of its Proprietary Information and Inventions Assignment Agreement (the “PIIA”). (Complaint, ¶ 8.) Plaintiff was required to sign the Agreement and continues to be bound by its terms. (Complaint, ¶¶ 9-13.) Defendant violated Labor Code section 923 and 232 by requiring employees to sign the Agreement, as a condition of employment. (Complaint, ¶¶ 17.)

Based on the foregoing, Plaintiff initiated this action on August 29, 2025, which asserts a single cause of action for PAGA penalties.

Plaintiff now moves for an order approving the Settlement Agreement (the “Settlement”).

IX. 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) 596 U.S. 639 [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.)

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

On June 17, 2025, Plaintiff submitted written notice to the Labor and Workforce Development Agency (“LWDA”) and Defendant. On August 29, 2025, Plaintiff initiated this action. In September 2025, Defendant filed a notice of appearance, and the Court deemed the case complex. Subsequently, the parties met and conferred about this action and they agreed to participate in mediation.

Over the next few months, the parties exchanged informal discovery and Defendant produced: (1) all versions of the PIIA that had been in effect since 2017; (2) data regarding the numbers of active and former employees who were employed during the one-year PAGA statute of limitations period and the specific numbers of pay periods worked by employees under each iteration of the PIIA; (3) the materials submitted to all 15,696 active employees on August 11, 2025 that Defendant maintains sufficiently cured any potential Labor Code violations asserted by Plaintiff; and (4) a declaration form a company management attesting to the manner and means of distribution the curative materials to active employees.

On December 9, 2025, the parties attended mediation with Antonio Piazza and they reached an agreement in principle. Over the next two months, the parties negotiated the terms and in February 2026, they executed the Agreement currently before the Court.

Pursuant to the Settlement, Defendant will pay a non-reversionary gross settlement amount of $1,200,000, which is comprised of attorneys’ fees of up to $400,000 (or one-third of the gross settlement amount), up to $25,000 in litigation costs, and up to $45,000 administration costs. The net settlement amount ($725,000) will be distributed 65% ($471,250) to the LWDA and 35% ($253,750) to “Settlement Group Members,” who are defined as “all current and former employees who worked for Cisco in California ay any time from June 24, 2024 through the date of the Approval Order and Judgment.” The average PAGA payment will be approximately $15. Plaintiff will request a service award in the amount of $10,000. Funds

associated with checks uncashed after 180 days will be transmitted to the State Controller’s Unclaimed Property Fund in the name of the Settlement Group Member. In exchange for settlement, Settlement Group Members will release:

[A]ny and all claims under PAGA for civil penalties against Cisco and the Released Parties that arise out of or reasonably relate to the allegations in the notice submitted by Plaintiff to the LWDA and/or the Complaint, including the allegations that, during the PAGA Period, Cisco required, as a condition of employment, that employees refrain from disclosing the amount of wages or other working conditions, required employees to sign a waiver or other document purporting to deny them the right to disclose the amount of wages or other working conditions, and/or required employees to agree in writing to a term or condition known by Cisco to be prohibited by law.

The release is appropriately tailored to the allegations at issue, and 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].)

XI. DISCUSSION

A. Potential Verdict Value

In the Complaint, Plaintiff alleges that employees were required to sign the PIIA as a condition of employment in violation of the Labor Code. Plaintiff’s counsel estimates Defendant’s maximum exposure as $90,604,100, which is based on $100/each employee per pay period x 906,041 workweeks.1 However, Plaintiff’s counsel states that there are multiple outcomes in this action including a scenario where Defendant’s maximum exposure is less (or even) $0, if Defendant is found to have cured the alleged violations and one where the maximum exposure is $27,181,230, based only on prospective compliance.

Plaintiff’s counsel contends that Defendant’s maximum exposure is closer to $0 than to $90,604,000 for the following reasons: there is a substantial risk that a court could find Defendant sufficiently cured any potential Labor Code violations before the present lawsuit was filed; even if Defendant did not sufficiently cure past alleged violations, a court could find that it took “all reasonable steps” to be in prospective compliance by utilizing an updated PIIA for all new-hires that corrects the alleged unlawful provisions; and independent of the effect of Defendant’s efforts to cure, there are risks as to the underlying merits of the alleged violations that could preclude or drastically reduce the recovery of civil penalties. Additionally, Plaintiff counsel also considered the fact that the alleged violations do not involve underpayment of wages and Defendant has attempted to cure so it is likely that a court would exercise its discretion to reduce any penalties awarded.

1 Plaintiff’s damages analysis determined that employees worked 459,628 pay periods while subject to a version of the PIIA that includes a non-solicitation provision that allegedly violates the Labor Code and 446,413 pay periods while subject to a version of the PIIA that includes a non-disclosure provision that allegedly violations the Labor Code for a total of 906,041 pay periods at issue.

The gross settlement amount represents approximately 1.32% of the higher range of maximum exposure and it represents 4.4% of the lower figure provided. While this is below 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]), some courts have approved settlements with lower recoveries for PAGA penalties. (See Merante v. Am. Inst. for Foreign Study, Inc., (N.D. Cal. July 25, 2022) 2022 U.S. Dist. LEXIS 131833 at * 6 [approved a settlement amount between 0.27% and 2% of the maximum PAGA exposure]; Hamilton v. Juul Labs, Inc. (N.D. Cal. Nov. 16, 2021) 2021 U.S. Dist. LEXIS 221416 at * 10 [approved of PAGA settlement of 2.2% of the maximum PAGA exposure].)

Based on the foregoing, as well as the risks attendant to proceeding to trial, the range of potential liability, 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.

B. Attorneys’ 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 $400,000 in attorneys’ fees. Plaintiff’s counsel lodestar figure is $249,200 based on 321 hours worked at billing rates ranging from $750 to $800. 214,165.00 based on 305.1 hours at billing rates of $750 to $800 per hour, resulting in a multiplier of 1.60. This is within 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 work performed by Plaintiff’s counsel, and because the requested multiplier sought is within the range of multipliers regularly approved by California courts in similar actions and that it is supported by Plaintiff’s counsel’s declaration, the Court finds counsel’s requested fee award is reasonable and therefore it is approved.

C. Plaintiff’s Service Award, Other Costs and Expenses

Plaintiff requests a Class Representative Enhancement payment of $10,000.

The rationale for making enhancement or incentive awards to named plaintiffs is that they should be compensated for the expense or risk they have incurred in conferring a benefit on other members of the class. An incentive award is appropriate if it is necessary to induce an individual to participate in the suit. Criteria courts may consider in determining whether to make an incentive award include: 1) the risk to the class representative in commencing suit, both financial and otherwise; 2) the notoriety and personal difficulties encountered by the class representative; 3) the amount of time and effort spent by the class representative; 4) the duration of the litigation and; 5) the personal benefit (or lack thereof) enjoyed by the class representative as a result of the litigation.

These “incentive awards” to class representatives must not be disproportionate to the amount of time and energy expended in pursuit of the lawsuit. (Cellphone Termination Fee Cases (2010) 186 Cal.App.4th 1380, 1394-1395, internal punctuation and citations omitted.) Incentive awards are particularly appropriate where a plaintiff undertakes a significant reputational risk in bringing an action against an employer. (Covillo v. Specialty’s Café (N.D. Cal. 2014) 2014 U.S.Dist.LEXIS 29837, at *29.)

Plaintiff submitted a declaration in support of the request. Plaintiff states he has spent approximately 25 hours on the instant matter, which includes: meeting with Plaintiff’s counsel to discuss the facts involved in this case; gathering and reviewing documents related to the case; identifying potential witnesses; and communicating regularly with counsel. (Plaintiff’s Declaration (“Decl.”), ¶¶ 8-10.) Plaintiff further states that he considered the personal and professional risk of participating in this action. (Plaintiff’s Decl., ¶¶ 6-7.) The Court finds Plaintiff is entitled to a service award and the amount requested is reasonable, therefore the request is approved.

Plaintiff’s counsel requests litigation costs in the amount of $21,677.47. This is supported by the declaration of Plaintiff’s counsel and it is below the $25,000.00 provided for in the Settlement. Thus, this amount appears reasonable and is approved.

Administration costs of $40,000 are also approved.

XII. ADMINISTRATION PROCESS

Pursuant to the terms of the Settlement, within 30 days of Court approval of its terms, Defendant will provide settlement administrator Phoenix Class Action Administration Solutions (“Phoenix”) with the Settlement Group Information. Within 3 days of the Settlement becoming final, Phoenix will provide Defendant with wire transfer information and no later than 20 days from that date, Defendant will fully fund the Settlement. Within 10 days of Defendants funding the gross settlement amount, Phoenix shall mail the checks for individual PAGA payments, the LWDA PAGA payment, the service award, the administration expenses payment, and the payments counsel and litigation costs payments. Phoenix shall conduct an address search for all Settlement Group Members whose checks are returned and it must remail the check within 7 days. Funds associated with checks uncashed after 180 days shall be

transmitted to the State Controller’s Unclaimed Property Fund. These administrative procedures are appropriate and are approved.

XIII. ORDER AND JUDGMENT

Plaintiff’s motion for approval of the parties’ PAGA settlement is GRANTED. The covered individuals are: All current and former employees who worked for Cisco in California at any time from June 24, 2024 through the date of the Approval Order and Judgment

Judgment shall be entered through the filing of this order and judgment. (Code Civ. Proc., § 668.5.) Plaintiff and Settlement Group Members shall take from the PAGA claim in their operative pleading 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 May 13, 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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