SHEPHERD, FINKELMAN, MILLER & SHAH, LLP Rose F. Luzon … · RUIZ FOOD PRODUCTS, INC., and DOES...

MEMO OF LAW IN SUPPORT OF

MOTION FOR FINAL APPROVAL OF

CLASS ACTION SETTLEMENT

CASE NO. 10-CV-02354-AWI-SKO

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SHEPHERD, FINKELMAN, MILLER & SHAH, LLP Rose F. Luzon (SBN 221544) 401 West A Street, Suite 2350 San Diego, CA 92101 Phone: (619) 235-2416 Facsimile: (619) 234-7334 Email: [email protected] [Additional Counsel Appear on Signature Page] Attorneys for Plaintiffs and Proposed Class

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

FRESNO DIVISION

PATRICIA FRANCO and LILIA CASTRO,

on behalf of themselves and all others

similarly situated,

Plaintiffs,

vs.

RUIZ FOOD PRODUCTS, INC., and DOES 1-50, inclusive,

Defendants.

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Case No.: 1:10-cv-02354-AWI-SKO

MEMORANDUM OF LAW IN SUPPORT

OF MOTION FOR FINAL APPROVAL

OF CLASS ACTION SETTLEMENT

Date: August 1, 2012

Time: 9:30 a.m.

Crtrm.: 7

Judge: Hon. Sheila K. Oberto

Case 1:10-cv-02354-SKO Document 38-1 Filed 07/05/12 of 33

i MEMO OF LAW IN SUPPORT OF

MOTION FOR FINAL APPROVAL OF CLASS ACTION SETTLEMENT


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TABLE OF CONTENTS

I. INTRODUCTION ................................................................................................................. 1

II. NATURE OF CASE AND PROCEDURAL HISTORY ...................................................... 3

A. Core Claims And Defenses ........................................................................................... 3

B. Discovery ...................................................................................................................... 3

C. Mediation ...................................................................................................................... 4

III. SUMMARY OF SETTLEMENT TERMS ............................................................................ 4

IV. THE PARTIES HAVE SATISFIED THEIR NOTICE OBLIGATIONS UNDER THE PRELIMINARY APPROVAL ORDER ............................................................................... 5

V. THE PROPOSED SETTLEMENT MEETS THE STANDARDS FOR FINAL APPROVAL .......................................................................................................................... 6

A. Final Certification Of The Settlement Class Is Proper And Should Be Granted .......... 7

1. Numerosity. .......................................................................................................... 8

2. Commonality........................................................................................................ 8

3. Typicality. ............................................................................................................ 9

4. Adequate Representation. .................................................................................... 9

5. Predominance Of Common Questions............................................................... 10

6. Superiority.......................................................................................................... 11

B. The Settlement Is Fair, Reasonable, And Adequate ................................................... 11

1. The Value Of The Settlement Supports Approval …………………………………13

a. The Risks Inherent In Continued Litigation Are Great. ........................... 13

b. The Amount Offered In The Settlement Supports Approval. ................... 15

c. Substantial Discovery Supports Approval. .............................................. 15

d. Earlier Payment Supports Approval. ........................................................ 16

e. The Fairness Of The Distribution Supports Approval. ............................. 17

f. The Plan Of Allocation For Distributing The Settlement To The Class Members. .................................................................................................. 17

g. Settlement Administration. ....................................................................... 17

h. No Reversion Of Residual Funds. ............................................................ 18

2. The Method, Form, And Content Of Class Notice Support Approval……………18 VI. CLASS COUNSEL’S REQUEST FOR ATTORNEYS’ FEES AND COSTS IS FAIR

AND REASONABLE ......................................................................................................... 20

A. The Results Achieved ................................................................................................. 21


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B. The Effort Expended By Class Counsel ..................................................................... 21

C. The Skill And Experience Of Counsel........................................................................ 22

D. The Complexity Of Issues And The Risks Assumed By Class Counsel .................... 22

E. Reaction Of The Class ................................................................................................ 22

F. A Lodestar Analysis Confirms That The Requested Fee Award Is Reasonable ........ 23

VII. REIMBURSEMENT OF CLASS COUNSEL’S EXPENSES AND COSTS IS WARRANTED .................................................................................................................... 24

VIII. THE PROPOSED INCENTIVE AWARDS TO THE CLASS REPRESENTATIVES ARE FAIR AND REASONABLE ...................................................................................... 24

IX. REIMBURSEMENT OF CLASS COUNSEL’S EXPENSES AND COSTS IS WARRANTED .................................................................................................................... 26

X. CONCLUSION .................................................................................................................... 26


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TABLE OF AUTHORITIES

Cases Acosta v. Trans Union LLC, 243 F.R.D. 377 (C.D. Cal. 2007) ...................................................... 7 Baldwin & Flynn v. Nat’l Safety Assocs., 149 F.R.D. 598 (N.D. Cal. 1993) ................................. 7 Blackie v. Barrack, 524 F.2d 89 (9th Cir. 1975)............................................................................. 7 Blackwell v. Skywest Airlines, 245 F.R.D. 453 (S.D. Cal. 2007).................................................. 14 Boeing Co. v. Van Gemert, 444 U.S. 472 (1980).......................................................................... 20 Boyd v. Bechtel Corp., 485 F. Supp. 610 (N.D. Cal. 1979) .......................................................... 13 Brailsford v. Jackson Hewitt, Inc. et al., C06-00700 CW, 2007 U.S. Dist. LEXIS 35509 (N.D. Cal. May 3, 2007) ........................................................................................................... 21 Brinker Restaurant Corp. v. Superior Court, 53 Cal.4th 1004 (2012) ......................................... 14 Cal. Rural Legal Assistance, Inc. v. Legal Servs. Corp., 917 F.2d 1171 (9th Cir. 1990) ............... 9 Class Plaintiffs v. City of Seattle, 955 F.2d 1268 (9th Cir. 1992). ................................................. 6 Consolidated Rail Corp. v. Town of Hyde Park, 47 F.3d 473 (2d Cir. 1995) ................................ 8 Eisen v. Carlisle & Jacquelin, 417 U.S. 156 (1974) ....................................................................... 7 Glass v. UBS Financial Servs., Inc., No. C-06-4068 MMC, 2007 WL 221862 (N.D. Cal. Jan. 26, 2007) .......................................................................................................... 25 Grunin v. International House of Pancakes, 513 F.2d 114 (8th Cir. 1975) ................................. 18 Hanlon v. Chrysler Corp., 150 F.3d 1011 (9th Cir. 1998) ............................................................. 7 Hanon v. Dataprods. Corp., 976 F.2d 497 (9th Cir. 1992) ............................................................ 9 Harris v. Palm Springs Alpine Estates, Inc., 329 F.2d 909 (9th Cir. 1964) ................................... 8 Hensley v. Eckerhart, 461 U.S. 424 (1983) .................................................................................. 21 In re Activision Sec. Litig., 723 F. Supp. 1373 (N.D. Cal. 1989) ................................................. 21 In re Cendant Corp. Prides Litig., 243 F.3d 722 (3d Cir. 2001) .................................................. 24 In re Crazy Eddie Sec. Litig., 824 F. Supp. 320 (E.D.N.Y. 1993) ................................................ 23 In re Equity Funding Corp. Sec. Litig., 438 F. Supp. 1303 (C.D. Cal. 1977) .............................. 22 In re General Motors Corp., 55 F.3d 768 (3d Cir. 1995) ............................................................. 13


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In re Heritage Bond Litigation, No. MDL 02-ML-1475 DT, et al., 2005 U.S. Dist. LEXIS 13555 (C.D. Cal. June 10, 2005) ........................................................ 21 In re Immune Response Securities Litigation, 497 F.Supp.2d 1166 (S.D. Cal. 2007).................. 16 In re King Resources Co. Sec. Litig., 420 F. Supp. 610 (D. Colo. 1976) ..................................... 21 In re Media Vision Tech. Sec. Litig., 913 F. Supp. 1362 (N.D. Cal. 1996) .................................. 24 In re Mego Fin. Corp. Securities Litigation, 213 F.3d 454 (9th Cir. 2000) ................................. 15 In re Mego Financial Corp. Sec. Litig., 213 F.3d 454 (9th Cir. 2000) ......................................... 25 In re Michael Milken & Assocs. Sec. Litig., 150 F.R.D. 57 (S.D.N.Y. 1993) .............................. 20 In re Pacific Enterprises Securities Litig., 47 F.3d 373 (9th Cir. 1995) ....................................... 20 In re Prudential Sec. Ltd. P’ships. Litig., 985 F. Supp. 410 (S.D.N.Y. 1997) ............................. 23 In re Washington Public Power Supply Sys. Sec. Litig., 19 F.3d 1291 (9th Cir. 1994) ............... 22 Kohler v. Hyatt Corp., No. EDCV 07-782-VAP (CWx), 2008 U.S. Dist. LEXIS 63392 (C.D. Cal. July 23, 2008) .......................................................................................................... 14 Krzesniak v. Cendant Corp., No. C 05-05156 MEJ, 2007 U.S. Dist. Lexis 47518 (N.D. Cal., June 20, 2007) .......................................................................................................... 8 Langford v. Devitt, 127 F.R.D. 41 (S.D.N.Y. 1989) ..................................................................... 18 Linney v. Cellular Alaska P’ship, 151 F.3d 1234 (9th Cir. 1998) ................................................ 12 Linney v. Cellular Alaska P’ship, 1997 WL 450064 (N.D. Cal. Jul. 18, 1997) ........................... 13 Local Joint Exec. Bd. of Culinary/Bartender Trust Fund v. Las Vegas Sands, Inc., 244 F.3d 1152 (9th Cir. 2001) .................................................................................................. 10 Maley v. Del Global Technologies Corp., 186 F. Supp. 2d 358 (S.D.N.Y. 2002) ....................... 23 Mandujano v. Basic Vegetable Products, Inc., 541 F.2d 832 (9th Cir. 1976) .............................. 18 Mendoza v. United States, 623 F.2d 1338 (9th Cir. 1980)............................................................ 20 Mullane v. Cent. Hanover Bank & Trust Co., 339 U.S. 306 (1950) ............................................. 19 Officers for Justice v. Civil Serv. Comm’n of San Francisco, 688 F.2d 615 (9th Cir. 1982) ....... 12 Paul, Johnson, Alston & Hunt v. Graulty, 886 F.2d 268 (9th Cir. 1989) ..................................... 20 Perez v. Safety-Kleen Sys., Inc., 253 F.R.D. 508 (N.D. Cal. 2008) .............................................. 14 Phillips Petroleum Co. v. Shutts, 472 U.S. 797 (1985) ................................................................ 11


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Salazar v. Avis Budget Group, Inc., 251 F.R.D. 529 (S.D. Cal. 2008) ......................................... 14 Silber v. Mabon, 18 F.3d 1449 (9th Cir. 1994) ............................................................................. 18 Singer v. Becton Dickinson, No. 08-cv-821, 2010 WL 2196104 (S.D. Cal. Jun. 1, 2010) ............................................................................................................. 23 Six Mexican Workers v. Arizona Citrus Growers, 904 F.2d 1301 (9th Cir. 1990) ....................... 20 Staton v. Boeing Co., 327 F.3d 938 (9th Cir. 2003) ....................................................................... 7 Stoetzner v. United States Steel Corp., 897 F.2d 115, 118-19 (3d Cir. 1990) .............................. 23 Torrisi v. Tucson Elec. Power Co., 8 F.3d 1370 (9th Cir. 1993) .................................................. 20 Valentino v. Carter-Wallace, Inc., 97 F.3d 1227 (9th Cir. 1996) ................................................. 11 Van Bronkhorst v. Safeco Corp., 529 F.2d 943 (9th Cir. 1976) ..................................................... 6 Van Vranken v. Atlantic Richfield Co., 901 F. Supp. 294 (N.D. Cal. 1995)................................. 25 Vincent v. Hughes Air West, Inc., 557 F.2d 759 (9th Cir. 1977) .................................................. 24 Vizcaino v. Microsoft Corp., 142 F. Supp. 2d 1299 (W.D. Wash. 2001) ……………...………..24 Vizcaino v. Microsoft Corp., 290 F.3d 1043 (9th Cir. 2002) …………………………………....22 Watson-Smith v. Spherion Pac. Workforce LLC, No. C 03-1180 RS, 2008 U.S. Dist. LEXIS 106147 (N.D. Cal. Dec. 12, 2008) ...................................................... 14 Zinser v. Accufix Research Inst., Inc., 253 F.3d 1180 (9th Cir. 2001) ......................................... 10

Federal and State Statutes 29 U.S.C. § 216 ............................................................................................................................... 4 Business and Professions Code §17200 .......................................................................................... 3 Cal. Lab. Code § 226 ...................................................................................................................... 3

Rules Fed. R. Civ. Proc. 23 .............................................................................................................. passim

Other Authorities Schwarzer, Tashima & Wagstaffe, Cal. Prac. Guide: Fed. Civ. Pro. Before Trial, § 10:571 (The Rutter Group 2011) ........................................................................................... 7


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Plaintiffs, Patricia Franco and Lilia Castro (“Plaintiffs”), on behalf of themselves and all

others similarly situated (“Class Members”), without opposition from Defendant, Ruiz Foods

Products, Inc. (“Ruiz”) and Does 1-50 (collectively, “Defendant”) (together with Plaintiffs, the

“Parties”), respectfully submit this Memorandum of Law in Support of their Motion for Final

Approval of Class Action Settlement (“Motion”).

I. INTRODUCTION

Plaintiffs filed this hybrid Rule 23 wage and hour class action and Section 216(b)

collective action under the Fair Labor Standards Act (“FLSA”) against Defendant on December

15, 2010. Following significant formal and informal discovery conducted by the Parties, as well

as arm’s-length mediation discussions led by experienced wage and hour class action mediator,

Michael J. Loeb, the Parties reached a settlement of Plaintiffs’ claims, as memorialized in the

Parties’ Joint Stipulation of Settlement and Release Between Plaintiffs and Defendant (“Joint

Stipulation of Settlement” or “Settlement”). (Dkt. 29, Ex. 1.)

The basic terms of the Settlement are as follows:

• Class Members will share in a $2,500,000.00 settlement (the “Maximum Settlement Amount”);

• The Maximum Settlement Amount, none of which will revert to Defendant, will be entirely distributed as follows: (1) Settlement shares to Class Members based on their work weeks within the Class Period; (2) a payment of $10,000.00 for California Private Attorney General Act penalties, of which $7,500.00 will be paid to the State of California; (3) Class Representative payments to Plaintiffs in compensation for their services as Class Representatives in the amount of $7,000.00 each, as approved by the Court; (4) an attorneys’ fees payment of $825,000.00 (33% of the Gross Settlement Amount) to Class Counsel in compensation for their services to the Class, and a payment of not more than $30,000.00 to Class Counsel in reimbursement for their expenses and costs incurred in prosecuting this action, as approved by the Court; and (5) the payment of reasonable fees and expenses of Heffler, Radetich & Saitta LLP (the “Settlement Administrator”) in administering the Settlement of approximately $30,000.00, as approved by the Court; and





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• Plaintiffs and the Class will seek dismissal of all claims against Defendant and will provide Defendant with a full release of the settled claims.

On February 10, 2012, the Court granted preliminary approval of the Settlement. (Dkt.

No. 35) (“Preliminary Approval Order”). The Court’s Preliminary Approval Order appointed

Settlement Class Counsel and Class Representatives; conditionally certified a settlement class

under Federal Rule of Civil Procedure 23(b)(3) and the FLSA; preliminarily approved the

Parties’ Settlement; approved and directed the plan for giving notice to Class Members in form,

method, and content; and appointed the Settlement Administrator. (Id.) The Preliminary

Approval Order also set deadlines for Class Members to request exclusion from and/or object to

the proposed Settlement, as well as other interim deadlines leading up to the final approval

hearing set for August 1, 2012. (Id.)

Consistent with the Court’s Preliminary Approval Order, the Court-approved notice, in

both English and Spanish (“Class Notice”), was mailed to a total of 2,055 Class Members. Class

Members’ response to the Class Notice has been, to put it mildly, tremendously positive, with

only 2 Requests for Exclusion and 0 Objections submitted. Now that all Court-ordered

directives and deadlines have been dutifully satisfied by the Parties and Settlement

Administrator, with Class Members overwhelmingly in support of the Settlement, the Court

should grant the Motion and order final approval of the Settlement.

In connection with seeking final approval of the Settlement, Class Counsel also seek their

reasonable attorneys’ fees in the amount of $825,000.00, which represents 33 percent of the

Gross Settlement Amount, as well as $30,000.00 as reimbursement for the costs of bringing this

suit. This amount will fairly compensate Class Counsel for work already performed in this case

and for all of the work remaining to be performed in this case, including efforts to ensure that the

settlement is fairly administered and implemented and obtaining dismissal of the action. The

requested attorneys’ fees are consistent with Ninth Circuit precedent for attorneys’ fees in similar

cases. In addition, Plaintiffs each request a service award in the amount of $7,000.00. This





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award is also appropriate since Plaintiffs greatly assisted in the prosecution of this action.

Lastly, Class Counsel request that the Settlement Administrator be reimbursed in the amount of

$30,000.00 for the fees and expenses incurred in administering the Settlement.

II. NATURE OF CASE AND PROCEDURAL HISTORY

A. Core Claims And Defenses

Plaintiffs are non-exempt, non-union, hourly workers engaged in food processing at

Defendant’s production facility located in Dinuba, California. Plaintiffs brought this hybrid

wage and hour class action and collective action under the FLSA against Defendant, alleging the

following eight causes of action under both Federal law and California law:

1. Violation of the FLSA;

2. Violation of the California Labor Code—Failure to Compensate For All

Hours Worked;

3. Violation of the California Labor Code—Failure to Pay Over Time;

4. Violation of the California Labor Code—Failure to Provide Meal and Rest

Periods;

5. Unpaid Wages and Waiting Time Penalties;

6. Failure to Properly Itemize Pay Stubs (Cal. Lab. Code §§226(a) and

226(e)); and

7. Violation of California’s Business and Professions Code §§ 17200 et seq.

Defendant has denied all allegations and asserts that it has fully complied with all

applicable laws. Defendant also denied that, for any purpose other than settling this lawsuit, this

action is appropriate for class or collective action.

B. Discovery

The Parties exchanged Rule 26 initial disclosures and subsequently exchanged additional

information through numerous interrogatories and document requests, including thousands of





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pages of documents. Defendant produced Plaintiffs’ personnel files, payroll records, and pay

stubs, electronic data regarding Class Member information, and prepared a significant sampling

of payroll data and pay stubs for Class Members, internal operational memos, handbooks,

alternate work week voting documents, and approximately 10 Class Member declarations taken

by Defendant. (Declaration of Eric L. Young, Esquire, in Support of Joint Motion for

Preliminary Approval of Class Action Settlement (“Young Prelim. App. Decl.”), ¶ 5) (Dkt. 29.)

Class Counsel analyzed the information provided by Defendant, engaged in a meet and confer

conference (in addition to numerous other informal exchanges), and vetted the information

during meetings with Plaintiffs and many Class Members in Dinuba and surrounding areas. (Id.,

¶¶ 5-6.) Plaintiffs’ years of service with Ruiz provided them with considerable detailed

information about the claims asserted, which they shared with their counsel. (Id.) Class Counsel

also obtained 27 declarations from Class Members establishing that they met the criteria under

29 U.S.C. § 216(b), and a total of 8 depositions were taken in the case. (Id.) All of this

information, obtained through discovery and informal exchanges, provided the Parties with a

substantial basis to assess the strengths and weaknesses of their respective positions prior to the

mediation.

C. Mediation

The Parties mediated on September 28, 2011 with Michael J. Loeb, Esquire, who has

significant experience in mediating California wage and hour cases. After a full day of

mediation, at which time the Parties engaged in good-faith, arm’s-length discussions and

realistically assessed the strengths and weakness of their respective positions, the Parties reached

the Settlement.

III. SUMMARY OF SETTLEMENT TERMS

The Parties agreed to an “all paid” Settlement, whereby Defendant will pay a non-

reversionary, Maximum Settlement Amount of $2,500,000, the net of which shall be paid





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entirely to participating Class Members. (Joint Stipulation of Settlement, ¶ 13.)

Included within the Maximum Settlement Amount are the following items:

1. Attorneys’ fees of Class Counsel not to exceed $825,000.00 or 33% of the

Maximum Settlement Amount, as approved by the Court;

2. Legal costs and expenses not to exceed $30,000.00, as approved by the Court;

3. Enhancement awards to each of the named Plaintiffs, i.e., the Class

Representatives, in the amount of $7,000.00, as approved by the Court;

4. Payment of $10,000.00 for California Private Attorney General Act penalties, of

which $7,500.00 will be paid to the State of California (with the remaining

benefitting the Class); and

5. Claims Administrator costs, not to exceed $30,000.00, as approved by the Court.1

(Id., ¶¶ 13-14, and 10.)

The balance remaining, referred to as the Net Settlement Amount, shall constitute a non-

reversionary, all-paid amount to be paid to all Class Members who do not submit a timely

request for exclusion. (Id., ¶14(c).) To the extent any funds remain after satisfying all payments

to Class Members, the Settlement provides that all such funds will be paid in equal parts to Ruiz-

4-Kids and Chicana Latina Foundation, as the mutually-agreed upon cy pres recipients. (Id.)

IV. THE PARTIES HAVE SATISFIED THEIR NOTICE OBLIGATIONS UNDER

THE PRELIMINARY APPROVAL ORDER

On March 7, 2012, in compliance with the Court’s Preliminary Approval Order, the

Settlement Administrator received from Defendant a list of Class Members and their contact

information based on the number of weeks worked during the Class Period. (Declaration of

Settlement Administrator (“Settlement Administrator Decl.”), ¶ 7.) On March 23, 2012, the

Settlement Administrator received a supplemental list of Class Members, which added 39 Class

1 The Settlement provides that Ruiz shall pay separately from the Maximum Settlement Amount any and all applicable payroll taxes. (Joint Stipulation of Settlement, ¶ 14(c).)





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Members to the original list. (Id.) Based upon the original and supplemental lists provided to

the Settlement Administrator, the total number of Class Members is 2,055. (Id.) Of the 2,055

Class Members, 37 had 0 weeks worked and, thus, had a total Settlement Award of $0.00. (Id.)

On March 28, 2012, the Settlement Administrator mailed Class Notices in English and

Spanish via U.S. first-class mail to all 2,055 Class Members. (Id., ¶ 9.) Thereafter, the

Settlement Administrator received 119 Class Notices returned as undeliverable, and of these, 5

were returned by the U.S. Postal Service with forwarding addresses, which the Settlement

Administrator promptly re-mailed. (Id., ¶ 10.) In addition, for each of the 114 Class Notices that

were returned as undeliverable without a forwarding address, the Settlement Administrator

performed address traces. (Id.) Updated addresses were obtained for the 114 Class Notices, and

Class Notices were promptly mailed to these addresses. (Id.) Of these 114 Class Notices, 17

were returned as undeliverable and, consistent with the Joint Stipulation of Settlement, no further

processing was performed. (Id.)

Pursuant to the Preliminary Approval Order, the last day for Class Members to request

exclusion from the Settlement was May 14, 2012. As of this date, only two Class Members have

excluded themselves from the Settlement. (Id., ¶ 12.) This figure represents far less than 5% of

the total Class (i.e., 0.097%, or two out of 2,055 Class Members) who have sought exclusion

from the Settlement. Moreover, no Class Members have objected to the Settlement terms, (Id., ¶

13), and no Class Members have disputed the number of weeks worked or the approximate

Settlement Award noted in the Class Notice. (Id., ¶ 11.)

V. THE PROPOSED SETTLEMENT MEETS THE STANDARDS FOR FINAL

APPROVAL

The law favors settlement. This is particularly true in class and collective actions where

substantial resources can be conserved by avoiding the time, cost, and rigors of formal litigation.

See Van Bronkhorst v. Safeco Corp., 529 F.2d 943, 950 (9th Cir. 1976); Class Plaintiffs v. City of

Seattle, 955 F.2d 1268, 1276 (9th Cir. 1992).





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In reviewing a class action settlement, a court undertakes two fundamental inquiries.

“First, the district court must assess whether a class exists ... .” Staton v. Boeing Co., 327 F.3d

938, 952 (9th Cir. 2003). In other words, the court must determine that the lawsuit qualifies as a

class action under Rule 23. See, e.g., Hanlon v. Chrysler Corp., 150 F.3d 1011, 1022 (9th Cir.

1998) (reviewing settlement to ensure compliance with requirements of Rule 23(a) and

Rule 23(b)(3)). Second, the court must determine whether the settlement is “fair, adequate, and

reasonable.” Staton, 327 F.3d at 952. When parties reach a settlement agreement prior to class

certification, “courts must peruse the proposed compromise to ratify both the propriety of the

certification and the fairness of the settlement.” Acosta v. Trans Union LLC, 243 F.R.D. 377,

383 (C.D. Cal. 2007) (quoting Staton, 327 F.3d at 952).

A. Final Certification Of The Settlement Class Is Proper And Should Be

Granted

A plaintiff need only make a “prima facie showing” of the requirements under Rule 23.

See Schwarzer, Tashima & Wagstaffe, Cal. Prac. Guide: Fed. Civ. Pro. Before Trial § 10:571

(The Rutter Group 2011). The fundamental question “‘is not whether ... plaintiffs have stated a

cause of action or will prevail on the merits, but rather whether the requirements of Rule 23 are

met.’” Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 178 (1974) (citation omitted). Accordingly,

when ruling on the propriety of class certification, the district court “is bound to take the

substantive allegations of the complaint as true.” Blackie v. Barrack, 524 F.2d 891, 901 n.17

(9th Cir. 1975). A court “may not require plaintiffs to make a preliminary proof of their claim; it

requires only sufficient information to form a reasonable judgment.” Baldwin & Flynn v. Nat’l

Safety Assocs., 149 F.R.D. 598, 600 (N.D. Cal. 1993).

Here, in its Preliminary Approval Order, the Court has conditionally certified the

proposed Class. (Dkt. No. 35, ¶ 3.) Moreover, Defendant has agreed to such certification solely

for purposes of this Settlement. As demonstrated below, the Class meets the requirements for

certification under Rule 23(a) and Rule 23(b)(3) such that final certification of the Class is now





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appropriate.

1. Numerosity.

The first requirement of Rule 23(a) is that the class be so numerous that joinder of all

members would be “impracticable.” Fed. R. Civ. P. 23(a)(1). “‘Impracticability’ does not mean

‘impossibility,’ but only the difficulty or inconvenience of joining all members of the class.”

Harris v. Palm Springs Alpine Estates, Inc., 329 F.2d 909, 913-14 (9th Cir. 1964). Although

there is no “magic number” necessary to satisfy numerosity, and “a court must examine the

specific facts of each case to determine that numerosity has been satisfied,” it is generally held

that “numerosity may be presumed when the class comprises forty or more members.”

Krzesniak v. Cendant Corp., No. C 05-05156 MEJ, 2007 U.S. Dist. Lexis 47518, at *19 (N.D.

Cal., June 20, 2007), citing Consolidated Rail Corp. v. Town of Hyde Park, 47 F.3d 473, 483 (2d

Cir. 1995).

This Class is composed of 2,055 employees, all of whom have been identified from

Defendant’s payroll records. Therefore, the numerosity requirement is satisfied.

2. Commonality.

Rule 23(a)(2) requires that there be “questions of law or fact common to the class.” This

commonality requirement must be “construed permissively.” Hanlon, 150 F.3d at 1019. The

plaintiff need not demonstrate that all questions of fact and law are common. “The existence of

shared legal issues with divergent factual predicates is sufficient.” (Id.) Where a class is united

by a common interest in determining whether a defendant’s broad course of conduct is

actionable, commonality is not defeated “by slight differences in class members’ positions.”

Blackie, 524 F.2d at 902.

Here, the Class shares common legal questions. For Class Members, the issues were

whether Defendant violated the FLSA and multiple California Labor Code provisions, including,

but not limited to, the requirement to (i) pay overtime and (ii) provide meal and rest periods,





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proper wage statements, and payment of all wages upon termination.

3. Typicality.

Rule 23(a)(3) requires that the representative plaintiff has claims “typical of the claims ...

of the class.” Representative claims are typical “if they are reasonably co-extensive with those

of absent class members; they need not be identical.” Hanlon, 150 F.3d at 1020. In other words,

the named plaintiff need not be “identically situated” with all other class members. “It is enough

if their situations share a ‘common issue of law or fact’ and are ‘sufficiently parallel to insure a

vigorous and full presentation of all claims for relief.’” Cal. Rural Legal Assistance, Inc. v.

Legal Servs. Corp., 917 F.2d 1171, 1175 (9th Cir. 1990) (quoting Blackie, 524 F.2d at 904).

Typicality refers to the “nature of the claim ... of the class representative, and not to the

specific facts from which it arose.” Hanon v. Dataprods. Corp., 976 F.2d 497, 508 (9th Cir.

1992) (citation and internal quotation marks omitted). The test of typicality is thus “‘whether

other members have the same or similar injury, whether the action is based on conduct which is

not unique to the named plaintiffs, and whether other class members have been injured by the

same course of conduct.’” (Id.) (citation omitted).

Here, Plaintiffs contend that their claims arise out of the same type of factual and legal

circumstances surrounding the claims of each Class Member. Plaintiffs contend that they were

subject to the same working conditions and company policies, and they allege the same

injuries—i.e., that Defendant failed to provide them with (i) overtime pay, (ii) meal and rest

periods, (iii) proper wage statements, and (iv) payment of all wages upon termination.

4. Adequate Representation.

Rule 23(a)(4) requires that “the representative parties will fairly and adequately protect

the interests of the class.” Adequate representation turns on whether the named plaintiff and his

counsel “have any conflicts of interest with other class members,” and whether the named

plaintiff and his counsel will “prosecute the action vigorously on behalf of the class.” Hanlon,





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150 F.3d at 1020.

Here, there are no conflicts of interest between Plaintiffs and Class Members. Neither

Plaintiffs nor Class Counsel have interests antagonistic to Class Members. Plaintiffs are

residents of Tulare County, California, and neighbors to many members of the Class. Plaintiffs

played an instrumental role in arranging for meetings between Class Counsel and Class

Members. Plaintiffs helped to gather documentation and declarations, which was essential in

enabling Class Counsel to determine the merits of this action. Nor are there any perceived

conflicts with Plaintiffs’ counsel. Moreover, Plaintiffs’ counsel, who have substantial class

action experience from coast to coast, (Young Prelim. App. Decl., ¶ 3; Declaration of Eric L.

Young, Esquire, in Support of Motion for Final Approval of Class Action Settlement (“Young

Final App. Decl.”), ¶ 6), can and have adequately represented the Class. See Local Joint Exec.

Bd. of Culinary/Bartender Trust Fund v. Las Vegas Sands, Inc., 244 F.3d 1152, 1162 (9th Cir.

2001) (adequacy established by mere fact that counsel were experienced practitioners).

5. Predominance Of Common Questions.

The predominance inquiry focuses on whether the class is “‘sufficiently cohesive to

warrant adjudication by representation.’” Culinary/Bartender Trust Fund, 244 F.3d at 1162

(citation omitted). Central to this question is “‘the notion that the adjudication of common issues

will help achieve judicial economy.’” Zinser v. Accufix Research Inst., Inc., 253 F.3d 1180,

1189 (9th Cir. 2001) (citation omitted), amended, 273 F.3d 1266 (9th Cir. 2001).

Here, for purposes of the Settlement only, Defendant has agreed that the central inquiries

are whether Defendant violated the FLSA and certain provisions of the California Labor Code.

Considerations of judicial economy favor litigating a predominant common issue once in a class

action instead of many hundreds or thousands of times in separate lawsuits. “‘When common

questions present a significant aspect of the case and they can be resolved for all members of the

class in a single adjudication, there is clear justification for handling the dispute on a





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representative rather than on an individual basis.’” Hanlon, 150 F.3d at 1022 (citation omitted).

6. Superiority.

To determine whether the superiority requirements of Rule 23(b)(3) are satisfied, a court

must compare a class action with alternative methods for adjudicating the parties’ claims. Lack

of a viable alternative to a class action necessarily means that a class action satisfies the

superiority requirement. “‘[I]f a comparative evaluation of other procedures reveals no other

realistic possibilities, th[e] [superiority] portion of Rule 23(b)(3) has been satisfied.’”

Culinary/Bartender Trust Fund, 244 F.3d at 1163 (citation omitted; last alteration in original);

see also Valentino v. Carter-Wallace, Inc., 97 F.3d 1227, 1235-36 (9th Cir. 1996) (“[A] class

action is the superior method for managing litigation if no realistic alternative exists.”).

Plaintiffs and putative Class Members are primarily residents of Tulare County and are of

limited means, education and resources. Further, for purposes of the Settlement only, Defendant

does not contest that a class action would be superior because it would “‘permit the plaintiffs to

pool claims which would be uneconomical to litigate individually.’” See Culinary/Bartender

Trust Fund, 244 F.3d at 1163 (quoting Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 809

(1985)). To otherwise litigate individual claims for small amounts of damages would burden the

court system and makes little economic sense for litigants or their counsel. Hanlon, 150 F.3d at

1023 (noting possibility that in individual cases, “litigation costs would dwarf potential

recovery”). Thus, in a case such as this, a class action is clearly a superior method.

For each of the foregoing reasons, the Settlement Class should be finally certified for

settlement purposes pursuant to Federal Rules of Civil Procedure 23(a) and (b)(3). Since this

action easily satisfies Rule 23, final certification of the collective action under the FLSA is also

appropriate.

B. The Settlement Is Fair, Reasonable, And Adequate

“Fed. R. Civ. P. 23(e) requires the district court to determine whether a proposed





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settlement is fundamentally fair, adequate and reasonable.” Hanlon, 150 F.3d at 1026. To

determine whether a settlement agreement is fair, adequate and reasonable, a number of factors

may be considered, including: (1) the strength of the plaintiff’s case; (2) the risk, expense,

complexity and likely duration of further litigation; (3) the risk of maintaining class action status

throughout the trial; (4) the amount offered in settlement; (5) the extent of discovery completed

and the stage of the proceedings; (6) the experience and views of counsel; (7) the presence of a

governmental participant; and (8) the reaction of the class members to the proposed settlement.

Hanlon, 150 F.3d at 1027; see also Torrisi, 8 F.3d at 1375-76 (citation omitted); accord Linney

v. Cellular Alaska P’ship, 151 F.3d 1234, 1242 (9th Cir. 1998). However, no single criterion

determines whether a class action settlement meets the requirements of Rule 23(e). “The relative

degree of importance to be attached to any particular factor will depend upon and be dictated by

the nature of the claims advanced, the types of relief sought, and the unique facts and

circumstances presented by each individual case.” Officers for Justice v. Civil Serv. Comm’n of

San Francisco, 688 F.2d 615, 625 (9th Cir. 1982).

Due to the impossibility of predicting any litigation result with certainty, a district court’s

evaluation of a settlement essentially amounts to “nothing more than ‘an amalgam of delicate

balancing, gross approximations and rough justice.’” Officers for Justice, 688 F.2d at 625

(citation omitted). The ultimate touchstone, however, is whether “class counsel adequately

pursued the interests of the class as a whole.” Staton, 327 F.3d at 961. As the Ninth Circuit

explained in Officers for Justice, the district court’s role in evaluating a class action settlement is

therefore tailored to meet that narrow objective. Review under Rule 23(e) “must be limited to

the extent necessary to reach a reasoned judgment that the agreement is not the product of fraud

or overreaching by, or collusion between, the negotiating parties.” 688 F.2d at 625.

Accordingly, the Ninth Circuit will not reverse a district court’s approval of a class action

settlement “unless the fees and relief provisions clearly suggest the possibility that class interests





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gave way to self-interest.” Staton, 327 F.3d at 961.

Here, the Parties reached a non-collusive Settlement after extensive discovery and an

exhaustive mediation, all of which enabled counsel to form educated assessments about the

strength of Plaintiffs’ claims, the validity of Defendant’s defenses, and the value of the case.

Because obtaining class certification, overcoming Defendant’s defenses, and establishing

liability posed difficult hurdles for Plaintiffs that justified compromise of their claims, the

Settlement falls well within the range of reasonable outcomes and merits approval under Rule

23(e). See, e.g., Linney v. Cellular Alaska P’ship, 1997 WL 450064 at *5 (N.D. Cal. Jul. 18,

1997) (“The involvement of experienced class action counsel and the fact that the settlement

agreement was reached in arms’ length negotiations after relevant discovery had taken place

creates a presumption that because obtaining class certification, overcoming Defendant’s

defenses and establishing liability posed difficult hurdles for the Class that justified compromise

of their claims, the settlement agreement is within the range of reasonable outcomes”).

1. The Value Of The Settlement Supports Approval.

To estimate the value of continuing to litigate, Plaintiffs considered the inherent risks, the

potential magnitude of a recovery, and the probable length of the delay in payment.

a. The Risks Inherent In Continued Litigation Are Great.

To assess the fairness, adequacy, and reasonableness of a class action settlement, the

Court must weigh the immediacy and certainty of substantial settlement proceeds against the

risks inherent in continued litigation. See In re General Motors Corp., 55 F.3d 768, 806 (3d Cir.

1995) (“[T]he present value of the damages plaintiffs would likely recover if successful,

appropriately discounted for the risk of not prevailing, should be compared with the amount of

the proposed settlement.”) (citation omitted and internal quotation marks); Boyd v. Bechtel

Corp., 485 F. Supp. 610, 617 (N.D. Cal. 1979).

This factor supports final approval here. The Settlement affords the Class prompt and





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substantial relief, while avoiding significant legal and factual hurdles that otherwise may have

prevented the Class from obtaining any recovery at all. The outcome of class certification, trial

and any attendant appeals, were inherently uncertain. (Young Prelim. App. Decl., ¶ 9.) This is

even more true now, given the California Supreme Court’s recent decision in Brinker Restaurant

Corp. v. Superior Court, 53 Cal.4th 1004, 1017 (2012), holding that “an employer’s obligation is

to relieve its employee of all duty, with the employee thereafter at liberty to use the meal period

for whatever purpose he or she desires, but the employer need not ensure that no work is done,”

as well as rejecting certification of the off-the-clock subclass for lack of evidence of common

policies and means of proof. As many courts have recognized, if the duty to provide a meal

period means to make a meal period available, and not to ensure a meal period is taken,

certifying a class can be difficult, if not impossible, due to the individualized issues presented.

See, e.g., Brown v. Federal Express Corp., 249 F.R.D. 580 (C.D. Cal. 2008); Perez v. Safety-

Kleen Sys., Inc., 253 F.R.D. 508, 515 (N.D. Cal. 2008); Salazar v. Avis Budget Group, Inc., 251

F.R.D. 529 (S.D. Cal. 2008); Blackwell v. Skywest Airlines, 245 F.R.D. 453, 468 (S.D. Cal.

2007); Kohler v. Hyatt Corp., No. EDCV 07-782-VAP (CWx), 2008 U.S. Dist. LEXIS 63392, at

*19 (C.D. Cal. July 23, 2008); Watson-Smith v. Spherion Pac. Workforce LLC, No. C 03-1180

RS, 2008 U.S. Dist. LEXIS 106147, at *8 (N.D. Cal. Dec. 12, 2008). While Plaintiffs do not

necessarily agree, the substantial risk that class certification would be denied cannot be disputed.

All in all, the Settlement achieved confers a substantial benefit on Plaintiffs and the Class

Members, whereas proceeding with litigation would impose significant risk of no recovery as

well as ongoing, substantial expense. If Settlement were not achieved, continued litigation of

Plaintiffs’ and the Class’s claims in this action would require substantial additional preparation

and discovery. It ultimately would involve the deposition and presentation of numerous

additional witnesses; the production of additional substantial documentary evidence; the

performance of highly-controlled time and motion studies; and the preparation and analysis of





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expert reports. In addition, Defendant would oppose class certification. If this case were to go to

trial, it is estimated that fees and costs could conceivably exceed $3 million per side. (Young

Prelim. App. Decl., ¶ 9.)

By contrast, the Settlement will yield a prompt, certain, and very substantial recovery for

the Class. Such a result will benefit the Parties and the Court. For these reasons, Class Counsel

believe this is an excellent Settlement for Plaintiffs and the Class. (Young Prelim. App. Decl., ¶

10.)

b. The Amount Offered In The Settlement Supports Approval.

Defendant has agreed to pay $2,500,000.00 to settle this lawsuit. Even assuming that

Defendant had no defenses to Plaintiffs’ claims (in fact, Defendant contends it has several strong

defenses to all claims), the Settlement would represent a reasonable approximation of potential

recovery.

A settlement’s adequacy must be judged as “‘a yielding to absolutes and an abandoning

of highest hopes ... .” Naturally, the agreement reached normally embodies a compromise; in

exchange for the saving of cost and elimination of risk, the parties each give up something they

might have won had they proceeded with litigation ... .” Officers for Justice, 688 F.2d at 624

(citation omitted; second alteration in original). Therefore, considering the potential recovery,

the probability of lengthy litigation in the absence of settlement, and the risks that the Class

would not have been able to succeed at trial and that a jury could award lower or no damages, the

amount of the Settlement is well within the range of reasonableness.

c. Substantial Discovery Supports Approval.

A settlement is fair and adequate where there has been sufficient information sharing

between the parties. In re Mego Fin. Corp. Securities Litigation, 213 F.3d 454, 459 (9th Cir.

2000). Approval of a class action settlement is proper as long as discovery allowed the parties to

form a clear view of the strengths and weaknesses of their cases. In re Immune Response





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Securities Litigation, 497 F.Supp.2d 1166, 1174 (S.D. Cal. 2007). In this case, the discovery

process was sufficient to achieve this goal.

The Parties engaged in substantial discovery efforts, including the exchange of numerous

interrogatories and document requests; the production of thousands of pages of detailed company

policies, practices and procedures; the production of certain payroll and personnel records; and a

day-long inspection of Ruiz’s Dinuba, California, production facility by Plaintiffs’ counsel. In

addition, the parties took eight depositions over the course of several weeks. These efforts were

in addition to the substantial time and effort expended by counsel to independently develop their

respective claims and defenses, including interviewing countless Class Members and securing

declarations in support of their positions. (Young Prelim. App. Decl., ¶ 6.)

These documents and data provided Plaintiffs’ counsel with the facts needed to settle this

class action: data relating to payment of wages, meal and rest periods taken by the Class

Members, their hourly wages, and their final pay dates. Based on this information, counsel

formed educated assessments about the strength of Plaintiffs’ claims, the validity of the defenses,

and the value of the case.

d. Earlier Payment Supports Approval.

This Court also should consider that the Settlement provides for payment to the Class

now, rather than a speculative payment many years down the road. If the litigation were to

continue, and even if Plaintiffs were to prevail, payment would occur at some indeterminate time

in the future. Even though trial is not presently scheduled, if Defendant was not to prevail at

trial, Defendant would be determined to appeal from all adverse rulings. An appeal, of course,

might last another year or two, or even more. If the appellate court were to overturn the verdict,

the case might be remanded to the trial court for further proceedings which, again, could last

indefinitely.

This delay and the risks inherent in continued litigation led Plaintiffs to conclude that

fighting the lawsuit to the bitter end was not the wise course for the Class as a whole. The





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Settlement calls for $2,500,000.00 (less approved payments to Plaintiffs, Class Counsel, the

California Labor and Workforce Development Agency, and the Settlement Administrator) to be

paid to the Class Members now. If the litigation continues, Class Members may receive nothing

at all, or may receive much less at some distant time in the future.

e. The Fairness Of The Distribution Supports Approval.

The Parties not only believe that the total Settlement is fair to the Class, but Plaintiffs

contend, and Defendant does not contest, that the proposed payment of: (1) $10,000.00 to the

California Labor and Workforce Development Agency for its share of the settlement of civil

penalties; (2) Class Representative payments to Plaintiffs in compensation for their services as

Class Representatives in the amount of $7,000.00; (3) Class Counsel fees payment of

$825,000.00 (33% of the Maximum Settlement Amount) to Class Counsel in compensation for

their services to the Class; (4) Class Counsel Litigation Expenses Payment of not more than

$30,000.00; and (5) Settlement Administrator’s reasonable fees and expenses in administering

the Settlement of approximately $30,000.00.

f. The Plan Of Allocation For Distributing The Settlement To The Class Members.

The plan for allocating and distributing the Settlement to the Class Members is set forth

in detail in the Settlement. Following preliminary approval of the Settlement, Defendant

provided the Settlement Administrator with the number of work weeks that each Class Member

worked, based on payroll records. Each Class Member’s portion represents a pro rata share

based upon the number of weeks that the Class Member worked during the Class Period. This

method for determining how much each Class Member will receive is both efficient and fair.

g. Settlement Administration.

The Settlement Administrator in this case is an experienced administrator of class action

settlements, including those of employment claims. The Settlement Administrator has faithfully

and competently carried out its obligations to administer the Settlement.





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The Settlement Administrator’s duties with respect to the Settlement are set forth in the

Settlement, and reasonable fees and expenses will be paid from the Maximum Settlement

Amount.

h. No Reversion Of Residual Funds.

The entire Settlement will be paid out – and none will revert to Defendant. With respect

to Settlement checks issued but not cashed after 90 days, those and any other remaining funds

shall be placed in an interest bearing escrow account until such time that the Parties agree that

the funds may be donated to the charitable organizations, Ruiz-4-Kids (50%) and Chicana Latina

Foundation (50%).

2. The Method, Form, And Content Of Class Notice Support Approval.

Rule 23(e) requires that adequate notice be provided to all Class Members. Notice of a

Class action settlement is adequate where the notice is given in a “form and manner that does not

systematically leave an identifiable group without notice.” Mandujano v. Basic Vegetable

Products, Inc., 541 F.2d 832, 835 (9th Cir. 1976). The notice should be the best “practicable

under the circumstances, including individual notice to all members who can be identified

through reasonable effort.” Torrisi, 8 F.3d at 1374; Fed. R. Civ. Proc. 23(c)(2)(B), 23(e)(1)(B).

Sending individual notices to Settlement Class Members’ last-known addresses constitutes the

requisite effort. Grunin v. International House of Pancakes, 513 F.2d 114, 121 (8th Cir. 1975).

“[N]otice mailed by first class mail has been approved repeatedly as sufficient notice of a

proposed settlement.” Langford v. Devitt, 127 F.R.D. 41, 45 (S.D.N.Y. 1989). Further,

Rule 23(c)(2)(B) does not require “actual notice” or that a notice be “actually received.” Silber

v. Mabon, 18 F.3d 1449, 1454 (9th Cir. 1994). Notice need only be given in a manner

“reasonably calculated, under all the circumstances, to apprise interested parties of the pendency

of the action and afford them an opportunity to present their objections.” Mullane v. Cent.

Hanover Bank & Trust Co., 339 U.S. 306, 314 (1950).

Here, the Court-approved notice procedure utilized by the Parties and Settlement





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Administrator more than satisfies Rule 23(e). Specifically, the Parties agreed to provide the

Class Notice by First-Class mail to Class Members, whose last-known names and addresses are

available to Defendant. In addition, the Settlement Administrator, upon receipt of a returned

packet, searched for a more current address for the Class Member and re-mailed the Class Notice

to the Class Member. Finally, the Settlement Administrator also re-mailed the Class Notice to

Class Members for whom updated address information was received by Class Counsel. In sum,

all notice procedures set forth in the Settlement Agreement and approved by the Court were duly

executed by the Parties and Settlement Administrator.

In addition, the content and form of notice fully complies with Rule 23(c)(2)(B). The

notice concisely and clearly states in plain, easily understood language:

1. the nature of the action;

2. the definition of the Class certified;

3. the Class claims, issues, or defenses;

4. that Class Members may enter an appearance through counsel if the member so

desires;

5. that the Court will exclude from the Class any Class Member who requests

exclusion, stating when and how members may elect to be excluded; and

6. the binding effect of a Class judgment on Class members under Rule 23(c)(3).

Pursuant to the Court’s Preliminary Approval Order, the Court-approved Class Notice was also

translated in Spanish so that Class Members received the notice in both English and Spanish, as

was the Request for Exclusion form that accompanied the Class Notice.

The notice provided to Class Members was more than adequate and provided Class

Members with all of the information they need to make an informed choice about whether to be

part of the Settlement. Mendoza v. United States, 623 F.2d 1338, 1351 (9th Cir. 1980) (“very

general description of the proposed settlement” sufficient); In re Michael Milken & Assocs. Sec.





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Litig., 150 F.R.D. 57, 60 (S.D.N.Y. 1993) (notice “need only describe the terms of the settlement

generally”).

Given the Parties’ compliance with this Court’s orders, the fact that only two employees

submitted Requests for Exclusion out of a total of 2,055 Class Members, while none submitted

Objections, and all of the factors described above, final approval of the Settlement is appropriate

and necessary to secure the benefits promised to all remaining Class Members.

VI. CLASS COUNSEL’S REQUEST FOR ATTORNEYS’ FEES AND COSTS IS FAIR

AND REASONABLE

The U.S. Supreme Court “has recognized consistently that a litigant or a lawyer who

recovers a common fund for the benefit of persons other than himself or his client is entitled to a

reasonable attorney’s fee from the fund as a whole.” Boeing Co. v. Van Gemert, 444 U.S. 472,

478 (1980). Ninth Circuit courts are in accord. See Paul, Johnson, Alston & Hunt v. Graulty,

886 F.2d 268, 271 (9th Cir. 1989); Six Mexican Workers v. Arizona Citrus Growers, 904 F.2d

1301, 1311 (9th Cir. 1990) (common fund fee is generally “calculated as a percentage of the

recovery”). Further, Ninth Circuit courts have repeatedly endorsed the percentage-of-the-

recovery method in awarding attorneys’ fees. See Graulty, 886 F.2d at 272; Six Mexican

Workers, 904 F.2d at 1301 (“The district court did not abuse its discretion by calculating

attorney’s fees as a percentage of the total fund.); Torrisi v. Tucson Elec. Power Co., 8 F.3d

1370, 1376-77 (9th Cir. 1993). Where, as here, the fee award sought is approximately one-third

of the common fund, Ninth Circuit courts have routinely authorized such awards. See, e.g., In re

Pacific Enterprises Securities Litig., 47 F.3d 373, 379 (9th Cir. 1995) (upholding fee award of

one-third of common fund where plaintiffs cited complexity of issues and risks involved); In re

Heritage Bond Litigation, No. MDL 02-ML-1475 DT, et al., 2005 U.S. Dist. LEXIS 13555

(C.D. Cal. June 10, 2005) (holding that an award of one-third of settlement fund is justified

based on result obtained, class counsel’s effort, experience and skill, and the great risk assumed

by class counsel). Here, in fact, the amount requested of thirty-three percent is slightly less than





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the one-third percentage fee routinely awarded in similar matters. See also Brailsford v. Jackson

Hewitt, Inc. et al., C06-00700 CW, 2007 U.S. Dist. LEXIS 35509, at *14 (N.D. Cal. May 3,

2007) (awarding 30% of the common fund); In re Activision Sec. Litig., 723 F. Supp. 1373,

1377-78 (N.D. Cal. 1989) (nearly all common fund awards range around 30%).

When making a fee award using a percentage-of-the-recovery method, the following

factors may be considered: the result achieved for the class; the work performed; counsel’s skill

and experience; the complexity of issues faced; the risks faced, including the contingency nature

of payment assumed by counsel; the reaction of the class; and counsel’s lodestar. See In re

Heritage Bond Litig., 2005 U.S. Dist. LEXIS 13555, at *57-*60. As explained below, these

factors confirm that Class Counsel’s fee request is exceedingly reasonable and favor approval.

A. The Results Achieved

Here, Class Counsel’s recovery of $2,500,000.00 is an excellent result and provides

substantial and immediate relief to Class Members. As a result of the Settlement, Class

Members will receive a proportionate share of the Net Settlement Amount based on the number

of weeks worked, with a maximum Settlement Award of $1,267.06. (Settlement Administrator

Decl., ¶ 7.) Particularly when viewed against the probability of lengthy litigation in the absence

of settlement, the risk that the Class would not have been able to succeed at class certification or

trial, and the risk that a jury could award lower or no damages to the Class, the Settlement

Amount is significant and favors Class Counsel’s fee request. See Hensley v. Eckerhart, 461

U.S. 424, 436 (1983) (“the most critical factor is the degree of success obtained”); In re King

Resources Co. Sec. Litig., 420 F. Supp. 610, 630 (D. Colo. 1976) (“the amount of the recovery,

and end result achieved are of primary importance, for these are the true benefit to the client”).

B. The Effort Expended By Class Counsel

Class Counsel’s effort in prosecuting this case is another factor to be considered. See In

re Heritage Bond, 2005 U.S. Dist. LEXIS 13555, at *85-*88. Here, as detailed above, Class





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Counsel’s efforts have been of the highest quality, (Young Prelim. App. Decl., ¶ 6), and as a

result of their efforts, the case was well-positioned for settlement, thereby affording redress to

the entire Class, while avoiding the inevitable expense and risk attendant with protracted

litigation. By any measure, Class Counsel’s work in this case was tremendous, and strongly

supports the requested fee award.

C. The Skill And Experience Of Counsel

Class Counsel are experienced class action litigators, including in employment class

actions. (Young Final App. Decl., ¶ 6), attaching firm resumes and biographies of Class

Counsel). The experience, skill and professionalism of Class Counsel, as well as the

performance and quality of opposing counsel, all weigh in favor of the requested fee. In re

Equity Funding Corp. Sec. Litig., 438 F. Supp. 1303, 1337 (C.D. Cal. 1977).

D. The Complexity Of Issues And The Risks Assumed By Class Counsel

Class Counsel assumed a very real risk in taking on this case. Class Counsel took the

case on a contingency basis, and invested time, effort and money with no guarantee of any

recovery. (Young Final App. Decl., ¶ 6.) Indeed, as detailed above, significant legal and factual

hurdles existed that otherwise may have prevented the Class from obtaining any recovery at all.

In cases where the recovery is far from certain, as here, an award of one-third of the common

fund as attorneys’ fees is appropriate and legally supported. In re Washington Public Power

Supply Sys. Sec. Litig., 19 F.3d 1291, 1302 (9th Cir. 1994); Vizcaino v. Microsoft Corp., 290

F.3d 1043, 1048 (9th Cir. 2002).

E. Reaction Of The Class

Pursuant to the Court’s Preliminary Approval Order, Class Notice was mailed to 2,055

Class Members. (Settlement Administrator Decl., ¶ 9.) Significantly, only two Requests for

Exclusion and zero Objections were received. (Id., ¶¶ 12-13.) The lack of objections to a

proposed class settlement and request for attorneys’ fees, as here, is strong evidence that the fees





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are fair and reasonable. Singer v. Becton Dickinson, No. 08-cv-821, 2010 WL 2196104, at *9

(S.D. Cal. Jun. 1, 2010) (noting that approval of attorneys’ fees in the amount of one-third of the

common fund was “especially” warranted where no class member objected to request); see also,

e.g., In re Prudential Sec. Ltd. P’ships. Litig., 985 F. Supp. 410, 416 (S.D.N.Y. 1997)

(“[N]umerous courts have [noted] that ‘the lack of objection from members of the class is one of

the most important’” factors in determining reasonableness of the requested fee); Maley v. Del

Global Technologies Corp., 186 F. Supp. 2d 358, 374 (S.D.N.Y. 2002) (“The reaction by

members of the Class is entitled to great weight by the Court.”); In re Crazy Eddie Sec. Litig.,

824 F. Supp. 320, 327 (E.D.N.Y. 1993) (the lack of objections to the requested fee supported its

reasonableness); Stoetzner v. United States Steel Corp., 897 F.2d 115, 118-19 (3d Cir. 1990)

(objections by only 10% of the class “strongly favors settlement”).

F. A Lodestar Analysis Confirms That The Requested Fee Award Is

Reasonable

Lastly, Ninth Circuit courts often use a lodestar-times-multiplier analysis to confirm the

reasonableness of the percentage-of-the-recovery award. See, e.g., In re Heritage Bond, 2005

U.S. Dist. LEXIS 13555, at *57-*60. Here, such an analysis confirms that Class Counsel’s fee

request is more than reasonable.

Class Counsel’s fees for work performed in this case, when charged at historical hourly

rates, generates a lodestar of $617,980.00. (Young Final App. Decl., ¶ 7). Thus, the requested

fee is equivalent to a multiplier of lodestar of approximately 1.33, which falls to 1.24 when the

additional fees to be incurred in obtaining final approval and performing remaining, necessary

work, including fully effectuating the Settlement, is considered. According to the Ninth Circuit,

“courts have routinely enhanced the lodestar to reflect the risk of non-payment in common fund

cases.” Vizcaino, 290 F.3d at 1051 (quoting In re Washington Public Power Supply Sys. Sec.

Litig., 19 F.3d at 1300). Notwithstanding the risk of non-recovery, Class Counsel utilized their

full abilities to achieve the successful result here. They obtained the Settlement efficiently and





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swiftly, providing immediate redress to the Class Members and without forcing them to wait

through protracted, and risky, litigation. Despite considerable legal and factual challenges, Class

Counsel were able settle this case for a substantial amount. Given the Class excellent results

achieved by Class Counsel, “a multiplier [is] appropriate in this case.” Vizcaino, 290 F.3d at

1051. Indeed, the multiple here is very minimal and well within the range of multipliers

accepted by Ninth Circuit and other courts. See, e.g., Vizcaino v. Microsoft Corp., 142 F. Supp.

2d 1299, 1305-06 (W.D. Wash. 2001) (approving multiplier of 3.67); In re Cendant Corp. Prides

Litig., 243 F.3d 722, 742 (3d Cir. 2001) (surveying lodestar multipliers in large class actions and

finding them in the 1.35-2.99 range).

VII. REIMBURSEMENT OF CLASS COUNSEL’S EXPENSES AND COSTS IS

WARRANTED

Attorneys in a common fund case may be reimbursed for reasonable out-of-pocket

expenses. Ninth Circuit courts frequently award litigation costs and expenses in addition to a

percentage-of-the-recovery award of attorneys’ fees. See, e.g., Vincent v. Hughes Air West, Inc.,

557 F.2d 759, 769 (9th Cir. 1977); In re Media Vision Tech. Sec. Litig., 913 F. Supp. 1362, 1366

(N.D. Cal. 1996) (“An attorney who has created a common fund has the right to reimbursement

…”). Here, Class Counsel are seeking $30,000.00 for unreimbursed out-of-pocket expenses

(since this was cap agreed upon as part of the Settlement), which is well below the expenses

actually incurred by Class Counsel in this case. (Young Final App. Decl., ¶ 8) (the total amount

of expenses incurred is $36,654.95).) The outstanding unreimbursed costs and expenses

comprise those incurred from the outset of the litigation for court reporters and transcripts,

copying, filing and service, legal research, mediation, and travel, among other costs and

expenses. (Id.) The outstanding unreimbursed costs and expenses in the amount of $36,654.95

were necessarily and reasonably incurred by Class Counsel for the successful prosecution of this

case and should be approved. Thus, it respectfully is submitted that the request for payment of





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$30,000.00 in expenses is unquestionably reasonable.2

VIII. THE PROPOSED INCENTIVE AWARDS TO THE CLASS REPRESENTATIVES

ARE FAIR AND REASONABLE

The Ninth Circuit and other federal courts have repeatedly approved the award of service

payments to class representatives for their assistance to a class. See, e.g., In re Mego Financial

Corp. Sec. Litig., 213 F.3d 454, 463 (9th Cir. 2000); Glass v. UBS Financial Servs., Inc., No. C-

06-4068 MMC, 2007 WL 221862, *16-17 (N.D. Cal. Jan. 26, 2007); Van Vranken v. Atlantic

Richfield Co., 901 F. Supp. 294, 300 (N.D. Cal. 1995). Relevant factors for analyzing the

amount of incentive payments made to the class representative include “the actions the plaintiff

has taken to protect the interests of the class, the degree to which the class has benefitted from

those actions, ... and reasonabl[e] fear[s of] workplace retaliation.” Staton, 327 F.3d at 977

(citation omitted).

Here, Class Counsel request that Plaintiffs, as the Class representatives, each receive a

payment of $7,000 for their time, effort, and service on behalf of the Class. Such award is

appropriate given the substantial time and effort that Plaintiffs have committed to the prosecution

of the case. (Young Prelim. App. Decl., ¶ 13.) Plaintiffs played a critical role in this litigation –

they brought the claim to Class Counsel’s attention and retained Class Counsel; they searched

their files and produced all of the documents they had relating to their employment by

Defendant; they explained the unfair employment practices that they encountered; they gave

extensive multiple interviews concerning their experiences; they also arranged for group

meetings with other current and former employees of Defendant; and they helped to gather

declarations and documentation from their putative Class members. (Id.) Plaintiffs took the

extraordinary step of putting themselves on the line by agreeing to serve as Class

Representatives, with all of the attendant duties, and agreeing to put the interests of the Class

2 The fact that Class Counsel are not receiving full reimbursement of their incurred expenses, which they continue to incur, further supports the requested attorneys’ fees, which only provide a modest multiplier to the time necessarily spent and to be spent prosecuting this action.





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ahead of their own, resulting substantial financial recoveries to Class Members. Plaintiffs are

clearly deserving of the requested award for their substantial efforts on behalf of the Class.

IX. REIMBURSEMENT OF THE SETTLEMENT ADMINISTRATOR’S EXPENSES

AND COSTS IS WARRANTED

Finally, Class Counsel seek, on behalf of the Settlement Administrator, the amount of

$30,000 as reimbursement for the expenses and costs incurred to date, as well as future expenses

and costs to be incurred, in administering the Settlement. The Settlement Administrator’s duties

have included, inter alia: (a) confirming addresses for the Class Members eligible to participate

in the Settlement; (b) preparing, printing and mailing of the Class Notice to Class Members; (c)

seeking new addresses for Class Members and re-mailing the Class Notices to them if Class

Notice packages were returned as undeliverable; (d) tracking of written Opt-Out Requests; (e)

preparing the Court-mandated declaration of due diligence in providing notice to Class

Members; and such other tasks required by the Joint Stipulation of Settlement following final

approval of the Settlement. (Settlement Administrator Decl., ¶ 3.) The expenses and costs

incurred by the Settlement Administrator were necessary and reasonable for the proper

administration of the Settlement and should also be approved.

X. CONCLUSION

For the foregoing reasons, the Parties respectfully request that this Court grant this

Motion in its entirety and order final approval of the Settlement.

Date: July 5, 2012 Respectfully Submitted,

SHEPHERD, FINKELMAN, MILLER & SHAH, LLP /s/ Rose F. Luzon ___________________ Rose F. Luzon (SBN 221544) 401 West A Street, Suite 2350 San Diego, CA 92101 Phone: (619) 235-2416 Facsimile: (619) 234-7334 Email: [email protected]





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James E. Miller (SBN 262553) Karen Leser-Grenon (SBN 231189) Shepherd, Finkelman, Miller & Shah, LLP 65 Main Street Chester, CT 06412 Telephone: (860) 526-1100 Facsimile: (860) 526-1120 Email: [email protected] [email protected] Philip A. Downey Admitted Pro Hac Vice The Downey Law Firm, LLC P.O. Box 1021 Unionville, PA 19375 Telephone: (610)324-2848 Facsimile: (610)813-4579 Email: [email protected] Eric L. Young Admitted Pro Hac Vice Egan Young, Attorneys-at-Law 526 Township Line Road, Suite 100 Blue Bell, PA 19422 Telephone: (215) 367-5151 Facsimile: (215) 367-5143 Email: [email protected]

Attorneys for Plaintiffs and the Proposed Class


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