Gonzalez v. PB Hudson LLC et al

MEMORANDUM OF LAW in Support re: 49 MOTION to Approve Service Award and Release Payment . . Document

S.D.N.Y.March 19, 2019

IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK VICTOR GONZALEZ, on behalf of himself and others similarly situated, Plaintiff, v. PB HUDSON LLC, BRUNETTI PIZZA COMPANY, INC., MICHAEL BRUNETTI, and JASON BRUNETTI, Defendants. Case No.: 17 CV 2010 Broderick, J. MEMORANDUM OF LAW IN SUPPORT OF PLAINTIFF’S UNOPPOSED MOTION FOR APPROVAL OF CLASS REPRESENTATIVE SERVICE AWARD AND RELEASE PAYMENT LEE LITIGATION GROUP, PLLC C.K. Lee (CL 4086) Anne Seelig (AS 3976) 30 East 39th Street, 2nd Floor New York, New York 10016 Telephone: (212) 465-1188 Fax: (212) 465-1181 Case 1:17-cv-02010-VSB Document 50 Filed 03/19/19 Page 1 of 13 ii TABLE OF CONTENTS I. INTRODUCTION………………...…………………………………………………….1 II.FACTUAL BACKGROUND……...……………………...............................................1 III.ARGUMENT.................................................................................................................2 The Service Award that the Class Representative Requests is Reasonable and Should Be Approved ......................................................................................................... 2 1. The Class Representative Assumed Significant Risks as Named Plaintiff…..............…………………………………………………………….…...……..4 2. The Class Representative Expended Significant Time and Effort .................................6 3. The Ultimate Recovery Supports the Requested Service Award ...................................7 4. The Release Payment Requested by the Class Representative Should Be Approved….8 IV. CONCLUSION.............................................................................................................9 Case 1:17-cv-02010-VSB Document 50 Filed 03/19/19 Page 2 of 13 iii TABLE OF AUTHORITIES CASES Page(s) Bowens v. Atl. Maint. Corp., 546 F. Supp. 2d 55 (E.D.N.Y. 2008)………………………...............................................2 de Munecas v. Bold Food, LLC, Slip Copy, No. 09 Civ. 00440, 2010 WL 3322580 (S.D.N.Y., August 23, 2010)…………………………………………6 Frank v. Eastman Kodak Co., 228 F.R.D. 174 (W.D.N.Y. 2005)..........……...........passim Guippone v. BH S&B Holdings, LLC, No. 09 Civ. 1029, 2011 WL 5148650 (S.D.N.Y. Oct. 28, 2011)…………………………………………….5 Han, et al., v. AB Green Gansevoort LLC, et al., 11 Civ. 2423 (S.D.N.Y. May 22, 2012)………………………………….…………….3, 6 Han, et al. v. Sterling National Mortgage Company, Inc., et al. 09 Civ. 5589 (E.D.N.Y. August 9, 2012)………………………………………………3, 6 Massiah v. MetroPlus Health Plan, Inc., No. 11 Civ. 5669, 2012 WL 5874655, at *8 (E.D.N.Y. Nov. 20, 2012)……………………………………...4 Mentor v. Imperial Parking Sys., Inc., No. 05 Civ. 7993, 2010 WL 5129068 (S.D.N.Y. Dec. 15, 2010)…………........................6 Parker v. Jekyll & Hyde Entm’t Holdings, L.L.C., No. 08 Civ. 7670, 2010 WL 532960 (S.D.N.Y. Feb. 9, 2010) ...................................4, 5, 7 Reyes v. Altamera Group, LLC, No. 10 Civ. 6451, 2011 WL 4599822, at *9 (S.D.N.Y. Aug. 16, 2011)…………………………………...3, 7 Roberts v. Texaco, Inc., 979 F. Supp. 185 (S.D.N.Y. 1997)......……………......................4 Silberblatt v. Morgan Stanley, 524 F. Supp. 2d 425 (S.D.N.Y. 2007) ...............................4 Tiro v. Pub. House Invs., LLC, No. 11 Civ. 7679, 2013 WL 4830949 (S.D.N.Y. Sept. 10, 2013)…………………………………………….5 Velez v. Majik Cleaning Serv., No. 03 Civ. 8698, 2007 WL 7232783 (S.D.N.Y. June 25, 2007) ...........……................3, 4 Willix v. Healthfirst, Inc., No. 07 Civ. 1143, 2011 WL 754862 (E.D.N.Y. Feb. 18, 2011)………..........................3, 6 Case 1:17-cv-02010-VSB Document 50 Filed 03/19/19 Page 3 of 13 iv OTHER AUTHORITIES Nantiya Ruan, Bringing Sense to Incentive Payments: An Examination of Incentive Payments to Named Plaintiffs in Employment Discrimination Class Actions, 10 Emp. Rts. & Emp. Pol’y J. 395 (2006)…………………………………………....................…..3 Case 1:17-cv-02010-VSB Document 50 Filed 03/19/19 Page 4 of 13 1 I. INTRODUCTION Plaintiff respectfully moves this Court to approve a service award for class representative Victor Gonzalez (“class representative”) in the amount of $5,000 to be paid from the Settlement Fund, in recognition of the services he rendered on behalf of the class, and for a release payment in the amount of $10,000 to be paid from the Settlement Fund, for his global release of all claims. This motion is being filed simultaneously with Plaintiff’s Motion for Certification of the Settlement Class, Final Approval of the Class Action Settlement, and Approval of the FLSA Settlement in this action, however these requested award is to be considered separately from the Court’s consideration of the fairness, reasonableness, adequacy and good faith of the settlement of the Litigation. Moreover, the outcome of this application does not terminate the settlement or otherwise affect the settlement of the Litigation. This service award is reasonable in light of the time and effort that Plaintiff Victor Gonzalez expended in furtherance of the class investigation and settlement, and the risks he endured in order to vindicate his rights and those of absent class members. This release payment is reasonable in light of Plaintiff’s global release of all claims. II. FACTUAL BACKGROUND The class representative has made important contributions to the prosecution and fair resolution of this action on behalf of the class members. See Declaration of C.K. Lee in Support of Plaintiff’s Motion for Approval of Attorneys’ Fees and Reimbursement of Expenses and for Class Representative Service Award and Release Payment (“Lee Dec.”) ¶13, 14. He assisted Class Counsel’s investigation and prosecution of the claims by Case 1:17-cv-02010-VSB Document 50 Filed 03/19/19 Page 5 of 13 2 providing detailed factual information regarding his job duties and those of other putative class members, the wages they were paid, the hours that they worked, and other information relevant to the claims. Id. at ¶13, 14. Throughout the litigation, the class representative regularly communicated with Class Counsel and assisted with the preparation of the complaint and discovery requests. Plaintiff also regularly made himself available to communicate with Class Counsel when necessary, including the in- person settlement meeting. The Settlement Agreement calls for a service payment of $5,000 to Plaintiff Victor Gonzalez, and a release payment of $10,000 to Plaintiff Victor Gonzalez. The Court-approved Notices that were sent to Class Members informed them generally of the terms of the settlement, including the payments for service award and release payment, and gave them the opportunity to examine the Settlement Agreement if desired. No Class Members have objected to the requested service award. III. ARGUMENT The Service Award that the Class Representative Requests Is Reasonable and Should Be Approved. The service award that the class representative requests is reasonable given the significant contributions he made to advance the prosecution and resolution of the lawsuit. Courts acknowledge that class representatives play a crucial role in bringing justice to those who would otherwise be hidden from judicial scrutiny, including low- wage workers. See, e.g., Bowens v. Atl. Maint. Corp., 546 F. Supp. 2d 55, 80 (E.D.N.Y. 2008) (recognizing the important role class representatives play in “enabling plaintiffs to redress wrongs . . . [w]here it is not economically feasible to obtain relief within the traditional framework of a multiplicity of small individual suits for damages”) (internal Case 1:17-cv-02010-VSB Document 50 Filed 03/19/19 Page 6 of 13 3 citations and quotation marks omitted); Velez v. Majik Cleaning Serv., No. 03 Civ. 8698, 2007 WL 7232783, at *7 (S.D.N.Y. June 25, 2007) (“[I]n employment litigation, the plaintiff is often a former or current employee of the defendant, and thus, by lending his name to the litigation, he has, for the benefit of the class as a whole, undertaken the risk of adverse actions by the employer or co-workers.”) (quoting Frank v. Eastman Kodak Co., 228 F.R.D. 174, 187 (W.D.N.Y. 2005) (internal quotation marks omitted); see also Nantiya Ruan, Bringing Sense to Incentive Payments: An Examination of Incentive Payments to Named Plaintiffs in Employment Discrimination Class Actions, 10Emp. Rts. & Emp. Pol’y J. 395 (2006); Willix v. Healthfirst, Inc., No. 07 Civ. 1143, 2011 WL 754862, at *7 (E.D.N.Y. Feb. 18, 2011) (approving service awards of $30,000, $15,000, and $7,500 in wage and hour action under FLSA and NYLL); Han, et al. v. Sterling National Mortgage Company, Inc., et al., 09 Civ. 5589 (E.D.N.Y. August 9, 2012) (approving service awards of $25,000 to each class representative in wage and hour action under FLSA and NYLL); Han, et al., v AB Green Gansevoort LLC, et al., 11 Civ. 2423 (S.D.N.Y. May 22, 2012) (approving service award of $20,000 in wage and hour action under FLSA and NYLL). “[S]ervice awards are common in class action cases and serve to compensate plaintiffs for the time and effort expended in assisting the prosecution of the litigation, the risks incurred by becoming and continuing as a litigant, and any other burdens sustained by the plaintiffs.” Reyes v. Altamera Group, LLC, No. 10 Civ. 6451, 2011 WL 4599822, at *9 (S.D.N.Y. Aug. 16, 2011). Service awards further the important purpose of compensating plaintiffs for the time that they spend and the risks that they take. Case 1:17-cv-02010-VSB Document 50 Filed 03/19/19 Page 7 of 13 4 Massiah v. MetroPlus Health Plan, Inc., No. 11 Civ. 5669, 2012 WL 5874655, at *8 (E.D.N.Y. Nov. 20, 2012). In examining the reasonableness of a requested service award, courts consider: (1) the personal risk incurred by the named plaintiffs; (2) the time and effort expended by the named plaintiffs in assisting the prosecution of the litigation; and (3) the ultimate recovery in vindicating statutory rights. Frank, 228 F.R.D. at 187; Roberts v. Texaco, Inc., 979 F. Supp. 185, 200 (S.D.N.Y. 1997).1. 1. The Class Representative Assumed Significant Risks as Named Plaintiff. In assessing the reasonableness of service awards, courts consider the risks the named plaintiff assumed in serving as a class representative. See Frank, 228 F.R.D. at 187; Parker v. Jekyll & Hyde Entm’t Holdings, L.L.C., No. 08 Civ. 7670, 2010 WL 532960, at *1 (S.D.N.Y. Feb. 9, 2010) (“Enhancement awards for class representatives serve the dual functions of recognizing the risks incurred by named plaintiffs and compensating them for their additional efforts.”). In the employment context, where workers are often blacklisted if they are considered “trouble makers,” class representatives are particularly vulnerable to retaliation. See Frank, 228F.R.D. at 187-88; see also Velez, 2007 WL 7232783, at *7 (observing that by serving as class representatives, the plaintiffs “exposed themselves to the prospect of having adverse actions taken against them by their former employer and former co-workers”); Silberblatt v. Morgan Stanley, 524 F. Supp. 2d 425, 435 (S.D.N.Y. 2007) (“A class representative who has been exposed to a demonstrable risk of employer retaliation or whose future employability has been impaired may be worthy of receiving an additional payment, lest others be dissuaded.”) Case 1:17-cv-02010-VSB Document 50 Filed 03/19/19 Page 8 of 13 5 “Courts acknowledge that plaintiffs play a crucial role in bringing justice to those who would otherwise be hidden from judicial scrutiny, and that ‘[service] awards are particularly appropriate in the employment context’ where ‘the plaintiff is often a former or current employee of the defendant, and thus…he has, for the benefit of the class as a whole, undertaken the risks of adverse actions by the employer or co-workers.’” Tiro v. Pub. House Invs., LLC, No. 11 Civ. 7679, 2013 WL 4830949, at *11 (S.D.N.Y. Sept. 10, 2013) (citations omitted). Even where, as here, there has been no threat or indication of retaliation, plaintiff merits recognition for assuming potential risk in filing the suit. See Guippone v. BH S&B Holdings, LLC, No. 09 Civl. 1029, 2011 WL 5148650, at *7 (S.D.N.Y. Oct. 28, 2011) (“Even where there is not a record of actual retaliation, notoriety or personal difficulties, class representatives merit recognition for assuming the risk of such for the sake of absent class members.” (quoting Frank, 228 F.R.D. at 187-88 (“Although this Court has no reason to believe that Kodak has or will take retaliatory action towards either [the Named Plaintiff] or any of the plaintiffs in this case, the fear of adverse consequences or lost opportunities cannot be dismissed as insincere or unfounded.”) Although Plaintiff Victor Gonzalez was no longer employed by Defendants at the time when he filed the Complaint, he still incurred the very real risk of retaliation from his current employer, and put his ability to secure future employment at risk as well. See Sewell, 2012 WL 1320124 at *14 (S.D.N.Y. Apr. 16, 2012); Guippone, 2011 WL 5148650, at *7 (“Today, the fact that a plaintiff has filed a federal lawsuit is searchable on the internet and may become known to prospective employers when evaluating the person.”) Parker, 2010 WL 532960, at *1 (“[F]ormer employees put in jeopardy their Case 1:17-cv-02010-VSB Document 50 Filed 03/19/19 Page 9 of 13 6 ability to depend on the employer for references in connection with future employment.”). Service awards “provide an incentive to seek enforcement of the law despite these dangers.” Id. Courts routinely approve service awards exceeding the size requested here in wage and hour class and collective actions. See Viafara v. MCIZ Corp., et al. 12-cv-7452 (approving a total service award of $25,000 to class representative); Willix, 2011 WL 754862, at *7 (approving service awards of $30,000, $15,000, and $7,500); Han, et al. v. Sterling National Mortgage Company, Inc., et al., 09 Civ. 5589 (E.D.N.Y. August 9, 2012) (approving service awards of $25,000 to each class representative in wage and hour action under FLSA and NYLL); Han, et al., v AB Green Gansevoort LLC, et al., 11 Civ. 2423 (S.D.N.Y. May 22, 2012) (approving service award of $20,000 in wage and hour action under FLSA and NYLL); Mentor v. Imperial Parking Sys., Inc., No. 05 Civ. 7993, 2010 WL 5129068, at *1-2 (S.D.N.Y. Dec. 15, 2010) (upholding $40,000 and $15,000 service awards in FLSA and NYLL wage and hour action). 2. The Class Representative Expended Significant Time and Effort. The class representative should be awarded a service award for the significant work he undertook on behalf of the class. Courts recognize the important factual knowledge that class representatives bring to employment class actions, including information about employer policies and practices that affect wages. See de Munecas v. Bold Food, LLC, Slip Copy, No. 09 Civ. 00440, 2010 WL 3322580, at *10 (S.D.N.Y., August 23, 2010) (noting the importance of “compensat[ing] plaintiffs for the time and effort expended in assisting the prosecution of the litigation, the risks incurred by becoming and continuing as a litigant, and any other burdens sustained by the plaintiff”); Case 1:17-cv-02010-VSB Document 50 Filed 03/19/19 Page 10 of 13 7 Frank, 228 F.R.D. at 187 (recognizing the important role that class representatives play as the “primary source of information concerning the claims[,]” including by responding to counsel’s questions and reviewing documents). Service awards are also meant to recognize the important role that class representatives play in the prosecution of the litigation and settlement negotiations. See Parker, 2010 WL 532960, at *1 (recognizing efforts by class representatives in meeting with counsel, reviewing documents, formulating theory of case, identifying and locating other class members to expand settlement participants, and attending court proceedings). As discussed above, throughout the litigation the class representative assisted Class Counsel’s investigation and prosecution of the claims by providing detailed factual information regarding job duties, hours worked, wages paid, and other information relevant to the claims. Lee Dec. ¶ 10. In addition, the class representative regularly communicated with Class Counsel and assisted with the preparation of the complaint and was responsive and involved during settlement negotiations and available to communicate with Class counsel when necessary, including during the parties’ in-person settlement meeting. Id. Plaintiff Victor Gonzalez was the sole Plaintiff assisting Class Counsel for the duration of this case. 3. The Ultimate Recovery Supports the Requested Service Award. The requested service award amounts to approximately 2.9% of the total recovery, which is reasonable in light of the ultimate recovery. See, e.g., Reyes, 2011 WL 4599822, at *1, *9 (approving awards totaling $50,000, representing approximately 16.6% of the $300,000 settlement); Parker, 2010 WL 532960, at *2 (finding that service awards totaling 11% of the total recovery are reasonable “given the value of the Case 1:17-cv-02010-VSB Document 50 Filed 03/19/19 Page 11 of 13 8 representatives’ participation and the likelihood that class members who submit claims will still receive significant financial awards”); Frank, 228 F.R.D. at 187 (approving award of approximately 8.4% of the settlement fund for named plaintiff in wage and hour case). The service award requested here is justified given the ultimate recovery achieved. If plaintiff were not to receive a service award, it would dissuade claimants from agreeing to act as class representatives. All cases would proceed as individual claims and the judicial system would not be able to enjoy the efficiency of class claims that is promoted in the Second Circuit. Secondly, it is inequitable that representative claimants only receive the identical rewards of other class members when they assume the risk of litigation and expended significant time and energy to the litigation. 4. The Release Payment Requested by Plaintiff Should Be Approved. The Settlement Agreement provides that every class member who does not timely opt out of the settlement will release Defendants from all wage and hour claims that were asserted or that could have been asserted in the Complaint. The Settlement Agreement further provides that named Plaintiff Victor Gonzalez will receive a release payment, in exchange for his mutual termination and full release of all claims permitted by law as set forth in Section 2.30 of the Settlement Agreement. In return for his full release of liability, named Plaintiff Victor Gonzalez has requested the Court approve a release payment in the amount of $10,000, for his global general release of all claims, including claims for discrimination. As such, the $10,000 Release Payment is designed to compensate named Plaintiff for his release of such claims, as well as to compensate him for a global release of any and all other potential claims. Case 1:17-cv-02010-VSB Document 50 Filed 03/19/19 Page 12 of 13 9 Courts in this Circuit and District have routinely approved release payments of and exceeding the size requested here in wage and hour class and collective actions in which the individual receiving the release payment is providing a global release of all claims. See Solorio v. 142 Mercer Street, LLC, et al., No. 15 Civ. 5817 (S.D.N.Y. Oct. 4, 2016) (approving $20,000 release payment to named plaintiff); Maisanache v. Paola Painting and Renovations LLC, et al., No. 16 Civ. 7697 (S.D.N.Y. May 3, 2018) (approving $20,000 release payment to named plaintiff); Mariani v. OTG Management, Inc., et al., No. 16 Civ. 1751 (E.D.N.Y. Sept. 28, 2018) (approving $10,000 release payment to named plaintiff). IV. CONCLUSION For the reasons set forth above, Plaintiff respectfully requests that the Court approve a service award for the Class Representative in the amount of $5,000, and a release payment in the amount of $10,000, to be paid from the Settlement Fund. Dated: March 19, 2019 Respectfully submitted, LEE LITIGATION GROUP, PLLC By: /s/ C.K. Lee C.K. Lee (CL 4086) Anne Seelig (AS 3976) 30 East 39th Street, Second Floor New York, NY 10016 Tel.: 212-465-1188 Fax: 212-465-1181 Attorneys for Plaintiff, FLSA Collective Plaintiffs and the Class Case 1:17-cv-02010-VSB Document 50 Filed 03/19/19 Page 13 of 13