James et al v. China Grill Management, Inc. et al

MEMORANDUM OF LAW in Support re: 101 MOTION to Approve Service Awards . . Document

S.D.N.Y.March 27, 2019

IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK BRYAN JAMES, et al., on behalf of themselves and others similarly situated, Plaintiffs, v. CHINA GRILL MANAGEMENT INC., et al., Defendants. Case No.: 18 CV 0455 Schofield, J. MEMORANDUM OF LAW IN SUPPORT OF PLAINTIFFS’ UNOPPOSED MOTION FOR APPROVAL OF CLASS REPRESENTATIVE SERVICE AWARDS 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 1:18-cv-00455-LGS Document 102 Filed 03/27/19 Page 1 of 13 ii TABLE OF CONTENTS I. INTRODUCTION………………...…………………………………………………….1 II.FACTUAL BACKGROUND……...……………………...............................................1 III.ARGUMENT.................................................................................................................2 1. The Service Awards that the Class Representatives Request is Reasonable and Should Be Approved ......................................................................................................... 2 2. The Class Representatives Assumed Significant Risks as Named Plaintiffs…...........…………………………………………………………….…...……..4 3. The Class Representatives Expended Significant Time and Effort ..............................6 4. The Ultimate Recovery Supports the Requested Service Awards ................................7 5. The Class Representatives Are Providing a Global Release in Exchange for the Requested Service Awards………………………………………………………………8 IV. CONCLUSION............................................................................................................9 Case 1:18-cv-00455-LGS Document 102 Filed 03/27/19 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)……………………………………...3 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) ...........……................2, 4 Willix v. Healthfirst, Inc., No. 07 Civ. 1143, 2011 WL 754862 (E.D.N.Y. Feb. 18, 2011)………..........................3, 6 Case 1:18-cv-00455-LGS Document 102 Filed 03/27/19 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 1:18-cv-00455-LGS Document 102 Filed 03/27/19 Page 4 of 13 1 I. INTRODUCTION Plaintiffs respectfully move this Court to approve service awards for class representatives Bryan James. Miguel Ballinas, Kim Kramer and Christopher Rosado (“class representatives”) in the amount of $10,000 each, to be paid from the Settlement Fund, in recognition of the services they rendered on behalf of the class, and in exchange for providing global releases of all claims. This motion is being filed simultaneously with Plaintiffs’ 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 awards are 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. The service awards are reasonable in light of the time and effort that Plaintiffs Bryan James. Miguel Ballinas, Kim Kramer and Christopher Rosado expended in furtherance of the class investigation and settlement, and the risks they endured in order to vindicate their rights and those of absent class members, and the claims they are releasing. II. FACTUAL BACKGROUND The class representatives have 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 Plaintiffs’ Motion for Approval of Attorneys’ Fees and Reimbursement of Expenses and for Class Representative Service Awards (“Lee Dec.”). They assisted Class Counsel’s investigation and prosecution of the claims by providing detailed factual Case 1:18-cv-00455-LGS Document 102 Filed 03/27/19 Page 5 of 13 2 information regarding their 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. Throughout the litigation, the class representatives regularly communicated with Class Counsel and assisted with the preparation of the complaint and with discovery. Plaintiffs also regularly made themselves available to communicate with Class Counsel when necessary, and participated by telephone during the full-day mediation. The Settlement Agreement calls for service payments of $10,000 each to Plaintiffs Bryan James. Miguel Ballinas, Kim Kramer and Christopher Rosado. The Court-approved Notices that were sent to Class Members informed them generally of the terms of the settlement, including the requested service awards, and gave them the opportunity to examine the Settlement Agreement if desired. No Class Members have objected to the requested service awards. III. ARGUMENT 1. The Service Awards that the Class Representatives Request Are Reasonable and Should Be Approved. The service awards that the class representatives request are reasonable given the significant contributions they 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 citations and quotation marks omitted); Velez v. Majik Cleaning Serv., No. 03 Civ. 8698, Case 1:18-cv-00455-LGS Document 102 Filed 03/27/19 Page 6 of 13 3 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. 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, Case 1:18-cv-00455-LGS Document 102 Filed 03/27/19 Page 7 of 13 4 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). 2. The Class Representatives Assumed Significant Risks as Named Plaintiffs. 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.”) “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 Case 1:18-cv-00455-LGS Document 102 Filed 03/27/19 Page 8 of 13 5 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, plaintiffs merit 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 Plaintiffs Bryan James, Miguel Ballinas, Kim Kramer and Christopher Rosado were no longer employed by Defendants at the time when they filed the Complaint, they still incurred the very real risk of retaliation from their current employers, and put their 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 ability to depend on Case 1:18-cv-00455-LGS Document 102 Filed 03/27/19 Page 9 of 13 6 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); 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). 3. The Class Representatives Expended Significant Time and Effort. The class representatives should be awarded service awards for the significant work they 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”); Frank, 228 F.R.D. at 187 (recognizing the important role that class representatives play Case 1:18-cv-00455-LGS Document 102 Filed 03/27/19 Page 10 of 13 7 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. In addition, the class representatives regularly communicated with Class Counsel and assisted with the preparation of the complaint, discovery and were responsive and involved during settlement negotiations and available to communicate with Class counsel when necessary, and participated telephonically during mediation. Id. See Declarations of Named Plaintiffs, attached as Exhibit C to the Declaration of C.K. Lee. 4. The Ultimate Recovery Supports the Requested Service Award. The requested service awards amount to approximately 3.3% 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 representatives’ participation and the likelihood that class members who submit claims Case 1:18-cv-00455-LGS Document 102 Filed 03/27/19 Page 11 of 13 8 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 awards requested here are justified given the ultimate recovery achieved. If Plaintiffs were not to receive service awards, 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. 5. The Class Representatives Are Providing a Global Release in Exchange for the Requested Service Awards In addition to providing Plaintiffs with service awards to compensate them in recognition of the services they rendered on behalf of the class, the Service Awards in this case provide the additional function of serving as release payments as well. The Settlement Agreement, § 4.1, provides that the Plaintiffs and each Class Member who does not timely opt out of the settlement will release Defendants from all wage and hour claims that have been brought, or could have been brought, under the NYLL or the regulations thereunder (Settlement Agreement, § 4.1(A)), and all Class Members that endorse and deposit their settlement checks will release Defendants from all wage and hour claims that have been brought, or could have been brought, under the FLSA (Settlement Agreement, § 4.1(B)). In addition to the wage and hour releases, in exchange for the full amount of Service Awards sought, Named Plaintiffs Bryan James, Miguel Ballinas, Kim Kramer Case 1:18-cv-00455-LGS Document 102 Filed 03/27/19 Page 12 of 13 9 and Christopher Rosado, will provide a global release of all claims. Settlement Agreement, § 4.1(D). Pursuant to the Settlement Agreement, “In the event the Court does not award the Named Plaintiffs any portion of their sought Service Award, such Named Plaintiffs shall only release [wage and hour] claims, pursuant to Sections 4.1(A) and 4.1(B).” Id. For this reason, the Service Awards are fair and do not confer an unfair benefit on Plaintiffs at the expense of class members, as Plaintiffs are providing a global release of all of their claims in exchange for the Service Award payment, whereas collective and class members are only releasing wage and hour claims by the settlement. IV. CONCLUSION For the reasons set forth above, Plaintiffs respectfully request that the Court approve service awards for the Class Representatives Bryan James. Miguel Ballinas, Kim Kramer and Christopher Rosado in the amount of $10,000 each, to be paid from the Settlement Fund. Dated: March 27, 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 Plaintiffs, FLSA Collective Plaintiffs and the Class Case 1:18-cv-00455-LGS Document 102 Filed 03/27/19 Page 13 of 13