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

MEMORANDUM OF LAW in Support re: 103 MOTION for Attorney Fees . . Document

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

i 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 ATTORNEYS’ FEES, ADMINISTRATION FEES AND REIMBURSEMENT OF EXPENSES LEE LITIGATION GROUP, PLLC C.K. Lee (CL 4086) Anne Seelig (AS 3976) 30 East 39th Street, Second Floor New York, New York 10016 Telephone: (212) 465-1188 Fax: (212) 465-1181 Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 1 of 32 ii TABLE OF CONTENTS I. INTRODUCTION………………………………...............................................….........1 II. CLASS COUNSEL ARE ENTITLED TO A REASONABLE FEE OF APPROXIMATELY ONE-THIRD OF THE SETTLEMENT FUND……......…........2 A. The Percentage Method Is the Preferred Method for Awarding Attorneys’ Fees in Common Fund Cases in the Second Circuit ...................................….................…...........4 B. Historical Data of Fees Awarded in Common Fund Cases…………………………….6 C. The Goldberger Factors Support an Award of Approximately One-third of the Settlement Fund.....…………………………………………...……………….….….......10 1. Class Counsel’s Time and Labor .............................................…...............…..............10 2. Magnitude and Complexity of the Litigation ........................................................…....13 3. Risk of Litigation .................................................................................................…….14 4. Quality of Representation ...................................................................................……..16 5. Fee in Relation to the Settlement .............................................................................….18 6. Public Policy Considerations ...................................................................................….19 III. THE LODESTAR CROSS CHECK FURTHER SUPPORTS AN AWARD TO CLASS COUNSEL OF APPROXIMATELY ONE-THIRD OF THE SETTLEMENT FUND ...............................................................................................................................23 IV. CLASS COUNSEL IS ENTITLED TO REIMBURSEMENT OF EXPENSES UNDER THE SETTLEMENT AGREEMENT…………………………………………24 V. ADMINISTRATION FEES……………………………………………………….…25 VI. CONCLUSION...................................................……........................………………26 Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 2 of 32 iii TABLE OF AUTHORITIES CASES Page(s) Aboud v. Charles Schwab & Co., Inc., No. 14 Civ. 2712 (S.D.N.Y. Oct. 29, 2014)…….3 A.H. Phillips v. Walling, 324 U.S. 490 (1945)......................................................……....20 Allende v. Unitech Design, Inc., 783 F. Supp. 2d 509 (S.D.N.Y. 2011)………………...22 In re Am. Bank Note Holographics, Inc., 127 F. Supp. 2d 418 (S.D.N.Y. 2001) .….........5 Ansoumana v. Gristede’s Operating Corp., 201 F.R.D. 81 (S.D.N.Y. 2001) ....…...…....13 Barrentine v. Arkansas-Best Freight Sys., Inc., 450 U.S. 728 (1981) .…….....................13 Behzadi v. Int’l Creative Mgmt. Partners, LLC, 2015 WL 4210906 (S.D.N.Y. July 9, 2015)………………………………………………3 Boeing Co. v. Van Gemert, 444 U.S. 472, 478 (1980)……………………………………3 In re Boesky Sec. Litig., 888 F. Supp. 551 (S.D.N.Y. 1995).......…..................................24 Brunson v. City of N.Y., Nos. 94 Civ. 4507, 94 Civ. 5632, 2000 WL 1876910 (S.D.N.Y. Dec. 22, 2000)........….16 City of Detroit v. Grinnell Corp., 495 F.2d 448 (2d Cir. 1974)...........……………….....14 Clark v. Ecolab, Nos. 07 Civ. 8623, 04 Civ. 4488, 06 Civ. 5672, 2010 WL 1948198 (S.D.N.Y. May 11, 2010), at *8 .........................................................................................................……19 In re Colgate-Palmolive Co. ERISA Litig., 36 F. Supp. 3d 344 (S.D.N.Y. 2014)….passim deMunecas v. Bold Food, LLC, No. 09 Civ. 440, 2010 WL 3322580 (S.D.N.Y. Aug. 23, 2010) ................….......... passim Deposit Guar. Nat’l Bank v. Roper, 445 U.S. 326 (1980) .........…………………...........20 Epic Systems Corp. v. Lewis, 584 U.S. ___ (2018)…………………………………22, 23 Frank v. Eastman Kodak Co., 228 F.R.D. 174 (W.D.N.Y. 2005) .….........................14, 21 Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 3 of 32 iv Gaspar v. Pers. Touch Moving, Inc., 2015 WL 7871036 (S.D.N.Y. Dec. 3, 2015)………3 In re Gilat Satellite Networks, Ltd., No. 02 Civ. 1510, 2007 WL 2743675 (E.D.N.Y. Sept. 18, 2007) .........…………..........18 In re Global Crossing Sec. & ERISA Litig., 225 F.R.D. 436 (S.D.N.Y. 2004) .......... 6, 17 Goldberger v. Integrated Res. Inc., 209 F.3d 43 (2d Cir. 2000)........……............... passim Hernandez v. Immortal Rise, Inc., 306 F.R.D. 91 (E.D.N.Y. 2015)………………………4 Hicks v. Morgan Stanley, No. 01 Civ. 10071, 2005 WL 2757792 (S.D.N.Y. Oct. 24, 2005) .....…………........19, 23 In re Indep. Energy Holdings PLC Sec. Litig., 302 F. Supp. 2d 180 (S.D.N.Y. 2003)18,25 J.I. Case Co. v. Borak, 377 U.S. 426 (1964) .................………………………...............21 Khait v. Whirlpool Corp., No. 06 Civ. 6381, 2010 WL 2025106 (E.D.N.Y. Jan. 20, 2010)....…........................19, 20 McDaniel v. Cnty. of Schenectady, 595 F.3d 411 (2d Cir. 2010)......................................4 McGreevy v. Life Alert Emergency Response, Inc., 258 F.Supp. 3d 380…………....7, 16 McMahon v. Olivier Cheng Catering & Events, LLC, No. 08 Civ. 8713, 2010 WL 2399328 (S.D.N.Y. Mar. 3, 2010) ..............…….........passim Mohney v. Shelly’s Prime Steak, No. 06 Civ. 4270, 2009 WL 5851465 (S.D.N.Y. Mar. 31, 2009) ....................................19 Parker v. Jekyll & Hyde Entm’t Holdings, LLC, No. 08 Civ. 7670, 2010 WL 532960 (S.D.N.Y. Feb. 9, 2010) ................…....................23 Phillips Petroleum Co. v. Shutts, 472 U.S. 797 (1985) ...........……………....................21 In re Polaroid ERISA Litig., No. 03 Civ. 8335, 2007 WL 2116398 (S.D.N.Y. July 19, 2007) .......…………….......5, 6 Prasker v. Asia Five Eight LLC, No. 08 Civ. 5811, 2010 WL 476009 (S.D.N.Y. Jan. 6, 2010) ..............................….21, 22 In re Prudential Sec. Inc. Ltd. P’ships Litig., 912 F. Supp. 97 (S.D.N.Y. 1996).....….....13 Puglisi v. TD Bank, N.A., 2015 WL 4608655 (E.D.N.Y. July 30, 2015)………………..3 Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 4 of 32 v In re Ramp Corp. Sec. Litig., No. 05 Civ. 6521, 2008 WL 58938 (S.D.N.Y. Jan. 3, 2008) .........................................5, 6 In re RJR Nabisco, Inc. Sec. Litig., MDL No. 818, No. 88 Civ. 7905, 1992 WL 210138 (S.D.N.Y. Aug. 24, 1992) .........2, 24 Sand v. Greenberg, No. 08 Civ. 7840, 2010 WL 69359 (S.D.N.Y. Jan. 7, 2010) ..4, 20, 21 Savoie v. Merchs. Bank, 166 F.3d 456 (2d Cir. 1999)........................................................6 Steiner v. Am. Broad. Co., 248 F. App’x 780 (9th Cir. 2007)…………………..……1, 24 Strougo ex rel. Brazilian Equity Fund, Inc. v. Bassini, 258 F. Supp. 2d 254, 262 (S.D.N.Y. 2003).................................………………................5 In re Sumitomo Copper Litig., 74 F. Supp. 2d 393 (S.D.N.Y. 1999) .............…..........5, 20 Sutherland v. Ernst & Young LLP, 768 F. Supp. 2d 547 (S.D.N.Y. 2011)…………...…22 Taft v. Ackermans, No. 02 Civ. 7951, 2007 WL 414493 (S.D.N.Y. Jan. 31, 2007) …....17 United Slate, Tile & Composition Roofers, Damp & Waterproof Workers Ass’n, Local 307 v. G&M Roofing & Sheet Metal Co., Inc., 732 F.2d 495 (6th Cir. 1984)……………………………………………………………..21 Varljen v. H.J. Meyers & Co., No. 97 Civ. 6742, 2000 WL 1683656 (S.D.N.Y. Nov. 8, 2000) ......… ….........................6 Velez v. Majik Cleaning Serv., Inc., No. 03 Civ. 8698, 2007 WL 7232783 (S.D.N.Y. June 25, 2007) ....………...................5, 6 Vizcaino v. Microsoft Corp., 290 F.3d 1043 (9th Cir. 2002)…………………...…….1, 24 Wal-Mart Stores, Inc. v. Visa U.S.A., Inc., 396 F.3d 96 (2d Cir. 2005)..........…….......5, 6 Westerfield v. Wash. Mut. Bank, Nos. 06 Civ. 2817, 08 Civ.0287, 2009 WL 5841129 (E.D.N.Y. Oct. 8, 2009) ...........…19 Willix v. Healthfirst, Inc., No. 07 Civ. 1143, 2011 WL 754862 (E.D.N.Y. Feb. 18, 2011)................................passim Yuzary v. HSBC Bank USA, N.A., 2013 WL 5492998 (S.D.N.Y. Oct. 2, 2013).2, 3, 4, 24 Zelster v. Merrill Lynch & Co., Inc., 2014 WL 4816134 (S.D.N.Y. Sept. 23, 2014)…….2 In re Zyprexa Prods. Liab. Litig., 594 F.3d 113 (2d Cir. 2010)…………………………..3 Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 5 of 32 vi STATUTES 29 U.S.C. § 216(b).......................................................................................................11, 13 Fair Labor Standards Act ......................................................................................... passim OTHER AUTHORITIES Theodore Eisenberg & Geoffrey P. Miller, Attorney Fees and Expenses in Class Action Settlements: An Empirical Study, 1 J. Empirical Legal Stud. 27 (2004)……………7, 8, 9 Theodore Eisenberg & Geoffrey P. Miller, Attorney Fees and Expenses in Class Action Settlements: 1993-2008, 7 J. Empirical Legal Stud. 248 (2010)……………………7, 8, 9 Brian T. Fitzpatrick, An Empirical Study of Class Action Settlements and Their Fee Awards, 7 J. Empirical Legal Stud. 811 (2010)……………………………………..7, 8, 9 Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 6 of 32 1 I. INTRODUCTION Lee Litigation Group, PLLC (“Class Counsel” or “LLG”) respectfully submits this motion for an award of attorneys’ fees and expenses in the amount of one-third of the settlement fund (the “Settlement Fund”). This motion is being submitted simultaneously with Plaintiffs’ Unopposed Motion for Certification of the Settlement Class, Final Approval of the Class Action Settlement, and Approval of the FLSA Settlement (“Motion for Final Approval”).1 Under the settlement, this 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. Class counsel has spent more than 241 attorney and paralegal hours prosecuting this case. See Declaration of C.K. Lee in Support of Plaintiffs’ Motion for Approval of Attorneys’ Fees, Administration Fees and Reimbursement of Expenses (“Lee Dec.”) ¶4. Multiplying these hours by the hourly rate of each attorney and paralegal results in a lodestar amount of $103,787.50. Id. Class Counsel’s request for one-third of the Settlement Fund – $406,666.66 – results in a multiplier of 3.91x. “Courts regularly award lodestar multipliers of up to eight times the lodestar, and in some cases, even higher multipliers”. See, Vizcaino v. Microsoft Corp., 290 F.3d 1043, 1052 (9th Cir. 2002) (listing nationwide class action settlements where multiplier ranged up to 19.6 times lodestar); Steiner v. Am. Broad. Co., 248 F. App’x 780, 783 (9th Cir. 2007) (multiplier of 6.85 “falls well within the range of multipliers that courts have allowed”); 1 For a detailed account of the factual and procedural background of this case, Class Counsel respectfully refers the Court to the Memorandum of Law in Support of Plaintiff’s Unopposed Motion for Certification of the Settlement Class, Final Approval of the Class Action Settlement, and Approval of the FLSA Settlement and the supporting Declarations of C.K. Lee. Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 7 of 32 2 Yuzary, 2013 WL 5492998, at *11 (awarding multiplier of 7.6 in wage and hour misclassification class action); In re RJR Nabisco, Inc. Sec. Litig., MDL No. 818, No. 88 Civ. 7905, 1992 WL 210138, at *5-8 (S.D.N.Y. Aug. 24, 1992) (awarding multiplier of 6). Class Counsel’s efforts to date have been without compensation, and their entitlement to payment has been wholly contingent upon achieving a positive result. Lee Dec. ¶6. For the reasons set forth below, Class Counsel respectfully submits that the attorneys’ fees and expenses reimbursement they seek are fair and reasonable under the applicable legal standards, and should be awarded in light of the historical data fee baselines, the contingency risk undertaken and the result achieved in this case. II. CLASS COUNSEL IS ENTITLED TO A REASONABLE FEE OF APPROXIMATELY ONE-THIRD OF THE SETTLEMENT FUND. Class Counsel is entitled to reasonable attorneys’ fees to compensate for their work in recovering unpaid wages on behalf of the class. The request for approximately one-third of the Settlement Fund, 3.91x more than the accrued lodestar, is reasonable and within the range approved by courts in similar cases. The Settlement Agreement, which has been preliminarily approved by the Court, provides that Plaintiffs’ Counsel will apply for up to one-third of the Fund at attorneys’ fees, plus reimbursement of reasonable litigation costs and expenses (Settlement Agreement § 4.2). In addition, the Court- approved Notices that were sent to all Class Members explained that Plaintiffs’ counsel would apply for one-third of the Fund, as attorneys’ fees, plus expenses. No Class Member has objected to the requested attorneys’ fees or expense reimbursement. The lack of objections to Class Counsel’s fee and cost reimbursement request is some indication of the reasonableness of the requested award and weighs in favor of its approval. Zelster v. Merrill Lynch & Co., Inc., No. 13 Civ. 1531, 2014 WL Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 8 of 32 3 4816134, at *9 (S.D.N.Y. Sept. 23, 2014) (lack of objections to class counsel’s request for one third of the fund “provide[d] support for Class Counsel’s fee request”); Yuzary v. HSBC Bank USA, N.A., No. 12 Civ. 3693, 2013 WL 5492998, at *10 (S.D.N.Y. Oct. 2, 2013) (same). The Court should award attorneys’ fees as a percentage of the total fund made available to the Class. When counsel’s efforts result in the creation of a common fund, counsel 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) (emphasis added); In re Colgate-Palmolive Co. ERISA Litig., 36 F. Supp. 3d 344, 348 (S.D.N.Y. 2014) (Schofield, J.) (“Under the percentage method, the fee is a reasonable percentage of the total value of the settlement fund created for the class.”). Recovery of fees based on the entire fund “permits litigants or lawyers who recover a common fund for the benefit of persons other than themselves to obtain reasonable attorney’s fees out of the fund, thus spreading the cost of the litigation to its beneficiaries.” In re Zyprexa Prods. Liab. Litig., 594 F.3d 113, 128 (2d Cir. 2010). The request for one-third of the Gross Settlement Amount is also within the range approved by courts in wage and hour class action cases. See, e.g., Gaspar v. Pers. Touch Moving, Inc., No. 13 Civ. 8187, 2015 WL 7871036, at *2 (S.D.N.Y. Dec. 3, 2015) (“Fee awards representing one third of the total recovery are common in this District”); Puglisi v. TD Bank, N.A., No. 13 CIV. 637, 2015 WL 4608655, at *1 (E.D.N.Y. July 30, 2015) (approving attorneys’ fees award of one-third of the settlement fund in class and collective action case); Behzadi v. Int’l Creative Mgmt. Partners, LLC, No. 14 Civ. 4382, 2015 WL 4210906, at *2-3 (S.D.N.Y. July 9, 2015) (same); Aboud v. Charles Schwab & Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 9 of 32 4 Co., Inc., No. 14 Civ. 2712 (S.D.N.Y. Oct. 29, 2014) (granting award of attorneys’ fees in the amount of $1,266,066.67 equaling one-third of the fund in a wage and hour case involving a $3.7 million fund). A. The Percentage Method Is the Preferred Method for Awarding Attorneys’ Fees in Common Fund Cases in the Second Circuit. In wage and hour class action lawsuits, public policy favors a common fund attorneys’ fee award. Hernandez v. Immortal Rise, Inc., 306 F.R.D. 91, 102 (E.D.N.Y. 2015); Yuzary, 2013 WL 5492998, at *9; Willix v. Healthfirst, Inc., No. 07 Civ. 1143, 2011 WL 754862, at *6 (E.D.N.Y. Feb. 18, 2011); deMunecas v. Bold Food, LLC, No. 09 Civ. 440, 2010 WL 3322580, at *8 (S.D.N.Y. Aug. 23, 2010). Where relatively small claims can only be prosecuted through aggregate litigation, and the law relies on prosecution by “private attorneys general,” attorneys who fill that role must be adequately compensated for their efforts. deMunecas, 2010 WL 3322580, at *8; McMahon v. Olivier Cheng Catering & Events, LLC, No. 08 Civ. 8713, 2010 WL 2399328, at *7 (S.D.N.Y. Mar. 3, 2010); Sand v. Greenberg, No. 08 Civ. 7840, 2010 WL 69359, at *3 (S.D.N.Y. Jan. 7, 2010) (statutory attorneys’ fees are meant to “encourage members of the bar to provide legal services to those whose wage claims might otherwise be too small to justify the retention of able, legal counsel”). If not, wage and hour abuses would go without remedy because attorneys would be unwilling to take on the risk. Willix, 2011 WL 754862, at *6; McMahon, 2010 WL 2399328, at *7; Sand, 2010 WL 69359, at *3 (“But for the separate provision of legal fees, many violations of the Fair Labor Standards Act would continue unabated and uncorrected.”). Although there are two ways to compensate attorneys for successful prosecution of statutory claims, the lodestar method and the percentage of the fund method, McDaniel v. Cnty. of Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 10 of 32 5 Schenectady, 595 F.3d 411, 417 (2d Cir. 2010), the trend in this Circuit is to use the percentage of the fund method in common fund cases like this one. Id.; Wal-Mart Stores, Inc. v. Visa U.S.A., Inc., 396 F.3d 96, 121 (2d Cir. 2005); deMunecas, 2010 WL 3322580, at *8. There are several reasons that courts prefer the percentage method. First, the percentage method “directly aligns the interests of the class and its counsel” because it provides an incentive to attorneys to resolve the case efficiently and to create the largest common fund out of which payments to the class can be made. Wal-Mart Stores, 396 F.3d at 122 (internal quotation marks omitted); In re Ramp Corp. Sec. Litig., No. 05 Civ. 6521, 2008 WL 58938, at *2 n.2 (S.D.N.Y. Jan. 3, 2008); In re Polaroid ERISA Litig., No. 03 Civ. 8335, 2007 WL 2116398, at *2 (S.D.N.Y 4 July 19, 2007); Velez v. Majik Cleaning Serv., Inc., No. 03 Civ. 8698, 2007 WL 7232783, at *7 (S.D.N.Y. June 25, 2007). The percentage method is also closely aligned with market practices because it “mimics the compensation system actually used by individual clients to compensate their attorneys.” In re Sumitomo Copper Litig., 74 F. Supp. 2d 393, 397 (S.D.N.Y. 1999); see also Strougo ex rel. Brazilian Equity Fund, Inc. v. Bassini, 258 F. Supp. 2d 254, 262 (S.D.N.Y. 2003) (the percentage method “is consistent with and, indeed, is intended to mirror, practice in the private marketplace where contingent fee attorneys typically negotiate percentage fee arrangements with their clients”); In re Am. Bank Note Holographics, Inc., 127 F. Supp. 2d 418, 432 (S.D.N.Y. 2001) (the court should “determine what the lawyer would receive if he were selling his services in the market rather than being paid by court order”). Second, the percentage of the fund method promotes early resolution. It “provides a powerful incentive for the efficient prosecution Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 11 of 32 6 and early resolution of litigation.” Wal-Mart Stores, 396 F.3d at 122 (internal quotation marks omitted); see also In re Ramp Corp. Sec. Litig., 2008 WL 58938, at *2 n.2; In re Polaroid ERISA Litig., 2007 WL 2116398, at *2; Velez, 2007 WL 7232783, at *7. The percentage method discourages plaintiffs’ lawyers from running up their billable hours, one of the most significant downsides of the lodestar method. See Savoie v. Merch. Bank, 166 F.3d 456, 460-61 (2d Cir. 1999) (“once the fee is set as a percentage of the fund, the plaintiffs’ lawyers have no incentive to run up the number of billable hours for which they would be compensated under the lodestar method.”) (citation omiited). Third, the percentage method preserves judicial resources because it “relieves the court of the cumbersome, enervating, and often surrealistic process of evaluating fee petitions.” Id. (quoting Savoie v. Merchs. Bank, 166 F.3d 456, 461 n.4 (2d Cir. 1999)). While courts still use the lodestar method as a “cross check” when applying the percentage of the fund method, courts are not required to scrutinize the fee records as rigorously. Goldberger, 209 F.3d at 50; see In re Global Crossing Sec. & ERISA Litig., 225 F.R.D. 436, 468 (S.D.N.Y. 2004) (using an “implied lodestar” for the lodestar cross check); Varljen v. H.J. Meyers & Co., No. 97 Civ. 6742, 2000 WL 1683656, at *5 (S.D.N.Y. Nov. 8, 2000) (using an “unexamined lodestar figure” for the lodestar cross check). B. Historical Data of Fees Awarded in Common Fund Cases Before analyzing the attorneys’ fees sought under the Second Circuit’s Goldberger factors, detailed infra, we address the Court’s request during the preliminary approval hearing that Plaintiff provide the historic reference and median figures for comparing fees cases of similar magnitude. Based on the empirical data set forth in Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 12 of 32 7 Theodore Eisenberg & Geoffrey P. Miller, Attorney Fees and Expenses in Class Action Settlements: An Empirical Study, 1 J. Empirical Legal Stud. 27 (2004); accord Theodore Eisenberg & Geoffrey P. Miller, Attorney Fees and Expenses in Class Action Settlements: 1993-2008, 7 J. Empirical Legal Stud. 248 (2010) (the “Eisenberg & Miller Study”) and Brian T. Fitzpatrick, An Empirical Study of Class Action Settlements and Their Fee Awards, 7 J. Empirical Legal Stud. 811 (2010), (the “Fitzpatrick Study”), and for the reasons set forth herein, Plaintiff believes an attorneys’ fees award of 1/3 of the settlement sum is appropriate. This Court has articulated the value of the Eisenberg & Miller and Fitzpatrick studies in establishing a baseline for median attorneys’ fees in its opinions in In Re Colgate-Palmolive Co. ERISA Litig., 36 F.Supp.3d, 344, 2014 U.S. Dist. LEXIS 93379 and McGreevy v. Life Alert Emergency Response, Inc., 258 F.Supp. 3d 380, in which the Court found an attorneys’ fees “baseline percentage” of 25% and 26.5%, respectively, appropriate. However, Colgate-Palmolive Co. and McGreevy are distinguishable from the instant action in one significant respect – both cases involved claims-made reversionary settlements, where as the instant action is an “opt-out” settlement, and importantly, there is no reversion. The Court cautioned in McGreevy, “[g]iven the low participation rates for ‘claims made settlements’ (i.e., settlements that require the filing of a claim form in order to share in the settlement proceeds), a reversionary settlement structure (i.e., a provision that unclaimed monies revert back to the defendant) creates perverse incentives and potentially a bad result.” See McGreevy, 58 F.Supp. 3d 380, at *6. Here, every single class member that does not opt-out will be mailed a check. Furthermore, the instant settlement provides an additional benefit to class members in Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 13 of 32 8 that all class members that deposit their settlement check will receive a second distribution from the unclaimed funds portion of the settlement. Defendants will not receive any return of the settlement fund, resulting in the best possible deal for class members and one reason for the justification of why Plaintiffs’ counsel is deserving of their sought 1/3 fee percentage. The value of the settlement in this case is $1.2 Million, which puts this case in the lower end of the second decile of cases in the Eisenberg Study, with settlements between $1.1 Million and $2.8 Million. In re Colgate-Palmolive Co. ERISA Litig., 36 F.Supp. 3d 344, *5 at table 1. In that decile, the median fee was 26.4% of the fund with a standard deviation of 9.1%. Id. In the Fitzpatrick Study, the settlement falls in the third decile of his cases, comprising settlements between $1.75 Million and $2.85 Million, in which the median fee percentage was 29.3% with a standard deviation of 7.9%. Considering the median fee percentages, taken together with the standard deviations, the attorneys’ fees of 33% that Plaintiffs seek falls within the historical range for baseline fees. Moreover, it is important to note that the medians set forth in the Eisenberg & Miller and Fitzpatrick studies are distinguishable and to some extent, inapplicable, to the analysis of attorneys’ fees in the instant action, for the reasons detailed below:  Both the Eisenberg & Miller Study and the Fitzpatrick Study are somewhat out-of-date. The settlements analyzed therein pertain to the time periods 1993-2008, and 2006-2007, respectively, both concluding more than ten years ago. In such time, the legal profession has seen significant increases, inter alia, in billable hourly rates, expenses, and speficially in regards to operating a law-firm in New York City, costs have doubled in the past 10 years. See Lee Decl. at ¶ 14.  Labor & Employment cases comprised only 14% of those in the Fitzpatrick Study. Many of the other settlements covered by the study either have a fee percentage capped by legislation (i.e. Securities cases, which make up the majority of cases in the study), or provide for Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 14 of 32 9 injunctive relief only – both of which skew the results for fee percentage medians downward. See Fitzpatrick Study at Table 1. See also Table 3, showing that the median attorneys’ fees are brought down as non-Labor & Employment settlements provide for either a significant injunctive or declaratory relief component. While Labor & Employment settlements on average have a 95% cash component, Civil Rights cases, for example, have a 49% cash component. Id.  Per the Fitzpatrick Study, the average Labor & Employment federal class action took 2.5-3 years to reach settlement (Id at Table 2), however, in the instant action, and because of Lee Litigation Group’s experience, expertise and reputation in the market, Defendants often want to talk class-wide settlement with us on an expedited basis. In the instant action, we outperformed the average significantly, reaching a settlement in principle a mere 6 months after commencement and should thusly be rewarded for such an expedient resolution.  The SDNY, which is well known as the most expensive jurisdiction in the country, only comprises approximately 20% of the cases in the Eisenberg & Miller Study. See Eisenberg & Miller Study at 256.  The Eisenberg & Miller Study explains that other circuits base fees on benchmarks (“the Ninth Circuit has a 25% benchmark fee in common fund cases…[District Courts in] the Eleventh Circuit…view 25% as a benchmark.” Id at 259. The Second Circuit, under Goldberger, does not use benchmarks and, as such, other circuits’ benchmarks bring down the average (“the Second Circuit’s Goldberger decision rejected the use of benchmarks and mandated a fact-specific inquiry.”) Id at 260. As set forth in Table 13 of the Eisenberg & Miller Study, in the Second Circuit, fifty-four (54%) percent of class action attorneys’ fee requests are granted in the amount requested. For the reasons stated in the instant application, the undersigned’s fee application in the amount of 1/3 of the settlement fund should be part of the 54% of granted fee applications. Plaintiffs believe a reasonable baseline fee for this case is 33.3%, or $406,666. Even assuming arguendo that the Court believes the reasonable baseline fee were to be lower, falling at a mid-point between the two contemplated Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 15 of 32 10 medians, 27.85%, Plaintiffs believe such baseline should be increased to the applied-for percentage, based on the Goldberger factors. C. The Goldberger Factors Support an Award of Approximately One-third of the Settlement Fund. Reasonableness is the touchstone for determining attorneys’ fees. In Goldberger, the Second Circuit articulated six factors for courts to consider in determining the reasonableness of fee applications: (1) the time and labor expended by counsel; (2) the magnitude and complexities of the litigation; (3) the risk of litigation; (4) the quality of representation; (5) the requested fee in relation to the settlement; and (6) public policy considerations. 209 F.3d at 50 (quotation marks omitted). All of the Goldberger factors weigh in favor of granting approval of Class Counsel’s fee application. 1. Class Counsel’s Time and Labor Class Counsel spent significant effort to achieve the $1,220,000 settlement. From the outset, Class Counsel thoroughly investigated the claims and defenses, focusing on the underlying merits of the class members’ claims, the damages to which they were entitled, and the propriety of class certification. See Declaration of C.K. Lee in Support of Plaintiffs’ Unopposed Motion for Certification of the Settlement Class, at ¶5-9. Through discovery, Class Counsel obtained, reviewed, and analyzed comprehensive wage and hour records with respect to the class members, including wage-hour policies, personnel files, wage statements (pay stubs) and wage notices for a sampling of class members, as well as class-wide data containing, among other things, potential class member employment dates, job titles and pay rates. Id. at ¶9. This comprehensive Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 16 of 32 11 discovery enabled Class Counsel to perform a class-wide damage assessment. Id. at ¶19. On January 18, 2018, Plaintiffs filed the instant lawsuit seeking to bring class and collective action claims against Defendants pursuant to Federal Rule of Civil Procedure 23 and 29 U.S.C. § 216(b), alleging violations of the Fair Labor Standards Act (“FLSA”) and the New York Labor Law (“NYLL”). Plaintiffs’ Complaint (the “Complaint”) alleged that Defendants failed to pay Plaintiffs and other non-exempt employees for all the hours they worked—including hours worked over forty—due to time-shaving, failed to pay tipped employees the proper minimum wages and overtime due to an invalid tip credit, and failed to provide accurate wage statements and wage notices. Plaintiffs sought to recover, on behalf of themselves and others they claimed were similarly situated, unpaid wages and other back pay, liquidated damages and penalties, injunctive relief and attorneys’ fees and costs. On April 9, 2018 Defendants filed their Answer to the Complaint. The Parties attended an initial conference on April 25, 2018. The Parties informed the Court of their intention to engage in private, class-wide mediation, and, on July 19, 2018 the Court denied the Parties’ request to extend the fact discovery deadline without prejudice to renewal after the Parties engaged in mediation. On December 11, 2018 the Court granted preliminary approval of the class settlement. Since the commencement of this action, the parties have engaged in extensive settlement negotiations. The initial settlement offers from Defendants were only for the named Plaintiffs and were for nominal value. As the litigation progressed through document exchange, the parties began to explore the possibilities and parameters for a class-wide settlement. In addition to numerous informal telephone conferences for settlement, the parties also engaged in an all-day Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 17 of 32 12 private mediation with Stephen Sonnenberg of JAMS on July 24, 2018, at which the parties reached a settlement in principle. During the months thereafter, the parties continued negotiating the terms of the class settlement and reached an agreement on all terms, which they memorialized in the Settlement Agreement, executed on May 7, 2018. Class Counsel subsequently prepared and submitted a preliminary approval motion, which was approved and So Ordered by the Court on December 11, 2018 following a preliminary approval hearing on November 20, 2018. In performing all of the aforementioned tasks, Class Counsel spent over 241 hours of attorney and paralegal time for an aggregate lodestar of more than $103,787.50. Lee Dec. at ¶ 4. These hours are reasonable for a case such as this and were compiled from contemporaneous time records maintained by each attorney and paralegal participating in the case. Id. at ¶ 4. Moreover, the requested fee is not based solely on time and effort already expended; rather, it is also meant to compensate Class Counsel for time that will be spent administering the settlement in the future. See In re Colgate-Palmolive Co. ERISA Litig., 36 F. Supp. 3d at 347 (noting that time records submitted with fee petitions “exclude time spent preparing and arguing the motion to approve the settlement and attorneys’ fees, and time that will be spent administering the settlement”); Beckman, 293 F.R.D. at 482 (“Class Counsel is often called upon to perform work after the final approval hearing, including answering class member questions, answering questions from the claims administrator, and negotiating and sometimes litigating disagreements with defendants about administering the settlement and distributing the fund.”). In Class Counsel’s experience, administering class settlements require a substantial and ongoing commitment. For example, since the Notices were mailed out, Class Counsel has Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 18 of 32 13 responded to several Class Members’ questions about the terms of the settlement and the amount of their settlement awards. As is common in wage and hour class actions, Class Counsel expects to respond to more Class Member inquiries after final approval, especially after checks are issued. 2. Magnitude and Complexity of the Litigation. The size and difficulty of the issues in a case are significant factors to be considered in making a fee award. Goldberger, 209 F.3d at 50; In re Prudential Sec. Inc. Ltd. P’ships Litig., 912 F. Supp. 97, 100-01 (S.D.N.Y. 1996). Courts have recognized that wage and hour cases involve complex legal issues. “FLSA claims typically involve complex mixed questions of fact and law…These statutory questions must be resolved in light of volumes of legislative history and over four decades of legal interpretation and administrative rulings.” Barrentine v. Arkansas-Best Freight Sys., Inc., 450 U.S. 728, 743 (1981). Among FLSA cases, the most complex type is the “hybrid” action brought here, where state wage and hour violations are brought as an “opt out” class action pursuant to Federal Rule of Civil Procedure 23 in the same action as the FLSA “opt in” collective action pursuant to 29 U.S.C. § 216(b). Because the same set of operative facts is being applied and analyzed under both statutory frameworks, justice is served and consistency and efficiency are achieved by having the litigation in one forum. See Ansoumana v. Gristede’s Operating Corp., 201 F.R.D. 81, 89 (S.D.N.Y. 2001). A trial on the merits would involve significant factual development. Plaintiffs’ counsel are experienced and realistic and understand that the resolution of liability issues, the outcome of trial and the appeals process are inherently uncertain in terms of outcome and duration. These mixed factual and legal questions support approval of Class Counsel’s attorneys’ fee request. Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 19 of 32 14 See deMunecas, 2010 WL 3322580, at *7-8 (awarding attorneys’ fees of 33% of the common fund in wage and hour case involving mixed questions of law and fact). This case hinged on mixed questions of fact and law. In particular, the Parties disputed the facts surrounding whether employees were required to work “off-the-clock” and whether employees were compensated for such off-the-clock work. This is a highly fact intensive issue as Defendants’ document production appeared to indicate that employees’ time was tracked to the minute, that there were no mandatory lunch break deductions, and that employees’ payroll records reflected they were paid for all hours worked. However, allegations of time-shaving are rarely proved on documents, but rather, highly rely on testimony. Here, the time shaving allegation by Plaintiffs is heavily dependent on Plaintiffs’ testimony and testimony of corroborating witnesses. These unresolved factual and legal questions support approval of Class Counsel’s attorneys’ fee request. Frank v. Eastman Kodak Co., 228 F.R.D. 174, 189 (W.D.N.Y. 2005) (mixed questions of fact and law supported court’s award of attorneys’ fees representing approximately 40% of the common fund). 3. Risk of Litigation. The risk of litigation is also an important factor in determining a fee award. Uncertainty that an ultimate recovery will be obtained is highly relevant in determining the reasonableness of an award. City of Detroit v. Grinnell Corp., 495 F.2d 448, 470 (2d Cir. 1974), abrogated by Goldberger, 209 F.3d 43 (2d Cir. 2000). “[D]espite the most rigorous and competent of efforts, success is never guaranteed.” Id. at 471. “No one expects a lawyer whose compensation is contingent upon his success to charge, when successful, as little as he would charge a client who in advance had agreed to pay for his Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 20 of 32 15 services, regardless of success.” Id at 470. “Risk should be considered ‘as of when the case is filed.’” In re Colgate-Palmolive Co. ERISA Litig., 36 F. Supp. 3d at 351 (quoting Goldberger, 209 F.3d at 55). Class Counsel undertook to prosecute this action without any assurance of payment for its services, litigating this case on a wholly contingent basis in the face of tremendous risk. Class and collective wage and hour cases of this type are, by their very nature, complicated and time-consuming. Lawyers undertaking representation of large numbers of affected employees in such actions inevitably must be prepared to make an enormous investment of time, energy, and resources. Due also to the contingent nature of the customary fee arrangement, lawyers are asked to be prepared to make this investment with the very real possibility of an unsuccessful outcome and no fee of any kind. Class Counsel stood to gain nothing in the event the case was unsuccessful. Moreover, the circumstances of this case presented hurdles to a successful recovery as Plaintiffs’ claims are highly fact specific and require a plaintiff-friendly interpretation of the law. Each of the claims of Plaintiffs and class members carry significant risk: (I) Plaintiffs’ and class members’ time shaving claim is highly risky as a review of Defendants’ discovery production appears to indicate that employees’ time was tracked to the minute, that there was no mandatory deduction for lunch break, and that employees’ payroll records reflect that they were paid for hours worked. The time shaving allegation by Plaintiffs that managers required them to work off-the-clock is heavily dependent on Plaintiffs’ testimony and testimony of corroborating witnesses. (II) Plaintiffs’ and class members’ minimum wage and overtime claim based on invalid tip credit is highly risky, however, because both oral and written notice of the Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 21 of 32 16 tip credit was provided to tipped employees. The issue is whether the tip credit notices (which state the actual wage rage subject to the tip credit, not the regular hourly rate paid prior to tip credit deduction) are proper. (III) Plaintiffs and class members brought statutory claims that Defendants failed to provide proper wage notices. However, in their class discovery production, Defendants produced wage notices for a sampling of employees at each restaurant. The only issues are whether the notices provided sufficient notice of the tip credit. This claim is further risky as under the law, there is a safe harbor if employees are properly paid. (IV) Plaintiffs and class members brought statutory claims that Defendants failed to provide wage statements in compliance with the law. Similar to the wage notice claim, this claim is highly risky as the only issue is whether the wage statements provided sufficient notice of the tip credit, as they did not include the hourly tip allowance, and whether the wage statements stated the actual hours worked. The wage statement claim is similarly subject to a safe harbor if employees are properly paid. This factor therefore weighs in favor of granting the requested fees. See, e.g., Brunson v. City of N.Y., Nos. 94 Civ. 4507, 94 Civ. 5632, 2000 WL 1876910, at *4 (S.D.N.Y. Dec. 22, 2000) (where class counsel “faced significant obstacles…verifying…tasks performed by individual plaintiffs,” class counsel was entitled to a premium). 4. Quality of Representation. The quality of counsel’s representation may present a reason to alter the baseline fee. McGreevy, 258 F.Supp. 3d 380 at *5. “Quality of representation is best measured by results” Id. “To determine the ‘quality of the representation,’ courts review, among other Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 22 of 32 17 things, the recovery obtained and the backgrounds of the lawyers involved in the lawsuit.” Taft v. Ackermans, No. 02 Civ. 7951, 2007 WL 414493, at *10 (S.D.N.Y. Jan. 31, 2007) (citing In re Global Crossing, 225 F.R.D. at 467). Class Counsel has substantial experience prosecuting large-scale wage and hour class and collective actions. Lee Dec. ¶3. Class Counsel’s skill and experience were directly responsible for the favorable settlement and weigh in favor of granting the requested fees. As detailed supra, due to the quality of representation, counsel was able to reach a class- wide settlement after a mere 6 months, which provides that every single class member that does not opt-out will be mailed a check, plus an additional benefit that all class members that deposit their settlement check will receive a second distribution from the unclaimed funds portion of the settlement. As set forth in the Declaration of C.K. Lee, Plaintiffs’ counsel is uniquely qualified to receive approval for premium fees and rates. C.K. Lee is a STEM graduate who attended University of Pennsylvania Law School. See Lee Decl. at 15. He speaks English, Mandarin Chinese and Spanish, and over an 8 year period was associated with some of the top firms in New York City, including Schulte Roth & Zabel, Morrison & Foerster and Clifford Chance. Id. Because he was highly regarded, for every year that he worked at a large firm, he billed close to or exceeded 3,000 hours per year. Id. Previously, Mr. Lee had also been an investment banker with HSBC Private Equity, in charge of investments in Korea and Taiwan. Id. Unique among litigators, C.K. Lee is trained in risk analysis and financial modeling, having served on the boards of various companies. Id. The Court would be hard pressed to find many others engaged in wage and hour class action practice with a similar blue chip background. Id. at 16. Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 23 of 32 18 LLG hires attorneys from the top law schools and currently has law school graduates from Stanford, Georgetown, Cornell, University of Virginia, Columbia, University of Pennsylvania and Berkeley, among others. Id. at 16. LLG also invests significantly in diversity, hiring African American, Eastern European, Middle Eastern, South Asian, Latino and East Asian employees, among others. Id. LLG sustains a high overhead in hiring exclusive graduates from the top schools in order to be competitive with large corporate defense firms. Id. at 17. As counsel belongs to a small and select group of highly qualified, highly experienced class counsel who have litigated and achieved successful settlements for tens of thousands of class members nationwide in various wage and hour cases, the rates and fees sought herein should be approved, in view of the quality of representation. 5. Fee in Relation to the Settlement. Courts also consider the size of the settlement to ensure that the percentage awarded does not constitute a “windfall.” See, e.g., In re Gilat Satellite Networks, Ltd., No. 02 Civ. 1510, 2007 WL 2743675, at *16 n.41 (E.D.N.Y. Sept. 18, 2007). “[T]he percentage used in calculating any given fee award must follow a sliding-scale and must bear an inverse relationship to the amount of the settlement.” Id. (quoting In re Indep. Energy Holdings PLC Sec. Litig., No. 00 Civ. 6689, 2003 WL 22244676, at *6 (S.D.N.Y. Sept. 29, 2003)) (internal quotation marks omitted). Where the size of the fund is relatively small, courts typically find that requests for a greater percentage of the fund are reasonable. See, e.g., In re Gilat Satellite Networks, Ltd., 2007 WL 2743675, at *16 n.41 (finding a 30% fee would not constitute a windfall “given the modest size of the [$20 million] settlement”). Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 24 of 32 19 The size of the $1,220,000 settlement weighs in favor of granting the requested fee award of approximately one-third of the Settlement Fund. See, e.g., Mohney v. Shelly’s Prime Steak, No. 06 Civ. 4270, 2009 WL 5851465, at *5 (S.D.N.Y. Mar. 31, 2009) (awarding 33% of $3,265,000 fund in FLSA and NYLL tip misappropriation case). Courts in this Circuit have routinely granted requests for approximately one-third of the fund in cases with settlement funds substantially larger than this one. See, e.g., Willix, 2011 WL 754862,at *6 (awarding class counsel one-third of $7,675,000 settlement fund in FLSA and NYLL wage and hour action); Clark, 2010 WL 1948198, at *8-9 (awarding class counsel 33% of $6 million settlement fund in FLSA and multi-state wage and hour case); Khait v. Whirlpool Corp., No. 06 Civ. 6381, 2010 WL 2025106, at *8 (E.D.N.Y. Jan. 20, 2010) (awarding class counsel 33% of $9.25 million settlement fund in FLSA and multi-state wage and hour case); Westerfield v. Wash. Mut. Bank, Nos. 06 Civ. 2817, 08 Civ.0287, 2009 WL 5841129, at *4-5 (E.D.N.Y. Oct. 8, 2009) (awarding 30% of $38 million fund in nationwide overtime suit). This is true even though “[a]s the size of the settlement fund increases, the percentage of the fund awarded as fees often decreases so as to prevent a windfall to plaintiffs’ attorneys.” Hicks v. Morgan Stanley, No. 01 Civ. 10071, 2005 WL 2757792, at *9 (S.D.N.Y. Oct. 24, 2005) (internal quotation marks omitted). A fee of approximately 33% of the Settlement Fund is reasonable and “consistent with the norms of class litigation in this circuit.” Willix, 2011 WL 754862, at *7 (quoting Gilliam v. Addicts Rehab. Ctr. Fund, No. 05 Civ. 3452, 2008 WL 782596, at *5 (S.D.N.Y. Mar. 24, 2008)). 6. Public Policy Considerations. Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 25 of 32 20 Public policy considerations weigh in favor of granting Class Counsel’s requested fees. In rendering awards of attorneys’ fees, “the Second Circuit and courts in this district also have taken into account the social and economic value of class actions, and the need to encouraged experienced and able counsel to undertake such litigation.” In re Sumitomo Copper Litig., 74 F. Supp. 2d at 399. The FLSA and NYLL are remedial statutes designed to protect the wages of workers. See A.H. Phillips v. Walling, 324 U.S. 490, 493 (1945) (recognizing the FLSA’s objective–ensuring that every employee receives “a fair day’s pay for a fair day’s work”) (internal quotation marks omitted). Where relatively small claims can only be prosecuted through aggregate litigation, and the law relies on prosecution by “private attorneys general,” attorneys who fill the private attorney general role must be adequately compensated for their efforts. Willix, 2011 WL 754862, at *6; deMunecas, 2010 WL 3322580, at *8; McMahon, 2010 WL 2399328, at *7. If not, wage and hour abuses would go without remedy because attorneys would be unwilling to take on the risk. Willix, 2011 WL 754862, at *6; deMunecas, 2010 WL3322580, at *8; McMahon, 2010 WL 2399328, at *7. Adequate compensation for attorneys who protect those rights by taking on such litigation furthers the remedial purpose of those statutes. Willix, 2011 WL 754862, at *6; deMunecas, 2010 WL 3322580, at *8; McMahon, 2010 WL 2399328, at *7; see also Sand, 2010 WL 69359, at *3 (“But for the separate provision of legal fees, many violations of the Fair Labor Standards Act would continue unabated and uncorrected.”) Courts have recognized that fee awards in cases like this serve the dual purposes of encouraging “private attorneys general” to seek redress for violations and discouraging future misconduct of a similar nature. See Deposit Guar. Nat’l Bank v. Roper, 445 U.S. 326, 338-39 (1980); Khait, 2010 Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 26 of 32 21 WL 2025106, at *8; Prasker v. Asia Five Eight LLC, No. 08 Civ. 5811, 2010 WL 476009, at *6 (S.D.N.Y. Jan. 6, 2010). Class actions are also an invaluable safeguard of public rights. See Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 809 (1985); J.I. Case Co. v. Borak, 377 U.S. 426, 433-34 (1964). Particularly where, as here, the settlement fund is relatively small, an award of attorneys’ fees ensures that “plaintiffs’ claims [will] likely . . . be heard.” Frank, 228 F.R.D. at 189. If courts denied sufficient attorneys’ fees “no attorneys . . . would likely be willing to take on . . . small-scale class actions[.]” Id.; deMunecas, 2010 WL 3322580, at *8; Sand, 2010 WL 69359, at *3. It is important to adequately compensate lawyers who take wage and hour cases, especially high-risk, low reward cases like this one. See Prasker v. Asia Five Eight LLC, No. 08 Civ. 5811, 2010 WL 476009, at *6 (S.D.N.Y. Jan 6, 2010) (“Adequate compensation for attorneys who protect wage and hour rights furthers the remedial purposes of the FLSA and NYLL”). Such adequate compensation is consistent with the FLSA’s purpose of eliminating “labor conditions detrimental to the maintenance of the minimum standard of living” of workers through private lawsuits and “insur[ing] effective access to the judicial process” by removing the significant barrier of paying legal fees and costs out of pocket. United Slate, Tile & Composition Roofers, Damp & Waterproof Workers Ass’n, Local 307 v. G&M Roofing & Sheet Metal Co., Inc., 732 F.2d 495, 501-502 (6th Cir. 1984) (internal quotations omitted). Fee shifting provisions “encourage members of the bar to provide legal services to those whose wage claims might otherwise be too small to justify the retention of able, legal counsel. But for the separate provision of legal fees, many violations…would continue unabated and uncorrected.” Sand v. Greenberg, No. 08 Civ. 7840, 2010 WL Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 27 of 32 22 69359, at *3 (S.D.N.Y. Jan 7, 2010). “Attorneys who fill the private attorney general role must be adequately compensated for their efforts. If not, wage and hour abuses would continue to go without remedy because attorneys would be unwilling to take on the risk.” Prasker, 2010 WL 476009, at *6; see also Allende v. Unitech Design, Inc., 783 F. Supp. 2d 509 (S.D.N.Y. 2011) (“the award of attorneys’ fees…encourages the vindication of Congressionally identified policies and rights.”). As Justice Ginsburg pointedly noted in her dissent in Epic Systems Corp. v. Lewis, 584 U.S. ___ (2018), the result of decisions like that in Epic is an erosion of workers rights, and the “underenforcement of federal and state statutes designed to advance the well being of vulnerable workers.” Id at 26. Noting a staggering statistic that “in Chicago, Los Angeles and New York city alone, low-wage workers lose nearly $3 billion in legally owed wages each year”, Justice Ginsburg observed that “because of their limited resources, however, government agencies must rely on private parties to take a lead role in enforcing wage and hours laws.” Id at 27. Significant reductions in attorneys’ fees in mounting individual claims for wage and hour violations makes it nearly impossible for attorneys to take on such types of cases. “If employers can stave off collective employment litigation aimed at obtaining redress for wage and hours infractions, the enforcement gap is almost certain to widen. Expenses entailed in mounting individual claims will often far outweigh potential recoveries…(because “the FLSA systematically tends to generate low-value claims,” “mechanisms that facilitate the economics of claiming are required”); Sutherland v. Ernst & Young LLP, 768 F. Supp. 2d 547, 552 (SDNY 2011) (finding that an employee utilizing Ernst & Young’s arbitration program would likely have to spend $200,000 to Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 28 of 32 23 recover only $1,867.02 in overtime pay and an equivalent amount in liquidated damages); cf. Resnik, Diffusing Disputes: The Public in the Private of Arbitration. Id at 28. In other cases, where the liability is risky, it would also not be profitable to undertake the lawsuit because of the low amount of fees awarded. This is directly adverse to the legislation of the FLSA where the legislature wanted all claims, large or small, to be prosecuted and to have any accrued cost be borne by defendants. Defense firms are aware of the minimal risk of fee shifting now, and have undertaken to engage in protracted litigation, and then seek to settle for the individual liability of the named plaintiff, knowing that such liability is low, in essence, forcing plaintiff’s firms to eat their time. This trend severely impacts the ability of plaintiffs to seek optimal private counsel, rather than resorting to Legal Aid, or other public options. This is exactly what Justice Ginsburg cautioned against in Epic Systems Corp. III. THE LODESTAR CROSS CHECK FURTHER SUPPORTS AN AWARD TO CLASS COUNSEL OF APPROXIMATELY ONE-THIRD OF THE SETTLEMENT FUND Following Goldberger, the trend in the Second Circuit has been to apply the percentage method and loosely use the lodestar method as a “baseline” or as a “cross check.” Goldberger, 209 F.3d at 50. The Second Circuit “encourages the practice of requiring documentation of hours as a ‘cross check’ on the reasonableness of the requested percentage.” Id.; see also Parker, 2010 WL 532960, at *2. As part of the cross check, the lodestar is determined by multiplying the hours reasonably expended on the case by a reasonable hourly rate. Hicks, 2005 WL 2757792, at *8. Courts then consider whether a multiplier is warranted based on factors, such as: (1) the contingent nature of the expected compensation for services rendered; (2) the consequent risk of non-payment Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 29 of 32 24 viewed as of the time of filing the suit; (3) the quality of representation; and (4) the results achieved. In re Boesky Sec. Litig., 888 F. Supp. 551, 562 (S.D.N.Y. 1995). See also Goldberger, 209 F.3d at 47. Courts regularly award lodestar multipliers of up to eight times the lodestar, and in some cases, even higher multipliers. See Beckman, 293 F.R.D. at 481-82 (granting 6.3 multiplier); see also Steiner v. Am. Broad. Co., 248 F. App’x 780, 783 (9th Cir. 2007) (multiplier of 6.85 “falls well within the range of multipliers that courts have allowed”); Vizcaino v. Microsoft Corp., 290 F.3d 1043, 1052 (9th Cir. 2002) (listing nationwide class action settlements where multiplier ranged up to 19.6 times lodestar); Yuzary, 2013 WL 5492998, at *11 (awarding multiplier of 7.6 in wage and hour misclassification class action); In re RJR Nabisco, Inc. Sec. Litig., MDL No. 818, No. 88 Civ. 7905, 1992 WL 210138, at *5-8 (S.D.N.Y. Aug. 24, 1992) (awarding multiplier of 6). In calculating the lodestar for cross check purposes, the “hours documented by counsel need not be exhaustively scrutinized by the district court.” Goldberger, 209 F.3d at 50. Rather, “the reasonableness of the claimed lodestar can be tested by the court’s familiarity with the case…” Id. Class Counsel spent over 241 hours litigating and settling this matter. Lee Dec. ¶ 4. The time spent by Class Counsel is described in the Declaration of C.K. Lee and Class Counsel’s contemporaneous time records attached thereto. Id. at ¶ 4; Ex. A (Time Records). The hours worked by Class Counsel result in a lodestar of more than $103,787.50. Lee Dec. ¶ 4. Class Counsel’s request for approximately 3.91x their lodestar is reasonable, particularly in light of the excellent result achieved for the class. IV. CLASS COUNSEL IS ENTITLED TO REIMBURSEMENT OF EXPENSES UNDER THE SETTLEMENT AGREEMENT Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 30 of 32 25 Under the terms of the Settlement Agreement, the attorneys’ fees award of $406,666.66 sought by Class Counsel does not include expenses. See Settlement Agreement ¶ 3.2(A). “Attorneys may be compensated for reasonable out-of-pocket expenses incurred and customarily charged to their clients, as long as they were ‘incidental and necessary to the representation’ of those clients.” In re Indep. Energy Holdings PLC Sec. Litig., 302 F. Supp. 2d 180, 183 n.3 (S.D.N.Y. 2003) (internal quotation marks omitted). Here, Class Counsel’s actual expenses were incidental and necessary to the representation of the Class. Lee Dec. ¶5. These expenses and costs include filing fees, and fees related to mediation. Id. Based on expenses accrued, Plaintiffs respectfully request that the Court approve Class Counsel’s application for reimbursement of expenses of $3,167.12, to be paid from the Settlement Fund. V. ADMINISTRATION FEES RUST Consulting (“RUST”) is a third party administration company. RUST has acted as the Settlement Administrator in this lawsuit and has disseminated Class and Collective Notices to Class Members, performed calculations of awards to each Class Member, and maintained correspondences with Class Members. See Declaration of Jennifer Mills, attached as Exhibit B to the Lee Declaration. The Parties agreed to fees of $37,080 (to be paid from the Settlement Fund) to the Settlement Administrator, which is consistent with prevailing market rates. RUST has extensive experience in providing court-approved notice of class actions and administering various types of class action settlements. Case 1:18-cv-00455-LGS Document 104 Filed 03/27/19 Page 31 of 32 26 VI. CONCLUSION For the reasons set forth above, Plaintiffs respectfully request that the Court grant Plaintiffs’ Motion for Approval of Attorneys’ Fees and Reimbursement of Expenses. 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 104 Filed 03/27/19 Page 32 of 32