Memorandum Points and Authorities

Cal. Super. - 6th Dist.June 22, 2021

10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 21 CV383425 Santa Clara - Civil AEGIS LAW FIRM, PC Kashif Haque, State Bar N0. 218672 Samuel A. Wong, State Bar N0. 2 1 7 1 04 Jessica L. Campbell, State Bar N0. 280626 Fawn F. Bekam, State Bar No. 3073 12 9811 Irvine Center Drive, Suite 100 Irvine, California 92618 Telephone: (949) 379-6250 Facsimile: (949) 379-6251 Electronically Filed by Superior Court of CA, County of Santa Clara, on 12/9/2021 8:21 AM Reviewed By: R. Walker Case #21 CV383425 Envelope: 7825596 Attorneys for Plaintiff Javier Diaz and George Mendez, individually and on behalf of all others similarly situated. SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF SANTA CLARA JAVIER DIAZ and GEORGE MENDEZ, individually and on behalf 0f all others similarly situated, Plaintiffs, VS. BGIS GLOBAL INTEGRATED SOLUTIONS US, LLC; and DOES 1 through 20, inclusive, Defendants. Case N0. 21CV383425 Assignedfor allpurposes t0: Hon. Sunil R. Kulkarni, Dept. I PLAINTIFFS’ MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT Date: March 10, 2022 Time: 1:30 pm. Dept: 1 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF CONTENTS I. INTRODUCTION ....................................................................................................................... 1 II. SUMMARY OF THE LITIGATION ........................................................................................ 2 III. SUMMARY OF THE SETTLEMENT ..................................................................................... 3 A. Terms 0f Settlement ......................................................................................................... 3 B. Proposed Opt-Out and Objection Process .......................................................................4 C. Proposed Release ............................................................................................................. 5 IV. LEGAL ARGUMENTS SUPPORTING PRELIMINARY APPROVAL ............................. 6 A. Provisional Certification 0f the Class is Appropriate ..................................................... 6 1. The Proposed Class is Numerous and Ascertainable ........................................6 2. A Well-Defined Community of Interest Exists Among Class Members ..........6 a. Common Questions Predominate .................................................................. 7 b. Plaintiffs' Claims are Typical of the Class Claims ........................................ 7 c. Plaintiffs' and Plaintiffs' Counsel Will Adequately Represent the Interests of the Proposed Class ............................................................................................. 8 3. A Class Actionis Superior t0 a Multitude of Individual Lawsuits .................... 8 B. The Settlement Meets the Standards for Preliminary Approval ..................................... 8 1. The Settlement is Entitled t0 a Presumption of Faitnress ................................. 9 a. The Settlement is the Result 0f Arm's Length Negotiations ........................ 9 b. Plaintiffs' Counsel Conducted Sufficient Investigation and Discovery ...... 9 c. Plaintiffs' Counsel is Experienced in Similar Litigation .......................... 10 2. The Settlement ls Reasonable Given the Strengths 0f Plaintiffs' Claims and the Risks and Expense 0f Litigation .................................................................................. 10 a. Exposure Analysis ............................................................................. 10 C. The Requested Incentive Award for Plaintiffs ......................................................... 12 D. The Requested Attomeys’ Fees and Costs ............................................................... 13 V. CONCLUSION ....................................................................................................................... 14 i PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF AUTHORITIES Page(s) Cases Bell v. Farmers Ins. Exch, 115 Cal. App. 4th 715 (2004) ....................................................... 13 Brinker Restaurant Corp. v. Superior Court, 53 Cal. 4th 1004 (2012) ................................. 6, 7 Capitol People First v. State Dep ’t ofDevelopmental Servs. , 155 Cal. App. 4th 676 (2007)..8 Cellphone Termination Fee Cases, 186 Cal. App. 4th 1380 (2010) .................................... 9, 13 Chavez v. Netflix, Ina, 162 Cal. App. 4th 43 (2008) ............................................................... 13 Classen v. Weller, 145 Cal. App. 3d 27 (1983) .......................................................................... 7 Dunk v. Ford Motor C0,, 48 Cal. App. 4th 1794 (1996) ............................................................ 9 Fireside Bank v. Superior Court, 40 Cal. 4th 1069 (2007) .................................................... 6-7 Ghazaryan v. Diva Limousine, Ltd, 169 Cal. App. 4th 1524 (2008) ........................................ 8 Kullar v. Foot Locker Retail, Ina, 168 Cal. App. 4th 116 (2008) ........................................... 10 Linder v. Thrifty Oil C0., 23 Cal. 4th 429 (2000) ....................................................................... 8 Munoz v. BCI Coca-Cola Bottling C0. 0fL.A., 186 Cal. App. 4th 399 (2010) ....................... 10 North County Contractor’s ASS n., Inc. v. Touchstone Ins. Servs. , 27 Cal. App. 4th 1085 (1994) Rebney v. Wells Fargo Bank, 220 Cal. App. 3d 1117 (1991) .................................................. 10 Reyes v. Bd. ofSupervisorS, 196 Cal. App. 3d 1263 (1987) ...................................................... 6 Richmond v. Dart Industries, Ina, 29 Cal. 3d 462 (1981) ......................................................... 7 Sav-On Drug Stores, Inc. v. Superior Court, 34 Cal. 4th 319 (2004) .................................. 7, 13 Wershba v. Apple Computer, Ina, 91 Cal. App. 4th 224 (2001) ............................................. 11 Statutes Business and Professions Code § 17200 .................................................................................. 2, 5 Lab. Code § 1174 ......................................................................................................................... 6 Lab. Code § 1174.5 ...................................................................................................................... 6 Lab. Code § 1194 ......................................................................................................................... 6 Lab. Code § 1194.2 ...................................................................................................................... 6 i PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT Lab. Code § 1197 ......................................................................................................................... 6 20 21 22 23 24 25 26 27 28 Lab. Code § 1198 ......................................................................................................................... 6 Lab. Code § 201 ....................................................................................................................... 5, 6 Lab. Code § 202 ....................................................................................................................... 5, 6 Lab. Code § 203 ................................................................................................................. 5, 6, 12 Lab. Code § 204 ....................................................................................................................... 5, 6 Lab. Code § 210 ....................................................................................................................... 5, 6 Lab. Code § 226 ................................................................................................................. 5, 6, 12 Lab. Code § 226.3 .................................................................................................................... 5, 6 Lab. Code § 226.7 .................................................................................................................... 5, 6 Lab. Code § 227.3 .................................................................................................................... 5, 6 Lab. Code § 2698 ..................................................................................................................... 1, 2 Lab. Code § 2699(e)(2) ............................................................................................................. 12 Lab. Code § 2699(f) .................................................................................................................. 12 Lab. Code § 2699(l)(2) ................................................................................................................ 3 Lab. Code § 2699.3(a) .................................................................................................................. 2 Lab. Code § 2800 ......................................................................................................................... 6 Lab. Code § 2802 ......................................................................................................................... 6 Lab. Code § 510 ........................................................................................................................... 6 Lab. Code § 511 ........................................................................................................................... 6 Lab. Code § 512 ........................................................................................................................... 6 Lab. Code § 558 ........................................................................................................................... 6 Treatises Conte & Newberg, Newberg 0n Class Actions, § 11.26 (4th ed. 2002) .................................... 8 ii PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 I. INTRODUCTION Pursuant to California Rules of Court 3.769 (d) and (e), Plaintiffs Javier Diaz and George Mendez (“Plaintiffs”) request that the Court grant preliminary approval 0f a class action settlement of wage and hour claims, including claims under the California Private Attorneys General Act of 2004, codified at Lab. Code § 2698, et seq. (“PAGA”), against Defendant BGIS Global Integrated Solutions US LLC (“Defendant”) (collectively, Plaintiffs and Defendant referred to as, the “Parties”). The putative class consists of approximately 97 non-exempt employees who worked for Defendant in California (individually, “Class Member”; collectively, the “Class”) from August 17, 2016, through November 12, 2021 (the “Class Period”). The basic terms of the Joint Stipulation of Settlement (“Settlement Agreement” 0r “Settlement”)1 provide for the following: (1) A non-reversionary Gross Settlement Amount 0f $1,275,000 allocated t0 approximately 97 Class Members 0n a pro rata basis according t0 the number 0f weeks each Class Member worked during the Class Period; (2) An award 0f up to one-third 0f the Gross Settlement Amount (currently $425,000.00) and up to $20,000 in reimbursement of costs t0 Plaintiffs’ Counsel for services rendered as counsel 0n this matter; (3) Incentive Awards 0f up t0 $10,000.00 t0 each named Plaintiff, totaling up t0 $20,000; (4) Settlement Administration fees and costs of up to $6,000; and (5) Payment 0f $50,000 for civil penalties pursuant to PAGA. Seventy-five percent (75%) 0f this payment will be paid t0 the California Labor and Workforce Development Agency (“LWDA Payment”), and twenty-five percent (25%) Will be paid t0 the Net Settlement Amount for distribution t0 Class Members. With each Class Member allocated an average recovery 0f approximately $7,900 from the Net 1 A true and correct copy 0f the fiJIIy-executed “Joint Stipulation 0f Settlement” is attached as Exhibit 1 t0 the Declaration 0f Jessica L. Campbell in Support 0f Plaintiff” s Motion for Preliminary Approval of Class Action Settlement (“Campbell Decl.”), filed concurrently herewith. Unless otherwise defined herein, all capitalized terms in this Motion will be used as such terms are defined and used in the Settlement. 1 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Settlement Amount, the Settlement satisfies the criteria for preliminary approval and falls well Within the range ofreasonableness given the risks and costs 0f continued litigation. The Settlement was reached through informed, arms-length bargaining at and after mediation between experienced attorneys. As such, Plaintiffs request that the Court grant preliminary approval 0f the Settlement, conditionally certify the Class for settlement purposes only, appoint Plaintiffs as the Class Representative, appoint Plaintiffs’ Counsel as Class Counsel, appoint Phoenix Settlement Administrator, as the Settlement Administrator, authorize the Settlement Administrator t0 send notice of the Settlement, and set a final approval hearing date. II. SUMMARY OF THE LITIGATION On February 16, 2021, Plaintiff Diaz filed a class action 0n behalf 0f Defendant’s non-exempt employees. The case is entitled Javier Diaz v. BGIS Global Integrated Solutions US, LLC Case N0. 21- CV-02804-VKD and currently pending in the United States District Court Northern District 0f California (the “Federal Action”). After removal of the Federal Action to the United States District Court Northern District of California, Plaintiffs filed this action as a representative action under PAGA on June 22, 2021. Campbell Decl. at 1] 3. Plaintiffs allege the following causes 0f action in the operative Complaint: (1) failure to pay minimum wages; (2) failure to pay overtime wages; (3) failure to provide meal periods; (4) failure t0 permit rest breaks; (5) failure t0 provide accurate wage statements; (6) failure to pay all wages timely and upon separation of employment; (7) failure to reimburse necessary business expenses; (8) Violation of Business and Professions Code § 17200, et seq., based 0n the preceding claims; and (9) enforcement 0f Lab. Code § 2698, et seq. (“PAGA”), for the preceding claims. Id. On February 11, 2021, before adding a PAGA claim, Plaintiff Diaz provided written notice t0 the LWDA and Defendant as required by Lab. Code § 2699.3(a). Plaintiff Diaz sent amended notice to the LWDA and Defendant 0n March 18, 2021 to add Plaintiff Mendez and additional factual allegations. Id. at 11 4. After agreeing t0 a Settlement in principle, Plaintiffs filed an amended complaint in this action t0 add all the claims asserted in the Federal Action and stipulated to stay the Federal Action pending approval of this Settlement. Id. at 1] 7. The case faced various hurdles, including a removal t0 federal court. After removal, Plaintiffs conducted formal discovery, and received policy documents, time records, and wage statements. After the 2 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 meet and confer efforts regarding the claims and discovery, the Parties agreed to mediate. Id. at 11 5. On September 13, 2021, the Parties attended a mediation session with Hon. Carl J. West (rat), a respected mediator. Id. at 11 6. The Parties spent the next several months negotiating the terms of the Settlement, which was finalized in October of 2021. Id. On December 8, 2021, Plaintiffs submitted the Settlement to the LWDA pursuant t0 Lab. Code § 2699(l)(2). Id. at 1] 8, Ex. 2 (Confirmation 0f Submission of Settlement to LWDA). III. SUMMARY OF THE SETTLEMENT A. Terms 0f Settlement Plaintiffs and Defendant agreed t0 settle the class claims in exchange for a Gross Settlement Amount 0f $ 1 ,275,000. Settlement Agreement, § 3.07(a). The Gross Settlement Amount Will be used t0 make payments for the following: (1) Individual Settlement Payments t0 Participating Class Members; (2) attorneys’ fees t0 Class Counsel 0f up t0 one -third of the Gross Settlement Amount; (3) reimbursement 0f Class Counsel’s litigation costs 0f up t0 $20,000; (4) Incentive Awards to each Plaintiff of up t0 $10,000.00, totaling up t0 $20,000; (5) Settlement Administration fees and costs 0f $6,000; and (6) a payment t0 the LWDA of $37,500 pursuant t0 PAGA. Id. at § 3.07(a-f). Class Members’ Individual Settlement Payments will be distributed after final approval of the Settlement and Defendant funds the Gross Settlement Amount. Id. at § 3.07(f). Individual Settlement Payments Will be calculated by comparing the total Qualifying Workweeks for the Class t0 each individual Class Member’s Qualifying Workweeks. See Settlement Agreement at § 3.07(f). However, for purposes 0f calculating the Individual Settlement Payment, the individual Qualifying Workweeks for all Participating Class Members shall be weighted, in Which the Settlement Administrator shall apply a 2/3 weighted ratio factor t0 the AWS Subclass Member’s Individual Settlement Payment, and a 1/3 weighted ratio factor for all remaining Participating Class Members who are not members 0f the AWS Subclass, § 3.07(f). The intent of this weighting is to provide value for the AWS claims, which are worth more than non-AWS claims, as explained below. With approximately 97 Class Members, the Net Settlement Amount allocates an average of $7,900 per Class Member. The Settlement Administrator will calculate the actual estimated recovery to include in the Class Notice and provide the estimated low and high range 0f possible recovery at final 3 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 approval. Id.; Settlement Agreement, EX. A (Notice of Class Action Settlement). If the number of Class Members increases by more than 10% as 0f the end 0f the Class Period, then there Will be a pro rata adjustment t0 the Gross Settlement Amount, equal to the Net Settlement Amount multiplied by the percentage in excess 0f 10%. Id. at § 3.05(e). The Individual Settlement Payments to Class Members will be allocated for tax purposes as follows: 1/3 t0 wages; 1/3 t0 penalties; and 1/3 t0 interest. Settlement Agreement, § 3.07(f). The employer-side payroll taxes on the portion allocated t0 wages will be paid by Defendant separately from, and in addition t0 the Gross Settlement Amount. Id. at § 3.07(a). N0 portion 0f the Gross Settlement Amount Will revert t0 Defendant. Id. at § I(o). Funds from uncashed or undeliverable Checks Will be tendered by the Settlement Administrator t0 the State Controller Unclaimed Property Fund in the name of the Class Member for whom the funds are designated. Id. at § 3.07(f). B. Proposed Opt-Out and Objection Process The Settlement Administrator will send Class Members the Notice of Class Action Settlement (“Class Notice”) by first-class mail after checking for updated addresses through the National Change 0f Address database. Settlement Agreement, § 3.04. The Class Notice provides information regarding the nature of the lawsuit, a summary of the substance of the settlement terms, the formula for calculating Individual Settlement Payments, the individual’s estimated payout, a statement that Class Members who take n0 action Will release their claims and receive settlement checks, instructions regarding how t0 dispute the calculations, instructions regarding how t0 request exclusion 0r obj ect to the Settlement, the date for the final approval hearing, the amounts sought for attorneys’ fees and costs, the Settlement Administration Costs, the class representative’s Incentive Award, the PAGA allocation, and information 0n how t0 access the court’s website to View the case records. See Settlement Agreement, EX. A (Class Notice). The Class Notice provides instructions for Class Members who Choose t0 exclude themselves from the Settlement. See Settlement Agreement § 3.05(b). T0 opt out, Class Members are instructed t0 submit a Request for Exclusion to the Settlement Administrator by a specified date (45 days after the date of mailing 0f the Class Notice). Id. at pp. 2, 6. Class Members do not need t0 submit a claim form to participate in the Settlement. See Settlement Agreement, EX. A (Class Notice), p. 1. Class Members are 4 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 informed 0f how they can object t0 the Settlement, and the Class Notice informs Class Members 0f the date, time, and location of the final fairness and approval hearing so that they can appear in person or Virtually if the Court s0 requires. Id. at pp. 1, 5-7. Accordingly, the content of the Class Notice complies with the requirements of Cal. R. Ct. 3.766(d). If Class Notice packets are returned as undeliverable, the Settlement Administrator will perform a skip-trace 0r other search, and re-mail the Class Notice With an extended deadline, t0 opt out or obj ect, of 15 days from the date 0f mailing 0r the original deadline, Whichever is later. Settlement Agreement, § 3.04. The initial 45-day notice period and extension process ensures the notice program provides due process by giving Class Members enough time to determine Whether they want t0 participate in the Settlement. This means of notice is reasonably calculated to apprise Class Members of the pendency of the action. See Cal. R. Ct. 3.766 (d)-(f). C. Proposed Release The release t0 be given by Class Members is limited to the Defendants and their predecessors, successors, parents, subsidiaries, affiliates and/or related entities and each of their respective directors, members, officers, committee members, supervisors, employees, representatives and agents (“Released Parties”). Settlement Agreement, § I(gg). Under the proposed release, Class Members who do not exclude themselves from the Settlement Will be deemed t0 have released or waived the following “Released Claims” against the Released Parties during the period 0f August 17, 2016, through November 12, 2021: Upon the date Defendant transfers the Gross Settlement Amount, Named Plaintiffs and Participating Class Members who do not opt out 0f the Settlement, release the Released Parties from any and all claims alleged or Which could have been in alleged based on facts pleaded in Named Plaintiffs’ operative complaints in the State Action and Federal Action, during the Class Period, including but not limited t0 the: (1) failure to pay minimum wages; (2) failure t0 pay overtime wages; (3) failure t0 provide meal periods; (4) failure t0 authorize 0r permit rest periods; (5) failure t0 pay wages upon separation 0f employment and Within the required time; (6) failure t0 furnish accurate itemized wage statements wage statement Violations; (7) failure to reimburse necessary business expenses; (8) failure to pay vacation wages in Violation of Cal. Lab. Code 227.3; and (9) Violation 0f California Business and Professions Code §§17200, et seq., based 0n the preceding claims, including claims for Violation 0f California Labor Code sections 201-203, 204, 210, 226, 226.3, 226.7, 227.3, 5 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 510, 511, 512, 558, 1174, 1174.5, 1194, 1194.2, 1197, 1198, 2800, and 2802 (“Released Claims”). Id at § 5.01. Under the proposed PAGA release, PAGA Group Members, defined in the Settlement Agreement as “Class Members employed by Defendant at any time between August 17, 2016 through November 12, 2021” cannot opt out and Will be deemed t0 have released all PAGA claims, including Violations 0f California Labor Code sections 201-203, 204, 210, 226, 226.3, 226.7, 227.3, 510, 51 1, 512, 558, 1174, 1174.5, 1194, 1194.2, 1197, 1198, 2800, and 2802. Id at § 5.02. Only Plaintiffs will agree to a general release 0f any and all claims, whether known or unknown, which exist or may exist on Plaintiffs’ behalves as 0f the date of the Settlement, and a waiver of CiV. Code § 1542. Id. at § 5.03. IV. LEGAL ARGUMENTS SUPPORTING PRELIMINARY APPROVAL A. Provisional Certification 0f the Class is Appropriate Class certification is appropriate When there exists (1) an ascertainable and sufficiently numerous class, (2) a well-defined community of interest among class members, and (3) When certification would be a fair and efficient means 0f adjudicating the action, rendering class litigation superior t0 alternative means. See Brinker Restaurant Corp. v. Superior Court, 53 Cal. 4th 1004, 1021 (2012). 1. The Proposed Class is Numerous and Ascertainable Whether a class is “ascertainable” is “determined by examining (1) the class definition, (2) the size 0f the class, and (3) the means available for identifying class members.” Reyes v. Bd. ofSupervisors, 196 Cal. App. 3d 1263, 1271 (1987). Here, the Class consists of all current and former non-exempt employees who are and/or were employed by Defendant in California at any time from August 17, 2016, through November 12, 2021. Settlement Agreement, § I(d). Defendant’s records show the Class consists of approximately 97 individuals, making joinder of all Class Members impracticable. Campbell Decl. fl 9. Further, the Class is readily ascertainable from Defendant’s business records because all Class Members are current or former employees 0f Defendant. Id. 2. A Well-Defined Community 0f Interest Exists Among Class Members “[T]he ‘community 0f interest requirement embodies three factors: (1) predominant common questions 0f law or fact; (2) class representatives With claims 0r defenses typical 0f the class; and (3) class representatives who can adequately represent the class.”’ Fireside Bank v. Superior Court, 40 Cal. 6 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 4th 1069, 1089 (2007) (quoting Richmond v. Dart Industries, Inc., 29 Cal. 3d 462, 470 (1981)). a. Common Questions Predominate To assess Whether common questions predominate, courts focus 0n Whether the theories 0f recovery advanced are likely to prove amenable to class treatment. See Sav-On Drug Stores, Inc. v. Superior Court, 34 Cal. 4th 319, 327 (2004). In other words, courts determine whether the elements necessary t0 establish liability are susceptible 0f common proof, even if the class members must individually prove their damages. Brinker, supra, 53 Cal. 4th at 1021-1022, 1024. Plaintiffs alleged that Defendant maintained uniform employment policies and/or practices that illegally deprived Class Members 0f lawful wages, meal periods, rest breaks, reimbursements 0f business expenses, accurate wage statements, and waiting time pay. Campbell Decl. 1] 10. Plaintiffs’ allegations present common legal and factual questions of, inter alia, whether Defendant applied the same scheduling, timekeeping, minimum and overtime pay, meal period, rest break policies, and reimbursement ofbusiness expenses to all Class Members; Whether these policies and practices resulted in Labor Code Violations; whether Defendant’s conduct was intentional; and whether Class Members are entitled t0 penalties. Id. These common questions could be resolved using Class Members’ schedules, time punches, and payroll records, Defendant’s corporate representative’s testimony, written communications between Defendant and Class Members, and Class Member declarations. Campbell Decl. fl 10. Thus, the Court can and should exercise its discretion t0 grant conditional class certification for settlement purposes. b. Plaintiffis‘ ’ Claims are Typical 0fthe Class Claims The typicality requirement is satisfied when the legal theories and facts supporting Plaintiffs claims are substantially similar t0 other class members. See Classen v. Weller, 145 Cal. App. 3d 27, 46 (1983). Here, Plaintiffs allege that they and other Class Members were employed by Defendant and injured by Defendant’s common wage and hour policies and practices, including Defendant’s scheduling, timekeeping, minimum wage pay, overtime pay, meal period, rest break, and business expense reimbursement practices. Campbell Decl. 1H] 11. Through documents and information exchanged in formal and informal discovery, Plaintiffs confirmed that these common policies and practices similarly affected Plaintiffs and the Class. Id. Thus, Plaintiffs’ claims arise from the same employment practices and are based on the same legal theories as those applicable to other Class 7 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Members, as further explained in Plaintiffs’ exposure analysis below. c. Plaintiffs and Plaintiffiv ’ Counsel Will Adequately Represent the Interests 0fthe Proposed Class Certification requires adequacy of both the proposed class representative (s) and proposed class counsel. With respect to the class representative, a plaintiff must adequately represent and protect the interests 0f other members 0f the class and demonstrate that his 0r her claim is not inconsistent With the claims of other members of the class. See Capitol People First v. State Dep ’t ofDevelopmental Servs., 155 Cal. App. 4th 676, 696-697 (2007). Here, Plaintiffs’ interests are coextensive With the interests of the Class. Plaintiffs demonstrated an ability t0 advocate for the interests 0f the Class by initiating this litigation, gathering documents and information, being available 0n the day of mediation to answer questions, meeting with their attorneys on several occasions t0 understand the claims and theories 0f liability at issue, assisting attorneys in preparing for mediation, reviewing the proposed settlement agreement to understand its legal effect, and obtaining a fair settlement on behalf 0f Class Members who stand t0 recover a substantial amount under the Settlement. Campbell Decl. 1] 22. Likewise, Aegis Law Firm, PC has expended considerable time and effort 0n this case and Will continue to d0 so through final approval. See generally, Campbell. Decl. Accordingly, Plaintiffs should be appointed Class Representatives, and Plaintiffs’ Counsel should be appointed Class Counsel. 3. A Class Action is Superior to a Multitude of Individual Lawsuits Class treatment is superior to other methods 0f adjudication when the probability is small that each class member Will come forward to prove his 0r her claim and When the class approach would deter and redress the alleged wrongdoing. See Linder v. Thrifty Oil C0., 23 Cal. 4th 429, 435, 446 (2000); Ghazaryan v. Diva Limousine, Ltd, 169 Cal. App. 4th 1524, 1537-1538 (2008). Here, none of the other 97 Class Members had shown any interest in bearing the expense and burden 0f litigating their own claims. Campbell Decl. 11 22. Thus, a class action is the superior method for seeking relief. B. The Settlement Meets the Standards for Preliminary Approval Preliminary approval is warranted if the settlement falls within a “reasonable range.” See North County Contractor’s Assn” Inc. v. Touchstone Ins. Servs., 27 Cal. App. 4th 1085, 1089-90 (1994); Conte & Newberg, Newberg 0n Class Actions, § 11.26 (4th ed. 2002). In reviewing the fairness of a 8 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 “C class action settlement, due regard should be given t0 what is otherwise a private consensual agreement between the parties.”’ Cellphone Termination Fee Cases, 186 Cal. App. 4th 1380, 1389 (2010). The inquiry “must be limited t0 the extent necessary t0 reach a reasoned judgment that the agreement is not the product of fraud or overreaching by, or collusion between, the negotiating parties, and that the settlement, taken as a whole, is fair, reasonable and adequate t0 all concerned.” Id. Reasonableness and fairness are presumed where (1) the settlement is reached through “arms- length bargaining”; (2) investigation and discovery are “sufficient t0 allow counsel and the court t0 act intelligently”; (3) counsel is “experienced in similar litigation”; and (4) the percentage 0f objectors “is small.” Dunk v. Ford Motor Ca, 48 Cal. App. 4th 1794, 1802 (1996). The Settlement satisfies the first three factors. Plaintiffs Will analyze the fourth factor at the final approval stage. 1. The Settlement is Entitled t0 a Presumption 0f Fairness a. The Settlement is the Result ofArm ’s-Length Negotiations Courts presume the absence 0f fraud or collusion in the negotiation of a settlement, unless evidence t0 the contrary is offered. Thus, there is a presumption that settlement negotiations are conducted in good faith. Here, the Settlement was the product of a full day mediation session With a respected mediator after formal discovery. Campbell Decl. W 6, 11. The negotiations were adversarial, conducted at arm’s length and tempered by the efforts 0f both sides t0 serve the interests 0f their clients. Id. at fl 6. The amounts 0f Plaintiffs’ requested Incentive Awards were not negotiated until after the Parties agreed t0 the Gross Settlement Amount and many other terms. Id. at 1] 23. b. Plaintiffs ’ Counsel Conducted Sufficient Investigation and Discovery Plaintiffs’ Counsel thoroughly investigated the class Claims, applicable law, and potential defenses. See generally, Campbell Decl. In particular, Plaintiffs’ Counsel assessed the value 0f the class claims using Defendant’s data and documents produced through formal and informal discovery. Campbell Decl. 1H] 5, 11, 13-21. Plaintiffs’ counsel extensively reviewed time records and compared them to payroll documents t0 identify potential Violations. Id. Accordingly, Plaintiffs’ Counsel fully understood the strengths and weaknesses of the claims before the Parties reached a settlement. Id. 9 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 c. Plaintiffis ’ Counsel is Experienced in Similar Litigation Plaintiffs are represented by Aegis Law Firm, PC (“Class Counsel”). Class Counsel prosecute wage and hour class actions on behalf 0f employees and others Who have had their rights violated. Campbell Decl. 1N 25-39. The attorneys working on this case have been appointed class counsel in many cases, through both contested motions and settlement approval motions. Id. Thus, Plaintiffs’ Counsel has extensive experience in similar litigation and should be appointed as Class Counsel. 2. The Settlement is Reasonable Given the Strengths of Plaintiffs’ Claims and the Risks and Expense 0f Litigation Courts have discretion t0 approve class settlements by assessing several factors, including the “strength 0f plaintiffs’ case, risk, expense, complexity and likely duration of further litigation and risk of maintaining the class action through trial.” Munoz v. BCI Coca-Cola Bottling C0. 0fL.A., 186 Cal. App. 4th 399, 407 (2010); see Kullar v. Foot Locker Retail, Inc. , 168 Cal. App. 4th 116, 129 (2008). While Plaintiffs and their counsel believed and continue t0 believe this is a strong case for certification, the significant risks and expenses associated with class certification and liability proceedings were taken into account. Campbell Decl. 11 13. T0 determine if the amount offered at mediation was reasonable, Plaintiffs’ Counsel weighed that figure against many risk factors. If Plaintiffs continued t0 prosecute the claims rather than accept a settlement, Plaintiffs would have faced deadlines t0 file a motion for class certification, had t0 have engaged in more formal written discovery and taken depositions, expended time and resources to resolve disputes, prepared and filed potential dispositive motions and/or discovery motions, and engaged in extensive trial preparation. An adverse ruling at any one 0f these stages could have prevented the Class from obtaining any recovery. Id. W 14-15. a. EXDOSLlVe AnalVSiS A settlement does not have t0 provide 100% of the damages sought to be considered a fair and reasonable settlement. See Rebney v. Wells Fargo Bank, 220 Cal. App. 3d 1117, 1139 (1991). Rather, compromise is expected: Compromise is inherent and necessary in the settlement process . . . even if “the relief afforded by the proposed settlement is substantially narrower than it would be if the suits were t0 be successfully litigated,” this is n0 bar t0 a class settlement 10 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 because “the public interest may indeed be served by a voluntary settlement in which each side gives ground in the interest of avoiding litigation.” Wershba v. Apple Computer, Ina, 91 Cal. App. 4th 224, 250 (2001) (citation omitted). Here, Plaintiffs contend that their claims are based 0n Defendant’s common, class-wide policies and procedures, and that liability could be determined on a class-wide basis without dependence 0n individual assessments 0f liability. Campbell Decl. W 12. Although the amount 0f Defendant’s potential exposure - if proven - is substantial, the legitimate and serious risks of succeeding at class certification and trial compelled a serious consideration of the benefit 0f a settlement. Id. at 1W 13-21. Minimum Wage and Overtime Claims: Plaintiffs’ minimum wage and overtime claims were premised on the theories that Defendant required Class Members t0 work invalid Alterative Workweek Schedules and failed to pay them daily overtime compensation, illegally rounded time punches, and required Class Members t0 work on call shifts without adequate compensation. Plaintiffs calculated that the AWS overtime claim was worth approximately $320,040, the rounding claim was worth approximately $6,247, and the on-call claim was worth approximately $2 million. However, Defendant argued it adopted a valid Alternative Workweek Schedule, exempting it from overtime requirements, its rounding policy was neutral, and Class Members were not actually on call for the length 0f time alleged. Although Plaintiffs believed the AWS claims were very strong, the rounding claim was very small and the on-call claim could be hard t0 prove because it would depend 0n evidence 0f the employer’s control, Which could be an individualized issue. As such, this claim was discounted in settlement negotiations. Campbell Decl. fl 16. Meal and Rest Break Claims: Plaintiffs’ theory 0f liability for meal and rest break Violations was based 0n Defendant’s lack of meal and rest policies for the majority 0f the class period. Plaintiffs’ damages estimate about $1 millions for rest period Violations and about $294,751 for meal period Violations. However, Defendant could argue through time records that class members received their meal periods and the rest period Violations would rely 0n Class Member testimony, making it hard to certify the claim. As such, these claims were also discounted in settlement negotiations. Campbell Decl. 'n 17. 11 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Expense Reimbursement Claims: Plaintiffs alleged class members were required t0 use their personal cell phones for work. Plaintiffs estimated the damages could reach about $30,078 but Defendant could argue that the cell phone usage was optimal, raising individualized issues for class certification. Campbell Decl. 11 18. Derivative Waiting Time and Wage Statement PenaltV Claims: Plaintiffs’ Counsel also considered the arguable presence ofvarious penalties, and weighed the potential recoveries against probable defenses. Specifically, Defendant could argue that Plaintiffs could not prove the “willful” prong needed to obtain waiting time penalties under Lab. Code § 203. Additionally, Defendant could argue that Plaintiffs could not show that Class Members suffered an “injury” as a result 0fwage statement Violations, as required by Cal. Lab. Code § 226. Although the Class arguably could have seen a payout of approximately $560,280 for waiting time penalties and $156,000 for wage statement penalties, Plaintiffs would not recover any 0f these derivative penalties if they failed t0 prove the underlying claims. Campbell Decl. 11 19. PAGA Claim: The PAGA claim presented even higher hurdles. Although Plaintiffs’ Counsel found Defendant’s exposure could potentially reach approximately $501,300 under Lab. Code § 2699(f), assuming the initial penalty rate 0f $100 for each pay period, Plaintiffs would have to prove a Violation in every pay period. Most importantly, the Court would have discretion t0 reduce the PAGA award based 0n whether the amount 0f the award would be “unjust, arbitrary and oppressive, 0r confiscatory.” Lab. Code § 2699(e)(2). In theory, the Court could reduce the award by 99% if it so wished. Given the small size 0f the employer, Plaintiffs were doubtful they could recover significant PAGA penalties, especially if a large class judgment was entered for the same Violations. Accordingly, Plaintiffs could not place a high value 0n the PAGA penalties, and therefore allocated $50,000 0f the Gross Settlement Amount t0 settle these claims. Campbell Decl. 1] 20. C. The Requested Incentive Award for Plaintiffs Plaintiffs seek an Incentive Award 0f up t0 $10,000 t0 each Plaintiff, totaling up t0 $20,000, for accepting the responsibilities 0f representing the interests of the Class and assuming risks and potential costs that were not borne by any other Class Members. Settlement Agreement, § 3.07(d). A named plaintiff is eligible for payment that reasonably compensates him 0r her for undertaking and fulfilling a 12 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 fiduciary duty t0 represent absent class members. See Cellphone Termination Fee Cases, supra, 186 Cal. App. 4th at 1393; Bell v. Farmers Ins. Exch, 115 Cal. App. 4th 715, 726 (2004). Here, Plaintiffs had the option t0 pursue their claims individually, but instead chose t0 pursue this class action, delaying individual recovery until approval 0f a class action settlement. Campbell Decl. 1] 22. Throughout the case, Plaintiffs assisted counsel in gathering the evidence necessary t0 prosecute the class claims, maintained regular contact With counsel, were available 0n the day of mediation and communicated With their attorneys during the day of mediation to answer critical questions, and reviewed the Settlement to make sure it was fair to the Class. Id. No action would likely have been taken by Class Members individually, and n0 compensation would have been recovered for them, but for Plaintiffs’ services on behalf of the Class. Id. By actively pursuing this action, Plaintiffs furthered the California public policy goal of enforcing the State’s wage and hour laws. See Sav-On Drug Stores, Inc. , supra, 34 Cal. 4th at 340. The requested Incentive Award for Plaintiffs’ service as the class representatives and for a general release of all employment claims is reasonable and should be preliminarily approved. At the final approval stage, Plaintiffs Will further support the request for Incentive Awards by declarations addressing the factors for the award. Campbell Decl. 1] 24. D. The Requested Attorneys’ Fees and Costs The purpose 0f an attorneys’ fee award in class action litigation is t0 reward counsel who invested in a case despite the risk of non-payment and achieved a substantial positive result for the class. Attorneys’ fees are awarded as a matter 0f equity. California courts routinely award attorneys’ fees equaling one-third 0r more 0f the potential value 0f the common fund. See Chavez v. Nezflix, Ina, 162 Cal. App. 4th 43, 66, n.11 (2008) (“Empirical studies show that, regardless 0f whether the percentage method 0r the lodestar method is used, fee awards in class actions average around one-third 0f the recovery”). Plaintiffs seek appointment 0f Aegis Law Firm, PC as Class Counsel. The attorneys performed significant work and expended litigation costs in prosecuting the matter With n0 guarantee 0f any payment. Campbell Decl. 11 38. Plaintiffs’ Counsel seeks preliminary approval for $425,000.00 in attorneys’ fees, which is up t0 one-third of the Gross Settlement Amount, and up t0 $20,000 in 13 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT U‘IAUJN \OOOQQ 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 reimbursement of litigation costs. Given the work performed in this matter, the extensive information exchange, and substantial recovery obtained 0n behalf 0f Plaintiffs and the Class, Plaintiffs’ Counsel achieved a settlement through efficient and diligent work. See generally, Campbell Decl. At final approval, Plaintiffs’ Counsel will fully brief the merits of its request for the award 0f attorneys’ fees and litigation costs. Id. at 1] 39. V. CONCLUSION The Parties have negotiated a fair and reasonable Settlement of the class claims in light 0f the risks present in this case. Plaintiffs have appropriately presented the materials and information necessary for preliminarily approval, and therefore, respectfully requests that the Court preliminarily approve the Settlement and schedule a date to conduct the final approval hearing. Dated: December 8, 2021 AEGIS LAW FIRM, PC Byfl"z"M Jessica L. Campbell Attorneys for Plaintiffs 14 PLAINTIFFS’ MPA ISO MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT