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23(b)(3) Class, Claims, Class Actions, Contract, Paystub, Vacation, Wages

Class Certification Granted in Vacation, Uniform, Paycheck, Wage and Contract Class Action

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The Southern District of California granted class certification in a vacation, uniform, paycheck, wage and contract class action. Lopez v. G.A.T. Airline Ground Support, Inc., No. 09cv2268-IEG(BGS), 2010 WL 3633177 (S.D. Cal. Sept. 13, 2010) (slip op.).

Background

Former employees of Defendant G.A.T. Airline Ground Support, Inc. (“GAT”) sued for systematic wage and hour violations in violation of federal and state law. Id. *1. GAT provides services to airlines, including ground transportation, aircraft maintenance, and cargo operations management. Id. The four named Plaintiffs are former ramp agents employed by GAT in California. Id. Continue reading →

Tagged Breach of contract, California, Class action, Law, Lawsuit, Plaintiff, United States Court of Appeals for the Ninth Circuit, United States Supreme Court

Class Actions

Northern District Strikes Aiding and Abetting Allegations From Overtime Class Action Complaint

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The Northern District of California granted a motion to strike aiding and abetting allegations from an overtime class action complaint. Toy v. Triwire Engineering Solutions, Inc., No. C 10-1929 SI, 2010 WL 3448535 (N.D. Cal. Sept. 1, 2010) (slip op.).

Background

Plaintiff Jason Toy filed a putative class action in state court against defendants TriWire Engineering Solutions, Inc., Comcast Corporation, and Comcast Cable Communications Management LLC, alleging that TriWire and Comcast employed Toy as a cable technician to install, disconnect, and upgrade cable television and computer services for consumers throughout California. Id. *1. Plaintiff contended he was not exempt from overtime requirements, and was not paid overtime in accordance with the law. Id. Continue reading →

Tagged Accomplice, Allegation, California, Law, Legal Information, Plaintiff, Susan Illston, United States District Court for the Northern District of California

CAFA Jurisdiction, Class Actions, Remand

Central District Remands Minimum Wage and Overtime Class Action for Failure to Satisfy CAFA Amount in Controversy

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The Central District remanded a putative minimum wage and overtime class action suit in Munoz v. Central Parking Sys., Inc., No. CV 10-6172 PA (RCx), 2010 WL 3432239 (C.D. Cal. Aug. 30, 2010) (unpublished).

Plaintiff’s complaint attempted to avoid removal, stating “[i]t is believed that the total sum owed to the Class alleged herein is less than $5 million, based upon the anticipated size of the Class and the amount in controversy for each member of the Class.” Id. *1. Continue reading →

Tagged Central District, Class action, Class Action Fairness Act of 2005, Minimum wage, Plaintiff, United States, United States Supreme Court, Wage

CAFA Jurisdiction, Certification, Class Actions

Eastern District Holds That Plaintiffs May Rely on a “Few Representative Inquiries” and Extrapolate to the Class

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The court in Adoma v. University of Phoenix, Inc., No. CIV. S-10-0059 LKK/GGH, 2010 WL 3431804 (E.D. Cal. Aug. 31, 2010 (slip op.) held that even where plaintiff’s proposed method of “reconstructing records of hours worked . . . will be imperfect”, plaintiffs may rely on “a few representative inquiries whose results will be extrapolated to the class.” Continue reading →

Tagged Class action, Class Action Fairness Act, Class Action Fairness Act of 2005, Defendant, Fair Labor Standards Act, Lawsuit, Plaintiff, University of Phoenix

CAFA Jurisdiction, Class Actions, Remand

Morgan Stanley Wage and Hour Class Action Remanded to San Diego Superior Court for Failure to Show Diversity or Amount in Controversy

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Judge James Lorenz faced a remand motion in Martinez v. Morgan Stanley & Co., Inc., Civil No. 09cv2937-L(JMA), 2010 WL 3123175 (S.D. Cal. Aug. 9, 2010). The court remanded, holding that Defendants did not meet their burden of showing that it is more likely than not that the matter in controversy for the class action exceeds $5 million or that Plaintiff’s individual claims exceed $75,000.

Defendants removed this wage and hour class action from state court based on 28 U.S.C. Sections 1332 and 1441, or in the alternative, on the Class Action Fairness Act (“CAFA”), 28 U.S.C. §§ 1332(d) and 1453. Plaintiff filed a motion to remand arguing that Defendants failed to establish the requisite diversity of citizenship and the jurisdictional amount in controversy. Continue reading →

Tagged Allegedly Unethical Firms, Business, Class Action Fairness Act of 2005, Defendant, Law, Legal Information, Litigation, Morgan Stanley

23(b)(3) Class, Attorneys' Fees, Class Actions, Settlement

Northern District Approves 28.9% Fee Award in Wage and Hour Class Action Settlement

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Judge Jeffrey S. White approved a wage and hour class action settlement of a non-reversionary $1.8 million, inclusive of $520,000 in attorneys fees, in Ozga v. U.S. Remodelers, Inc., No. C 09-05112 JSW, 2010 WL 3186971 (N.D. Cal. Aug. 9, 2010).

Plaintiff filed a class action in the Alameda Superior Court on February 17, 2009, alleging that Defendant U.S. Remodelers Inc. violated the California Labor Code and violated California Industrial Welfare Commission Wage Orders by: (1) requiring its Installer employees to work substantial amounts of time without compensation; (2) regularly failing to provide Installers with meal and rest periods; and (3) refusing to reimburse expenses that Installers incurred in the performance of their work duties, including travel expenses and equipment costs.

Defendant removed the action to this Court, and Plaintiff subsequently moved to remand. But before the hearing on the motion to remand, the parties reached a settlement, which was facilitated, in part, by a mediation that occurred on October 1, 2009, before Michael Loeb. The parties also engaged in some discovery, and Class Counsel interviewed a number of Settlement Class members.

The Court finds that the terms of the Settlement are fair, adequate and reasonable. As noted, the settlement was reached after the parties engaged in discovery, conducted a meditation, and continued to engage in arms-length negotiations. The parties agreed to a Settlement payment of $1,800,000.00, none of which will revert to the Defendant. The overall reaction to the settlement has been positive. The Claims Administrator has received 156 claim forms from the 270 Class Members. (Id., ¶¶ 20-21.) Neither the Claims Administrator nor the Court received any objections to the Settlement. No Class Member appeared at the final approval hearing to object. According to the Claims Administrator, assuming the Court were to grant in full Plaintiff’s motion for attorneys’ fees and costs and service awards, approximately $1,108,917.72 would be available to distribute Class Members who submitted timely claim forms, for an average award of just over $7,000. (Id. ¶¶ 16-18.)

The Court approved costs to be paid to the Claims Administrator of $10,000.00 from the Settlement Fund.

Attorneys Fees, Costs, and Service Awards

Plaintiff brought an unopposed fee application, seeking $600,000.00 in attorneys’ fees, $11,274.89 in costs, and $10,000.00 in service awards to him and to class member Boris Moskovich.

Plaintiff’s counsel sought an award of attorneys’ fees based on the percentage method, asking for 33 1/3% of the Settlement Fund. The court agreed to depart from the 25% benchmark. See Vizcaino v. Microsoft Corp., 290 F.3d 1043, 1047 (9th Cir. 2002) (noting that 25% is benchmark and “usual” range of awards is 20-30%); Hanlon v. Chrysler Corp., 150 F.3d 1011, 1029 (9th Cir. 1998) (stating that 25% is benchmark). But the court would not vary from the benchmark to the degree requested by counsel.

The Court concludes that counsel did achieve an excellent result for the class, that the reaction to the settlement has been overwhelmingly positive, and that Plaintiff faced significant risk in prosecuting this case given the uncertain state of California law in similar wage and hour cases. The Court also recognizes that other courts have awarded settlement fees of up to 33 1/3% in such cases. However, the parties reached this settlement quickly and did not engage in any motion practice. See, e.g., Navarro v. Servisair, 2010 WL 1729538 (N.D. Cal. Apr. 27, 2010) (finding that proposed award of 30% of settlement fund unjustifiably departed from benchmark based in part on speed with which parties reached a settlement). Moreover, the requested percentage would amount to award that is more than double the fees actually incurred by counsel. Compare Vasquez v. Coast Valley Roofing, Inc., 266 F.R.D. 482, 491 (E.D. Cal. 2010) (awarding 33 1/3% of settlement fund which was “significantly less” than asserted lodestar).

Thus the court found that an award of $520,000.00 was reasonable.

The court found counsels’ requests for costs in the amount of $11,274.89 reasonable.

The court also approved service awards in the amount of $10,000.00 for the lead plaintiff and for a class member.

Tagged Attorney's fee, California, California Labor Code, Class action, Google, Lawsuit, Settlement, United States District Court for the Northern District of California

Affirmative Defenses, CAFA Jurisdiction, Class Actions, Remand

Central District Remands Class Action Based on Local Controversy Exception to CAFA

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In Coleman v. Estes Express Lines, Inc., No. CV 10-2242 ABC (AJWx), — F. Supp. 2d —-, 2010 WL 3156850 (C.D. Cal. July 19, 2010) a wage and hour plaintiff brought a motion to remand, after the case was removed pursuant to CAFA. The Court granted Plaintiff’s remand motion.

While Defendants have demonstrated that more than $5,000,000 is in controversy under CAFA, Plaintiff has demonstrated that CAFA’s Local Controversy exception applies in this case. Therefore, the Court must decline to exercise jurisdiction. See Serrano, 478 F .3d at 1022. Plaintiff’s motion is GRANTED and this case is REMANDED to Los Angeles Superior Court.

Plaintiffs were represented by Mark P. Estrella, Miriam L. Schimmel, Robert E. Byrnes, Sue Jin Kim of Initiative Legal Group APC and Payam Shahian of Strategic Legal Practices APC.

Defendants were represented by David L. Terry, David L. Woodard of Poyner Spruill LLP and Sarah N. Drechsler and Timothy M. Freudenberger of Carlton Disante & Freudenberger LLP.

The judge is Hon. Audrey B. Collins.

Tagged Audrey B. Collins, Defendant, Estes Express Lines, Los Angeles, Plaintiff, Remand (court procedure), United States, United States Supreme Court

Attorneys' Fees, Class Actions, Expense Reimbursement, Settlement

Northern District Approves $4.5 Million Settlement Against RadioShack in Expense Reimbursement Case, With $1.5 Million in Fees, and $5,000 Incentive Payments to Each Lead Plaintiff

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Magistrate Judge Edward M. Chen (whose confirmation to the Northern District of California bench has unfortunately been stalled for far too long) approved the class settlement and attorney fee application in Stuart v. RadioShack Corp., 2010 WL 3155645, No. C-07-4499 EMC (N.D. Cal. Aug. 9, 2010).

This class action was initiated in state court in June 2007, alleging that RadioShack had improperly failed to reimburse its employees for expenses they incurred in using their personal vehicles to perform inter-company transfers (“ICSTs”). Plaintiffs claimed for reimbursement pursuant to California Labor Code § 2802 and for a violation of California Business & Professions Code. Subsequently Plaintiffs added a claim for recovery of penalties under the California Labor Code Private Attorneys General Act (“PAGA”). The case was removed in August 2007. And in February 2009, Judge Chen granted the motion for class certification, certifying a class consisting of “all persons employed by RadioShack within the State of California, at any time from June 3, 2003, to the present, who drove their personal vehicles to and from RadioShack stores to carry out ICSTs and who were not reimbursed for mileage.” On October 1, 2009–nine days before trial was scheduled to begin–the parties reached a settlement.

Under the Settlement Agreement, RadioShack will pay a total of $4.5 million for the release by the class, as an all-inclusive sum (proceeds to be distributed to the class, attorney’s fees and litigation expenses, costs of claim administration, incentive payments to the class representatives, and the PAGA award to the state), without reversion of any of the $4.5 million to RadioShack.

After attorney’s fees, litigation expenses, costs of claim administration, incentive payments, and the PAGA award to the state have been deducted from the $4.5 million, the remainder for distribution to the class members and/or donation to charity is $2,796,563.31.

Each class member’s award “depends on the number of weeks that the class member worked.”

The Court found that, importantly, “the amount available to the class after deductions for, e.g., fees and costs–i.e., $2,796,563.31–is not far off what the class might be awarded if it were to prevail on the merits after a trial.” Id. *4.

Plaintiffs’ counsel asked for an award of $1.5 million (i.e., one-third of the total settlement amount), plus litigation expenses which total $78,436.69.

The Court has reviewed the expenses and determined that they are reasonable. The Court notes that the sum is not excessive given that this litigation has been ongoing for more than three years.

Attorneys Fees Application

The attorneys presented a fee application claiming $1.5 million as a lodestar for fees–excluding work performed in preparing for final approval and any post-judgment work that may be needed. The $1.5 million sum represents 2,116.69 hours of work over a period of more than three years, at hourly rates of the billing attorneys ranging from $600 to $1,000.

After reviewing the billing records submitted by counsel as well as the declarations regarding the hourly rates of counsel, the court found that the number of hours was reasonable given the length of the lawsuit and the vigorous disputes over the course of the litigation (e.g., regarding RadioShack’s defense that it had no duty to reimburse until an employee made a request for reimbursement).

The court did express some “concerns about the $1,000 hourly rate” claimed by one of the attorneys. “Based on the Court’s experience, this is an inordinately large hourly rate, even if the Court were to assume that [the attorney] has fifty years of experience.” But the Court concluded that “given the 2,116.69 hours incurred, the average hourly rate for a fee award of $1.5 million total is $708, an amount that the Court deems appropriate, particularly when no multiplier is being sought on top of the lodestar.”

Compared to the percentage of the fund, the court noted that “the total settlement amount to be paid by RadioShack (with no possibility of reversion), the fee award represents one-third of the settlement amount.” The court found that this was “well within the range of percentages which courts have upheld as reasonable in other class action lawsuits.”

The court also approved an incentive award of $5,000 for each of the two class representatives, for a total of $10,000. The Court concluded that the incentive payments were appropriate and reasonable. “Although the class representatives did not enter this litigation until late in the proceedings, due consideration must be given to the fact that they were willing and ready to go to trial.” The court noted that if the “class representatives had asked for a larger sum, the Court might well have reached a different conclusion, but the $5,000 sought for each representative was viewed as “relatively modest.”

Tagged Attorney's fee, California, Class action, Edward M. Chen, RadioShack, Settlement, Settlement Agreement, United States District Court for the Northern District of California

CAFA Jurisdiction, Class Actions

Southern District of California Denies Remand in Case Asserting CAFA Jurisdiction

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In Johnson v. U.S. Vision, Inc., No. 10-CV-0690 BEN (CAB), 2010 WL 3154847 (S.D. Cal. Aug. 9, 2010) the Southern District of California faced a remand motion in a wage and hour case that had been removed pursuant to the Class Action Fairness Act (“CAFA”), 28 U.S.C. §§ 1332, 1441, 1453.

Judge Roger T. Benitez denied the motion to remand. Defendant presented a calculation of damages, supporting its calcualtions with declaration from, among other people, the Assistant Controller, Operations, for U.S. Vision, Inc., responsible for enforcing Defendants’ payroll policies and procedures. The declaration set forth Plaintiff’s most recent hourly rate of pay, as well as the specific number of optical managers and optechs employed during the Class Period, average hourly rates of pay for managers and optechs, number of employees who separated their employment with Defendants, and number of possible wage statements for each employee per year.

Plaintiff argued that Defendants miscalculated the amount in controversy because:

Defendants erroneously assumed “each class member was damaged to the same extent that Plaintiff Johnson was, and that every putative class member, among other things, worked off the clock and incurred a break violation every single day of the entire class period.” Mot. 6. Plaintiff emphasizes that Defendants have access to more specific figures to calculate the amount in controversy and that “each [class] member can be identified using information contained in Defendants’ payroll, scheduling and personnel records.” Compl. ¶ 39.

But the Court held that absent a “persuasive argument that Defendants are required to prove actual damages in order to remove this action, however, the Court must consider the amount put in controversy by the Complaint, not the ultimate or provable amount of damages.” (citing Rippee v. Boston Market Corp., 408 F. Supp. 2d 982, 986 (S.D. Cal. 2005).) The Court found that, having based their calculations on allegations provided in the Complaint, Defendants proved with a legal certainty that CAFA’s jurisdictional threshold is satisfied.

Despite Plaintiff’s attempt to provide supplemental information in the motion to remand, Defendants were entitled to, and did, use the factual allegations in the Complaint to calculate the amount in controversy. See Gaus v. Miles, Inc., 980 F.2d 564, 567 (9th Cir. 1992) (holding that defendant must use specific factual allegations or provisions in the complaint to support its argument of proper removal). The Court finds that Defendants provided detailed and competent evidence supporting their calculations and showing, to a legal certainty, that the jurisdictional threshold under CAFA is met. To the extent subsequent events show that jurisdiction would not be proper, the Court can address remand at that time. 28 U.S.C. § 1447(c).