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Erick Gallo; Armando Gutierrez; Angel v. Masco Corporation

April 28, 2011


The opinion of the court was delivered by: Cathy Ann Bencivengo United States Magistrate Judge


Before the Court is plaintiffs' motion for attorneys' fees and costs in the above-captioned case and related case, Ibarra, et al v. Builder Services Group, et al, Case No. 10cv199. The parties reached a settlement of these cases in June of 2010. As part of the negotiated agreement, the parties agreed that plaintiffs' counsel could submit an application for fees and costs in these cases for a final determination by the undersigned.*fn1 Defendants could object in whole or part. The total of any award by the Court cannot exceed an agreed ceiling of $400,000. The parties finalized and executed the settlement during the months that followed and the cases were dismissed with prejudice on December 16, 2010. [Doc. No. 98.]

Plaintiffs filed their application for fees and costs on December 15, 2010. [Doc. No. 95.] Defendants filed their opposition on January 18, 2011. [Doc. No. 100.] Plaintiffs filed a reply on January 25, 2011. [Doc. No. 103.] Defendants were given leave to file a surreply which was submitted on February 4, 2011. [Doc. No. 106.] The Court found the motion suitable for determination on the papers and it was submitted without oral argument pursuant to Civil Local Rule 7.1(d)(1).


Gallo et al v. Masco Corporation, et al, 08cv604 ("Gallo Case") was filed on April 2, 2008 as a class action with six named plaintiffs alleging 10 separate causes of action for violations of federal and state wage and hour laws.*fn2 The complaint was amended on May 22, 2008, adding a seventh named plaintiff, but no new causes of action.

For the next year discovery proceeded and settlement discussions were held with the expectation that plaintiffs would seek certification of a class of defendants' employees numbering approximately 100 individuals. Plaintiffs last day to file their motion for class certification was June 12, 2009 [Doc. No. 27], however by May 2009, plaintiffs' counsel had decided not to proceed with the class allegations. After meeting with over 50 of the putative class members, plaintiffs' counsel concluded it would be best to proceed as a multi-plaintiff case instead of seeking class certification.*fn3 [Doc. No. 95-1, at 4-5.]

On June 29, 2009, plaintiffs filed a motion for leave to file a second amended complaint adding 52 plaintiffs to the Gallo Case, withdrawing the class and collective action allegations, adding a defendant and proceeding as a multi-plaintiff case. [Doc No. 29]. The motion was opposed by defendants. [Doc. No. 30.] Plaintiffs' motion was denied by District Judge John Houston on December 7, 2009. [Doc. No. 46.]

Thereafter, the seven plaintiffs in the Gallo Case prepared to proceed to trial on their claims. Pretrial disclosures were exchanged and a Pretrial Order was submitted to the Court. The Pretrial Conference was held before District Judge Houston on April 5, 2010. The Court directed the parties to file an amended Pretrial Order and the Pretrial Conference was continued to June 21, 2010. The parties reached a settlement and the Pretrial Conference was vacated. As set forth above, the settlement was eventually finalized and the case dismissed.

Also following the Court's order denying the motion to amend, plaintiffs' counsel prepared and filed a complaint in the Superior Court of California, County of Imperial, case no. ECU05330, on behalf of those plaintiffs who were not added by amendment to the Gallo Case. Defendant removed that state court case on January 26, 2010 to this District Court, Ibarra et al v. Builder Services Group, Inc., 10cv199 ("Ibarra Case"). There were 53 named plaintiffs alleging similar wage and hour violations as those asserted in the Gallo Case. On February 22, 2010, plaintiffs filed a motion to remand the case back to state court. [Doc. No. 9.] Opposition and reply briefs were submitted and the motion was taken under submission by District Judge Houston on April 14, 2010. [Doc. No. 15.] While the motion was pending, the case was settled in conjunction with the Gallo Case.


In both the Gallo and Ibarra Cases, plaintiffs claimed violations of California Labor Code provisions including but not limited to the non-payment of overtime and prevailing wage, failure to provide meal periods and accurate itemized wage statements and for reimbursement of travel costs and other business expenses. The California Labor Code provides the statutory basis for the recovery of reasonable fees and costs to a prevailing party for such violations. See Cal. Labor Code §§218.5; 226; 1194.

To qualify as a prevailing party, a plaintiff must obtain at least some relief on the merits of his claim, by judgment, consent decree or settlement. Farrar v. Hobby, 506 U.S. 103, 111 (1992) (plaintiff must secure relief that directly benefits him at the time of settlement). Although the court in Farrar addressed recovery of fees for a civil rights violation, this Court applies the articulated principle to the settlement of a wage case that provides for the statutory recovery of fees. The plaintiffs argue that they prevailed in these cases in that the settlement provided for payment to all 60 plaintiffs for dismissal of their wage claims. The defendants do not directly challenge that the plaintiffs qualify as a prevailing party in this case, although they do argue that plaintiffs would not have ultimately prevailed on their claims at trial. Given that these disputed claims settled and plaintiffs received a direct benefit in the settlement, the Court finds the plaintiffs the prevailing party and entitled to the recovery of reasonable fees and costs.


The calculation of a reasonable fee award involves a two-step process. First, the court must calculate the "lodestar figure" by taking the number of hours reasonably expended on the litigation and multiplying it by a reasonable hourly rate. Taken into account in either the reasonable hours component or the reasonable rate component of the lodestar calculation are: "(1) the novelty and complexity of the issues; (2) the special skill and experience of counsel; (3) the quality of representation; (4) the results obtained; and (5) the contingent nature of the fee agreement." Morales v. City of San Rafael, 96 F.3d 359, 364 (9th Cir. 1996). The second step involves the district court, in its equitable discretion, adjusting this amount "on the basis of other considerations." Lytle v. Carl, 382 F.3d 978, 988 (9th Cir. 2004).

The prevailing attorneys bear the burden of establishing entitlement to an award and must document the appropriate hours expended and hourly rates. Hensley v. Eckerhart, 461 U.S. 424, 437 (1983). Once the applicants submit evidence of the appropriate hours spent on litigation, "the party opposing the fee application has a burden of rebuttal that requires submission of evidence to the district court challenging the accuracy and reasonableness of the hours charged." Gates v. Deukmejian, 987 F.2d 1392, 1397 (9th Cir. 1992). Applicants should make a good faith effort to exclude excessive, redundant, or otherwise unnecessary hours from a fee request. Hensley, 461 U.S. at 434. "The district court has a great deal of discretion in determining the reasonableness of the fee." Gates, 987 F.2d at 1398.


A reasonable hourly rate is calculated according to the prevailing market rates in the relevant community. Sorenson v. Mink, 239 F.3d 1140, 1145 (9th Cir. 2001). The community where the court sits is the relevant market for determining reasonable fees. Deukmejian, 987 F.2d at 1405. Two law firms represented the plaintiffs, Rukin Hyland Doria & Tindall, LLP, located in San Francisco, California, and Gulledge Law Group, located in Ventura, California. Neither firm is located in this District Court's community.

John Hyland provided a declaration on behalf of the Rukin firm. He stated he has practiced for 15 years, exclusively in the area of employment law with extensive experience in wage and hour law. [Doc. No. 95-3 at ¶4.] He states his hourly rate in this case was $475. He was assisted by two Spanish-speaking associates Kate Hege and Carole Vigne,*fn4 who were billed at $300 an hour and two paralegals, Mark Gains and Maia Siu, who were billed at $175 an hour. [Id. at ¶8.]

Linda Gulledge provided a declaration on behalf of the Gulledge firm. She stated that she has practiced law for 12 years, exclusively in the area of employment law with extensive experience in wage and hour law. [Doc. No. 95-4 at ¶4.] She is fluent and literate in Spanish and states her hourly rate in this case was $400. Gulledge stated that her partner Woody Gulledge also practices in employment law, advising companies on wage and hour practices, and his hourly rate in this case was $400. The Gulledges were assisted by a Spanish-speaking paralegal, Maria Azuncea Garcia, who was billed at $150 an hour. [Id. at ¶¶4, 8.]

Plaintiffs cite the Court to three cases from the Southern District as evidence that the rates claimed by their counsel are in line with those prevailing in the community, for similar services and comparable skill. Those cases found lead counsel rates in the range of $400 to $425 an hour, $220 to $250 for an associate and $125 for a paralegal to be reasonable hourly rates in this community. See Kochenderfer v. Reliance Standard Life Ins. Co, 2010 WL 1912867, *4 (S.D. Cal.Apr. 21, 2010); Fleming v. Coverstone, 2009 WL 764940, *7 (S.D. Cal. Mar. 18, 2009); Cornwell v. Belton, 2008 WL 80724,*1 (S.D. Cal. Jan. 7, 2008). [Doc. No. 95-1, at 14.] Defendants correctly point out that "the fee applicant has the burden of producing satisfactory evidence, in addition to the affidavits of its counsel, that the requested rates are in line with those prevailing in the community for similar services of lawyers of reasonably comparable skill." Jordan v. Multnomah County, 815 F.2d 1258, 1263 (9th Cir. 1987). [Doc. No. 101, at 7.] Each of the cases relied upon by plaintiffs reflects an hourly rate generally less than the amount requested by the plaintiffs' counsel*fn5 and none of the cases are wage and hour cases. Plaintiffs offer no analysis of the subject matter, services and skills of the lawyers in the cited cases to demonstrate how those rates support the generally higher rates they request. Defendants offer no evidence that the rates approved in this District Court and offered by plaintiffs as evidence of reasonable rates in this community, are not appropriate in this case.

Based on the Court's knowledge of prevailing standards in the community, and without further evidence from the parties beyond the cases cited by plaintiffs in support of their application, the Court applies the following rates as reasonable in this case:

$400 an hour for partners John Hyland, Linda Gulledge and Woody Gulledge; $220 an hour for associates Kate Hege and Carole Vigne; and, $125 an hour for paralegals ...

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