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Tyrus Colllins and James Greer, On Oww Mjs Behalf of Themselves and Others Similarly Situated v. Cargill Meat Solutions Corporation

June 28, 2011


The opinion of the court was delivered by: Oliver W. Wanger United States District Judge



This is a wage-and-hour class action brought on behalf of 16 meat workers employed by Cargill Meat Solutions Corp., in Fresno County, California. Declaration of Anthony J. Orshansky 19 ("Orshansky Decl."), Doc. 48 ¶ 5; see also Second Amended Class 20 Action Complaint ("SAC"), Doc. 32, filed Dec. 17, 2010. The 21 action is brought on behalf of Plaintiffs and approximately 239 22 current and former employees of Defendants' from August 1, 2008 23 to March 7, 2011 for alleged violations of state wage-and-hour 24 laws. Orshansky Decl. at ¶ 16. 25 26 The parties have entered into a Joint Stipulation of 27 Settlement Agreement. Orshansky Decl. at ¶ 11. A March 7, 2011 28 memorandum decision:

(1) conditionally certified a Settlement Class; (2) appointed Class Counsel; (3) appointed Class Representatives; (4) appointed a Settlement Administrator; (5) preliminarily approved the Class Settlement; (6) approved the class Notice and related materials for distribution; (7) directed the mailing, by first-class mail, of the Notice Packet by March 25, 2011; and (8) scheduled a final approval hearing for June 27, 2011. Doc. 41. Plaintiffs have filed a motion for final approval of the settlement, Doc. 44, along with supporting 10 declarations, Docs. 48-48-1. Plaintiffs have also moved for 11 approval of their request for attorneys' fees and costs, Doc. 45, 12 and filed a supporting declaration, Doc. 48. No objections to 13 approval have been received. See Declaration of Amanda J. Myette 14 15 ("Myette Decl."), Doc. 48-1 ¶ 15.


Plaintiffs allege Defendants failed to reimburse Employees 18 for expenses they necessarily incurred in the performance of 19 their job duties; failed to provide legally required rest 20 21 periods; failed to pay premium pay for each day on which 22 requisite rest periods were not provided or were deficiently 23 provided; failed to pay out wages twice per calendar month; 24 failed to provide accurate itemized wage statements; and 25 willfully failed to pay all wages due upon termination or 26 separation of employment. Plaintiffs sought to certify a class 27 composed of themselves and similarly situated individuals, and 28 sought declaratory relief and recovery of unreimbursed business expenditures, back wages, interest, penalties, attorneys' fees, and costs. See SAC.

Both prior and subsequent to the complaint being filed, Plaintiffs conducted substantial discovery and non-discovery investigation regarding class certification and the merits of their claims. Oshansky Decl. ¶ 7. After suit was filed, Plaintiffs propounded written discovery requesting documents and 10 information relating to Defendant's employment policies and 11 practices; pay and time records; Class Members' wages, paychecks, 12 wage statements, and termination wages; Defendant's policies and 13 practices relating to reimbursement for work-related expenses; 14 15 Defendant's policies and practices relating to safety equipment 16 and devices required; and other matters relating to certification 17 issues. Id. at ¶ 9. Prior to mediation, Class Counsel also 18 devoted substantial time and resources to meeting and conferring 19 with opposing counsel regarding discovery; negotiating a 20 protective order; reviewing the documentation provided by 21 Defendant; doing follow-up research on relevant legal and 22 23 procedural questions; preparing damage models; and developing 24 settlement and negotiation strategies. Id. at ¶ 10.


The case was resolved with the aid of a mediator, Michael 27 Loeb, Esq. The Settlement covers approximately 239 current and 28 former meat workers employed by Defendant in California ("Class Members") from August 1, 2008 to March 7, 2011 ("Covered Period"). Settlement Agreement ("Settlement"), Doc. 38-1, § 9(c); see also Oshansky Decl. ¶ 16.

A.Settlement Payment.

Under the Settlement, Defendant will make payments totaling approximately $260,000.00, which will be paid out within 15 business days following the final approval of the settlement. 10 See Settlement §§ 9, 11. This sum will cover: settlement awards to be paid to Class Members who timely submit valid claims (paid out of the Net Settlement Fund of $150,000.00); 15 a $2,000 payment to the California Labor and Workforce 16 Development Agency for the amount in penalties due to it under Labor Code § 2699, et seq. the Settlement Administrator's reasonable fees and expenses (no more than $10,000); 21 (subject to court approval) payments to Plaintiffs, in 22 addition to their Settlement Awards, of $4,000 each in 23 compensation of their services as Class Representatives; 24 (also subject to court approval) payments to Class Counsel 25 26 of $82,500, for their reasonable attorneys' fees, as well as 27 actual litigation costs, up to $7,500.

See Settlement, §§ 9, 11. There will be no reversion of the Net Settlement Fund to Defendant. Id. at § 9(a).

B.Payment of Settlement Awards.

The Net Settlement Fund ("NSF") of $150,000 will be completely separate from any other payments the Defendant makes. Oshansky Decl. ¶ 12. It will be distributed to all Class Members who timely submit valid claims ("Qualified Claimants"), based upon the following allocation formula: 10 Each Qualified Claimant shall receive a payment based on the 11 number of weeks that he or she worked during the Covered 12 Period, which shall be from August 1, 2008 through preliminary approval. Each Qualified Claimant will be 13 entitled to a provisional share of the settlement calculated by (1) taking the Qualified Claimant's number of workweeks, 14 (2) dividing that number by the total number of workweeks of all Qualified Claimants, and (3) multiplying the resulting 15 number by the NSF. For purposes of this calculation, the 16 number of employee's "Workweeks" shall be calculated by (1) subtracting the employee's first workday during the Covered 17 Period from his or her last workday of the Covered Period, (2) dividing that number of days by 7, and then (3) rounding 18 to the nearest integer. 19 Settlement, § 9(c). A Claim Form, which was mailed to Class 20 Members with the "Notice of Pendency of Class Action, Proposed 21 Settlement, Your Rights, and Options for you to Consider" 22 ("Notice"), included for each Class Member the number of weeks 23 worked during the Class Period and the Class Member's estimated 24 25 Settlement Amount.

See Claim Form, Doc. 38-3.

For tax purposes, one-quarter (1/4) of each settlement 27 amount awarded will be deemed wages, one-half (1/2) will be 28 characterized as expense reimbursement, and one-quarter (1/4) will be treated as penalties and interest. Settlement Awards will be subject to applicable tax withholding and reporting. Settlement, § 9(e).

The formula relies upon objective evidence of the number of weeks worked during the Class Period, provided by the Defendant. Settlement, § 17. Class Members could also review and confirm this information, and the Claim Form permitted Class Members to challenge the number of weeks worked. See Claim Form, § 2(B). 10 11 C. Distribution of Unclaimed Funds and Uncashed Checks. 12 The Settlement is structured so as to distribute the 13 entirety of the NSF, regardless of whether or not every member of 14 the class files a valid claim form. There will be no unclaimed 15 funds. See Settlement, § 9(c). Checks that remain uncashed 16 after one hundred and eighty (180) calendar days shall revert to 17 the California Uncashed Check Fund in the name of the Qualified 18 Claimant. Settlement, § 18. 19 20 D.Scope of the Release. 21 The Settlement provides that all Class Members, other than 22 those who elect not to participate in the Settlement, shall have 23 released the "Released Parties" from the "Covered Claims." The 24 Notice contains the following release: 25 26 Upon the final approval by the Court of the settlement, each

Class member who does not opt out of the settlement, shall, 27 for the period of time extending from August 1, 2008 to [preliminary approval], fully release and forever discharge 28 Defendant and its respective present and former officers, directors, employees, shareholders, agents, trustees, representatives, attorneys, insures, parent companies, subsidiaries, divisions, affiliates, predecessors, successors, assigns, and any individual or entity that could be jointly liable with Defendant (the foregoing are collectively referred to hereafter as the "Releasees") from any and all acclaims, causes of action, damages, wages, benefits, expenses, penalties, debts, liabilities, demands, obligations, attorney's fees, costs, and any other form of relief or remedy at law or in equity, of whatever kind or nature, asserted by the Covered Claims based on the facts alleged in the Second Amended Complaint ("Complaint") filed in the Lawsuit.

"Covered Claims" means any and all claims, demands, rights liabilities, and/or causes of actions arising out of the facts alleged in the Complaint for: (1) violation of 10 Labor Code § 2802(a); (2) rest-period violations, Labor Code 11 § 226.7; (3) violation of Labor Code § 204; (4) violation of Labor code § 226(a); (5) penalties pursuant to Labor Code § 12 203; (6) penalties under California Labor Code §2609 et seq.; (7) any penalties that could have been brought based 13 on the violations alleged in the Complaint, and (8) violation of Business & Professions Code §17200, et seq. 14 based on the foregoing alleged violations. 15 Claim Form, § 4. Furthermore: 16 Representative Plaintiffs additionally expressly waive any 17 and all rights they have under Section 1542 of the Civil

Code of the State of California, which provides: 18 19 "A general release does not extend to claims which the creditor does not know or suspect to exist in his or 20 her favor at the time of executing the release, which if known by him or her must have materially affected 21 his or her settlement with the debtor." 22 Notwithstanding the provision of Section 1542, and for the 23 purpose of implementing a complete release and discharge, Representative Plaintiffs expressly acknowledge the this 24 Settlement Agreement is intended to include in its effect, without limitation, claims and causes of action which they 25 do not know of or suspect to exist in their favor at the time of execution hereof and that his agreement contemplates 26 the extinguishment of all such claims and causes of action.

Settlement, § 10(c). The § 1542 release does not extend to non-representative class members.

E.Objections and Opt-Out Process.

Any Class Member who so wishes may object or elect not to participate in the Settlement. Settlement, §§ 19, 20. The Notice fully explains the objection and opt-out procedures. See Notice, § VI; see also "Exclusion Form", Doc 38-4.

10 F.Class Representative Payments; Class Counsel Attorneys' Fees

Payment and Class Counsel Litigation Expenses Payment. 11 The settlement also permits Plaintiffs and their counsel ...

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