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Medalia Rodriguez and Juan Alcala, On v. Western Mesquite Mines

April 6, 2012


The opinion of the court was delivered by: Hon. Michael M. ANELLOUnited States District Judge


Plaintiffs Medalia Rodriguez and Juan Alcala filed this class action against their former employers, Defendants Western Mesquite Mines, Inc. and New Gold, Inc., alleging various violations of California's Labor Code. Plaintiffs represent a class including current and former non-exempt hourly employees of Defendants. On September 30, 2011, the parties filed a joint motion for preliminary approval of a settlement of this action, which the Court granted on November 15, 2011. See Doc. Nos. 23, 25. On April 2, 2012, the Court entered final approval of the settlement and granted Plaintiffs' unopposed motion for attorneys fees and costs. See Doc. Nos. 34, 35. The sole issue remaining before the Court for resolution is whether Plaintiffs should receive a class representative enhancement award of $5000 each.


Plaintiffs request an enhancement award in the amount of $5000 each, as commemorated in the Stipulation of Settlement and Release signed by all parties on September 30, 2011. See Doc. No. 23-2. Defendants agreed to this award, and did not oppose Plaintiffs' motion for approval of the award. See Doc. No. 27.

After assessing the reasonableness of the proposed enhancement award under the factors set forth in Van Vranken v. Atlantic Richfield Co., 901 F. Supp. 294 (N.D. Cal. 1995), the Court tentatively ruled that Plaintiffs are deserving of the award based on its finding that they were actively involved in the preparation and prosecution of this litigation.*fn1 For example, they participated in the discovery process by providing information and documents to their counsel, met with counsel to review documents and discuss the status of the litigation, participated in the private mediation of this action; provided deposition testimony, and prepared declarations. Both Plaintiffs appear to have taken the responsibility of being class representatives seriously, and each diligently pursued his/her claims against Defendants on behalf of themselves and all other persons similarly situated. No class member opposed the enhancement award, and the award is modest.

During the March 19, 2012 hearing on final approval of the proposed settlement, Defendants asked the Court to reconsider its tentative ruling regarding the propriety of a $5000 enhancement award for each Plaintiff. According to Defendants, Plaintiffs have refused to release all claims against Defendants arising out of their previous employment, and instead both have brought separate actions against Defendants on employment claims arising out of their terminations that pre-date this litigation and the parties' related settlement agreements. As a result, Defendants request that the Court order Plaintiffs to comply with the terms of the settlement requiring that Plaintiffs release Defendants from those claims and take the necessary actions to dismiss the other lawsuits.

Alternatively, Defendants urge the Court to reduce Plaintiffs' enhancement award by an appropriate amount.

Pursuant to paragraph 17 of the final approval order, "the Court retains jurisdiction of all matters relating to the interpretation, administration, implementation, effectuation, and enforcement of this order and the Settlement." See Doc. No. 35; see also Callie v. Near, 829 F.2d 888, 890 (9th Cir. 1987) ("It is well settled that a district court has the equitable power to enforce summarily an agreement to settle a case pending before it."). To be enforceable, a settlement must meet two requirements. First, it must be a complete agreement. Callie, 829 F.2d at 890-91. Second, both parties must have either agreed to the terms of the settlement or authorized their respective counsel to settle the dispute. Harrop v. Western Airlines, Inc., 550 F.2d 1143, 1144-45 (9th Cir. 1977). The settlement agreement in this case meets both requirements. Upon breach of a settlement agreement, the Court may award damages or compel specific performance, as appropriate. TNT Marketing, Inc. v. Agresti, 796 F.2d 276, 278 (9th Cir. 1986), citing Village of Kaktovik v. Watt, 689 F.2d 222, 230, 223 U.S. App. D.C. 39 (D.C. Cir. 1982).

The September 30, 2011 Stipulation of Settlement and Release speaks for itself, and provides in pertinent part:

As a condition of receipt of the service payment [i.e., enhancement award], each of the Plaintiffs shall execute a general release of all known and unknown claims she/he may have against Defendant and its parents, subsidiaries and affiliated corporations, and the predecessors and successors and all current and former directors, officers and employees of all such entities, based on her/his employment with the Defendant.

See Stipulation ¶ 11(f). These terms are not unusual. Enhancement awards often are premised in part on class representatives agreeing to a general release of their claims against the defendant. See, e.g., Sandoval v. Tharaldson Emple. Mgmt., 2010 U.S. Dist. LEXIS 69799, at 23-24 (C.D. Cal. June 15, 2010) (approving enhancement award for class representative where "the full general release of her claims . . . is 'much broader' than the Class Members' 'Released Claims' in the Settlement"); Ortiz v. Home Depot U.S.A., Inc., 2012 U.S. Dist. LEXIS 13009, 3-4 (N.D. Cal. Feb. 2, 2012) (approving enhancement award for class representatives who agreed to release all their claims against Home Depot in a broader release than the release for the class); Brooks v. Williams Tank Lines, 2011 U.S. Dist. LEXIS 51982, 26 (N.D. Cal. May 13, 2011) (preliminarily approving enhancement award for class representative where he "signed a broader release than the one applicable to all other class members."). By refusing to execute a "general release of all known and unknown claims" against Defendants "based on her/his employment with the Defendant," and actively pursuing such claims against Defendants via separate litigation, Plaintiffs have failed to perform a "condition of receipt" of the enhancement award.

Plaintiffs assert that the enhancement award "is not conditioned upon the Class Representatives signing separate releases."*fn2 See Pl's Supp. Brief, 2. Yet the terms stated above in paragraph 11(f) of the Stipulation are plain, clear, and unambiguous. Furthermore, the Stipulation makes clear that the amount of the enhancement award would be set at the Court's discretion -- not the actual receipt of the award. See Stipulation ¶ 11(f). The parties chose to contract the terms upon which receipt of the award would be based. Thus, Plaintiffs' contention that "the decision as to whether, or not, to award incentive fees to the Class Representatives the fees lies entirely within the discretion of this court" is without merit. See Pl's Supp. Brief, at 2.


Based on the foregoing, the Court concludes that a $5000 enhancement award for Plaintiffs is reasonable in this case. However, Plaintiffs agreed to be bound by the terms of the September 30, 2011 Stipulation of Settlement and Release, which has now been approved and finalized by the Court. Accordingly, Plaintiffs shall be entitled to receipt of a $5000 enhancement award upon the execution ...

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