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Luis Sandoval; Isreal Rodriguez; Cesar Martinez, On Behalf of v. Ab Landscaping

September 26, 2012

LUIS SANDOVAL; ISREAL RODRIGUEZ; CESAR MARTINEZ, ON BEHALF OF THEMSELVES AND ALL OTHERS SIMILARLY SITUATED, PLAINTIFFS,
v.
AB LANDSCAPING, INC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Howard R. Lloyd United States Magistrate Judge

*E-filed: September 26, 2012*

NOT FOR CITATION

ORDER GRANTING FINAL APPROVAL OF CLASS ACTION SETTLEMENT, AWARDING ATTORNEY FEES, and AUTHORIZING DISTRIBUTION AND CY PRES PAYMENT [Re: Dkt. Nos. 69, 72]

Luis Sandoval ("Sandoval"), Israel Rodriguez ("Rodriguez"), and Cesar Martinez ("Martinez") (collectively, "Named Plaintiffs" or "Class Representatives") move for Final Approval 19 of a class action settlement, an order for distribution and cy pres payment, and attorney's fees and 20 costs. (Dkts. 69, 72). 21

I.BACKGROUND

Named Plaintiffs*fn1 brought this putative class action in October 2009 and filed an amended 23 complaint in April 2010. Named Plaintiffs claim that their former employer, AB Landscaping, and 24 its owner, Victor Arellano, ("Defendants") failed to properly pay overtime wages and provide 25 adequate pay statements. Based on these allegations, they brought claims under the California Labor Code, the Federal Fair Labor Standards Act, and the California Business and Professions 2 Code. 3

4 parties moved for an order certifying the tentative settlement class, preliminarily approving the 5 proposed settlement, approving and directing the notice plan, appointing class counsel, and 6 approving settlement administrator (Dkt. 59) ("Joint Motion"). The motion included the original 7

Joint Stipulation of Settlement and Release ("Settlement Agreement"), as well as proposed notice, 8 claim, and opt-in forms (Dkt. 60-1). 9

10 hearing, the parties submitted revised notice, claim, and opt-in forms. The Court made further

revisions to the newly submitted forms and attached the proposed revisions to an Interim Order,

instructing the parties to submit comments or proposed revisions within seven days (Dkt. 64). The 13 parties submitted no comments or proposed revisions. 14

15 submitted a joint letter concerning the cy pres procedure outlined in the Settlement Agreement. The 16

Action Settlement and Settlement Hearing, a Claim Form, and an Opt-in Form to the order

approving the Joint Motion ("Notice and Claims Process Documents") (Dkts. 68-1, 68-2, 68-3). 19

In February of 2011, the parties reached a settlement agreement. In April of 2011, the

The Court held a hearing on the Joint Motion. Based on the Court's comments during the

For the Northern District of California

The Court held a further hearing on the Joint Motion. In response to this hearing, the parties

Court granted the Joint Motion in September 2011 (Dkt. 68). The Court attached a Notice of Class 17

The order granting the Joint Motion specifically approved the form and substance of the notice 20 procedures set forth in the Notice and Claims Process Documents, over any contradictory terms in 21 the Settlement Agreement. 22

23 costs (Dkt. 69). Shortly thereafter, the Named Plaintiffs moved for final approval of the class action 24 settlement and for an order for distribution and cy pres payment (Dkt. 72). The Court held a final 25 fairness hearing in February 2012. The moving parties appeared at that hearing and were heard by 26 the Court. Despite the opportunity to object, outlined in the Notice and Claims Process Documents, 27 no one did. Counsel for Class Representatives submitted a Proposed Order of Final Approval of 28

Class Action Settlement in August 2012.

After entry of an order on the Joint Motion, class counsel moved for attorney's fees and

II.DISCUSSION

A. Jurisdiction

4

This Court finds that it has jurisdiction over the claims the members of the class asserted in 5 this proceeding, personal jurisdiction over the settling parties (including all members of the 6 settlement class), and subject matter jurisdiction to approve the Settlement Agreement filed with this 7

Court. 8

B.Class Definition

The parties agreed to certification of a Settlement Class that included all employees of Defendants who were employed on an hourly basis between October 20, 2005 and April 1, 2011.

The class members are identified in Exhibit 1 to the parties' Settlement Agreement ("Settlement nited States District Court

Class" or "Class Members").

C. Terms of the Settlement Agreement

1.Relief Offered

The Notice of Class Action Settlement and Settlement Hearing gave Class Members five 16 options. First, they could make a claim. This would entitle the Class Member to unpaid wages 17 owed and a share of corresponding penalties under the California Labor Code. To exercise this

option, Class Members had to complete and mail in the Claim Form. Second, they could opt-in for 19 liquidated damages under the FLSA. This would entitle them to receive additional money in 20 settlement of their claims for liquidated damages under the FLSA. To exercise this option, Class 21

Members had to complete and mail in an Opt-In Form. So, Class Members could send in a Claim 22

Form (for the full amount of their unpaid wages and a share of penalties under the state labor code) 23 and an Opt-In Form (for a share of liquidated damages under the FLSA). Third, Class Members 24 could request to be excluded from the settlement. To do this, they had to submit a written request 25 for exclusion indicating their intent to be excluded from the settlement. Fourth, Class Members 26 could object, either personally or through an attorney. Objections needed to be signed writings, 27 filed with the court andmailed to Class Counsel. Those who objected were also invited to attend 28 the fairness hearing and present their objections. Finally, Class Members could do nothing. By

doing nothing, Class Members lost their right to bring suit for unpaid wages and the corresponding 2 penalties under the California Labor Code, but they would not lose their right to pursue liquidated 3 damages under the FLSA. 4

Under the Settlement Agreement, the Defendants pay a total of $324,068.99 to fully resolve

5 the lawsuit. A portion of this amount ($172,482.86) was already distributed to 34 Class Members 6 for payment of their unpaid wages ("Distributed Funds"). The remaining amount ($151,586.13) 7 will be distributed as follows: 8

Members who timely submitted the Opt-In Form to settle their claims for liquidated damages under 19 the FLSA; and 20% of the remaining amount will be distributed to all Class Members who timely 20 submitted a Claim Form for penalties under the California Labor Code. 21

The Settlement Agreement resolves the Class Members' claims for unpaid wages (including

23 overtime) and penalties under the California Labor Code, that were alleged or that reasonably arise 24 out of the facts alleged in the First Amended Complaint (Dkt. 11). Only those Class Members who 25 signed and returned the Opt-In Form released claims for liquidated damages under the FLSA. The 26

Settlement Agreement does not release any claims a Class Member may have to vested benefits 27 pursuant to any AB Landscaping Inc. employee benefit plan or under the California workers 28 compensation laws.

* First, $22,744.78 will be set aside to pay Class Members who did not receive Distributed Funds for unpaid wages. The amount of unpaid wages owed to these Class Members was

calculated based on an audit of payroll and time records. The amount of unpaid wages

owed to each individual Class Member was set forth in their Claim Form;

* Second, Class Representatives Luis Sandoval, Israel Rodriguez and Cesar Martinez will be paid $10,000, $10,000, and $5,000, respectively, for their services as the Class

Representatives.

* Third, Defendants will pay their statutorily-required matching contributions on the wage

portion of the settlement amount;

* Fourth, attorney's fees not to exceed $80,000 and costs not to exceed $10,000 will be

paid to Plaintiffs' counsel Adam Wang.

After paying the above amounts, 80% of the remaining amount will be distributed to Class

2.Scope of Release

$10,000, $10,000, and $5,000, respectively, for their services as the Class Representatives. In light 4 of this payment, they will not receive money in settlement of their claims for penalties under the 5

California Labor Code.6

Because not all Class Members submitted a Claim Form, the wages owed to those Class

Members ("Cy Pres Funds") will be paid to the Pro Bono Project Silicon Valley at 480 N. First 9

Association as the Cy Pres recipient, at the Final Fairness hearing, and as set forth in the Proposed

Order of Final Approval of Class Action Settlement, the parties agreed that Cy Pres Funds will be

paid to the Pro Bono Project Silicon Valley (see Proposed Order of Final Approval of Class Action 13

3.Payment to the Class Representative

As described above, Class Representatives Sandoval, Rodriguez and Martinez will be paid

4.Distribution and Cy PresPayment

Street, San Jose, CA, 95112. Although the Settlement Agreement lists the California Bar 10

Settlement, Dkt. 75, ¶ 10). Accordingly, despite the designation in the Settlement Agreement, 14 the Pro Bono Project Silicon Valley is the Cy Pres recipient . 15

The Settlement Agreement provided for a maximum award of $80,000 in attorney's fees and

$10,000 in costs. Class Counsel's motion for fees and costs is discussed below in section II.F.

For the Northern District of California

5.Attorney's Fees

Administrator for purposes of issuing Claim Forms, independently reviewing the Claim Forms and 21 documentation associated with the computation of Class Members' pro rata shares of the Settlement 22

W-2s and 1099 forms. 24

This Court preliminarily approved the notice procedure set forth in the Notice and Claims

Process Documents, which were attached to the Court's order approving the ...


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