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Mira v. Heartland Employment Service

United States District Court, N.D. California, San Jose Division

March 13, 2014

ELSY GARCIA DE MIRA, individually, and on behalf of all others similarly situated, Plaintiff,
v.
HEARTLAND EMPLOYMENT SERVICE, LLC.; and DOES 1 through 10, inclusive, Defendants.

ORDER GRANTING MOTION FOR AWARD OF ATTORNEYS' FEES AND REIMBURSEMENT OF COSTS

LUCY H. KOH, District Judge

The Motion of Class Counsel for an award of attorneys' fees in the sum of $436, 050 and for costs in the sum of $18, 000 came on regularly for hearing before this Court on February 27, 2014. ECF NO. 66 ("Motion"). Defendant does not oppose the Motion. Having considered the parties' submissions, including the supplemental declaration and exhibits filed after the February 27, 2014 hearing, the relevant case law, the parties' arguments, and the record in this case, the Court GRANTS Class Counsel attorneys' fees in the sum of $406, 980 and costs in the sum of $18, 000.

I. ATTORNEYS' FEES

The efforts of Class Counsel have created a common fund for the benefit of the Settlement Class in the amount of $1, 453, 500. This is a non-reversionary settlement and, as such, no funds will be returned to the Defendant. Class Counsel seeks an upward adjustment of the Ninth Circuit "benchmark" of 25% of the common fund to 30% of that fund. It should be noted that Class Counsel reduced their requests from the $483, 333 (or 33.3%) originally sought at preliminary approval. ECF Nos. 45 and 59.

A. Legal Standard for Granting Attorney's Fees

The Ninth Circuit has stated that, in common fund cases like the instant case, a court may award attorneys' fees as a percentage of the common fund. Paul, Johnson, Alston & Hunt v. Graulty ("Paul"), 886 F.2d 268, 271 (9th Cir. 1989). The Ninth Circuit has endorsed a benchmark of 25% for attorney's fees awards. Id. at 272. That percentage amount can then be adjusted upward or downward depending on the circumstances of the case. Id. Indeed, "in most common fund cases, the award exceeds th[e] benchmark." In re Omnivision Technologies, Inc., 559 F.Supp.2d 1036, 1047 (N.D. Cal. 2008). Percentage awards of between 20% and 30% are common. See In re Activision Sec. Litig., 723 F.Supp. 1373, 1377 (N.D. Cal 1989) ("This court's review of recent reported cases discloses that nearly all common fund awards range around 30% even after thorough application of either the lodestar or twelve-factor method."); Vizcaino v. Microsoft Corp. (" Vizcaino II "), 290 F.3d 1043, 1047 (9th Cir. 2002) ("The district court based its percentage award on Bowles, which states that [i]n common fund cases, the benchmark' award is 25 percent of the recovery obtained, ' with 20-30% as the usual range... [The] Ninth Circuit cases echo this approach." ( quoting Bowles v. Washington Dept. of Ret. Sys., 121 Wash.2d 52, 72-73 (1993) and citing Paul, 886 F.2d at 271)).

Whether the Court awards the benchmark amount or some other rate, the award must be supported "by findings that take into account all of the circumstances of the case." Vizcaino II, 290 F.3d at 1048. The Ninth Circuit has approved a number of factors which may be relevant to the district court's determination: (1) the results achieved; (2) the risk of litigation; (3) the skill required and the quality of work; (4) the contingent nature of the fee and the financial burden carried by the plaintiffs; and (5) awards made in similar cases. See id. at 1048-1050. In addition, district courts may also compare the proposed percentage award to the attorney's fee award that would be granted were the district court to use the lodestar method to determine fees. Id. at 1050.

B. Analysis

Class Counsel seeks an upward adjustment of the Ninth Circuit benchmark of 25% of the common fund to 30% of that fund. As set forth below, the Court believes that, particularly in light of the significant risks of the litigation, the factors set forth in Vizcaino II weigh in favor of granting Class Counsel an upward adjustment of the Ninth Circuit benchmark. However, the Court believes that a percentage award of 28% of the common fund is appropriate, rather than the 30% requested by Class Counsel.

1. The Results Achieved

The Court notes that Class Counsel has achieved monetary and non-monetary results in this case. Class Counsel has achieved a settlement in the amount of $1, 453, 500. That fund was made available to 4, 144 class members, with 1, 193 members submitting claim forms and participating. The fund is also non-reversionary, thus the entire Net Settlement Fund (after deductions for attorneys' fees, costs, incentive awards, LWDA, and administrative costs) will be fully paid to 1, 193 class members with an average recovery for each participating class members of approximately $776.15. Class Counsel represents that the average recovery for the 1, 193 class members is approximately 72% of the estimated actual damages recovery. See Connor Decl. ΒΆ 40, ECF No. 68-1. Significantly, there were no objections to the final settlement or Class Counsel's request for attorney's fees. There were also only 4 opt-outs. Finally, Defendant has ceased and no longer utilizes the Kronos rounding feature and now uses actual tracking of employee time for payment purposes as it pertains to hourly non-exempt employees in California. Accordingly, these results achieved on behalf of the class by Class Counsel weigh in favor of granting Class Counsel's request for a fee award of 28%.

2. The Risks Of Litigation

There were significant risks of litigation here. As an initial matter, Defendant was represented by an experienced and well-resourced defense firm. Had Class Counsel failed to vigorously prosecute this case, it is unlikely that this settlement could have been achieved. Absent the settlement, Plaintiff would face challenging hurdles both factually and legally. Defendant's rounding policy is neutral on its face, thus, Plaintiff must factually demonstrate that application of the Kronos rounding systematically undercompensates employees. See Alonzo v. Maximus, Inc., 832 F.Supp.2d 1122, 1126 (C.D. Cal. 2011). Plaintiff's analysis of data suggests that the Kronos rounding disadvantaged employees in terms of comparing underpaid-to-overpaid hours by a ratio of about 5:1. However, some courts consider the impact on individual employees, as opposed to total hours, and have found that both a gain and loss of minutes results in a neutral application. See, e.g., Waine-Golston v. Time Warner Entertainment-Advance/New House Partnership, No. 11cv1-57-GPB(RBB), 2013 WL 1285535, at *9 (S.D. Cal. March 27, 2013). In fact, Class Counsel is cognizant of the uncertainty and associated risks in this area of the law as they are counsel in the matter of Gillings v. Time Warner Cable, LLC (Case No. 12-55766), currently pending before the Ninth Circuit. In Gillings, Class Counsel appealed the U.S. District Court for the Central District of California's grant of summary judgment in favor of an employer after finding that the clock-in, rounding, and commission policies at issue were neutral and ...


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