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Connolly v. Weight Watchers North America Inc.

United States District Court, N.D. California

July 21, 2014

JERI CONNOLLY, et al., Plaintiffs,
v.
WEIGHT WATCHERS NORTH AMERICA INC., Defendant.

ORDER CERTIFYING SETTLEMENT CLASS AND PRELIMINARILY APPROVING CLASS ACTION SETTLEMENT

THELTON E. HENDERSON, District Judge.

This matter was scheduled to come before the Court on July 28, 2014, on Plaintiffs' unopposed motion to certify a settlement class and to preliminarily approve a class action settlement. Having considered the proposed settlement and the moving papers submitted, the Court determines that this matter is appropriate for resolution without oral argument pursuant to Civil Local Rule 7-1(b), and hereby VACATES the scheduled hearing and GRANTS Plaintiffs' motion for the reasons set forth below.[1]

BACKGROUND

1. This class action lawsuit alleges that Weight Watchers North America, Inc. ("Weight Watchers") violated California's wage and hour laws. The case asserts claims nearly identical to those asserted by a similarly-situated class of individuals in Sabatino v. Weight Watchers North America, Inc., Case No. CV 09-4926-TEH (N.D. Cal. 2009), represented by Rudy, Exelrod, Zieff & Lowe, LLP, who are also the attorneys in this follow-up action. The Sabatino complaint alleged, among other things, that Defendant failed to pay its meeting "Leader" and "Receptionist" employees at least the minimum wage for all hours worked, failed to pay them premium overtime wages for all overtime hours worked, failed to pay them the required minimum wage for working "split shifts, " failed to reimburse them for all expenses incurred in the course of their employment, failed to provide them with itemized pay statements showing their total hours worked and the rates or formulae used for calculating their meeting pay, failed to pay employees at least the minimum wage and/or the contract wage for all hours they spent performing hourly-paid "location coordinator" work, failed to keep required payroll and work records, willfully failed to pay all wages due but unpaid at the time of separation from employment, and engaged in "unfair competition" within the meaning of California law by failing to pay required wages and expense reimbursements. The complaint asserted claims under the California Labor Code and the California Business and Professions Code, and sought recovery of, among other things, unpaid wages, penalties, and reasonable attorney's fees and costs.

2. The Sabatino case was resolved pursuant to court-approved settlement on May 23, 2011. That settlement covered wage and hour claims arising during the time period from September 17, 2005 to January 8, 2011.

3. On April 29, 2014, Plaintiffs Jeri Connolly and Rhonda Arneson filed the Complaint in this Litigation (as hereinafter defined) as a putative class action. The Complaint alleges, among other things, that for the time period of January 9, 2011 through December 9, 2012 (a period during which Plaintiffs allege the policies and practices challenged in the Sabatino case remained in place), Defendant Weight Watchers North America, Inc. continued to fail to pay its meeting "Leader" and "Receptionist" employees at least the minimum wage and contract wage for all hours worked, failed to pay Leaders and Receptionists premium overtime wages for all overtime hours worked, failed to pay Leaders and Receptionists the required minimum wage for working "split shifts, " failed to reimburse Leaders and Receptionists for all expenses incurred in the course of their employment, failed to provide Leaders and Receptionists with itemized pay statements showing their total hours worked and the rates or formulae used for calculating their meeting pay, failed to pay employees at least the minimum wage and/or the contract wage for all hours they spent performing location coordinator work (as hereinafter defined), failed to keep required payroll and work records, willfully failed to pay all wages due but unpaid at the time of separation from employment, and engaged in "unfair competition" within the meaning of California law by failing to pay required wages and expense reimbursements.

4. Prior to and after the Complaint was filed, the Parties participated in extensive settlement negotiations. Those negotiations led to an agreement to settle the case and execution of a memorandum of understanding. The negotiations were conducted after the parties had reviewed many records and documents from the Sabatino case and had exchanged information, including information relating to the dates of changes to the pay practices challenged here and payroll data maintained by Weight Watchers for Leaders and Receptionists who worked for Weight Watchers in California during the period from January 9, 2011 (immediately following the conclusion of the class period in Sabatino ) and December 9, 2012 (the date that Weight Watchers changed the pay practices challenged by Plaintiffs in this case and by the Sabatino plaintiffs in the Sabatino case.)

5. The Parties negotiated and executed a Joint Stipulation of Settlement and Release, filed with the Court on June 11, 2014. A true and correct copy of the fully-executed Joint Stipulation of Settlement and Release ("Joint Stipulation, " "Settlement") is attached as Exhibit 1 to the Declaration of Steven G. Zieff ("Zieff Declaration")(Docket No. 13-1). The Joint Stipulation provides for the full settlement and release of all class and representative claims encompassed by the Complaint and otherwise sets forth the terms of the proposed settlement which is before the Court for preliminary approval. Weight Watchers continues to deny all allegations contained in the Complaint, and Weight Watchers does not admit or concede that it has, in any manner, violated the California Labor Code, the California Unfair Competition Law, or any other law. Weight Watchers also denies that this case is appropriate for class action treatment other than for purposes of settlement.

CERTIFICATION OF SETTLEMENT CLASS

6. Based on the findings and conclusions set forth below in Subparagraphs (a)-(e), the Court determines that this case meets the requirement for certification of a class under Rule 23(a) and 23(b)(3) of the Federal Rules of Civil Procedure for purposes of settlement, and hereby orders that this case is certified as a class action, for purposes of settlement only, on behalf of the following class: "All persons who worked for Weight Watchers North America, Inc. as Leaders, ' Receptionists, ' or employees performing location coordinator work' (pay codes 40 and 41) in California at any time during the period from January 9, 2011 through December 9, 2012, according to Weight Watchers' payroll records" ("Class" or "Class Members"). The findings and conclusions that follow are based on the Court's consideration of: the allegations, information, arguments, and authorities cited in the Motion and supporting memorandum and declaration; the allegations, information, arguments, and authorities provided in connection with the complaint filed in this case; Defendant's agreement, for settlement purposes only, not to oppose certification of the settlement class specified in the Joint Stipulation; the terms of the Settlement; and the elimination of the need, on account of the Settlement, for the Court to consider any potential trial manageability issues that might otherwise bear on the propriety of class certification.

(a) Numerosity. The Court finds that the Class is so numerous that joinder of all members is impracticable because there are more than 3, 000 class members. Class Members' identities can be ascertained from Defendant's records.

(b) Common Questions of Law or Fact. The Court finds that, for purposes of this settlement only, there are questions of law or fact common to the Class, including but not limited to: whether Defendant has violated Labor Code § 1197 and IWC Wage Order No. 2 and applicable Labor Code provisions by failing to pay Leaders and Receptionists the required minimum wage and contract wage for all hours worked, including an hour's pay at the minimum wage rate for working split shifts; whether Defendant has violated Labor Code § 510 by failing to pay overtime compensation to Leaders and Receptionists when they worked overtime; whether Defendant has violated Labor Code § 226 by failing to provide Leaders and Receptionists with itemized wage statements showing, among other things, all their daily and weekly hours worked, all applicable rates and formulae of pay, and an itemization of their pay under the different applicable rates and formulae; whether Defendant has violated Labor Code § 2802 by failing to indemnify Leaders and Receptionists for their business expenditures; whether Defendant has willfully failed to pay due but unpaid minimum wages and overtime wages to Leaders and Receptionists upon their separation from employment (or within 72 hours of their separation, if they quit without giving 72 hours' notice); whether Defendant has violated Business and Professions Code § 17200 by failing to pay Leaders and Receptionists minimum wages and overtime wages, and by failing to indemnify Leaders and Receptionists for their business expenditures; whether Defendant has failed to keep complete and accurate records of Leaders' and Receptionists' hours of work as required by California Labor Code § 1174 and IWC Wage Order No. 4; whether Defendant's acts and omissions giving rise to the action for failure to pay minimum wages have been in good faith, and whether Defendant has had reasonable grounds for believing their acts and omissions were not violations of the Labor Code, for purposes of determining Leaders and Receptionists' entitlement to liquidated damages under Labor Code § 1194.1; and the proper measure of damages for Defendant's alleged violations.

(c) Typicality of the Representative Plaintiffs' Claims. The Court finds that, for purposes of this settlement only, the claims of Plaintiffs Jeri Connolly and Rhonda Arneson ("Representative Plaintiffs") are typical of the claims of the Class, in that their claims arise from the same alleged events and course of conduct as the claims of the Class, and are based on the same legal theories.

(d) Fair and Adequate Representation of the Class's Interests. The Court finds that, for purposes of this settlement only, the Representative Plaintiffs will fairly and adequately represent the Class's interests, in that the Representative Plaintiffs for purposes of this settlement have the same interests as all members of the Class, have diligently and zealously prosecuted this action to date, and are represented by experienced and competent attorneys who have the resources necessary to represent the Class. The Court hereby ...


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