United States District Court, N.D. California
ORDER GRANTING MOTION FOR FINAL APPROVAL OF CLASS ACTION SETTLEMENT; GRANTING IN PART MOTION FOR INCENTIVE AWARD; GRANTING IN PART MOTION FOR ATTORNEYS' FEES AND COSTS [DOCKET NOS. 91, 92, 93]
DONNA M. RYU, Magistrate Judge.
Plaintiff Cesar Cruz moves for final approval of a class action settlement, an incentive award for the named Plaintiff, and attorneys' fees. [Docket Nos. 91, 92, 93.] Defendant Sky Chefs, Inc. does not oppose the motion. The court conducted a Final Approval Hearing on this matter on December 18, 2014. For the reasons stated below, Plaintiff's motion for final approval of the class action settlement is granted, and Plaintiff's motions for an incentive award and for attorneys' fees are granted in part and denied in part.
A. Litigation History
Sky Chefs, a business which provides in-flight food and beverage catering services to numerous airline carriers within the United States, hired Plaintiff Cesar Cruz ("Plaintiff") in July 1996 as an assembler. Murray Decl. [Docket No. 38-1] at ¶¶ 2, 6. Plaintiff filed this putative class action on March 16, 2012 in Alameda County Superior Court. [ See Docket No. 1 at 2.] On May 23, 2012, Plaintiff filed an amended complaint stating nine California state law causes of action against Defendant and LSG Lufthansa Service Holding AG, dba LSG Sky Chefs. On May 25, 2012, Sky Chefs removed the case to federal court, basing federal jurisdiction on the Class Action Fairness Act, 28 U.S.C. § 1332(d). Notice of Removal [Docket No. 1]. On October 5, 2012, Defendant moved to dismiss the amended complaint; the court denied the motion to dismiss on December 21, 2012. [Docket Nos. 20, 30.] On January 16, 2013, Plaintiff filed a second amended complaint. On February 21, 2013, Defendant moved to dismiss the second amended complaint; the court denied the motion to dismiss on May 6, 2013. [Docket Nos. 38, 50.]
Plaintiff filed a third amended complaint ("TAC"). [Docket No. 72.] The TAC, which is the operative complaint, brings ten causes of action against Defendant: (1) failure to pay wages for compensable work at minimum wage pursuant to California Labor Code §§ 1194 and 1197, (2) failure to pay earned wages for compensable time in violation of California Labor Code § 204, (3) failure to pay overtime wages at the proper rate under California Labor Code §§ 510 and 1194 and California Industrial Welfare Commission Wage Order 9-2001 (the "wage order"), (4) failure to provide required meal periods pursuant to California Labor Code §§ 226.7 and 512 and the wage order, (5) failure to provide timely meal periods in violation of California Labor Code §§ 226.7 and 512 and the wage order, (6) failure to provide more than two rest periods in violation of California Labor Code §§ 226.7 and 512 and the wage order, (7) failure to provide complete and accurate wage statements in violation of California Labor Code § 226, (8) failure to pay all wages timely upon separation of employment in accordance with California Labor Code §§ 201 and 202, (9) unfair competition in violation of California Business and Professions Code § 17200, and (10) a request for civil penalties under the Labor Code Private Attorneys General Act of 2004 ("PAGA"), California Labor Code § 2698 et seq . TAC at ¶¶ 37-112. The fifth and sixth claims were not in the previous complaint and apparently were added during the settlement negotiations.
B. Discovery and Mediation
The parties have engaged in formal and informal discovery. Lavi Decl. [Docket No. 91-1] ¶¶ 6-7. Plaintiff propounded written discovery. Id. at ¶ 7. In response, Defendant produced information regarding class data, including putative Class Members' payroll records, timesheets, and other payroll information. Id. Defendant also disclosed policies and procedures related to meal and rest breaks, work time, recording time, and other workplace policies applicable to Plaintiff's class claims. Id. Plaintiff's counsel interviewed Plaintiff, reviewed documents, and reviewed and analyzed the provided policies, procedures, and data. Id. at ¶ 8. The parties also agreed to conduct informal discovery wherein Defendant provided Plaintiff with a random sampling of class members' timecards during the class period. Lavi Decl. Second Prelim. Approval [Docket No. 83] at ¶¶ 7-8.
After a period of discovery, the parties participated in a day-long mediation on June 5, 2013, before Jeff Krivis, Esq. Lavi Decl. at ¶ 6. The parties were not able to reach a settlement at the mediation. Id. After the mediation, the parties continued to negotiate, with the assistance of the mediator, and agreed to the terms of the settlement approximately ten weeks after the mediation. Id. Plaintiff then filed his first unopposed motion for preliminary approval of a class action settlement, which the court denied. See Docket Nos. 65, 81. Plaintiff subsequently filed a second unopposed motion for preliminary approval of a class action settlement, which the court granted. See Docket Nos. 82, 90.
II. THE SETTLEMENT AGREEMENT
The complete terms of the proposed settlement agreement are set forth in the Stipulation and Settlement Agreement ("Agreement"). See Lavi Decl. Second Prelim. Approval Ex. 1. The Agreement provides for a principal settlement class defined as follows:
"Class" or "Class Member" or "Class Members" means any current or former hourly, non-exempt employee of Sky Chefs who performed paid work for Sky Chefs in California from March 16, 2008 up to December 12, 2013, or if such person is incompetent or deceased, the person's guardian, executor, heir or successor in interest.
Agreement at 3.
A. Settlement Amount and Release of Claims
Under the terms of the settlement, in exchange for a release of claims against Defendant, Defendant will pay a Gross Settlement Amount of $1, 750, 000. The Gross Settlement Amount is non-reversionary and shall include participating Class Members' claims and payroll taxes, Class Counsel Fees and Costs, Enhancement Payment to Class Representative Plaintiff, payment to the Labor and Workforce Development Agency (LWDA) for PAGA penalties, and Settlement Administration Costs. Agreement at 18:4-21:16.
The total portion of the Gross Settlement Amount to be paid to "Authorized Claimants, " or Class Members who file a valid and timely Claim Form with the Settlement Administrator to register their claim for a Settlement Payment,  will be equal to the Gross Settlement Amount less (1) Class Counsel Fees and Costs, (2) Enhancement Payment, (3) LWDA Payment, and (4) Settlement Administration Costs, which would result in a total class payout of approximately $1, 156, 500 ("Distributable Amount"). Agreement at 2:17-19, 19:1-8. Each of these deductions is explained in greater detail below.
1. Class Counsel Fees and Costs: $525, 000
The Agreement states that Class Counsel will request payment of $525, 000 for Class Counsel Fees and an amount not to exceed $13, 000.00 for Class Counsel Costs. Agreement at 21:25-22:5. As discussed below, Plaintiff's counsel actually seeks ...