United States District Court, N.D. California
ORDER GRANTING MOTION FOR PRELIMINARY APPROVAL OF
CLASS ACTION SETTLEMENT Re: Dkt. No. 36
WILLIAM H. ORRICK UNITED STATES DISTRICT JUDGE
The
Court, having carefully considered the briefs, argument of
counsel, and all matters presented to the Court, and good
cause appearing, hereby ORDERS THAT:
1. The
Court preliminarily approves the MediFit Corporate Services,
Inc. “Wage and Hour” Class Action Settlement
Agreement and Release of Claims (“Settlement
Agreement”) attached as Exhibit A to the Notice of
Errata filed at Docket Number 37. This is based on the
Court’s determination that the Settlement is within the
range of possible final approval. Per the parties’
Joint Response to Court’s Notes Regarding Hearing on
Preliminary Approval of Class Action Settlement and their
representations at the preliminary approval hearing on July
20, 2016, the Settlement Agreement is amended as follows
(with additions underlined and deletions
struckthrough):
a. Paragraph 45 of the Settlement Agreement is amended to
read: Settlement Class Members who do not opt-out
may object to the settlement. Settlement Class Members who do
not opt-out may not object to the
settlement. If an opt-out a
Settlement Class Member who has not opted-out wishes
to object, he/she must do so within forty-five (45) calendar
days after the Class Notice is sent (or not more than twenty
(20) calendar days after the date the Class Notice is
re-mailed, in the circumstance described above). Objections
to the Settlement must be submitted to the Court either by
mailing them to the Class Action Clerk, United States
District Court for the Northern District of California,
Philip Burton Federal Building & United States
Courthouse, 450 Golden Gate Avenue, San Francisco, CA 94102,
or by filing them in person at any location of the United
States District Court for the Northern District of
California. A Settlement Class Member who has not
opted-out may also object by appearing at the final approval
hearing, even if he or she has not previously submitted a
written objection.
b. Paragraph 46 of the Settlement Agreement is amended to
read: Objections must describe why the objector believes the
Settlement is unfair and whether the
objector intends to appear at the final approval hearing.
Deficient or untimely objections shall not be considered.
Class Members who fail to file and serve timely written
objections in the manner specified above shall be deemed to
have waived any objections and shall be foreclosed from
making any objection (whether by appeal or otherwise) to the
Settlement, unless otherwise ordered by the Court.
Class Counsel and Defendant’s Counsel may, at least ten
(10) calendar days (or some other number of days as the Court
shall specify) before the Final Approval Hearing, file
responses to any written objections.
c. Paragraph 50 of the Settlement Agreement is amended to
read: No challenge will be considered timely if it is
postmarked more than the number of days set forth in the
preceding paragraph of this Settlement Agreement. Absent an
agreement between Class Counsel and Defendant’s Counsel
regarding how to address the dispute, the Settlement
Administrator shall have authority to resolve the challenge
and make a final and binding determination without hearing or
right of appeal. Defendant agrees to provide the Settlement
Administrator with additional documents or other information
associated with the challenge, if such exists. All disputes
shall be resolved, either by agreement of Class Counsel and
Defendant’s Counsel, or by decision of the Settlement
Administrator as provided herein, prior to submitting the
Settlement Administrator’s declaration to the Court for
final approval. Responses to challenges shall be made
within fourteen (14) days of receiving the challenge.
d. Paragraph 51 of the Settlement Agreement is amended to
read: Settlement checks issued to the Class Representatives
and Settlement Class Members shall remain valid for
one-hundred and eighty (180) calendar days from the date of
issuance. This expiration or cancellation date shall be
clearly printed on the front of the check (“Void
Date”). If the Class Representatives or any Settlement
Class Members do not cash their settlement payment check(s)
before the Void Date, the funds represented thereby will be
tendered to the cy pres beneficiaries, to be
selected by the parties, (the Legal Aid Society
– Employment Law Center, The Eagle Fund, and Stand by
the Wounded) within five (5) days of the close of the
180 day period. The Settlement Administrator will perform one
skip trace on any undeliverable settlement check. Settlement
checks can be reissued to Settlement Class Members upon
request within this 180 day period but any reissued checks
shall have the same Void Date as the original settlement
check. Those Settlement Class Members who fail to cash their
settlement checks will be deemed to have waived irrevocably
any right in or claim to a settlement payment, but the
Settlement Agreement and its waivers and releases shall
remain binding upon them.
e. Paragraph 52 of the Settlement Agreement is amended to
read: Upon the final approval by the Court of this Settlement
Agreement, and except as to such rights or claims as may be
created by this Settlement Agreement, the Settlement Class
Members release Defendant, its current or former
subsidiaries, affiliates, owners, parents, predecessors,
insurers, agents, employees, successors, assigns, officers,
officials, directors, employers, attorneys, personal
representatives, executors, and shareholders, including their
respective pension, profit sharing, savings, health, and
other employee benefit plans of any nature, the successors of
such plans, and those plans’ respective current or
former trustees and administrators, agents, employees, and
fiduciaries (“Releasees”), of and from any and
all claims, rights, demands, charges, complaint, causes of
action, obligations or liability of any and every kind that
were, or could have been, asserted in any
version of any complaint filed in the Action, or are
based on or arise out of the facts or
law alleged in any version of any
complaint the Second Amended Complaint filed
in the Action, including those under any state and federal
law for minimum wage and overtime, failure to provide meal
breaks, failure to authorize and permit rest breaks, failure
to timely pay wages at termination, failure to pay a proper
piece rate, failure to pay wages due, failure to reimburse
necessary business expenses, failure to provide accurate and
itemized wage statements, unfair business practices, and
violations of the Labor Code Private Attorneys General Act of
2004.
2. The
Court conditionally certifies, for settlement purposes only,
the proposed Plaintiff Classes, defined as follows:
California Class: All persons who worked in
California for Defendant, or its entity, MediFit Community
Services, LLC, at any point since June 16, 2011 as a group
exercise instructor, personal trainer, or swim instructor.
FLSA Class: All persons who worked in California for
Defendant, or its entity, MediFit Community Services, LLC, at
any point since June 16, 2012 as a group exercise instructor,
personal trainer, or swim instructor.
3. The
Court hereby conditionally certifies the proposed Plaintiff
Classes contained therein and conditionally finds that,
solely for the purposes of approving this settlement and for
no other purpose and with no other effect on this litigation,
the proposed Plaintiff Classes meet the requirements for
certification under Federal Rules of Civil Procedure, Rules
23(a) and 23(b), including that: (a) the proposed classes are
ascertainable and so numerous that joinder of all members of
the classes is impractical; (b) there are predominant
questions of law or fact common to the proposed classes, and
there is a well-defined community of interest amongst the
members of the proposed classes with respect to the subject
matter of the litigation; (c) the claims of Representative
Plaintiffs are typical of the claims of the members of the
proposed classes; (d) Representative Plaintiffs and Class
Counsel will fairly and adequately protect the interests of
the members of the classes; (e) a class action is superior to
other available methods for an efficient adjudication of this
controversy; and (f) Class Counsel is qualified to act as
counsel for the Representative Plaintiffs in their individual
and representative capacities.
4. The
Court provisionally finds Scott Cole & Associates, APC to
be sufficiently experienced and proficient in class action
proceedings that they may act as Class Counsel and are,
therefore, appointed as such.
5. The
Court provisionally appoints Francisco Flores and Giulia
Ferraris as the representatives of the Plaintiff Classes
(“Representative Plaintiffs, ” “Class
Representatives, ” or “Plaintiffs”).
6. The
Court provisionally appoints Rust Consulting as the
Settlement Administrator.
7. The
Court approves, as to form and content, the following: the
Class Notice, attached as Exhibit A to this Order. The Class
Notice shall be disseminated to the Plaintiff Class Members
in the manner set forth in the Settlement Agreement.
8. The
Court approves, as to form and content, the following: the
Second Amended Complaint, attached as Exhibit B to this
Order. The Second Amended Complaint is deemed filed upon the
entry of this Order.
9. The
final approval hearing shall be held on November 9, 2016, at
2 p.m., in Courtroom 2, 17th floor of this Court, to
determine whether the proposed Settlement is fair, adequate,
reasonable, and should be granted final approval. At that
time, the Court will also consider Plaintiff’s
application for attorneys’ fees, costs, and expenses,
and any application for Enhancement Awards to the
Representative Plaintiffs.
10. Any
Plaintiff Class member may choose to opt-out of and be
excluded from the Settlement Classes by following the
instructions for requesting exclusion from the Settlement
that are set forth in the Class Notice. Any such person who
chooses to op- out of and be excluded from the Settlement
Classes will not be entitled to any recovery under the
Settlement and will not be bound by the Settlement or have
any right to object, appeal or comment thereon. Settlement
Class members who have not requested exclusion shall be bound
by the terms of the Settlement Agreement, including its
Release, and the Court’s Judgment.
11. Any
Class Member who has not opted-out may object to the
Settlement in writing as set forth in the Class Notice, and
may also appear at the final approval hearing to object or to
express his or her views regarding the Settlement. Class
Counsel and Defendant’s Counsel may, at least ten (10)
calendar days (or some other number of days as the Court
shall specify) before the Final Approval Hearing, file
responses to any written objections.
12. In
the event that the Settlement does not become effective in
accordance with the terms of the Settlement Agreement, or the
Settlement is not finally approved, or is terminated,
cancelled or fails to become effective for any reason, this
Order shall be rendered null and void and shall be vacated,
and the Parties shall revert back to their respective
positions as of before entering into the Settlement
Agreement.
13. The
Court reserves the right to adjourn or continue the date of
the final approval hearing and all dates provided for in the
Settlement Agreement without further notice to Settlement
Class members, and retains jurisdiction to consider all
further applications arising out of or connected with the
proposed Settlement.
IT IS
SO ORDERED.
Exhibit
A
UNITED
STATES DISTRICT COURT NORTHERN DISTRICT OF
CALIFORNIA
FRANCISCO
FLORES and GIULIA FERRARIS, individually, and on behalf of
all others similarly situated, Plaintiffs, vs.
MEDIFIT
CORPORATE SERVICES, INC., and DOES 1 through 100, inclusive,
Defendant.
NO.
3:15-cv-03423-WHO
NOTICE
OF PROPOSED CLASS ACTION SETTLEMENT AND SETTLEMENT APPROVAL
HEARING
To:All
persons who worked for MediFit Corporate Services, Inc., or
its entity MediFit Community Services, LLC,
as a group exercise instructor, personal trainer, or swim
instructor in California at any point since June 16,
2011.
PLEASE
READ THIS NOTICE CAREFULLY YOU MAY BE ENTITLED TO
COMPENSATION FROM THIS SETTLEMENT
This
is a court approved notice. This is not an
advertisement.
You
are NOT being sued. However, your legal rights are
affected whether you act or not.
I.
INTRODUCTION
You
received this Notice because the records of MediFit Corporate
Servies, Inc. and/or MediFit Community Services, LLC
(hereafter “MediFit”) show that you were employed
by MediFit as a group exercise instructor, personal trainer,
or swim instructor in California at some time during the
period of June 16, 2011 to______ (the “Class
Period”). All individuals who fall within that
description are considered “Class Members” under
the terms of this Notice.
We are
providing this Notice to make you aware that a proposed class
action settlement (the “Settlement”) of the
above-captioned lawsuit (the “Action”) pending in
the United States District Court, Northern District of
California (the “Court”), has been reached by the
parties and has been granted preliminary approval by the
Court supervising the Action. A final settlement hearing will
be held on ____, 2016 at___.m. to determine whether the
Settlement should be granted final approval.
MediFit’s
records indicate that you are a Class Member and might be
entitled to compensation under the Settlement. The Settlement
affects your legal rights unless you ask to be excluded from
the Action, also known as “opting out” of the
Settlement. The purpose of this Notice is to: (1) describe
the Action, (2) inform you of the terms of the Settlement,
and (3) inform you of your rights and options in connection
with the Settlement. The Court file has the full settlement
documents with more information on the lawsuit. MediFit will
not fire, punish, retaliate, or otherwise discriminate
against any employee because he or she chooses to or does not
choose to participate in this Settlement, or objects to the
Settlement.
II.
SUMMARY OF THE ACTION
Plaintiffs
Francisco Flores and Giulia Ferraris
(“Plaintiffs”) allege in their Complaint that,
during the Class Period, MediFit required Class Members to
work off-the-clock, failed to provide meal and rest breaks,
failed to provide accurate itemized wage statements, failed
to reimburse expenses, and failed to pay wages timely upon
Class Members’ terminations. Plaintiffs allege that
these violations resulted in underpayment of wages to Class
Members. Plaintiffs seek to maintain a class action for their
claims on behalf of themselves and all persons who have been
employed or are currently employed within the Class Period as
a MediFit group exercise instructor, personal trainer, or
swim instructor. Plaintiffs seek damages and civil penalties
related to these claims under California law and the federal
Fair Labor Standards Act (“FLSA”).
MediFit
denies any liability or wrongdoing of any kind in connection
with Plaintiffs’ claims, and contends that Class
Members are and were provided with meal and rest breaks as
required by California law, that Class Members are and have
been provided with itemized wage statements that comply with
California law, that Class Members were not denied
reimbursement of expenses, and that Class Members are and
were properly compensated for all time worked and upon
termination. Consequently, MediFit does not believe that any
liability to Plaintiffs or Class Members exists, or that
Plaintiffs or Class Members are entitled to any recovery.
The
Court granted preliminary approval of the Settlement on
[date of preliminary approval] on behalf of the
following settlement classes defined as:
California Class: All persons who worked in
California for MediFit at any point since June 16, 2011 as a
group exercise instructor, personal trainer, or swim
instructor.
FLSA Class: All persons who worked in
California for MediFit at any point since June 16, 2012 as a
group exercise instructor, personal trainer, or swim
instructor.
The
Court also preliminarily approved Plaintiffs Francisco Flores
and Giulia Ferraris to serve as Class Representatives, and
the law firm Scott Cole & Associates, APC to serve as
Class Counsel.
The
Court also scheduled a Final Approval Hearing on the
Settlement at__ ._m. on__, 2016, in Courtroom 2 on the 17th
Floor at the United States District Court, Northern District
of California, located at 450 Golden Gate Avenue, San
Francisco, California, at which time the Court will decide
whether to grant final approval of the Settlement.
III.
SUMMARY OF SETTLEMENT TERMS
Settlement
Amount. MediFit has agreed to pay $1, 300, 000 (the
“Gross Settlement Fund”) to fully resolve this
Action and obtain a release of claims as described below.
From this Gross Settlement Fund, the following sums will be
deducted if approved by the court:
• Settlement Administration. $20, 500 to the
Settlement Administrator, Rust Consulting, for the expense of
notifying the Class Members of the Settlement, processing
opt-outs submitted by Class Members, and distributing
Settlement Payments.
• Attorneys’ Fees and Expenses. Class
Counsel’s attorneys’ fees not to exceed 25% of
the Gross Settlement Fund ($325, 000) for the work Class
Counsel performed in this Action, and for work to be
performed through settlement finalization and Class
Counsel’s litigation expenses, not to exceed $20, 000.
• Enhancement Awards to Representative
Plaintiffs. Enhancement Awards not to exceed $4, 500 to
Plaintiff Flores and $1, 500 Plaintiff Ferraris to compensate
them for their service on behalf of the Class in initiating
and prosecuting the action. These payments are in addition to
whatever payments Plaintiffs are otherwise entitled to
receive as Class Members.
• Payment to the LWDA. $5, 000 to the
California Labor and Workforce Development Agency
(“LWDA”) for settlement of claims brought under
the Private Attorneys General Act (“PAGA”). The
payment to the LWDA represents seventy-five percent (75%) of
the total PAGA payment of $3, 750. The other twenty-five
percent (25%) of the total PAGA payment, or $1, 250, shall be
added to the Net Settlement Fund and distributed among Class
Members as discussed below.
Calculation
of Class Member Awards. Each Class Member will be
eligible to receive a gross (pre-tax) share of the Net
Settlement Fund (i.e., the Gross Settlement Fund,
minus approved Class Counsel fees and litigation costs, all
settlement administration expenses, the Enhancement Awards,
and payment to the LWDA). The share distributed to each Class
Member is referred to as the “Individual Settlement
Share” and will be calculated as follows:
1. Ninety-five percent of the Net Settlement
Fund will be allocated to settle the claims of the California
Class, with the remaining five percent being allocated to
settle the claims of the FLSA Class.
2. Both the California and FLSA portions of
the Net Settlement Amount will be divided by the total number
of pay periods worked by all California or FLSA Class Members
during either the California or FLSA Settlement Periods.
3.To calculate the Individual Settlement
Share for each Class Member, the amount to be paid per pay
period will be multiplied by the total number of pay periods
that each Class Member worked during the respective
Settlement Periods.
Tax
Withholding. Thirty-three percent of each Individual
Settlement Share is treated as wages that are subject to the
normal payroll taxes and withholdings and W-2 reporting.
Thirty-three percent will be considered interest and the
remaining thirty-four percent will be considered penalties.
The interest and penalties are not subject to
payroll taxes, but are subject to IRS Form 1099 reporting.
Aside from any payroll taxes for which MediFit is
responsible, any and all tax obligations arising from any
payments to Class Member will be the sole responsibility of
the individual receiving such payment(s).
Releases.
Upon Final Approval of the Settlement, each Class Member
shall be deemed to have fully, finally, and forever released
the Releasees, as defined in the Settlement, from any and all
individual and class claims, debts, liabilities, demands,
obligations, penalties, guarantees, costs, expenses,
attorneys’ fees, damages, action or causes of action of
whatever kind or nature, whether known or unknown, that are
based on or arise out of the facts alleged in the Second
Amended Complaint filed in the Action, including those under
any state and federal law for minimum wage and overtime,
failure to provide meal breaks, failure to authorize and
permit rest breaks, failure to timely pay wages at
termination, failure to pay a proper piece rate, failure to
pay wages due, failure to reimburse necessary business
expenses, failure to provide accurate and itemized wage
statements, unfair business practices, and violations of the
Labor Code Private Attorneys General Act of 2004, which arose
between June 16, 2011 and the date the Court grants final
approval to the Settlement or December 31, 2016, whichever is
sooner.
All
Class Members shall be bound by this release unless they
opt-out of the Settlement. However, only those Class Members
who cash their settlement checks will be bound by the release
of FLSA claims.
Conditions
of Settlement. This Settlement is conditioned upon the
Court entering an Order after the Final Approval Hearing
finally approving the Settlement.
IV.
COMPENSATION INFORMATION
MediFit’s
records indicate that you worked at one or more of its
California locations from_____ to ______.
MediFit’s
records indicate that you worked a total of ____ pay periods
during this time frame. Accordingly, your
estimated Individual Settlement Share
(before taxes and withholdings) is roughly $ ______.
If you
wish to challenge the accuracy of the above information, you
must send a written, signed challenge along with supporting
documents to the Settlement Administrator at the address
given in Section IX below, via First Class Mail, postmarked
no later than . Absent an agreement between Class Counsel and
MediFit’s Counsel regarding how to address the dispute,
the Settlement Administrator shall have authority to resolve
the challenge and make a final and binding determination
without hearing or right of appeal.
Please
note: The above amount is an estimate only
and will change if the fees and costs awards are different
than estimated (as described in Section III, above). All
Settlement Awards are subject to tax withholdings and
reporting to the IRS and state tax authorities. You will
receive a W-2 for the wages and IRS Form 1099-MISC for
interest and penalties.
Settlement
checks shall remain valid for 180 days from the date of
issuance. If you do not cash your settlement payment check
within this time period, or if your check is returned as
undeliverable, your settlement check will be voided and a
stop payment will be placed on it. Settlement checks can be
reissued to Class Members upon request within this 180-day
period, but any reissued checks shall have the same Void Date
as the original settlement check. If you fail to cash your
settlement check, or if your check is returned as
undeliverable, the funds will be tendered to a charity
selected by the parties, but the Settlement Agreement shall
remain binding upon you.
V.
RIGHT TO OPT OUT
If you
do not wish to participate in the Settlement of your claims,
you may exclude yourself from the Settlement or “opt
out.” If you opt out, you will receive no compensation
from the Settlement, and you will not be bound by its terms.
To opt out, you must submit a signed, written request by
first-class U.S. mail to the Settlement Administrator at the
address below, postmarked no later than ____, 2016. The
request to opt out must contain your full name and the last
four digits of your Social Security Number, and must state in
substance the following:
“I have read the Class Notice and I wish to opt-out of
the class action and do not wish to participate in the
settlement of the case Flores, et al. v. MediFit
Corporate Services, Inc.”
VI.
RIGHT TO OBJECT
If you
are a Class Member, and you do not exclude yourself from the
Settlement Class (opt out), you may object to the settlement
before final approval of the settlement by the Court.
You can
ask the Court to deny approval by filing an objection. You
cannot ask the Court to order a larger settlement; the Court
can only approve or deny the settlement. If the Court denies
approval, no settlement payments will be sent out and the
lawsuit will continue. If that is what you want to happen,
you must object.
You may
object to the proposed settlement in writing. You may also
appear at the Final Approval Hearing, either in person or
through your own attorney. If you appear through your own
attorney, you are responsible for paying that attorney. All
written objections and supporting papers must (a) clearly
identify the case name and number (Flores, et al. v.
MediFit Corporate Services, Inc., Case Number
3:15-cv-03423-WHO), (b) be submitted to the Court either by
mailing them to the Class Action Clerk, United States
District Court for the Northern District of California,
located at the Philip Burton Federal Building & United
States Court House, 450 Golden Gate Avenue, San Francisco,
California, or by filing them in person at any location of
the United states District Court for the Northern District of
California, and (c) be filed or postmarked on or before
______.
If you
object to the Settlement, you will remain a member of the
Class, and if the Court approves the Settlement, you will be
bound by the terms of the Settlement in the same way as Class
Members who do not object. Any Class Member who does not
submit an objection in the manner described above shall have
waived any objection to the Settlement. If the court enters
an order finally approving the settlement, you will be bound
by its terms even if you submit an objection.
VII.
HEARING ON THE SETTLEMENT
The
Final Approval Hearing on the adequacy, reasonableness, and
fairness of the Settlement will be held at __._m. on ___,
2016 in Courtroom 2, 17th Floor of the United States District
Court, Northern District of California, located at 450 Golden
Gate Avenue, San Francisco, California. This hearing date may
change without further notice to the Settlement Class. Class
Members should check the settlement website at
www.___.com, or the Court’s PACER site
(described in section IX, below), to confirm that the date
has not changed. You are not required to attend the Final
Approval Hearing, although any Class Member is welcome to
attend the hearing.
VIII.
ADDITIONAL INFORMATION
This
Notice summarizes the proposed settlement. For the precise
terms and conditions of the settlement, please see the
Settlement Agreement and the Court’s Order Granting
Preliminary Approval (“Court’s Order”),
available at www.____.com. The Court’s Order
contains the precise terms of the release of class
members’ claims, as stated in this Notice. The release
of class members’ claims in the Settlement Agreement
contains different language from the release of class
members’ claims in the Court’s Order and this
Notice. The language in the Court’s Order and this
Notice is the controlling language for the release of class
members’ claims. You will also find other documents
related to this matter at the website listed above, including
the Second Amended Complaint.
You may
also obtain additional information regarding the settlement
by contacting Class Counsel at the address provided below, by
accessing the Court docket in this case through the
Court’s Public Access to Court Electronic Records
(PACER) system at https://ecf.cand.uscourts.gov, or
by visiting the office of the Clerk of the Court for the
United States District Court for the Northern District of
California, located at 450 Golden Gate Avenue, San Francisco,
California, between 9:00 a.m. and 4:00 p.m., Monday through
Friday, excluding Court holidays. Class Counsel may be
contacted at:
Scott Edward Cole, Esq.
SCOTT COLE & ASSOCIATES, ...