United States District Court, N.D. California
ORDER GRANTING PRELIMINARY APPROVAL OF CLASS
SETTLEMENT RE: DKT. NO. 100
HAYWOOD S. GILLIAM, JR. United States District Judge
before the Court is Plaintiff Jane Roe’s unopposed
motion for preliminary approval of class action settlement.
Dkt. No. 100 (“Mot.”). After careful
consideration of the settlement agreement and the
parties’ arguments, the Court GRANTS Plaintiff’s
motion for preliminary approval.
December 20, 2013, Plaintiff filed a class action complaint
against Defendant Frito-Lay, Inc. and Does 1-10 in Alameda
Superior Court. Dkt. No. 1-2. Plaintiff’s initial
complaint alleged that Defendant failed to provide notice to
prospective and existing employees prior to taking adverse
employment actions based on information disclosed in a
consumer report. Id. Plaintiff asserted violations
of the Fair Credit Reporting Act, 15 U.S.C. §§
1681b(b)(3)(A) (“FCRA”), and California Labor
Code § 432.7(a). Id. On February 19, 2014,
Defendant removed the action to this Court. Dkt. No. 1.
Plaintiff filed a first amended complaint on September 3,
2014, asserting a single claim for violation of the FCRA.
Dkt. No. 27.
parties participated in an initial mediation session with
Mark Rudy, Esq., on November 20, 2014. Dkt. No. 31. The
parties were unable to reach an agreement, but they continued
to engage Mr. Rudy’s services in pursuit of settlement.
Id.; Dkt. No. 35. On March 3, 2015, the parties
informed the Court that they had reached a settlement. Dkt.
No. 35. After further lengthy negotiations and several
deadline extensions, the parties filed their initial motion
for preliminary approval on October 14, 2015. Dkt. No. 53.
However, at the November 19, 2015, hearing on the initial
motion for preliminary approval, it became apparent that the
parties were not in agreement as to the terms of the
settlement. Following the hearing, the parties reengaged Mr.
Rudy to assist with further settlement negotiations. Dkt. No.
58. In light of the continuing dispute, the Court entered a
case schedule on January 5, 2016. Dkt. No. 66. On May 5,
2016, Plaintiff filed a motion to certify a class. Dkt. No.
11, 2016, the parties again notified the Court that they had
reached a settlement. Dkt. No. 93. After an additional case
management conference, the parties filed the pending motion
for preliminary approval of class action settlement on June
23, 2016. Dkt. No. 100.
Overview of the Proposed Agreement
parties’ Stipulation and Settlement of Class Action
Claims (“Settlement Agreement”) contains the
following key provisions:
Terms. In full settlement of the claim asserted in this
lawsuit, Defendant agrees to pay a gross settlement sum
(“GSS”) of $950, 000. This amount includes
payment to individuals who do not opt out of the Settlement
Agreement (“Settlement Class Members”) for
release of their claims, any award of attorneys’ fees
and costs, an incentive award to the named Plaintiff, and all
costs of administration, including settlement administration
Method. After attorneys’ fees, costs, the named
Plaintiff’s incentive award, and reasonable settlement
administration costs are subtracted, the remainder of the GSS
(“Payout Fund”) will be distributed to the
Settlement Class Members equally on a pro-rata basis. All
checks that remain uncashed after sixty (60) days will revert
to the Payout Fund, and Settlement Class Members who timely
cash their initial checks will receive a pro-rata share of
the remaining Payout Fund, so long as the pro-rata share
meets or exceeds $5.00.
Settlement Funds. If after the first distribution, the
Payout Fund will not result in a second pro-rata payment that
meets or exceeds $5.00, the remaining funds will be
distributed cy pres to the National Consumer Law
Center (“NCLC”). None of the GSS will revert to
Fees and Costs. The Settlement Agreement authorizes
class counsel to apply to the Court for an attorneys’
fees award of up to thirty-three and one-third percent (33
1/3%) of the GSS. Class counsel may also apply to the Court
for an award of reasonable costs.
Payment. The Settlement Agreement provides that class
counsel will petition the Court for approval of an incentive
payment of no more than $10, 000 to the named Plaintiff.
Settlement Class Members will release all claims
“asserted or that might have been asserted . . .arising
out of, relating to, or in connection with all causes of
action pleaded or that could have been pleaded based upon the
facts asserted in the Action.” Settlement Agreement at
10-11. The named Plaintiff will release Defendant from all
claims in existence prior to the final approval of the
Settlement Agreement. Id. at 12-13.
for Claims and Settlement. Class members must object to,
or opt out of, the settlement within forty-five (45) days of
the initial mailing of the notice packet.
Any Settlement Class Members may file an objection to the
Settlement Agreement. Settlement Class Members must give
written notice of their intention to appear at the
Court’s settlement hearing.
CONDITIONAL CLASS CERTIFICATION
certification under Rule 23 is a two-step process. First,
Plaintiff must demonstrate that Rule 23(a)’s four
requirements are met: numerosity, commonality, typicality,
and adequacy. Class certification “is proper only if
the trial court is satisfied, after a rigorous analysis, that
the prerequisites of Rule 23(a) have been satisfied.”
Wal-Mart Stores, Inc. v. Dukes, 131 S.Ct. 2541, 2551
(2011) (internal quotation marks omitted). Second, Plaintiff
must satisfy one of the bases for certification in Rule
23(b). Here, by invoking Rule 23(b)(3), Plaintiff must
establish that “questions of law or fact common to
class members predominate over any questions affecting only
individual members, and . . . [that] a class action is
superior to other available methods for fairly and
efficiently adjudicating the controversy.” Fed.R.Civ.P.
23(b)(3). The party seeking class certification bears the
burden of demonstrating by a preponderance of the evidence
that all four Rule 23(a) requirements and at least one of the
three requirements under Rule 23(b) are met. See
Wal-Mart, 131 S.Ct. at 2551.
Rule 23(a)(1) - Numerosity
23(a)(1) requires that the class be “so numerous that
joinder of all members is impracticable.” The
settlement class is comprised of 2, 928 members. The Court
finds that numerosity is satisfied here because joinder of
all the class members would be impracticable.
Rule 23(a)(2) - Commonality
23 class is certifiable only if “there are questions of
law or fact common to the class.” Fed.R.Civ.P.
23(a)(2). Under Rule 23(a)(2), even a single common question
is sufficient. Wal-Mart, 131 S.Ct. at 2556. The
question, however, “must be of such a nature that it is
capable of classwide resolution - which means that
determination of its truth or falsity will resolve an issue
that is central to the validity of each one of the claims in
one stroke.” Id. at 2551. “What matters
to class certification . . . is not the raising of common
‘questions’ - even in droves - but rather the
capacity of a classwide proceeding to generate common
answers apt to drive the resolution of the
litigation.” Id. (emphasis in original)
Court finds that the proposed class satisfies the commonality
requirement because, at a minimum, Defendant’s alleged
policies and practices concerning provision of a pre-adverse
action notice as required by the FCRA implicate the class
members’ claims as a whole.