United States Magistrate Judge Donna M. Ryu of the Northern District of California granted a petition for attorneys fees and costs in a FDCPA class action of up to $23,539.31 in costs and up to $287,589.25 in attorneys’ fees from a $359,000 total settlement fund. Hunt v. Imperial Merchant Services, No. C-05-04993 DMR, 2010 WL 3958726, *1 (N.D. Cal. Oct. 7, 2010) (slip op.).
Plaintiffs filed a consolidated class action against Defendant Imperial Merchant Services, Inc., doing business as Check Recovery Systems (“IMS”), for violating the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. section 1692 et seq. Id. *1. Plaintiffs claimed that IMS’ practice of demanding 10% interest, in addition to a statutory service charge for dishonored checks, was not permitted by California law and was unlawful under the FDCPA. Id.
Plaintiffs obtained class certification, and the parties reached a class-wide settlement, which generated a $359,000 total settlement fund. Id. Specifically, the settlement funds are to be used first to pay class notice costs incurred by Plaintiffs’ counsel as well as expenses for administering the class settlement. Id. Next, the two class representatives will receive $2,000 each, and qualifying class members will be entitled to a pro rata share of the $100,000 Damages Class Fund, up to 100% of an individual class members’ damages. Id. The settlement funds are then be used to pay attorneys’ fees and expenses. Id. And any remaining settlement funds are to be distributed to designated cy pres recipients. Id. Subject to the terms of the above plan of distribution, the court granted the motion for reimbursement of up to $287,589.25 in attorneys’ fees. Id.
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The United States District Court for the Northern District of California denied a motion for class certification for evading the page limit on briefing by relying on 11 pages of argument crammed into a supporting declaration. Juarez v. Jani-King Of California, Inc., No. 09-3495 SC, 2010 WL 3766649 (N.D. Cal. Sept. 24, 2010). Plaintiffs brought a putative class action arising out of the sale of franchises by Defendants Jani-King of California, Inc., Jani-King, Inc., and Jani-King International, Inc. Id. *1. Plaintiffs petitioned the Court for leave to file a brief exceeding Northern District of California’s Civil Local Rule 7-4(b)’s twenty-five-page limit, but the court denied the request. Id.
Plaintiffs filed their Motion to Certify, as well as sixty exhibits totaling more than four thousand pages in support of the Motion. Id. Defendants filed objections to an eleven-page section of a declaration that Plaintiffs filed in support of their Motion. Id.
The Statement of Facts in Plaintiffs’ motion cited almost exclusively to seventy-six paragraphs in this declaration. Id. And in turn, these paragraphs cited to the evidence supporting the Motion. The court gave the following example from the motion and declaration: Read the rest of this entry »
Issuing a robust opinion in a putative wage and hour class and FLSA collective action, Judge Lucy H. Koh invalidated opt-out forms solicited by defendants, granted plaintiff’s request for a curative notice at defendants’ expense, and ordered defendants to show cause why they should not be sanctioned pursuant to Rule 11. Li v. A Perfect Day Franchise, Inc., No. 10-CV-01189-LHK, 2010 WL 3835596 (N.D. Cal. Sept. 29, 2010). The court concluded that based on the record, it appeared likely that “the opt-out forms submitted by Defendants on September 7, 2010 were fraudulently created after the September 2, 2010 hearing on the underlying motions.” Id. *11. The court admonished that “Defendants will not be permitted to defraud this Court by submitting false testimony.” Id. *12.
Named plaintiffs are former workers for A Perfect Day Franchise, Inc., which owns and operates spas. Id. *1. Named plaintiffs describe themselves and the majority of the putative class as being native Chinese speakers, with limited English proficiency and little or no formal education. Id. Plaintiffs claim that they paid for a massage training course offered by an entity related to Perfect Day, the Minjian Hand Healing Institute. Id. Plaintiffs allege they paid for the course based on promises, contained in advertisements for the training program, that they would be employed by Perfect Day and would earn a minimum income once it was completed, but that these promises were not honored by Perfect Day, and that Perfect Day has miscategorized them as independent contractors rather than employees. Id. Read the rest of this entry »
The Northern District of California granted final approval of a settlement in a meal and rest break class action in Ross v. US Bank National Association, No. C 07-02951 SI, 2010 WL 3833922 (N.D. Cal. Sept. 29, 2010). The complaint was filed on behalf of all hourly employees who worked at a California U.S. Bank in-store branch. See Memorandum of Points and Authorities in Support of Plaintiff’s Motion for Preliminary Approval of Class Action Settlement (“MPA”) at 1. Plaintiffs alleged that they and other hourly paid employees have not been provided a legally compliant meal and rest period on Sundays and worked off the clock pre and post shift and during their meal breaks. Id. The parties settled the case, and the settlement agreement provides for the payment of compensation to each Participating Class Member based on his or her total workweeks in a Class position during a certain period. Ross, 2010 WL 3833922, *1. The court approved a non-reversionary settlement of $3,500,000 for approximately 3,300 settlement class members. MPA at 2.
Attorneys’ Fees and Costs
Plaintiffs’ counsel sought an award of 30% of the settlement fund, $1,050,000.00, as attorneys’ fees. Ross, 2010 WL 3833922, *1. Plaintiffs estimate that the total time spent litigating this case, including time overseeing claims administration, will be approximately 2647.7 hours. Id. Plaintiffs’ counsel listed hourly rates ranging from $185 an hour to $650 an hour. MPA at 14. The court reduced the award to 25%: Read the rest of this entry »
In a putative meal and rest break class action, the Second District denied class certification, holding that “employers must provide employees with breaks, but need not ensure employees take breaks.” Hernandez v. Chipotle Mexican Grill, Inc., No. B216004, 2010 WL 3789012 (Cal. Ct. App. 2d Dist. Sept. 30, 2010). Plaintiff and appellant Rogelio Hernandez (Hernandez) Hernandez filed a class action lawsuit against Chipotle Mexican Grill, Inc. (Chipotle) alleging that Chipotle violated labor laws by denying employees meal and rest breaks. Id. *1. The trial court denied class certification, and plaintiff appealed. Id. The Court of Appeal affirmed, holding that it would not be “practical” to require “enforcement of meal breaks” since it “would place an undue burden on employers whose employees are numerous or who … do not appear to remain in contact with the employer during the day.” Id. *7. “It would also create perverse incentives, encouraging employees to violate company meal break policy in order to receive extra compensation under California wage and hour laws.” Id.
The Court of Appeal also held that: (1) It was appropriate for the trial court to decide the threshold legal issue of whether employers must provide meal breaks rather than ensure they be taken as it could not otherwise assess whether class treatment was warranted; (2) a party seeking to introduce sampling of employee testimony to support certification must explain how the procedure will effectively manage the issues in question; and (3) there was substantial conflicts of interest among the putative class members were some employees moved in and out of supervisory roles with the responsibility to provide meal and rest breaks for themselves and other employees on the shift. Read the rest of this entry »
The Fourth District Court of Appeal reversed a denial of class certification in Kershenbaum v. Buy.com, Inc., No. G042303, 2010 WL 3800339 (Cal. Ct. App. 4th Dist. Sept. 30, 2010). Plaintiff Richard M. Kershenbaum did not receive an advertised rebate on a product he purchased through Buy.com, Inc.’s Web site. Id. *1. Buy.com contended the rebate was offered by the product manufacturer, and it was therefore not responsible for compensating Kershenbaum. Id.
The Court of Appeal held that the trial court erred in denying the motion for class certification:
The different definitions of the proposed class contained in the memorandum of points and authorities and the proposed order did not warrant denial of the motion for lack of ascertainability. Any confusion caused by the different definitions could and should have been remedied by the trial court, either by correcting the proposed order, or by independently drafting a new order.
We also conclude the trial court erred in determining the claims asserted by the class were vague.
Finally, Kershenbaum had standing to assert a claim for misleading advertising; the trial court erred in determining otherwise. Read the rest of this entry »
The Second District compelled a class action plaintiff to arbitrate his individual claims in Maiorano v. Professional Community Management, Inc., No. B220127, 2010 WL 3786721 (Cal. Ct. App. 2d Dist. Sept. 30, 2010). Defendant, Professional Community Management, Inc., appealed from an order denying its petition to compel arbitration of a putative class action filed by plaintiff, Ray A. Maiorano. Id. *1. The Second District held that “based solely on the parties’ agreement, we conclude they cannot be compelled to arbitrate on a class basis”, but it directed the trial court to compel arbitration of plaintiff’s individual claims. Id. The court reasoned that the “presence of a provision limiting arbitration to individual rather than joined or representative claims did not present a basis upon which the trial court could conclude the present arbitration agreement was permeated by an unlawful purpose.” Id. *4.
Plaintiff brought a class action complaint alleging violations of statutory meal and rest breaks, wage reporting and overtime requirements, and unlawful and unfair business practices. Id. *2. Plaintiff also asserted a cause of action for penalties under the Labor Code Private Attorneys General Act of 2004–Labor Code sections 2698 and 2699. Id. Defendant filed a petition to compel arbitration. The trial court denied defendant’s petition, ruling that: Read the rest of this entry »
On Monday, the U.S. Court of Appeals for the Ninth Circuit affirmed in “all respects” the trial court’s grant of partial summary judgment to plaintiffs, a judgment after jury and bench trials, and an award of attorney’s fees to plaintiffs. Wang v. Chinese Daily News, Inc., Nos. 08-55483, 08-56740, — F.3d —-, 2010 WL 3733568 (9th Cir. Sept. 27, 2010). Among other things, the Ninth Circuit held that plaintiff newspaper reporters were non-exempt. (Thank you to Randy Renick for bringing this case to my attention.)
Employees of Chinese Daily News, Inc. (“CDN”), a Chinese-language newspaper, filed suit against CDN on behalf of current, former, and future CDN employees based in CDN’s San Francisco and Monterey Park (Los Angeles), California locations. Id. *1. Plaintiffs claimed violations of the FLSA, California’s Labor Code, and California’s Unfair Competition Law, Cal. Bus. & Prof. Code § 17200, alleging that employees were made to work in excess of eight hours per day and forty hours per week. Id. They further alleged that they were wrongfully denied overtime compensation, meal and rest breaks, accurate and itemized wage statements, and penalties for wages due but not promptly paid at termination. Id. The district court certified the FLSA claim as a collective action, and it certified the state-law claims as a class action under Rule 23(b)(2) and, alternatively, under Rule 23(b)(3). Id. Read the rest of this entry »