18th Annual Workplace Class Action Report - 2022 Edition

Annual Workplace Class Action Litigation Report: 2022 Edition 297 amount after accounting for attorneys’ fees and costs and incentive payments was estimated to be $1,427,500. Additionally, the settlement agreement required Defendant to implement certain employment practices, including providing a full 30-minute duty-free meal period to the workers and rest periods of no less than 10 minutes for every four hours. The Court approved the settlement agreement pursuant to Rule 23(e). Following notice to the class members, Plaintiffs filed an unopposed motion for final settlement approval, which the Court granted. The Court made the same findings as it did at the preliminary approval stage. The Court granted an award of attorneys’ fees of $400,000. It found that the 1.84 multiplier was appropriate and also awarded the requested $4,315.74 in litigation costs. Finally, although the Court noted that the incentive payment requests of $7,500 were quite high, it ruled that they were appropriate here in light of the time and effort Plaintiffs expended for the benefit of the class and the risks associated with initiating the litigation. For these reasons, the Court granted final settlement approval. Perez, et al. v. CVS Health Corp., 2021 U.S. Dist. LEXIS 110216 (E.D. Cal. June 11, 2021). Plaintiff brought a putative class action alleging Defendant violated several provisions of the California Labor Code (“CLC”) by not compensating him and other distribution center employees for the time that they spent waiting to undergo security checks of their personal bags at the beginning and end of their shifts and when they left and returned from meal and rest breaks. The parties reached a settlement agreement and moved for final approval of a class action settlement, for an award of attorneys’ fees and costs, and for an incentive award for Plaintiff. The settlement agreement provided for a gross settlement amount of $1,850,000 to be allocated as follows: (i) attorneys’ fees in the amount of $616,666; (ii) litigation expenses in the amount of $8,763; (iii) payment to the Labor and Workforce Development Agency ("LWDA") in the amount of $75,000 for the PAGA claims and payment to the sub-set of class members who worked during the PAGA period ("PAGA Employees") of $25,000; (iv) settlement administration costs estimated to be $30,000; (v) incentive award of $10,000 to plaintiff Perez; and (vi) distribution to the class members in the amount of the remaining funds, estimated to be $1,084,569. Each individual class member’s share of the net settlement amount would be proportional to the number of weeks worked during the applicable time period with the average gross payment to class members being $315. In reviewing these terms, the Court found pursuant to Rule 23(e) that the proposed settlement was fundamentally fair, adequate, and reasonable. Likewise, the Court granted Plaintiffs’ request for an award of attorneys’ fees and litigation expenses, as well as an incentive award for the lead Plaintiff. While the settlement provided that class counsel would seek an award of fees equivalent to $616,666, the Court found that such an attorneys’ fee award of approximately 33% of the gross settlement was not justified in this case given the relatively short duration of this litigation, the lack of complexity in the issues involved, and the quick settlement before any expenditure of resources on motion practice and formal discovery. Instead, the Court found that a benchmark fee award of 25% of the gross settlement was fair and reasonable, which yielded an attorneys’ fee award of $462,500. A further lodestar cross-check confirmed that this amount reflected application of a 1.97 multiplier to counsel’s lodestar, which the Court concluded was a reasonable award of attorneys’ fees in this case. As to the requested representative service award of $10,000, the Court found that it was too high and it ruled that $7,500 was an appropriate amount for an incentive award in this case. Sarit, et al. v. Westside Tomato, Inc., 2021 U.S. Dist. LEXIS 94903 (S.D.N.Y. May 19, 2021). Plaintiff, a restaurant employee, filed a collective action alleging that Defendant violated various provisions of the FLSA. The parties ultimately settled the matter, and filed a motion for preliminary settlement approval. The Court held that the overall settlement amount of $20,000 was fair and reasonable, particularly in light of the parties’ representation that the restaurant was facing financial difficulties due to the COVID-19 pandemic. Second, the Court ruled that the $10,000 award for attorneys’ fees and costs was also reasonable, as it was clear upon review of Plaintiff’s counsel’s time records that significant time was spent on the matter. The Court also approved the parties’ release of claims, as the release terms were mutual. However, the Court opined that it could not, as presented, approve of the agreement’s non-disparagement provision barring both Plaintiff and Defendants from “making disparaging comments about each other." Id . at *8. The Court held because the non- disparagement provision did not have a carve-out for Plaintiff allowing her to make true statements about her experiences litigating this case, it declined to approve it. As a result, the Court ordered the parties to either: (i) file an amended settlement agreement; (ii) stipulate to a dismissal of the action without prejudice; or (iii) file a joint letter indicating their intention to abandon the settlement agreement and continue pursuing litigation.