Bowen v. JEA Senior Living Health & Welfare Benefit Plan, LLC
| Docket Number | 2:20-cv-2318-KJN |
| Decision Date | 09 June 2023 |
| Parties | ANNICA B. BOWEN, on behalf of herself and all others similarly situated, Plaintiffs, v. JEA SENIOR LIVING HEALTH AND WELFARE BENEFIT PLAN, LLC, et al., Defendants. |
| Court | U.S. District Court — Eastern District of California |
PRELIMINARY APPROVAL OF CLASS ACTION AND PAGA SETTLEMENT
(ECF NO. 40.)
Presently pending before the court is plaintiff's (Annica Bowen a.k.a. Annica Palacio) unopposed motion for provisional certification of a settlement class and preliminary approval of a Rule 23 Class Action and California Private Attorneys General Act (“PAGA”) settlement in this meal- and rest-break labor dispute.[1](ECF Nos. 40, 43.)
For the following reasons, the court GRANTS provisional certification of the settlement class, APPOINTS plaintiff as class representative and plaintiff's counsel as class counsel GRANTS preliminary approval of the class action and PAGA settlement, APPROVES the class notice-after small modifications are made, and SETS further deadlines.
Plaintiff alleges in the First Amended Complaint (“1AC”) that she previously worked as a non-exempt hourly-wage employee for defendants Empire Ranch, Willow Springs, and Blossom Grove, who jointly ran Alzheimer care centers in Northern California. (ECF No. 36 at ¶¶ 16-21.) Plaintiff alleges that from at least 2016 through 2021, defendants enforced policies and practices that did not allow for her and other caregivers to: (i) take meal breaks despite working 5+ hours a day; (ii) take rest breaks for every four hours worked; (iii) receive itemized wage statements; and (iv) receive all wages owed at the conclusion of their employment. (Id. at ¶¶ 6-7; see also Harris decl., ECF No. 40-1 at ¶ 6 ().) Plaintiff alleges, in essence, that defendants deprived her and other caregivers of breaks by requiring them to remain on site and in possession of their localized communication devices at all times. (ECF No. 36 at ¶ 8.)
On April 30, 2020, plaintiff filed a putative class action in California Superior Court, Los Angeles County, on behalf of herself and similarly situated current and former caregivers. (See ECF No. 1.) Defendants removed to the U.S. District Court for the Central District of California and answered the complaint; the case was transferred to the Eastern District in November of 2020. (See id.) After exchanging discovery responses, the parties participated in mediation in June of 2021, executed a settlement agreement shortly thereafter, submitted a first amended complaint in January of 2022, and moved for preliminary approval in March of 2022. (ECF Nos. 36; 40; 40-1 at ¶ 4.) The matter was taken under submission by the assigned district judge, reassigned to a different district judge, and ultimately reassigned to the undersigned after the parties consented to magistrate judge jurisdiction. (ECF Nos. 44, 45, 48, 49, 51.)
The Settlement Agreement contains a release of all claims that are factually supported by the 1AC against defendants by the proposed class, who are defined as “[a]ll current or former nonexempt caregivers working at the Willow Springs Facility, the Empire Ranch Facility, and/or the Blossom Grove Facility at any time between April 30, 2016, through September 2, 2021.”
(Settlement Agreement, ECF No. 40-2, at ¶ 1.4.) The Agreement sets the PAGA period from April 20, 2019, to September 2, 2021. (Id. at ¶ 1.27-1.29.) The proposed class consists of approximately 498 class members, with 323 former employees and the remaining those who continued employment with the new management company beyond 2021. (ECF No. 40-1 at ¶ 8.)
In return for the release of claims from these individuals, the Settlement Agreement provides for a non-reversionary gross settlement amount of $125,000. (ECF No. 40-2 at ¶ 1.19.) This amount represents approximately a quarter of the potential damages for alleged missed rest breaks (at just under $500,000), and approximately one-eighth to one-tenth of the potential maximum relief if additional penalties were to be found cognizable. (ECF No. 40-1 at ¶ 13-15.) The estimates are based on counsel's examination of discovery documents showing the number of breaks potentially at issue (13,863 work weeks) and the average hourly pay rate of class members (at $12/hour). (Id. at ¶ 13.) In arguing the settlement is fair, counsel notes the significant weaknesses in plaintiff's case, including that defendants' facial policy appears to allow caregivers to leave the premises during breaks, among other things. (Id. at ¶¶ 10-17.)
The Settlement Agreement proposes deducting from the $125,000 gross settlement amount the following:
(ECF No. 40-2 at ¶¶ 5.1-5.4.) The above deductions, if fully approved, would yield a Net Settlement Fund of $55,084. (See id.) /// As proposed, the Net Settlement Fund would be distributed across all class members who do not opt out of the settlement, on a pro-rata basis, as determined by the number of workweeks they worked as class members during the class period. (Id. at ¶ 5.5.) Using the parties' numbers, the proposed settlement would result in an average recovery of $110 per class member ($55,084 Net Settlement Fund / 498 class members, which of course will vary depending on the number of workweeks each class member actually worked).
The Settlement Agreement requires the Settlement Administrator to mail out notices of the class action settlement within 30 days of the court's preliminary approval. (ECF No. 40-2 at ¶ 3.4.) It then allows 45 days from the mailing of the proposed Notice of Class Action Settlement for class members to (a) do nothing and receive a payment, (b) request to be excluded from the settlement (“opt out”), (c) object to the terms of the settlement, or (d) dispute their dates of employment and estimated recovery amount listed. (Id. at ¶ 4.1; ECF No. 40-3 at ¶ 6 (the Class Notice).) Those who opt out will retain their right to sue but receive no payment under the settlement; those who remain in would ultimately receive their “Individual Settlement Payment” by check. (ECF No. 40-2 at ¶¶ 1.20, 4.2; ECF No. 40-3 at ¶¶ 6(a) and (c).) The Settlement Agreement also contains a procedure for distribution of the PAGA settlement should a class member opt out of the Rule 23 class settlement, and the Class Notice informs the class members that opting out of the Rule 23 class does not affect the PAGA settlement. (ECF No. 40-2 at ¶ 5.6.2; ECF No. 40-3 at ¶ 6(c).)
Plaintiff seeks: (A) provisional certification of the Rule 23 settlement class, her appointment as class representative, and appointment of her counsel as class counsel; (B) preliminary approval of a class action settlement; (C) approval of the PAGA settlement; and (D) appointment of the settlement administrator, approval of the notice to class members, and setting of a fairness hearing. (ECF No. 40.) Defendants submitted a statement of non-opposition, given their participation in the 2021 mediation session. (ECF No. 43.)
When parties seek approval of a class settlement before class certification, courts must analyze “both the propriety of the certification and the fairness of the settlement.” Staton v. Boeing Co., 327 F.3d 938, 952 (9th Cir. 2003); see Fed.R.Civ.P. 23(e) (“The claims, issues, or defenses of a certified class-or a class proposed to be certified for purposes of settlement-may be settled, voluntarily dismissed, or compromised only with the court's approval.”). Accordingly, the court considers whether the proposed class meets the certification requirements, and whether the proposed settlement is “fundamentally fair, adequate and reasonable.” Staton, 327 F.3d at 952. At the preliminary approval stage, the court considers the likelihood that it will ultimately approve the proposed settlement. Fed.R.Civ.P. 23(e)(1)(B). The final approval stage comes after notice to and feedback from the class and a fairness hearing. Fed.R.Civ.P. 23(e)(2).
Although this action largely consists of class claims, it also includes a claim for penalties under the California Labor Code's Private Attorneys General Act (“PAGA”). PAGA claims are distinct from class claims. See Kim v. Reins Int'l Cal., Inc., 9 Cal. 5th 73, 86-87 (2020) () (quotations omitted). This is because “[p]laintiffs may bring a PAGA claim only as the state's designated proxy suing on behalf of all affected employees.” Id. (emphases original); see Viking River Cruises, Inc. v. Moriana, 142 S.Ct. 1906, 1914 (2022) (explaining how California law characterizes PAGA as creating a “type of qui tam action” with the representative private plaintiff acting in place of the government (quoting Iskanian v. CLS Transp. Los Angeles, LLC, 59 Cal.4th 348, 382 (2014)). Because a PAGA claim is not “a collection of individual claims for relief' like a class action, Canela v. Costco Wholesale Corp., 971 F.3d 845, 855 (9th Cir. 2020) (discussing Kim's holding), PAGA claims “need not satisfy Rule 23 class certification requirements,” Hamilton v. Wal-Mart Stores, Inc., 39 F.4th 575, 583 (9th Cir. 2022)....
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