Cavazos v. Salas Concrete, Inc.

• Decision Date: 18 February 2022
• Docket Number: 1:19-cv-00062-DAD-EPG
• Parties: JOHN CAVAZOS, on behalf of himself and all others similarly situated, Plaintiff, v. SALAS CONCRETE INC., Defendant. Event Date
• Court: U.S. District Court — Eastern District of California

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JOHN CAVAZOS, on behalf of himself and all others similarly situated, Plaintiff,
v.
SALAS CONCRETE INC., Defendant.

No. 1:19-cv-00062-DAD-EPG

United States District Court, E.D. California

February 18, 2022

ORDER GRANTING PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT AND CONDITIONAL CLASS CERTIFICATION

(Doc. No. 45)

This matter is before the court on plaintiff's motion for preliminary approval of a class action settlement and conditional certification of settlement class filed on January 6, 2021. (Doc. No. 45.) Pursuant to General Order No. 617 addressing the public health emergency posed by the COVID-19 pandemic, plaintiff's motion was taken under submission on the papers. (Doc. No. 46.) For the reasons explained below, the court will now grant preliminary approval of the proposed settlement and conditional certification of the settlement class.^[1]

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BACKGROUND

Defendant Salas Concrete, Inc. is a “licensed concrete contractor that provides a wide range of concrete services, including, but not limited to, supplying, forming, reinforcing, pouring, finishing, and resurfacing concrete.” (Doc. No. 45-1 at 13.) Plaintiff John Cavazos was employed by defendant as an hourly, non-exempt employee from 2011 until 2018. (Id. at 13, 15.)

Plaintiff originally filed this class, collective, and representative action in this court on January 14, 2019. (Id. at 13.) Plaintiff filed a first amended complaint on March 27, 2019 (Doc. No. 8), alleging various wage, hour, and other labor-related claims in violation of the California Labor Code, California Business and Professions Code, and federal Fair Labor Standards Act (“FLSA”), which plaintiff claims give rise to penalties under California's Private Attorney's General Act (“PAGA”). (Id. at 13-14.) Defendant answered on April 22, 2019, denying that it violated any relevant California or federal laws. (Doc. No. 14.) Thereafter, the parties engaged in “informal discovery, ” whereby they exchanged “data, information, and documents, ” and defendant produced “time-keeping records, time and payroll data for putative class members.” (Doc. No. 45-1 at 14.) The parties then entered into private mediation before the Honorable Steven M. Vartabedian (Ret.) on November 6, 2019. (Id.)

On March 20, 2020, plaintiff filed a motion for conditional certification and preliminary approval of the class and collective action settlement. (Doc. No. 27.) After a hearing on the motion before Magistrate Judge Erica P. Grosjean, findings and recommendations were issued on July 21, 2020 recommending that the motion for conditional certification and preliminary approval of the class and collective action settlement be granted. (Doc. Nos. 30, 31.) Thereafter, the undersigned identified several issues of concern regarding the proposed settlement and directed the parties to submit responsive supplemental briefing. (Doc. No. 33.) On September 28, 2020, the court declined to adopt the findings and recommendations and denied plaintiff's motion for conditional certification and preliminary approval of the class and class action settlement. (Doc. No. 37.) Subsequently, the court directed the parties to file a new motion for preliminary approval of class action settlement. (Doc. No. 41.) On January 6, 2021, plaintiff

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filed the now pending motion for conditional certification and preliminary approval of the class and collective action settlement.^[2] (Doc. No. 45.)

THE PROPOSED SETTLEMENT

A. The Class

For settlement purposes, the parties request approval of the following class (the “Class”) of an estimated 39-40 individuals (the “Class Members” or “Settlement Class”): “all current and former California hourly, non-exempt employees Salas Concrete, Inc. employed during the Class Period.” (Doc. No. 45-2 at 37.)

B. The FLSA Collective

In his pending motion, plaintiff refers to the Class Members as being similarly situated to plaintiff for the purposes of FLSA Conditional Certification. (Doc. No. 45-1 at 29.) However, plaintiff does not specify a collective in the terms of the Settlement Agreement. Nonetheless, the court will preliminarily approve the following collective (the “FLSA Collective” or “FLSA Members”), which shares the same definition as that of the Class Members: “all current and former California hourly, non-exempt employees Salas Concrete, Inc. employed during the Class Period.”^[3] (Doc. No. 45-2 at 37.)

C. The Settlement Period

For settlement purposes, plaintiff has defined the “Class Period” as the time period of “January 14, 2015 through November 6, 2019.” (Doc. No. 45-2 at 38.)

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D. The Release of Claims

The settlement agreement defines the Released Parties as:

Defendant Salas Concrete, Inc. and its present and former parent companies, subsidiaries, divisions, affiliates related companies, joint ventures, and each of their respective present and former officers, directors shareholders, agents, employees, insurers, attorneys, payroll companies, accountants, auditors, advisors, representatives consultants, pension and welfare benefit plans, plan fiduciaries, administrators, trustees, general and limited partners, predecessors, successors and assigns

(Id. at 42.)

The Released Class Claims are defined as:

[A]ny and all claims, demands, rights, debts, obligations, costs, expenses, wages, liquidated damages, statutory damages, penalties including civil and statutory, liabilities, and/or causes of action of any nature and description whatsoever, whether known or unknown, at law or in equity, whether concealed or hidden, whether under federal, state, and/or local law, statute, ordinance, regulation, common law, or other source of law, which were asserted in the Action against the Released Parties arising out of the facts and circumstances alleged in the First Amended Complaint during the Release Period. Released claims include, without limitation, claims arising under federal, state, and/or local statutory, constitutional, contractual, or common law claims for wages, damages, costs, penalties, liquidated damages, punitive damages, interest, attorney fees, litigation costs, restitution, equitable relief, or other relief under California Business & Processions Code Section 17200 et seq. (“Section 17200”) based on the California Labor Code; the Wage Orders of the California Industrial Welfare Commission; and Section 17200, including, but not limited to, failure to provide timely, off-duty meal and/or rest breaks; failure to promptly pay all wages due and owing at the time of the employee's separation from employment; failure to reimburse for expenses; engaging in unlawful/unfair/fraudulent business practices in violation of Section 17200; failure to provide accurate itemized wage statements; failure to keep accurate payroll records; failure to pay the California or federal minimum wage; failure to pay California or federal overtime; and any and all California Labor Code provision[s] giving rise to PAGA penalties.

(Id. at 41-42.)

The Released FLSA Claims are defined as:

[A]ny related Fair Labor Standards Act (“FLSA”) wage claims, whether known or unknown, arising for any Settlement Class Member, based on those allegations in the Action but only for those Settlement Class Members who endorse their FLSA Settlement Checks . . . by signing under the pre-printed language under each

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Settlement check: “By signing, endorsing, depositing, cashing, and/or negotiating this check, I hereby ‘opt in' to the Settlement and release all claims pursuant to the Fair Labor Standards Act, 29 U.S.C. § 216(b) et seq.” Settlement Class Members will release the FLSA claim only if they opt in by cashing, depositing, or otherwise negotiating their FLSA Settlement Checks.

(Id.)

The release of claims extends from claims arising from January 14, 2015 through April 1, 2020. (Doc. No. 45-2 at 38.) In addition, the Settlement Agreement clarifies the scope of the Released Claims as follows:

It is understood and agreed that the stipulation will not release any person, party or entity from claims, if any, by Settlement Class Members for workers compensation, unemployment, or disability benefits of any nature. However, it is understood and agreed that any and all claims for penalties of any kind, including civil or statutory penalties with respect to any and all wages of any nature are released.

(Id. at 41-42.)

E. Summary of the Settlement Terms

Under the proposed settlement, defendants will pay a total of $175, 000.00 (the “Gross Settlement Fund”) allocated as follows: 1) up to $58, 333.00 for attorneys' fees and up to $15, 000 for plaintiff's counsel's documented litigation costs; (2) a $10, 000 incentive award for plaintiff; (3) $4, 000 in civil PAGA penalties, with $3, 000 of the penalties payable to the California Labor and Workforce Development Agency (“LWDA”)^[4]; and (4) up to $5, 000 for settlement administration costs. (Doc. No. 45-2 at 46-47, 49.) Defendant is responsible for paying any applicable payroll taxes “separate and apart” from the $175, 000 deposit to the Gross Settlement Fund. (Doc. No. 45-2 at 40.)

Assuming these allocations are awarded in full, approximately $83, 666.00 (the “Net Settlement Fund”) will be available for distribution to Class Members who do not submit a timely and valid request for exclusion (“Participating Class Members”) and FLSA Members who timely

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and validly opt-in to the FLSA Collective (“Participating FLSA Members”).^[5] (Doc. No. 45-2 at 40.) From the Net Settlement Fund, 90% will be allocated to the Class Settlement (“Net Class Settlement”) and 10% to the FLSA Settlement (“Net FLSA Settlement Fund”). (Id. at 55.) The Net Class and Net FLSA Settlement Funds will be distributed to their respective members on a pro rata basis based on the number of pay periods worked by the applicable Participating Class and FLSA Members while...