Harris v. Chipotle Mexican Grill, Inc., 13-cv-1719 (SRN/SER)

• Decision Date: 29 January 2018
• Docket Number: No. 13-cv-1719 (SRN/SER),No. 14-cv-4181 (SRN/SER),13-cv-1719 (SRN/SER),14-cv-4181 (SRN/SER)
• Parties: Marcus Harris, Julius Caldwell, Demarkus Hobbs, and Dana Evenson, on behalf of themselves and all others, similarly situated, Plaintiffs, v. Chipotle Mexican Grill, Inc., Defendant. DeShandre Woodards, on behalf of himself and all others similarly situated, Plaintiff, v. Chipotle Mexican Grill, Inc., Defendant.
• Court: U.S. District Court — District of Minnesota

Marcus Harris, Julius Caldwell, Demarkus Hobbs,
and Dana Evenson, on behalf of themselves and all others,
similarly situated, Plaintiffs,
v.
Chipotle Mexican Grill, Inc., Defendant.

DeShandre Woodards,
on behalf of himself and all others similarly situated, Plaintiff,
v.
Chipotle Mexican Grill, Inc., Defendant.

No. 13-cv-1719 (SRN/SER)
No. 14-cv-4181 (SRN/SER)

UNITED STATES DISTRICT COURT DISTRICT OF MINNESOTA

January 29, 2018

MEMORANDUM OPINION AND ORDER

Adam S. Levy, Law Office of Adam S. Levy LLC, P.O. Box 88, Oreland, Pennsylvania 19075; Andrew C. Quisenberry and Jere Kyle Bachus, Bachus & Schanker, LLC, 1899 Wynkoop Street, Suite 700, Denver, Colorado 80202; Kent M. Williams, Williams Law Firm, 1632 Homestead Trail, Long Lake, Minnesota 55356; Kevin E. Giebel, Giebel and Associates, LLC, P.O. Box 414, Lake Elmo, Minnesota 55042; Michael E. Jacobs and Thomas M. Hnasko, Hinkle Shanor LLP, 218 Montezuma Avenue, Santa Fe, New Mexico 87501; and Robert Joseph Gralewski, Jr., Kirby McInerney LLP, 600 B Street, Suite 1900, San Diego, California 92101, for Plaintiffs.

Adam M. Royval, Allison J. Dodd, John K. Shunk, Louis M. Grossman, Scott L. Evans,

Page 2

and Spencer Kontnik, Messner Reeves LLP, 1430 Wynkoop Street, Suite 300, Denver, Colorado 80202; Jeffrey Sullivan Gleason, Robins Kaplan LLP, 800 LaSalle Avenue, Suite 2800, Minneapolis, Minnesota 55402; and Jennifer M. Robbins, Madel PA, 800 Hennepin Avenue, Suite 700, Minneapolis, Minnesota 55403, for Defendants.

SUSAN RICHARD NELSON, United States District Court Judge

This matter is before the Court on Plaintiffs' Motion for Attorneys' Fees and Expenses, and for Authorization to Deduct Service Awards from an Award of Attorneys' Fees and/or Expenses [Doc. No. 446] and the Joint Motion for Approval of Settlement and to Dismiss Action with Prejudice [Doc. No. 453].¹ For the reasons stated below, Plaintiffs' motion is granted in part and denied in part, and the parties' joint motion is granted.

I. BACKGROUND

The facts of these cases are well documented in the Court's September 9, 2014 Order [Doc. No. 101], granting in part and denying in part Plaintiffs' Motion to Certify the Class, and the June 12, 2017 Order denying Defendant's Motion to Decertify the Class, and are incorporated herein by reference.

This litigation began in June 2013, when Dana Evenson and DeMarkus Hobbs—Named Plaintiffs in the Harris action—filed suit against Defendant Chipotle

Page 3

Mexican Grill, Inc. ("Chipotle") in the United States District Court for the District of Colorado. (See Shunk Decl. ¶ 14 [Doc. No. 471].) In July 2013, Marcus Harris and Julius Caldwell filed a similar suit against Chipotle in this District, asserting claims on behalf of themselves and all others similarly situated, pursuant to the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 201-219, and the Minnesota Fair Labor Standards Act, Minn. Stat. §§ 177.21-177.35. (See Consolidated Am. Class Action Compl. [Doc. No. 31] ("Am. Compl.") ¶ 1.) After the Colorado action was transferred to Minnesota, the Colorado plaintiffs joined Harris and Caldwell as the Named Plaintiffs in the Harris action. (See id.)

The Named Plaintiffs were all hourly employees at the Chipotle restaurant in Crystal, Minnesota ("the Crystal Restaurant"). (See Supp'l Harris Decl. [Doc. No. 64] ¶¶ 2-3; Supp'l Caldwell Decl. [Doc. No. 63] ¶ 2; Hobbs Decl. [Doc. No. 39] ¶¶ 3-5; Evenson Decl. [Doc. No. 40] ¶¶ 3-5; Gottlieb Decl. ¶¶ 20-23 [Doc. No. 50].) They generally alleged that Chipotle maintained a company-wide unwritten policy of requiring hourly-paid employees to work "off the clock" and without pay, and they sought to recover allegedly unpaid overtime compensation and other wages for themselves and other similarly situated employees. (See Am. Compl. ¶¶ 3-4.) Chipotle denied Plaintiffs' allegations. (See generally Answer to Am. Compl. [Doc. No. 45].)

The parties engaged in protracted discovery and frequent motion practice. Plaintiffs contend that Chipotle "dragged its feet" in discovery, (Williams Decl. ¶ 23 [Doc. No. 450]), failing to produce responses to discovery propounded in December 2013

Page 4

until September 2014, and failing to produce any further discovery until the Court issued a scheduling order in March 2015. (Id.) Even after that, they contend that Chipotle did not complete the majority of its document production until February 2016. (See id. ¶ 26.) Plaintiffs further assert that in contrast to their own narrow scope of discovery, Chipotle's discovery requests were unnecessarily wide-ranging, seeking written discovery of every member of the collective and noticing the depositions of 20 members. (See id. ¶¶ 27-28.) And as to Chipotle's responsive discovery, Plaintiffs assert that they were forced to cull through "tens of thousands of Chipotle documents to find about 130 that were the most relevant to the case." (Pls.' Mem. Supp. Mot. for Attys' Fees ("Pls.' Mem.") at 9 [Doc. No. 448].)

Chipotle, however, asserts that it "engaged in discovery necessary to adequately defend against nationwide collectives and statewide classes encompassing potentially hundreds of thousands of plaintiffs and untold millions in damages." (Def.'s Opp'n Mem. at 12 [Doc. No. 470.) It contends that it produced tens of thousands of documents at the request of Plaintiffs' counsel, "despite numerous warnings" from Chipotle of the high volume of documents. (See Shunk Decl. ¶ 39.) Chipotle also argues that before the Court limited the Harris collective to the Crystal Restaurant, Plaintiffs sought extensive discovery related to all hourly employees, spanning periods of several years. (See id.)

The Harris Plaintiffs moved to conditionally certify the collective on October 23, 2013. (See Williams Decl. ¶ 12.) While the motion was pending, Chipotle conducted an internal investigation into the labor practices at the Crystal Restaurant. (See Shunk Decl.

Page 5

¶ 13.) One of its Apprentice Managers acknowledged that he had required employees to work off the clock, leading to internal discipline. (See Williams Decl. ¶¶ 18, 44.) Chipotle also paid its then-current employees back wages. (Id.) Plaintiffs contend, however, that Chipotle made no effort to compensate former employees who had also worked off the clock. (See Pls.' Mem. at 7.)

On April 10, 2014, Magistrate Judge Rau recommended the conditional certification of a nationwide collective of closing-shift employees. (See April 10, 2014 R&R at 33-34.) On September 9, 2014, this Court adopted the R&R in part, limiting the scope of the conditional collective to Chipotle's Crystal Restaurant.² (Sept. 9, 2014 Order at 21-22.) Plaintiffs moved for the certification of an interlocutory appeal of this ruling to the Eighth Circuit, (see Pls.' Mot. Interlocutory Appeal [Doc. No. 104], which the Court denied. (Nov. 14, 2014 Order [Doc. No. 128].) Ultimately, 26 additional employees joined the litigation. (See Pls.' Mem. at 7.)

In October 2014, Plaintiff Woodards, a former Chipotle employee at its restaurant

Page 6

in Golden Valley, Minnesota, filed his complaint. (See Shunk Decl. ¶ 31.) Like the Named Plaintiffs in Harris, he initially sought to represent a nationwide collective. (Id.) In April 2016, Woodards filed an amended complaint, withdrawing any collective or class claims and pursuing an individual action under the FLSA and the Minnesota FLSA. (Woodards, 14-cv-4181 (SRN/SER), Am. Compl. ¶ 1 [Doc. No. 81].)

In December 2016, Chipotle moved to decertify the Harris collective, (see Def.'s Mot. to Decertify [Doc. No. 244]), and also filed a motion, preemptively, to deny Rule 23 class certification on Plaintiffs' claims arising under Minnesota state law. (See Def.'s Mot. to Deny R. 23 Certification [Doc. No. 258].) Six days after the filing, Plaintiffs elected to dismiss their state law claims in Harris, rendering the Rule 23 motion moot. (See Pls.' Dec. 15, 2016 Letter at 1 [Doc. No. 389].) Chipotle asserts that this was the first time that Plaintiffs' counsel in Harris had indicated that they would not seek class certification under Rule 23, (Def.'s Opp'n Mem. at 10), although Plaintiffs state that they gave notice prior to the filing of Chipotle's Rule 23 motion. (See Pls.' Dec. 15, 2016 Letter at 1.) On June 12, 2017, the Court denied Chipotle's decertification motion. (See June 12, 2017 Order [Doc. No. 423].)

Shortly before this matter was scheduled for trial, the parties reached a settlement. Under the terms of the settlement, Chipotle agreed to pay Plaintiff Woodards and the 27 members of the Harris collective the gross amount of $62,000. (See Ex. 1 to Jt. Mot. to Approve Settlement ¶ 6 (Settlement Agmt.) [Doc. No. 455].) Plaintiffs acknowledge that "[t]his [amount] is more than double their total damages at issue in this case, and almost

Page 7

certainly better than any result the Plaintiffs could have obtained at trial." (Pls.' Mem. at 2.)

Pursuant to the terms of the settlement agreement—in which the parties agreed to submit the matter of attorneys' fees and costs to the Court, (see Ex. 1 to Jt. Mot. to Approve Settlement ¶ 6 (Settlement Agmt.))—and the fee-shifting provisions of the FLSA, Plaintiffs' counsel now seek a combined total award of attorneys' fees in the amount of $3,236,368.50, and costs in the amount of $59,942.86, for their work in the two cases.³ (Pls.' Mem. at 3.) Plaintiffs contend that they obtained an "exceptional" settlement—the result of extraordinary effort and enormous investment by their counsel. (Id. at 2-3; 13.) They note that had this matter gone to trial, and had Plaintiffs proven all of their closing shift damages using their expert's methodology, single damages for the Harris collective would have totaled only $20,425.77, and $733.26 for Woodards. (See id. at 13.) Moreover, while enhanced doubling of damages are permitted under the law, Plaintiffs acknowledge that there was no guarantee of double damages in Harris. (Id.) Under the terms of the settlement agreement, however, Plaintiffs state...