Preview
Alejandro P. Gutierrez, SBN 107688
1 agutierrez(@hathawaylawfirm. com FILED
HATHAWAY, PERRETT, WEBSTER, POWERS, Superior Court Of California
2 CHRISMAN & GUTIERREZ, APC
5450 Telegraph Road, Suite 200
3 Venttira; CA 93006-3577 OS/28/2021
Telephone: (805) 644-7111 3tunter4
4 Facsimile: (805) 644-8296
By , Deputy
5 Daniel J. Palay, SBN 159348 Castt Numbuf!
djp<@,calemploymentcounsel. com
6 Brian D. Hefelfmger, SBN 253054 34-2018-00247272
bdh@calemploymentcounsel. com
7 PALAY HEFELFINGER, APC
1746 S. Victoria Avenue, Suite 230
8 Venttu-a, CaUfomia 93001'
Tel: (805) 628-8220
9 Fax: (805) 765-8600
gio Attorneys for Plaintiff JOHN BOUDREA U
and the Certified Class
SUPERIOR COURT OF THE STATE OF CALIFORNIA
0)13
rsi4 FOR THE COUNTY OF SACRAMENTO (UNLIMITED)
u. JOHN BOUDREAU, an individual, on behalf of
himself and all others similarly situated.
CaseNo. 34-2018-00247272
Complaint Filed: 12-27-18
15 Assigned to Dept. 41, Hon. David de Alba
Plaintiffs,
16 DECLARATION OF ALEJANDRO P.
vs. GUTIERREZ IN SUPPORT OF
17 UNOPPOSED MOTION FOR
PRIMERITUS FINANCIAL SERVICES, INC., PRELIMINARY APPROVAL OF CLASS
18 a Delaware Corporation; CHRIS SETTLEMENT
MCGUINNESS, an individual; and DOES 1
19 through 10, inclusive. Date: July 29, 2021
Time: 9:00 a.m.
20 Defendants. Dept: 41
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27 -I-
DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF
28 CLASS ACTION AND PAGA SETTLEMENT
1 I, ALEJANDRO P. GUTIERREZ, declare and state as follows:
2 1. I am an attomey at law duly Ucensed to practice law before all the courts in the State of
3 Califomia. I am a partner with the law firm of Hathaway, Perrett, Webster, Powers, Chrisman & Gutierrez,
4 APC, who, along with co-counsel Daniel J. Palay and Brian Hefelfinger of the firm Palay Hefelfinger APC, are
5 the attomeys of record for named Plaintiff John Boudreau and the Certified Class herein.
6 2. I am the primary attomey in my firm responsible for the handling of this matter, and I make this
7 Declaration based upon my own personal knowledge.
8 3. I am experienced and knowledgeable in wage and hour litigation and class action litigation, as
9 it is my primary practice area, as well as the primary practice area of the Palay Hefelfinger firm. If caUed as a
10 witaess I would and could competentiy testify to the facts stated herein. I make this declaration in support of
11 Plaintiffs Motion for Preliminary Approval of Class Action and PAGA Settlement.
12 4. John Boudreau has been employed by defendant Primeritus Financial Services, Inc. In this
13 lawsuit, Mr. Boudreau represents his individual interests and the interests of the Certified Class.
14 5. Mr. Boudreau hired Class Counsel on a contingency basis, and Class Counsel agreed to advance
15 all costs and receive no fee unless a recovery was accomplished. While litigating this case. Class Counsel had
16 to forego other work and faced considerable financialriskin this action.
17 6. Mr. Boudreau's claims are set forth in the operative First Amended Complaint in this matter,
18 filed April 12,2019, which alleges seven causes of action: (1) Failure to Pay Minimum Wage; (2) Failure
19 to Timely Pay Wages (Waiting Time Penalities); (3) Failure to Provide Rest Periods; (4) Failure to
20 Provide Meal Periods; (5) Failure to Provide Accurate Wage Statements; (6) Violation of the Unfair
21 Competition Law; and (7) Civil Penalites under PAGA. Plaintiff seeks remedies on behalf of himself
22 and other similarly situated employees of Defendant Primeritus.' The original complaint was filed on
23 December 27, 2018.
24 7. The parties and their counsel participated in a full-day mediation in December 2019 with
25 mediator David Phillips.
26 8. Following the filing of Plaintiff s motion for class certification, on January 10, 2020, the
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28 On Febmary 3,2020, this Court granted Class Certification pursuant to the Parties' stipulation.
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DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF
CLASS ACTION AND PAGA SETTLEMENT
1 Parties executed a Stipulation whereby Defendant Primeritus agreed to the certification of the class
2 defined as "All non-exempt current and or former employees of Primeritus who were employed by
3 Primeritus in Califomia during the class period, December 27, 2014 to August 12, 2019, who held the
4 position of Investigator/skip fracer." In the same Stipulation, the parties agreed that Defendant Chris
5 McGuiness would be dismissed from the action without prejudice, stipulated that 20 facts were
6 uncontested for all purposes; and that the parties would file Cross-Motions for Summary Adjudication
7 on the legality of the manner in which Primeritus paid Plaintiff and the certified class for rest periods and
8 nonproductive time and related legal issues including the Labor Code §226 (paysmb claim) and the
9 adjudication of certain penalties.
10 9. The Parties duly filed their cross-motions for summary adjudication, which were heard by
11 the Court on October 1, 2020.
12 10. On November 5, 2020, the Court issued its mling on the Parties' cross-motions for
13 summary adjudication, finding in favor of Plaintiffs. Specifically, the Court mled that "Plaintiffs were
14 not properly compensated for rest periods," and that "they are entitled to one additional hour of pay at
15 their regular rate of compensation for each day they were not properly compensated for rest periods."
16 The Court further mled that that Defendant's wage statements do not comply with Labor Code section
17 226(a).
18 11. Thereafter, on April 6, 2021, the parties participated in a mediation with Mark Rudy, a
19 seasoned mediator who is considered one of the best mediators in Califomia. Prior to the mediation,
20 Class Counsel conducted investigation, discovery, and research during the prosecution of the Action.
21 Such efforts included, among other things: (a) conducting a thorough pre-filing investigation; (b)
22 propounding a comprehensive set of written discovery requests and taking multiple depositions; (c)
23 inspecting and analyzing data and documents produced by Defendants pertaining to Plaintiff and the
24 class members; (d) interviewing class members; (e) analyzing the legal arguments made by Defendant;
25 (f) preparing an analysis of potential class-wide damages and constmcting a damages model;
26 (g) researching the applicable law with respect to the claims asserted in this Action and the potential
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DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF
CLASS ACTION AND PAGA SETTLEMENT
1 defenses thereto. Moreover, the Parties had filed cross-motions for summary adjudication, which
2 resolved for purposes of the trial court proceedings a number of disputed legal issues raised in the Action.
3 12. The case settled after mediation with Mark Rudy, as memorialized in the Joint Stipulation
4 of Class Action and PAGA Settlement for the sum total of $3,900,000.00 (the "Total Settlement
5 Amount"). The Total Settlement Amount roughly equates to the potential damages for alleged rest period
6 compensation claims, and wage statement penalties, and attorneys' fees and costs, as identified through
7 the mediation process and investigation, along with additional sums for civil penalties, adminisfration
8 costs and derivative Labor Code penalties. The Parties' counsel and the mediator believe that the terms
9 of the Settlement reflect a fair and equitable compromise between the Parties.
10 13. Attached as Exhibit A and incorporated herein by reference is a tme and correct copy of
11 the Joint Stipulation of Class Action and PAGA Settlement. The proposed Notice of Class Action
12 Settlement form that the parties have agreed, as well as the proposed Class Workweek Dispute Form (and
13 address correction form), are exhibits to the Stipulation of Settlement. As set forth in more detail in Exhibit
14 1, for the purposes of the settlement, the "Class" in this matter is defined as:
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[A] 11 non-exempt current and former employees of Primeritus who were employed by
16 Primeritus in Califomia during the Class Period as defined below, and who held the
position of Investigator/skipfracerand participated in the Incentive Pay Plan that was the
17 subject of the Action. One hundred sixty-five (165) putative members received class
notice and, except for the three individuals who opted out, are the members of the
18 proposed Settlement Class.
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14. The Class Members in this matter have been ascertained from Defendant's employment and
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21 payroU records. In fact, as part of the sharing of information for the discovery process and the subsequent
22 sharing of information for mediation, defense counsel provide employment records and data for the Class to
23 PlaintifPs counsel. Defendant has represented that, for the relevant claim period in this Action, there were
24 approximately 165 Skip Tracers working in Califomia for Defendant and also represented that there were
25 approximately 66,012 shifts lasting more than 3 Vi hours. Three employees opted out of the action.
26 15. As counsel for Plaintiff, I was involved in the initial interviews with the Plaintiff, and in the
27 investigation, evaluation, and negotiation of this case that resulted in settlement. Having thoroughly reviewed
28 and examined the records produced during the investigation and both formal and informal discovery, I have
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DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF
CLASS ACTION AND PAGA SETTLEMENT
1 attained a detailed and nuanced understanding of the factual scenario and underlying facts involved in this case.
2 16. As part of the due diligence in this matter. Class Counsel reviewed a substantial amount of data
3 pertaining to the class in this matter, including the relevant time and payroll information and records kept by
4 Defendant, and in regard to ascertaining the settlement class members and the scope of the shifts affected by the
5 case and the proposed settlement.
6 17. As such, based on the comprehensive investigation and mediation process, I am equipped with
7 sufficient factual and legal information to accurately assess the relative merits of PlaintifFs and Defendant's
8 positions and to evaluate the worth of the claims of the putative class. This understanding was at aU times the
9 foundation to the good faith, arm's-length negotiations.
10 18. As detailed more fully in Exhibit A attached hereto, the Stipulation of Settlement, this matter
11 has provisionally settled for tiie sum total of $3,900,000.00 (the "Total Settlement Amount"). I have
12 personal knowledge of the investigation and discovery conducted in this matter, as well as conceming the
13 underlying data and documents Class Counsel examined through the investigative and mediation processes.
14 Accordingly, I have a comprehensive understanding of the amount that is in confroversy and the realistic
15 range of outcomes in the litigation. The amount offered in settlement is squarely within the realistic range
16 of outcomes in the litigation, based on all of the risk factors. The investigation, employer data shared, and
17 mediation process in this matter revealed that potential rest period and unproductive time liability in the
18 matter, based on the time records and in light of the Defendzuit's written policies, was tabulated to be on
19 the order of $3,630,500.00. Additionally, the potential wage statement liability in the matter, based on
20 wage statements, was tabulated to be on the order of $217,800.00. Finally, the discovery and mediation
21 process discemed that the other, derivative Labor Code penalties, including PAGA potential liability in
22 the matter was in the order of $953,718.00. These categories of alleged violations are, in aggregate,
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around $4,802,018.00.
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19. The Settlement will result in a substantial benefit to all Class Members. The total
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settlement amount is in excess of eighty-one percent (81%) of the total potential recovery. After
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deducting the to-be-requested amounts for attomey's fees, settlement adminisfrator fees, and actual costs
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for Class Counsel, the Service Payment to the Class Representative, and the PAGA payment (including
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DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF
CLASS ACTION AND PAGA SETTLEMENT
1 the State of Califomia's portion), the net settlement amount to be divided among the class will be
2 approximately $2,379,600.00, with each settling Class Member receiving approximately $14,688.00
3 (net).
4 20. Class Counsel believe that the claims, allegations, and contentions asserted in the action
5 have merit. However, Class Counsel recognize and acknowledge the expense and delay of the lengthy
6 proceedings necessary to prosecute the Action against Defendant through trial and appeals. Furthermore,
7 Class Counsel has taken into account the risks inherent in any litigation, and the additional risk of
8 continued litigation in complex actions such as this, including the Defendant's threatened appeal.
9 Uncertainty in Plaintiffs' ability to secure from a jury a better outcome relative to the settlement amounts
10 the parties have agreed upon, as well as a significant delay in Class Members receiving settlement awards
11 after a trial for damages presented significant risk in the matter. Moreover, Class Counsel have also
12 considered the potential for reduction (or elimination) of penalties recoverable under the Labor Code
13 Private Attomeys' General Act, given that case law permits a discretionary reduction to said penalties
14 where "unjust, arbifrary, oppressive or confiscatory." Similarly, an award of penalties under Labor Code
15 section 203 requires a demonsfration of "willfiilness" on the part of the Defendant. In light of the
16 preceding potential risks. Class Counsel believe that the Settlement set forth in the Stipulation confers
17 substantial benefits upon the Plaintiff and each of the members of the Certified Class, and that an
18 independent review of this Joint Stipulation of Class Action and PAGA Settlement by the Court in the
19 approval process will confirm this conclusion. Based on their own independent investigation and
20 evaluation. Class Counsel have determined that the Settlement set forth in the Stipulation is in the best
21 interests of the Plaintiff and the members of the Certified Class.
22 21. Class Counsel are experienced lawyers with substantial complex litigation experience and
23 have extensive experience in successful prosecution of numerous class actions. We have recovered more
24 than one hundred million dollars on behalf of thousands of individuals in Califomia and have successfully
25 handled numerous significant wage-and-hour class and representative actions. Class Counsel committed
26 significant firm resources to the prosecution of this action. Plaintiffs' counsel for this action were
27 retained based upon a contingency fee arrangement wherein they agreed to advance all costs and receive
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DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF
CLASS ACTION AND PAGA SETTLEMENT
1 no fee unless recovery was accomplished. Because of the anticipated need of resources for the
2 prosecution of this case, we had to forego other work and face considerable financial risk in this Action.
3 22. Counsel for Defendant are also experienced lawyers with substantial complex litigation
4 experience, and are part of a major, intemational law firm, which advertises itself as "the largest global
5 employment and labor law practice . . . with more than 1,500 attomeys in 80 offices." (See, e.g.,
6 https://www.littler.com/es/node/500022). Counsel for Defendant have extensive experience in defending
7 wage-and-hour class actions.
8 23. At aU times, the Parties' settlement negotiations have been non-collusive, adversarial, and
9 conducted at arms-length.
10 24. Based upon my review of the facts of this case and the law, it is my recommendation that this
11 matter be resolved as to the terms set forth in the Settlement Agreement. In making this recommendation, I
12 have analyzed the chances of successfully prevailing at both the trial and appellate levels. Based upon the risks
13 inherent in this litigation, I beUeve that this is an appropriate resolution.
14 25. Class Counsel contacted Simpluris and other administrators for a quote for the administration
15 of the claims in this settlement. The Parties have agreed, as has Simpluris, to reimbursement of the
16 Settlement Adminisfrator's costs, estimated not to exceed $5,400 for the first installment of settlement
17 funds. The settlement provides that the second installment payment will be paid separately by the
18 Defendant and this amount will not be taken from the common fund.
19 26. Class Counsel have been and are fiiUy capable of prosecuting this htigation. I graduated from
20 the University of Califomia at Davis Law School and was admitted to the Califomia Bar in 1983.1 have
21 extensive experience in civil litigation and an over 35-year history of aggressive, successful prosecution
22 of labor law cases. For instance, in a wage and hour class action, in binding arbifration, I succeeded in
23 procuring an award of $51.2 million for the class. This recovery represented close to 100% of the
24 compensatory damages suffered by class members, an exceptional and rare result. In fact, my efforts
25 resuhed in what I believe to be the largest per-person award in Califomia history. Further, 1 have
26 successfully resolved several class and PAGA representative actions before trial in favor of the class,
27 including Avitia v. Big Lots Stores, Los Angeles County Superior Court Case No. BC436317; McNeal
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DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF
CLASS ACTION AND PAGA SETTLEMENT
1 V. Pacific Satellite, Los Angeles County Superior Court Case No. BC382775; Beltran v. Restaurant
2 Miramar, Venttira Co. Superior Court Case No. 56-2009-00362572-CU-BC-VTA; Dockstader v.
3 Employee Leasing, Inc., Venttira Co. Superior Court Case No. 56-2010-00371075-CU-OE-VTA; Britto
4 V. Zep, Alameda County Superior Court Case No. VG-10553718; Rizkv. DirectSat, Los Angeles County
5 Superior Court Case No. BC363435; Bankwitz v. Ecolab, USDC Case No. 2:17-cv-02924-EMC; Miner
6 V. Ecolab, USDC Case No. 2:17-cv-02313-FMO-JC. I have also defended class action cases with
7 favorable results, including successfully stemming a certification of class in a potentially multi-million
8 dollar action in Santa Barbara. (Villasenor v. Jimenez Nursery, Santa Barbara Superior Court Case No.
9 1131798).
10 27. In addition, I was lead or co-counsel in the following wage and hour class actions: Ross
11 V. Ecolab, Northern District of Califomia case number 13-cv-5097-PJH; Rose v. Sodexo, U.S. Disfrict
12 Court No. CV08-05687-RGK (AGRx); Cooper v. Ecolab, Los Angeles County Superior Court Case No.
13 BC486875; Roe v. Ecolab, Ventura Co. Superior Court Case No. CFV 233936; Dietz v. Ecolab, Ventura
14 Co. Superior Court Case No. CFV 241827; Campos v. Ecolab, Northem District of Califomia case
15 number 4:16-cv-04829-PJH; Martino v. Ecolab, Northem District of Califomia case number 5:14-cv-
16 04358-PSG; Ladore v. Ecolab, Central District of Califomia case number 2:ll-cv-09386, all of which
17 resolved in favor of the plaintiffs. I have been lead counsel or co-counsel in class actions that have
18 resulted in damage recoveries of over $130 million. I have also been one of the rare attomeys to take a
19 class action to completion, litigating an overtime action against Ecolab on behalf of its pest confrol
20 service specialists through an arbifration that Ecolab even challenged on appeal. I prevailed on that
21 appeal as well, which upheld an arbifration award of over $50 million. (Roe v. Ecolab, Inc. (Cal. Ct.
22 App., Aug. 19,2009, No. B210262) 2009 WL 2517569.)
23 28. I have also handled numerous matters involving Labor Commissioner cases,
24 approximately half of which were on behalf of the employee.
25 29. The Palay Hefelfinger APC firm (including counsel Daniel J. Palay's formerfirmsof McTague
26 & Palay, and The Palay Law Firm) has extensive experience in successfiil prosecution of wage class action
27 matters. Palay Hefelfinger, APC has a sfrong emphasis in employee-related litigation on a class-wide basis.
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DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF
CLASS ACTION AND PAGA SETTLEMENT
1 The Firm has resolved several certified class action matters and continues to represent individuals in presently-
2 certified class actions and pending certification matters. All of these class action cases have involved employee-
3 related wage claims, including those similar if not identical to the causes of action as presented in this subject
4 matter.
5 30. Mr. Daniel J. Palay is the founder of Palay Hefelfinger APC. Mr. Palay has personally handled
6 weU over fifty wage-and-hour class actions. Numerous courts throughout the state have appointed him class
7 counsel, including the foUowing cases: Kem County Superior Court cases Calvillo v. Diamond Well Service, S-
8 1500-CV 259751; Candete v. Cummings Transportation Service, S-1500-CV 264301; Carter v. B&L Tongs,
9 LLC, S-1500-CV-258154 SPC; and Gutierrez v. Halliburton Energy Services, Inc., S-1500-CV-257557 SPC;
10 Los Angeles County Superior Court case Henson v. Searles Valley Minerals Operations, Inc., BC404330; San
11 Francisco Superior Court case Icard v. Ecolab, Inc., CGC-09-495344; Solano County Superior Court case
12 Kenton v. PGD, FCS 029221; and Ventura County Superior Court cases Bautista v. Alliance Environmental
13 Group, 56-2009-00357772-CU-OE-VTA; Barragan v. Republic Drilling Co., 56-2007-00286959-CU-OE-
14 VTA; Cortez v. Pool Califomia Energy Services, Inc., CFV 222363; Gonzalez v. Key Energy Services, Inc., CIV
15 236497; Hemosillo v. KenaiDrilling Ltd., CIV 237210; Hiriarte v. Weatherford U.S.. LP., CIV 247425; Howe
16 V. BTCLaboratories, Inc., CFV 233988; Roe v. Ecolab, Inc., CFV 233936; and Vasquez v. DCH(Oxnard) Inc.,
17 CFV 243055. Mr. Palay is responsible for securing some of the largest, knovm per-claimant class action
18 settlements in CaUfomia history.
19 31. Mr. Brian Hefelfinger has also handled numerous wage-and-hour class action matters and
20 continues to litigate presently certified class actions and pending certification matters. AU of these class actio
21 cases have involved employee-related wage claims, including those similar to the causes of action as presented
22 in this matter. Examples of matters in which he has represented class members include: Alameda County
23 Superior Court case Britto v. Zep, VB- 10553718;San Francisco Superior Court case Icard v. Ecolab, Inc., CGC
24 09-495344 (removed as N.D. Case No. 13-cv-05097-PJH); Cenfral Distiict of California cases Pagel v. Dair
25 Farmers of America, Inc., CD. Cal. Case No. 13-cv-02382-CVW-VBK; Ladore v. Ecolab, Inc., Case No. 2:11 -
26 cv-09386 (FMO); Berry et al v. DCOR, LLC, CD. Cal. Case No. 2:15-CV-02792-RGKAJW; Kem County
27 case, Zavala v. Resource Staffing, Inc. et al., Kem County Case No. S-1500-CV0278358 LHB; Wawryk v. Zoom
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DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF
CLASS ACTION AND PAGA SETTLEMENT
1 Media Corp., Los Angeles Superior Case No. BC561047; Ventura County Superior Court case Perez v.
2 TruGreen, et al.. Case No. 56-2015-00471673-CU-OE-VTA; and Ross et ai v. Ecolab, N.D. Cal. Case No. C
3 13-5097 PJH; among other cases.
4 32. As noted m the Stipulation of Settlement, the proposed method of paying Class Members
5 in the Settlement is to send notice of the settlement to the Class Members (with multiple attempts being
6 made, and an address search if the first attempt(s) fails), followed by mailing a settlement check to each
7 Class Member. There is no requfrement to make a claim on the settlement. This process is outlined in
8 detail in the Stipulation of Settlement, section "C (4 - 5)" (Exhibit 1 hereto).
9 33. Class Counsel have utilized this payment method in other class action matters, and it is my belief
10 tiiat this method is more effective at distributing settlement monies to class members (and less confusing to
11 them) than a "claims-made" procedure.
12 I declare under penalty of perjury and under the laws of State of Califomia that the foregoing is
13 tme and cortect.
14 Executed this 22nd day of June 2021 at Ventura, Califomia.
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Alejandro P. Gutierrez
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DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF
CLASS ACTION AND PAGA SETTLEMENT
Exhibit A
1 Alejandro P. Gutierrez, SBN 107688
agutierrez@hathawavlawfirm.com
2 HATHAWAY, PERRETT, WEBSTER, POWERS,
CHRISMAN & GUTIERREZ, APC
3 5450 Telegraph Road, Suite 200
Venttira, CA 93006-3577
4 Telephone: (805) 644-7111
Facsimile: (805) 644-8296
5
Daniel J. Palay, SBN 159348
6 dip@calemplovmentcounsel.com
Brian D. Hefelfinger, SBN 253054
7 bdh@calemplovnientcounsel.com
PALAY HEFELFINGER, APC
8 1746 S. Victoria Avenue, Suite 230
Ventura, Califomia 93001
9 Tel: (805) 628-8220
Fax: (805) 765-8600
10
Attomeys for Plaintiff John Boudreau and the certified
11 class
12 [ADDITIONAL COUNSEL LISTED ON
FOLLOWING PAGE]
13
SUPERIOR COURT OF CALIFORNIA
14
COUNTY OF SACRAMENTO
15
JOHN BOUDREAU, an individual, on CaseNo. 34-2018-00247272
16 behalf of himself and all others similarly
situated. Assigned to Department 41, Hon. David De Alba
17
Plaintiff, JOINT STIPULATION OF CLASS ACTION
18 AND PAGA SETTLEMENT
V.
19
PRIMERITUS FINANCIAL SERVICES,
20 INC., A Delaware corporation; CHRIS
McGINNESS, an individual; and DOES 1
21 through 10, inclusive.
22
Defendants.
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1.
JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT
\ r \ . —T'yr> _ »-» _ r \ r \ jt _ r r t < * \ < - » j _ . i r y r " i . n _
1 KEITH A. JACOBY, Bar No. 150233
kiacobv@littler.com
2 BRADLEY E. SCHWAN, Bar No. 246457
bschwan@littler.com
3 LITTLER MENDELSON, P.C.
2049 Cenmry Park East
4 5th Floor
Los Angeles, CA 90067.3107
5 Telephone: 310.553.0308
Fax No.: 310.553.5583
6
NATHANIEL H. JENKINS, Bar No. 312067
7 nienkins@littler.com
LITTLER MENDELSON, P.C.
8 500 Capitol Mall
Suite 2000
9 Sacramento, CA 95814
Telephone: 916.830.7200
10 Fax No.: 916.561.0828
11 Attomeys for Defendants
Primeritus Financial Services, Inc., and Chris McGinness
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JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT
r-\ _ . • r~v. —T—Tr^-r^-r\r\A _ £r\r\r\ne\ A _ _ rr\ r-1_ n - A _I _ — r\ _ _ _ -»n /M A
1 Plaintiff JOHN BOUDREAU ("Plaintiff) and Defendant PRIMERITUS FINANCL\L
2 SERVICES, INC. ("Defendant") (together, tiie "Parties") hereby submit, subject to the approval of
3 the Court, that the settlement of this action shall be effectuated upon and subject to the following
4 terms and conditions.
5 A. DEFINITIONS
6 As used in this Joint Stipulation of Settlement of Class Action ("Joint Stipulation"), the
7 following terms shall have the meanings specified below. To the extent terms or phrases used in this
8 Joint Stipulation are not specifically defined below, but are defined elsewhere in the Joint
9 Stipulation, they are incorporated by reference into this definition section.
10 1. "Action" or "Lawsuif shall mean the above-entitled class action/representative case
11 John Boudreau, et al. v. Primeritus Financial Services, Inc., et al.. Case No. 34-2018-
12 00247272, which is pending in the Superior Court of the State of Califomia for the
13 County of Sacramento.
14 2. "Agreement," "Stipulation," "Joint Stipulation," "Stipulation of Settlement,"
15 "Settlement Agreement," or "Stipulation and Agreement" shall mean this Joint
16 Stipulation, including any attached exhibits." Class" or "Settlement Class" shall
17 include all non-exempt ciurent and former employees of Primeritus who were
18 employed by Primeritus in Califomia during the Class Period as defined below, and
19 who held the position of Investigator/skipfracerand participated in the Incentive Pay
20 Plan that was the subject of the Action. One hundred sixty-five (165) putative
21 members received class notice and, except for the three individuals who opted out,
22 are the members of the proposed Settlement Class. Individuals, if any, who were
23 qualified to participate in the Class and receive notice when the Class was certified
24 but were inadvertently left off of the class list will be given an opportunity to
25 participate in the Settlement Class and will additionally be given the opportunity to
26 opt out ofthe settlement class (referred to as the "Omitted Individuals") If any Class
27 Member is incompetent or deceased, the person's legal guardian, executor, heir, or
28 successor in interest may act of thefr behalf
3.
JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT
l~\ I rN . -r-T/^ - r\ ^ r\r\ A _ rt^t^r^i^i^ A rrt ry ^ A _I r\ -Ti-vr» i A
1 3. "Class Counsel" shall mean Alejandro P. Gutierrez, HATHAWAY, PERRETT,
2 WEBSTER, POWERS, CHRISMAN & GUTIERREZ, APC, 5450 Telegraph Road,
3 Suite 200 Venttira, CA 93006-3577 and Daniel J. Palay and Brian D. Hefelfinger,
4 PALAY HEFELFINGER, APC, 1746 S. Victoria Avenue, Suite 230, Venttu-a,
5 Califomia 93001.
6 4. "Settlement Class Notice" shall mean the Notice of Class And PAGA Action
7 Settlement, as set forth in the form of Exhibit 1 attached hereto, or as otherwise
8 approved by the Court, which is to be mailed to Class Members and PAGA
9 Employees as part ofthe Notice Packet (defined below).
10 5. "Class Participant(s)" shall mean any and all Class Members except those who timely
11 request exclusion (i.e., who elect to "opt out") as provided herein.
12 6. "Class Period" is December 27, 2014 to August 10, 2019, inclusive.
13 7. "Class Representative" or "Named Plaintiff or "Plaintiff shall mean Plaintiff John
14 Boudreau.
15 8. "Class Settlement" or "Settlemenf shall mean the settlement embodied in this Joint
16 Stipulation, which is subject to Court approval.
17 9. "Complaint" shall mean the original Complaint dated December 27, 2018.
18 10. "Court" shall mean the Superior Court of Califomia for the Coimty of Sacramento.
19 11. "Defendanf shall mean Primeritus Financial Services, Inc.
20 12. "Defense Counsel" or "Counsel for Defendant" shall mean the law firm of Littler
21 Mendelson, P.C. located at 2049 Century Park East, 5th Floor, Los Angeles, CA
22 90067, and 500 Capitol Mall, Suite 2000, Sacramento, CA 95814.
23 13. "Effective Date" shall mean the date this Agreement is approved as provided herein
24 and the Court's order granting Final Approval and entry of Judgment becomes final
25 and is no longer appealable. For purposes of this Agreement, "becomes final and is
26 no longer appealable" shall mean the later of: (a) the day after the last date by which a
27 notice of appeal to the applicable Court of Appeal of the order and judgment
28 approving this Agreement may be timely filed and none is filed (i.e., 61 days from
4.
JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT
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1 notice of enfry of judgment); (b) if an appeal is filed, and the appeal is finally
2 disposed of by mling, dismissal, denial, or in a any other maimer that confirms the
3 validity of the order and judgment, the day after the last date for filing a request for
4 further review of the order and judgment approving this Agreement passes, and no
5 further review is requested; or (c) if an appeal is filed and the order approving this
6 Agreement is affirmed and fiirther review of the order is requested, the day after the
7 review is finally resolved and the order and judgment approving this Agreement is
8 affirmed.
9 14. "Final Approval Date" shall mean the date upon which the Court enters an Order
10 approving the Class Settlement, after having determined that the Class Settlement is
11 fair, adequate, and reasonable to the Class as a whole, following: (i) notice to the
12 Class; (ii) an opportunity to submit timely exclusion or objections to the non-PAGA
13 portion of the Settlement; and (iii) a hearing on the faimess of the terms of the
14 Settlement.
15 15. "Final Approval Hearing" shall mean the final hearing held by the Court to ascertain
16 the faimess, reasonableness, and adequacy of the Class Settlement.
17 16. "First Amended Complaint" means the operative First Amended Complaint filed on
18 April 12, 2019 in this Action.
19 17. "Incentive Pay Plan" shall mean the pay plan under which Class Members received
20 eight dollars an hour for every hour worked and incentive pay eamed as a resuU of
21 points being awarded for collateral that that the Settlement Class Members identified,
22 which lead to an event qualifying for an award under the incentive plan.
23 18. "Individual PAGA Payment" shall mean the pro-rata share ofthe PAGA penalties
24 allocated to the settlement of the PAGA Claims to which each PAGA Employee is
25 entitied from the PAGA Fund based on the number of pay periods they worked
26 during the PAGA Period, as described below (PAGA Fund and Payment to Labor and
27 Workforce Development Agency).
28 19. "Individual Shifts at Issue" shall mean shifts worked over 3 Va hours (when a rest
5.
JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT
r> _ _ I r~\. _ mr\r\nn A - _ X'n r-1_ r\ - A _I r\ — _ -r rv »^ u _ A
1 period was eamed) during which time a Class Member was being paid pursuant to the
2 Incentive Pay Plan.
3 20. "Total Individual Class Settlement Payment" shall mean the amount to be distributed
4 to any and each Class Participant as described in Section D.4 below (Class Participant
5 Distribution Formula).
6 21. "LWDA" means the Califomia Labor and Workforce Development Agency.
7 22. "Net Settlement Amount" means the Total Settlement Amount less the Settlement
8 Administtator's Expenses, the Class Representative's Service Payment, the PAGA
9 Fund, and Class Counsel's attomeys' fees (not to exceed 35% of the Gross Settlement
10 Amount) and costs, subject to approval by the Court.
11 23. "Notice Packet" shall mean the Notice of Class Action Settlement and Opt-Out Form,
12 collectively.
13 24. "Opt-Out(s)" shall mean any and all eligible Settlement Class Members who timely
14 and validly request exclusion from the Settlement of the Released Class Claims in
15 accordance with the terms ofthe Class Notice. Any Settlement Class Member that
16 received notice of class certification sent pursuant to the Court's Febmary 3, 2020
17 Order and did not opt out does not have the option to opt out of this settlement; only
18 Omitted Individuals shall receive an Opt-Out Form. Notwithstanding the submission
19 ofa timely request for exclusion, PAGA Employees will still be bound by the
20 settlement and release of the Released PAGA Claims or remedies under the Judgment
21 pursuant to Arias v. Superior Court, 46 Cal. 4th 969 (2009). So long as the Court
22 approves the PAGA portion of the settlement, requests for exclusion do not apply to
23 the Released PAGA Claims, and will not be effective to preclude the release of the
24 Released PAGA Claims.
25 25. "Opt-Out Form" or "Exclusion Form" shall mean a document that an Omitted
26 Individual that is also a Class Member is required to mail to the Settlement
27 Adminisfrator, as set forth in the form of Exhibit 2 attached hereto, postmarked no
28 later than the date indicated on the Class Notice, to exclude himself or herself from
6.
JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT
1 the non-PAGA portion of the Class Settlement.
2 26. "Parties" shall mean the Class Representative and Defendant.
3 27. "PAGA" means the Califomia Labor Code Private Attomeys General Act, Califomia
4 Labor Code §§ 2698 et seq.
5 28. "PAGA Employees" shall mean all non-exempt employees who worked for
6 Defendant in Califomia during the PAGA Period.
7 29. "PAGA Claims" shall mean all claims for PAGA penalties on behalf of Plaintiff,
8 similarly aggrieved employees and the State of Califomia, during the PAGA Period
9 defined below.
10 30. "PAGA Fund" means the gross amount of $ 100,000 which the parties have allocated
11 for PAGA penalties for alleged Labor Code violations. Seventy-five percent of the
12 PAGA Fund (i.e., $75,000) shaU be paid to the LWDA, and the remaining twenty-
13 five percent (i.e., $25,000) shall be paid to PAGA Employees.
14 31. "PAGA Period" means from January 4, 2018 through the date of Prehminary
15 Approval.
16 32. "Participating Settlement Employees" means all Class Participants and PAGA
17 Employees.
18 33. "Preliminary Approval" means the Court Order preliminarily approving this Joint
19 Stipulation, authorizing the mailing of the Notice Packet by the Settlement
20 Adminisfrator, and setting the date of the Final Approval Hearing.
21 34. "Preliminary Approval Date" means the date upon which the Court enters an order
22 preliminarily approves this Stipulation, pending notice, an opportunity to submit
23 objections, and a faimess hearing thereon.
24 35. "Preliminary Approval Hearing" shall mean the hearing held on the motion for
25 preliminary approval ofthe Class Settlement.
26 36. "Released Class Claims" means all claims alleged or that could have been alleged
27 based on the operative facts pled in the original Complaint or operative First
28 Amended Complaint. The release of the Class Claims shall be effective at all times
7.
JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT
1 during the entirety ofthe Class Period. "Released PAGA Claims" means all PAGA
2 Claims that were actually alleged or could have been alleged in the original
3 Complaint or First Amended Complaint in this Action by Named Plaintiff, on behalf
4 of the State of Califomia, himself, and PAGA Employees. The release of the
5 Released PAGA Claims shall be effective during the entirely ofthe PAGA Period.
6 37. "Released Parties" shall mean Defendant Primeritus Financial Services, Inc. and each
7 of thefr respective parents, subsidiaries, affiliates, shareholders, members, agents
8 (including, without limitation, any investment bankers, accountants, insurers,
9 attomeys and any past, present or fiiture officers (including but not limited to
10 dismissed Defendant Chris McGinness), directors and employees), predecessors,
11 successors, and assigns.
12 38. "Service Payment" shaU mean any additional monetary payment provided to the
13 Class Representative for his efforts on behalf of the Class in this Action.
14 39. "Settlement Adminisfrator" shall mean the company knovra as Simpluris, a qualified,
15 third-party settlement administrator which the Parties have agreed will be responsible
16 for adminisfration of the Settlement and related matters.
17 40. "Settlement Adminisfrator's Expenses" means all costs and expenses relating to the
18 administration of the Settlement, including without limitation, address verification
19 measures, formatting, preparing, and mailing of Notice Packets, accounting for opt-
20 outs and objections, calculation and determination of payments to Participating
21 Settlement Employees, accounting and maintenance of Settlement Fund Account
22 (defined below), posting the necessary information (i.e., regarding the judgment) on
23 the adminisfrators' website, preparation of a report to the Court indicating the total
24 amount that was actuaUy paid to Participating Settlement Employees, administration
25 and payment of unclaimed and/or uncashed checks pursuant to Code of Civil
26 Procedure § 384, preparation and issuance of checks to Class Counsel for attomeys'
27 fees and costs, preparation and issuance ofthe checks to Representative Plaintiff for
28 her Service Payment, and submission of all tax-related documents and any other costs
8.
JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT
I i-N. -T^r^ . . A _ rr\nr\r\r\ A _ _ £r\ r-1_ r»_<«_i r» -rrt/M A
1 incidental to or associated with the claims adminisfration of this settlement, all
2 pursuant to the terms of this Agreement. All additional expenses related to the
3 payment of the Second Settlement Installment defined herein shall be home by
4 Defendant and shall not be paid out of the Total Settlement Amoimt.
5 41. "Settlement Fund Account" shall mean the Qualified Settlement Fund, as defmed by
6 the Intemal Revenue Code, established pursuant to the terms of this Joint Stipulation
7 from which all monies payable under the terms of this Stipulation shall be paid, as set
8 forth herein.
9 42. "Settling Parties" shall mean Class Representative, the Settlement Class, PAGA
10 Employees, and Defendant.
11 43. "Total Settlement Amount" or "Total Settlement Payment" shall mean the total
12 amount that Defendant will pay to resolve this Action, based on the aggregation of
13 the agreed-upon settlement value of individual claims, which is Three Million Nine
14 Hundred Thousand Dollars ($3,900,000), which includes the payment to the Class,
15 the PAGA Employees, Settlement Adminisfrator's Expenses, Class Representative's
16 Service Payment, payment to Labor and Workforce Development Agency for PAGA
17 penalties, and Class Counsel's attomeys' fees and costs. Defendant will pay its share
18 of applicable employer-side payroll taxes on the wage portion of the Settlement
19 payments separately and in addition to the Total Settlement Amount. In no event will
20 Defendant be required to pay more than the Total Settlement Amount, than its share
21 of applicable employer-side payroll taxes on the wage portion of the Settlement
22 payments and the costs associated with the second installment payment as part of this
23 Agreement.
24 B. PRE-TRIAL PROCEEDINGS AND NEGOTIATIONS
25 1. Investigation, Discovery, and Research
26 Class Counsel have conducted investigation, discovery, and research during the prosecution
27 of the Action. Such efforts included, among other things: (a) conducting a thorough pre-filing
28 investigation; (b) propounding a comprehensive set of written discovery requests and taking
9.
JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT
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1 depositions; (c) inspecting and analyzing data and documents produced by Defendants pertaining to
2 Plaintiff and the putative class members; (d) interviewing putative class members; (e) analyzing the
3 legal arguments made by Defendant; (f) preparing an analysis of potential class-wide damages and
4 constmcting a damages model; (g) researching the applicable law with respect to the claims asserted
5 in this Action and the potential defenses thereto. Moreover, the Parties filed cross-motions for
6 summary adjudication, which resolved for purposes of the trial court proceedings a number of
7 disputed legal issues raised in the Action Thus, the Parties have engaged in sufficient investigation,
8 discovery, and research to assess the relative merits of the claims of the Class Representative and of
9 Defendant's defenses to them.
10 2. Allegations of the Class Representative and Benefits of Settlement
11 The investigation and discovery conducted in this matter were adequate to give the Class
12 Representative and Class Counsel a sound understanding of the merits of thefr position and to
13 evaluate the worth of the claims of the Class. This Settlement was reached after arm's-length
14 bargaining by the Parties with the assistance of Mark Rudy, a highly experienced mediator in the
15 wage and hour field and after Class Counsel thoroughly reviewed all relevant evidence. The
16 information obtained from investigation and discovery as well as information exchanged for
17 mediation was sufficient to assess reliably the merits of the respective Parties' positions and to
18 compromise the issues on a fair and equitable basis.
19 The Class Representative and Class Counsel believe that the causes, allegations, and
20 co
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Alejandro P. Gutierrez, SBN 107688 1 agutierrez(@hathawaylawfirm. com FILED HATHAWAY, PERRETT, WEBSTER, POWERS, Superior Court Of California 2 CHRISMAN & GUTIERREZ, APC 5450 Telegraph Road, Suite 200 3 Venttira; CA 93006-3577 OS/28/2021 Telephone: (805) 644-7111 3tunter4 4 Facsimile: (805) 644-8296 By , Deputy 5 Daniel J. Palay, SBN 159348 Castt Numbuf! djp<@,calemploymentcounsel. com 6 Brian D. Hefelfmger, SBN 253054 34-2018-00247272 bdh@calemploymentcounsel. com 7 PALAY HEFELFINGER, APC 1746 S. Victoria Avenue, Suite 230 8 Venttu-a, CaUfomia 93001' Tel: (805) 628-8220 9 Fax: (805) 765-8600 gio Attorneys for Plaintiff JOHN BOUDREA U and the Certified Class SUPERIOR COURT OF THE STATE OF CALIFORNIA 0)13 rsi4 FOR THE COUNTY OF SACRAMENTO (UNLIMITED) u. JOHN BOUDREAU, an individual, on behalf of himself and all others similarly situated. CaseNo. 34-2018-00247272 Complaint Filed: 12-27-18 15 Assigned to Dept. 41, Hon. David de Alba Plaintiffs, 16 DECLARATION OF ALEJANDRO P. vs. GUTIERREZ IN SUPPORT OF 17 UNOPPOSED MOTION FOR PRIMERITUS FINANCIAL SERVICES, INC., PRELIMINARY APPROVAL OF CLASS 18 a Delaware Corporation; CHRIS SETTLEMENT MCGUINNESS, an individual; and DOES 1 19 through 10, inclusive. Date: July 29, 2021 Time: 9:00 a.m. 20 Defendants. Dept: 41 21 22 23 24 25 26 27 -I- DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF 28 CLASS ACTION AND PAGA SETTLEMENT 1 I, ALEJANDRO P. GUTIERREZ, declare and state as follows: 2 1. I am an attomey at law duly Ucensed to practice law before all the courts in the State of 3 Califomia. I am a partner with the law firm of Hathaway, Perrett, Webster, Powers, Chrisman & Gutierrez, 4 APC, who, along with co-counsel Daniel J. Palay and Brian Hefelfinger of the firm Palay Hefelfinger APC, are 5 the attomeys of record for named Plaintiff John Boudreau and the Certified Class herein. 6 2. I am the primary attomey in my firm responsible for the handling of this matter, and I make this 7 Declaration based upon my own personal knowledge. 8 3. I am experienced and knowledgeable in wage and hour litigation and class action litigation, as 9 it is my primary practice area, as well as the primary practice area of the Palay Hefelfinger firm. If caUed as a 10 witaess I would and could competentiy testify to the facts stated herein. I make this declaration in support of 11 Plaintiffs Motion for Preliminary Approval of Class Action and PAGA Settlement. 12 4. John Boudreau has been employed by defendant Primeritus Financial Services, Inc. In this 13 lawsuit, Mr. Boudreau represents his individual interests and the interests of the Certified Class. 14 5. Mr. Boudreau hired Class Counsel on a contingency basis, and Class Counsel agreed to advance 15 all costs and receive no fee unless a recovery was accomplished. While litigating this case. Class Counsel had 16 to forego other work and faced considerable financialriskin this action. 17 6. Mr. Boudreau's claims are set forth in the operative First Amended Complaint in this matter, 18 filed April 12,2019, which alleges seven causes of action: (1) Failure to Pay Minimum Wage; (2) Failure 19 to Timely Pay Wages (Waiting Time Penalities); (3) Failure to Provide Rest Periods; (4) Failure to 20 Provide Meal Periods; (5) Failure to Provide Accurate Wage Statements; (6) Violation of the Unfair 21 Competition Law; and (7) Civil Penalites under PAGA. Plaintiff seeks remedies on behalf of himself 22 and other similarly situated employees of Defendant Primeritus.' The original complaint was filed on 23 December 27, 2018. 24 7. The parties and their counsel participated in a full-day mediation in December 2019 with 25 mediator David Phillips. 26 8. Following the filing of Plaintiff s motion for class certification, on January 10, 2020, the 27 28 On Febmary 3,2020, this Court granted Class Certification pursuant to the Parties' stipulation. -2- DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION AND PAGA SETTLEMENT 1 Parties executed a Stipulation whereby Defendant Primeritus agreed to the certification of the class 2 defined as "All non-exempt current and or former employees of Primeritus who were employed by 3 Primeritus in Califomia during the class period, December 27, 2014 to August 12, 2019, who held the 4 position of Investigator/skip fracer." In the same Stipulation, the parties agreed that Defendant Chris 5 McGuiness would be dismissed from the action without prejudice, stipulated that 20 facts were 6 uncontested for all purposes; and that the parties would file Cross-Motions for Summary Adjudication 7 on the legality of the manner in which Primeritus paid Plaintiff and the certified class for rest periods and 8 nonproductive time and related legal issues including the Labor Code §226 (paysmb claim) and the 9 adjudication of certain penalties. 10 9. The Parties duly filed their cross-motions for summary adjudication, which were heard by 11 the Court on October 1, 2020. 12 10. On November 5, 2020, the Court issued its mling on the Parties' cross-motions for 13 summary adjudication, finding in favor of Plaintiffs. Specifically, the Court mled that "Plaintiffs were 14 not properly compensated for rest periods," and that "they are entitled to one additional hour of pay at 15 their regular rate of compensation for each day they were not properly compensated for rest periods." 16 The Court further mled that that Defendant's wage statements do not comply with Labor Code section 17 226(a). 18 11. Thereafter, on April 6, 2021, the parties participated in a mediation with Mark Rudy, a 19 seasoned mediator who is considered one of the best mediators in Califomia. Prior to the mediation, 20 Class Counsel conducted investigation, discovery, and research during the prosecution of the Action. 21 Such efforts included, among other things: (a) conducting a thorough pre-filing investigation; (b) 22 propounding a comprehensive set of written discovery requests and taking multiple depositions; (c) 23 inspecting and analyzing data and documents produced by Defendants pertaining to Plaintiff and the 24 class members; (d) interviewing class members; (e) analyzing the legal arguments made by Defendant; 25 (f) preparing an analysis of potential class-wide damages and constmcting a damages model; 26 (g) researching the applicable law with respect to the claims asserted in this Action and the potential 27 28 DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION AND PAGA SETTLEMENT 1 defenses thereto. Moreover, the Parties had filed cross-motions for summary adjudication, which 2 resolved for purposes of the trial court proceedings a number of disputed legal issues raised in the Action. 3 12. The case settled after mediation with Mark Rudy, as memorialized in the Joint Stipulation 4 of Class Action and PAGA Settlement for the sum total of $3,900,000.00 (the "Total Settlement 5 Amount"). The Total Settlement Amount roughly equates to the potential damages for alleged rest period 6 compensation claims, and wage statement penalties, and attorneys' fees and costs, as identified through 7 the mediation process and investigation, along with additional sums for civil penalties, adminisfration 8 costs and derivative Labor Code penalties. The Parties' counsel and the mediator believe that the terms 9 of the Settlement reflect a fair and equitable compromise between the Parties. 10 13. Attached as Exhibit A and incorporated herein by reference is a tme and correct copy of 11 the Joint Stipulation of Class Action and PAGA Settlement. The proposed Notice of Class Action 12 Settlement form that the parties have agreed, as well as the proposed Class Workweek Dispute Form (and 13 address correction form), are exhibits to the Stipulation of Settlement. As set forth in more detail in Exhibit 14 1, for the purposes of the settlement, the "Class" in this matter is defined as: 15 [A] 11 non-exempt current and former employees of Primeritus who were employed by 16 Primeritus in Califomia during the Class Period as defined below, and who held the position of Investigator/skipfracerand participated in the Incentive Pay Plan that was the 17 subject of the Action. One hundred sixty-five (165) putative members received class notice and, except for the three individuals who opted out, are the members of the 18 proposed Settlement Class. 19 14. The Class Members in this matter have been ascertained from Defendant's employment and 20 21 payroU records. In fact, as part of the sharing of information for the discovery process and the subsequent 22 sharing of information for mediation, defense counsel provide employment records and data for the Class to 23 PlaintifPs counsel. Defendant has represented that, for the relevant claim period in this Action, there were 24 approximately 165 Skip Tracers working in Califomia for Defendant and also represented that there were 25 approximately 66,012 shifts lasting more than 3 Vi hours. Three employees opted out of the action. 26 15. As counsel for Plaintiff, I was involved in the initial interviews with the Plaintiff, and in the 27 investigation, evaluation, and negotiation of this case that resulted in settlement. Having thoroughly reviewed 28 and examined the records produced during the investigation and both formal and informal discovery, I have -4- DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION AND PAGA SETTLEMENT 1 attained a detailed and nuanced understanding of the factual scenario and underlying facts involved in this case. 2 16. As part of the due diligence in this matter. Class Counsel reviewed a substantial amount of data 3 pertaining to the class in this matter, including the relevant time and payroll information and records kept by 4 Defendant, and in regard to ascertaining the settlement class members and the scope of the shifts affected by the 5 case and the proposed settlement. 6 17. As such, based on the comprehensive investigation and mediation process, I am equipped with 7 sufficient factual and legal information to accurately assess the relative merits of PlaintifFs and Defendant's 8 positions and to evaluate the worth of the claims of the putative class. This understanding was at aU times the 9 foundation to the good faith, arm's-length negotiations. 10 18. As detailed more fully in Exhibit A attached hereto, the Stipulation of Settlement, this matter 11 has provisionally settled for tiie sum total of $3,900,000.00 (the "Total Settlement Amount"). I have 12 personal knowledge of the investigation and discovery conducted in this matter, as well as conceming the 13 underlying data and documents Class Counsel examined through the investigative and mediation processes. 14 Accordingly, I have a comprehensive understanding of the amount that is in confroversy and the realistic 15 range of outcomes in the litigation. The amount offered in settlement is squarely within the realistic range 16 of outcomes in the litigation, based on all of the risk factors. The investigation, employer data shared, and 17 mediation process in this matter revealed that potential rest period and unproductive time liability in the 18 matter, based on the time records and in light of the Defendzuit's written policies, was tabulated to be on 19 the order of $3,630,500.00. Additionally, the potential wage statement liability in the matter, based on 20 wage statements, was tabulated to be on the order of $217,800.00. Finally, the discovery and mediation 21 process discemed that the other, derivative Labor Code penalties, including PAGA potential liability in 22 the matter was in the order of $953,718.00. These categories of alleged violations are, in aggregate, 23 around $4,802,018.00. 24 19. The Settlement will result in a substantial benefit to all Class Members. The total 25 settlement amount is in excess of eighty-one percent (81%) of the total potential recovery. After 26 deducting the to-be-requested amounts for attomey's fees, settlement adminisfrator fees, and actual costs 27 for Class Counsel, the Service Payment to the Class Representative, and the PAGA payment (including 28 DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION AND PAGA SETTLEMENT 1 the State of Califomia's portion), the net settlement amount to be divided among the class will be 2 approximately $2,379,600.00, with each settling Class Member receiving approximately $14,688.00 3 (net). 4 20. Class Counsel believe that the claims, allegations, and contentions asserted in the action 5 have merit. However, Class Counsel recognize and acknowledge the expense and delay of the lengthy 6 proceedings necessary to prosecute the Action against Defendant through trial and appeals. Furthermore, 7 Class Counsel has taken into account the risks inherent in any litigation, and the additional risk of 8 continued litigation in complex actions such as this, including the Defendant's threatened appeal. 9 Uncertainty in Plaintiffs' ability to secure from a jury a better outcome relative to the settlement amounts 10 the parties have agreed upon, as well as a significant delay in Class Members receiving settlement awards 11 after a trial for damages presented significant risk in the matter. Moreover, Class Counsel have also 12 considered the potential for reduction (or elimination) of penalties recoverable under the Labor Code 13 Private Attomeys' General Act, given that case law permits a discretionary reduction to said penalties 14 where "unjust, arbifrary, oppressive or confiscatory." Similarly, an award of penalties under Labor Code 15 section 203 requires a demonsfration of "willfiilness" on the part of the Defendant. In light of the 16 preceding potential risks. Class Counsel believe that the Settlement set forth in the Stipulation confers 17 substantial benefits upon the Plaintiff and each of the members of the Certified Class, and that an 18 independent review of this Joint Stipulation of Class Action and PAGA Settlement by the Court in the 19 approval process will confirm this conclusion. Based on their own independent investigation and 20 evaluation. Class Counsel have determined that the Settlement set forth in the Stipulation is in the best 21 interests of the Plaintiff and the members of the Certified Class. 22 21. Class Counsel are experienced lawyers with substantial complex litigation experience and 23 have extensive experience in successful prosecution of numerous class actions. We have recovered more 24 than one hundred million dollars on behalf of thousands of individuals in Califomia and have successfully 25 handled numerous significant wage-and-hour class and representative actions. Class Counsel committed 26 significant firm resources to the prosecution of this action. Plaintiffs' counsel for this action were 27 retained based upon a contingency fee arrangement wherein they agreed to advance all costs and receive 28 DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION AND PAGA SETTLEMENT 1 no fee unless recovery was accomplished. Because of the anticipated need of resources for the 2 prosecution of this case, we had to forego other work and face considerable financial risk in this Action. 3 22. Counsel for Defendant are also experienced lawyers with substantial complex litigation 4 experience, and are part of a major, intemational law firm, which advertises itself as "the largest global 5 employment and labor law practice . . . with more than 1,500 attomeys in 80 offices." (See, e.g., 6 https://www.littler.com/es/node/500022). Counsel for Defendant have extensive experience in defending 7 wage-and-hour class actions. 8 23. At aU times, the Parties' settlement negotiations have been non-collusive, adversarial, and 9 conducted at arms-length. 10 24. Based upon my review of the facts of this case and the law, it is my recommendation that this 11 matter be resolved as to the terms set forth in the Settlement Agreement. In making this recommendation, I 12 have analyzed the chances of successfully prevailing at both the trial and appellate levels. Based upon the risks 13 inherent in this litigation, I beUeve that this is an appropriate resolution. 14 25. Class Counsel contacted Simpluris and other administrators for a quote for the administration 15 of the claims in this settlement. The Parties have agreed, as has Simpluris, to reimbursement of the 16 Settlement Adminisfrator's costs, estimated not to exceed $5,400 for the first installment of settlement 17 funds. The settlement provides that the second installment payment will be paid separately by the 18 Defendant and this amount will not be taken from the common fund. 19 26. Class Counsel have been and are fiiUy capable of prosecuting this htigation. I graduated from 20 the University of Califomia at Davis Law School and was admitted to the Califomia Bar in 1983.1 have 21 extensive experience in civil litigation and an over 35-year history of aggressive, successful prosecution 22 of labor law cases. For instance, in a wage and hour class action, in binding arbifration, I succeeded in 23 procuring an award of $51.2 million for the class. This recovery represented close to 100% of the 24 compensatory damages suffered by class members, an exceptional and rare result. In fact, my efforts 25 resuhed in what I believe to be the largest per-person award in Califomia history. Further, 1 have 26 successfully resolved several class and PAGA representative actions before trial in favor of the class, 27 including Avitia v. Big Lots Stores, Los Angeles County Superior Court Case No. BC436317; McNeal 28 DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION AND PAGA SETTLEMENT 1 V. Pacific Satellite, Los Angeles County Superior Court Case No. BC382775; Beltran v. Restaurant 2 Miramar, Venttira Co. Superior Court Case No. 56-2009-00362572-CU-BC-VTA; Dockstader v. 3 Employee Leasing, Inc., Venttira Co. Superior Court Case No. 56-2010-00371075-CU-OE-VTA; Britto 4 V. Zep, Alameda County Superior Court Case No. VG-10553718; Rizkv. DirectSat, Los Angeles County 5 Superior Court Case No. BC363435; Bankwitz v. Ecolab, USDC Case No. 2:17-cv-02924-EMC; Miner 6 V. Ecolab, USDC Case No. 2:17-cv-02313-FMO-JC. I have also defended class action cases with 7 favorable results, including successfully stemming a certification of class in a potentially multi-million 8 dollar action in Santa Barbara. (Villasenor v. Jimenez Nursery, Santa Barbara Superior Court Case No. 9 1131798). 10 27. In addition, I was lead or co-counsel in the following wage and hour class actions: Ross 11 V. Ecolab, Northern District of Califomia case number 13-cv-5097-PJH; Rose v. Sodexo, U.S. Disfrict 12 Court No. CV08-05687-RGK (AGRx); Cooper v. Ecolab, Los Angeles County Superior Court Case No. 13 BC486875; Roe v. Ecolab, Ventura Co. Superior Court Case No. CFV 233936; Dietz v. Ecolab, Ventura 14 Co. Superior Court Case No. CFV 241827; Campos v. Ecolab, Northem District of Califomia case 15 number 4:16-cv-04829-PJH; Martino v. Ecolab, Northem District of Califomia case number 5:14-cv- 16 04358-PSG; Ladore v. Ecolab, Central District of Califomia case number 2:ll-cv-09386, all of which 17 resolved in favor of the plaintiffs. I have been lead counsel or co-counsel in class actions that have 18 resulted in damage recoveries of over $130 million. I have also been one of the rare attomeys to take a 19 class action to completion, litigating an overtime action against Ecolab on behalf of its pest confrol 20 service specialists through an arbifration that Ecolab even challenged on appeal. I prevailed on that 21 appeal as well, which upheld an arbifration award of over $50 million. (Roe v. Ecolab, Inc. (Cal. Ct. 22 App., Aug. 19,2009, No. B210262) 2009 WL 2517569.) 23 28. I have also handled numerous matters involving Labor Commissioner cases, 24 approximately half of which were on behalf of the employee. 25 29. The Palay Hefelfinger APC firm (including counsel Daniel J. Palay's formerfirmsof McTague 26 & Palay, and The Palay Law Firm) has extensive experience in successfiil prosecution of wage class action 27 matters. Palay Hefelfinger, APC has a sfrong emphasis in employee-related litigation on a class-wide basis. 28 DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION AND PAGA SETTLEMENT 1 The Firm has resolved several certified class action matters and continues to represent individuals in presently- 2 certified class actions and pending certification matters. All of these class action cases have involved employee- 3 related wage claims, including those similar if not identical to the causes of action as presented in this subject 4 matter. 5 30. Mr. Daniel J. Palay is the founder of Palay Hefelfinger APC. Mr. Palay has personally handled 6 weU over fifty wage-and-hour class actions. Numerous courts throughout the state have appointed him class 7 counsel, including the foUowing cases: Kem County Superior Court cases Calvillo v. Diamond Well Service, S- 8 1500-CV 259751; Candete v. Cummings Transportation Service, S-1500-CV 264301; Carter v. B&L Tongs, 9 LLC, S-1500-CV-258154 SPC; and Gutierrez v. Halliburton Energy Services, Inc., S-1500-CV-257557 SPC; 10 Los Angeles County Superior Court case Henson v. Searles Valley Minerals Operations, Inc., BC404330; San 11 Francisco Superior Court case Icard v. Ecolab, Inc., CGC-09-495344; Solano County Superior Court case 12 Kenton v. PGD, FCS 029221; and Ventura County Superior Court cases Bautista v. Alliance Environmental 13 Group, 56-2009-00357772-CU-OE-VTA; Barragan v. Republic Drilling Co., 56-2007-00286959-CU-OE- 14 VTA; Cortez v. Pool Califomia Energy Services, Inc., CFV 222363; Gonzalez v. Key Energy Services, Inc., CIV 15 236497; Hemosillo v. KenaiDrilling Ltd., CIV 237210; Hiriarte v. Weatherford U.S.. LP., CIV 247425; Howe 16 V. BTCLaboratories, Inc., CFV 233988; Roe v. Ecolab, Inc., CFV 233936; and Vasquez v. DCH(Oxnard) Inc., 17 CFV 243055. Mr. Palay is responsible for securing some of the largest, knovm per-claimant class action 18 settlements in CaUfomia history. 19 31. Mr. Brian Hefelfinger has also handled numerous wage-and-hour class action matters and 20 continues to litigate presently certified class actions and pending certification matters. AU of these class actio 21 cases have involved employee-related wage claims, including those similar to the causes of action as presented 22 in this matter. Examples of matters in which he has represented class members include: Alameda County 23 Superior Court case Britto v. Zep, VB- 10553718;San Francisco Superior Court case Icard v. Ecolab, Inc., CGC 24 09-495344 (removed as N.D. Case No. 13-cv-05097-PJH); Cenfral Distiict of California cases Pagel v. Dair 25 Farmers of America, Inc., CD. Cal. Case No. 13-cv-02382-CVW-VBK; Ladore v. Ecolab, Inc., Case No. 2:11 - 26 cv-09386 (FMO); Berry et al v. DCOR, LLC, CD. Cal. Case No. 2:15-CV-02792-RGKAJW; Kem County 27 case, Zavala v. Resource Staffing, Inc. et al., Kem County Case No. S-1500-CV0278358 LHB; Wawryk v. Zoom 28 DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION AND PAGA SETTLEMENT 1 Media Corp., Los Angeles Superior Case No. BC561047; Ventura County Superior Court case Perez v. 2 TruGreen, et al.. Case No. 56-2015-00471673-CU-OE-VTA; and Ross et ai v. Ecolab, N.D. Cal. Case No. C 3 13-5097 PJH; among other cases. 4 32. As noted m the Stipulation of Settlement, the proposed method of paying Class Members 5 in the Settlement is to send notice of the settlement to the Class Members (with multiple attempts being 6 made, and an address search if the first attempt(s) fails), followed by mailing a settlement check to each 7 Class Member. There is no requfrement to make a claim on the settlement. This process is outlined in 8 detail in the Stipulation of Settlement, section "C (4 - 5)" (Exhibit 1 hereto). 9 33. Class Counsel have utilized this payment method in other class action matters, and it is my belief 10 tiiat this method is more effective at distributing settlement monies to class members (and less confusing to 11 them) than a "claims-made" procedure. 12 I declare under penalty of perjury and under the laws of State of Califomia that the foregoing is 13 tme and cortect. 14 Executed this 22nd day of June 2021 at Ventura, Califomia. 15 16 17 Alejandro P. Gutierrez 18 19 20 21 22 23 24 25 26 27 28 -10- DECLARATION OF ALEJANDRO P. GUTIERREZ IN SUPPORT OF MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION AND PAGA SETTLEMENT Exhibit A 1 Alejandro P. Gutierrez, SBN 107688 agutierrez@hathawavlawfirm.com 2 HATHAWAY, PERRETT, WEBSTER, POWERS, CHRISMAN & GUTIERREZ, APC 3 5450 Telegraph Road, Suite 200 Venttira, CA 93006-3577 4 Telephone: (805) 644-7111 Facsimile: (805) 644-8296 5 Daniel J. Palay, SBN 159348 6 dip@calemplovmentcounsel.com Brian D. Hefelfinger, SBN 253054 7 bdh@calemplovnientcounsel.com PALAY HEFELFINGER, APC 8 1746 S. Victoria Avenue, Suite 230 Ventura, Califomia 93001 9 Tel: (805) 628-8220 Fax: (805) 765-8600 10 Attomeys for Plaintiff John Boudreau and the certified 11 class 12 [ADDITIONAL COUNSEL LISTED ON FOLLOWING PAGE] 13 SUPERIOR COURT OF CALIFORNIA 14 COUNTY OF SACRAMENTO 15 JOHN BOUDREAU, an individual, on CaseNo. 34-2018-00247272 16 behalf of himself and all others similarly situated. Assigned to Department 41, Hon. David De Alba 17 Plaintiff, JOINT STIPULATION OF CLASS ACTION 18 AND PAGA SETTLEMENT V. 19 PRIMERITUS FINANCIAL SERVICES, 20 INC., A Delaware corporation; CHRIS McGINNESS, an individual; and DOES 1 21 through 10, inclusive. 22 Defendants. 23 24 25 26 27 28 1. JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT \ r \ . —T'yr> _ »-» _ r \ r \ jt _ r r t < * \ < - » j _ . i r y r " i . n _ 1 KEITH A. JACOBY, Bar No. 150233 kiacobv@littler.com 2 BRADLEY E. SCHWAN, Bar No. 246457 bschwan@littler.com 3 LITTLER MENDELSON, P.C. 2049 Cenmry Park East 4 5th Floor Los Angeles, CA 90067.3107 5 Telephone: 310.553.0308 Fax No.: 310.553.5583 6 NATHANIEL H. JENKINS, Bar No. 312067 7 nienkins@littler.com LITTLER MENDELSON, P.C. 8 500 Capitol Mall Suite 2000 9 Sacramento, CA 95814 Telephone: 916.830.7200 10 Fax No.: 916.561.0828 11 Attomeys for Defendants Primeritus Financial Services, Inc., and Chris McGinness 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT r-\ _ . • r~v. —T—Tr^-r^-r\r\A _ £r\r\r\ne\ A _ _ rr\ r-1_ n - A _I _ — r\ _ _ _ -»n /M A 1 Plaintiff JOHN BOUDREAU ("Plaintiff) and Defendant PRIMERITUS FINANCL\L 2 SERVICES, INC. ("Defendant") (together, tiie "Parties") hereby submit, subject to the approval of 3 the Court, that the settlement of this action shall be effectuated upon and subject to the following 4 terms and conditions. 5 A. DEFINITIONS 6 As used in this Joint Stipulation of Settlement of Class Action ("Joint Stipulation"), the 7 following terms shall have the meanings specified below. To the extent terms or phrases used in this 8 Joint Stipulation are not specifically defined below, but are defined elsewhere in the Joint 9 Stipulation, they are incorporated by reference into this definition section. 10 1. "Action" or "Lawsuif shall mean the above-entitled class action/representative case 11 John Boudreau, et al. v. Primeritus Financial Services, Inc., et al.. Case No. 34-2018- 12 00247272, which is pending in the Superior Court of the State of Califomia for the 13 County of Sacramento. 14 2. "Agreement," "Stipulation," "Joint Stipulation," "Stipulation of Settlement," 15 "Settlement Agreement," or "Stipulation and Agreement" shall mean this Joint 16 Stipulation, including any attached exhibits." Class" or "Settlement Class" shall 17 include all non-exempt ciurent and former employees of Primeritus who were 18 employed by Primeritus in Califomia during the Class Period as defined below, and 19 who held the position of Investigator/skipfracerand participated in the Incentive Pay 20 Plan that was the subject of the Action. One hundred sixty-five (165) putative 21 members received class notice and, except for the three individuals who opted out, 22 are the members of the proposed Settlement Class. Individuals, if any, who were 23 qualified to participate in the Class and receive notice when the Class was certified 24 but were inadvertently left off of the class list will be given an opportunity to 25 participate in the Settlement Class and will additionally be given the opportunity to 26 opt out ofthe settlement class (referred to as the "Omitted Individuals") If any Class 27 Member is incompetent or deceased, the person's legal guardian, executor, heir, or 28 successor in interest may act of thefr behalf 3. JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT l~\ I rN . -r-T/^ - r\ ^ r\r\ A _ rt^t^r^i^i^ A rrt ry ^ A _I r\ -Ti-vr» i A 1 3. "Class Counsel" shall mean Alejandro P. Gutierrez, HATHAWAY, PERRETT, 2 WEBSTER, POWERS, CHRISMAN & GUTIERREZ, APC, 5450 Telegraph Road, 3 Suite 200 Venttira, CA 93006-3577 and Daniel J. Palay and Brian D. Hefelfinger, 4 PALAY HEFELFINGER, APC, 1746 S. Victoria Avenue, Suite 230, Venttu-a, 5 Califomia 93001. 6 4. "Settlement Class Notice" shall mean the Notice of Class And PAGA Action 7 Settlement, as set forth in the form of Exhibit 1 attached hereto, or as otherwise 8 approved by the Court, which is to be mailed to Class Members and PAGA 9 Employees as part ofthe Notice Packet (defined below). 10 5. "Class Participant(s)" shall mean any and all Class Members except those who timely 11 request exclusion (i.e., who elect to "opt out") as provided herein. 12 6. "Class Period" is December 27, 2014 to August 10, 2019, inclusive. 13 7. "Class Representative" or "Named Plaintiff or "Plaintiff shall mean Plaintiff John 14 Boudreau. 15 8. "Class Settlement" or "Settlemenf shall mean the settlement embodied in this Joint 16 Stipulation, which is subject to Court approval. 17 9. "Complaint" shall mean the original Complaint dated December 27, 2018. 18 10. "Court" shall mean the Superior Court of Califomia for the Coimty of Sacramento. 19 11. "Defendanf shall mean Primeritus Financial Services, Inc. 20 12. "Defense Counsel" or "Counsel for Defendant" shall mean the law firm of Littler 21 Mendelson, P.C. located at 2049 Century Park East, 5th Floor, Los Angeles, CA 22 90067, and 500 Capitol Mall, Suite 2000, Sacramento, CA 95814. 23 13. "Effective Date" shall mean the date this Agreement is approved as provided herein 24 and the Court's order granting Final Approval and entry of Judgment becomes final 25 and is no longer appealable. For purposes of this Agreement, "becomes final and is 26 no longer appealable" shall mean the later of: (a) the day after the last date by which a 27 notice of appeal to the applicable Court of Appeal of the order and judgment 28 approving this Agreement may be timely filed and none is filed (i.e., 61 days from 4. JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT r~\ _ _ i i - > , — T - f r ^ _ r ^ ^ r \ r \ A _ r / ^ <-\ /*> o o A r r t n i_ r\ _ A _ I r\ - ^ r\r\\ , 1 notice of enfry of judgment); (b) if an appeal is filed, and the appeal is finally 2 disposed of by mling, dismissal, denial, or in a any other maimer that confirms the 3 validity of the order and judgment, the day after the last date for filing a request for 4 further review of the order and judgment approving this Agreement passes, and no 5 further review is requested; or (c) if an appeal is filed and the order approving this 6 Agreement is affirmed and fiirther review of the order is requested, the day after the 7 review is finally resolved and the order and judgment approving this Agreement is 8 affirmed. 9 14. "Final Approval Date" shall mean the date upon which the Court enters an Order 10 approving the Class Settlement, after having determined that the Class Settlement is 11 fair, adequate, and reasonable to the Class as a whole, following: (i) notice to the 12 Class; (ii) an opportunity to submit timely exclusion or objections to the non-PAGA 13 portion of the Settlement; and (iii) a hearing on the faimess of the terms of the 14 Settlement. 15 15. "Final Approval Hearing" shall mean the final hearing held by the Court to ascertain 16 the faimess, reasonableness, and adequacy of the Class Settlement. 17 16. "First Amended Complaint" means the operative First Amended Complaint filed on 18 April 12, 2019 in this Action. 19 17. "Incentive Pay Plan" shall mean the pay plan under which Class Members received 20 eight dollars an hour for every hour worked and incentive pay eamed as a resuU of 21 points being awarded for collateral that that the Settlement Class Members identified, 22 which lead to an event qualifying for an award under the incentive plan. 23 18. "Individual PAGA Payment" shall mean the pro-rata share ofthe PAGA penalties 24 allocated to the settlement of the PAGA Claims to which each PAGA Employee is 25 entitied from the PAGA Fund based on the number of pay periods they worked 26 during the PAGA Period, as described below (PAGA Fund and Payment to Labor and 27 Workforce Development Agency). 28 19. "Individual Shifts at Issue" shall mean shifts worked over 3 Va hours (when a rest 5. JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT r> _ _ I r~\. _ mr\r\nn A - _ X'n r-1_ r\ - A _I r\ — _ -r rv »^ u _ A 1 period was eamed) during which time a Class Member was being paid pursuant to the 2 Incentive Pay Plan. 3 20. "Total Individual Class Settlement Payment" shall mean the amount to be distributed 4 to any and each Class Participant as described in Section D.4 below (Class Participant 5 Distribution Formula). 6 21. "LWDA" means the Califomia Labor and Workforce Development Agency. 7 22. "Net Settlement Amount" means the Total Settlement Amount less the Settlement 8 Administtator's Expenses, the Class Representative's Service Payment, the PAGA 9 Fund, and Class Counsel's attomeys' fees (not to exceed 35% of the Gross Settlement 10 Amount) and costs, subject to approval by the Court. 11 23. "Notice Packet" shall mean the Notice of Class Action Settlement and Opt-Out Form, 12 collectively. 13 24. "Opt-Out(s)" shall mean any and all eligible Settlement Class Members who timely 14 and validly request exclusion from the Settlement of the Released Class Claims in 15 accordance with the terms ofthe Class Notice. Any Settlement Class Member that 16 received notice of class certification sent pursuant to the Court's Febmary 3, 2020 17 Order and did not opt out does not have the option to opt out of this settlement; only 18 Omitted Individuals shall receive an Opt-Out Form. Notwithstanding the submission 19 ofa timely request for exclusion, PAGA Employees will still be bound by the 20 settlement and release of the Released PAGA Claims or remedies under the Judgment 21 pursuant to Arias v. Superior Court, 46 Cal. 4th 969 (2009). So long as the Court 22 approves the PAGA portion of the settlement, requests for exclusion do not apply to 23 the Released PAGA Claims, and will not be effective to preclude the release of the 24 Released PAGA Claims. 25 25. "Opt-Out Form" or "Exclusion Form" shall mean a document that an Omitted 26 Individual that is also a Class Member is required to mail to the Settlement 27 Adminisfrator, as set forth in the form of Exhibit 2 attached hereto, postmarked no 28 later than the date indicated on the Class Notice, to exclude himself or herself from 6. JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT 1 the non-PAGA portion of the Class Settlement. 2 26. "Parties" shall mean the Class Representative and Defendant. 3 27. "PAGA" means the Califomia Labor Code Private Attomeys General Act, Califomia 4 Labor Code §§ 2698 et seq. 5 28. "PAGA Employees" shall mean all non-exempt employees who worked for 6 Defendant in Califomia during the PAGA Period. 7 29. "PAGA Claims" shall mean all claims for PAGA penalties on behalf of Plaintiff, 8 similarly aggrieved employees and the State of Califomia, during the PAGA Period 9 defined below. 10 30. "PAGA Fund" means the gross amount of $ 100,000 which the parties have allocated 11 for PAGA penalties for alleged Labor Code violations. Seventy-five percent of the 12 PAGA Fund (i.e., $75,000) shaU be paid to the LWDA, and the remaining twenty- 13 five percent (i.e., $25,000) shall be paid to PAGA Employees. 14 31. "PAGA Period" means from January 4, 2018 through the date of Prehminary 15 Approval. 16 32. "Participating Settlement Employees" means all Class Participants and PAGA 17 Employees. 18 33. "Preliminary Approval" means the Court Order preliminarily approving this Joint 19 Stipulation, authorizing the mailing of the Notice Packet by the Settlement 20 Adminisfrator, and setting the date of the Final Approval Hearing. 21 34. "Preliminary Approval Date" means the date upon which the Court enters an order 22 preliminarily approves this Stipulation, pending notice, an opportunity to submit 23 objections, and a faimess hearing thereon. 24 35. "Preliminary Approval Hearing" shall mean the hearing held on the motion for 25 preliminary approval ofthe Class Settlement. 26 36. "Released Class Claims" means all claims alleged or that could have been alleged 27 based on the operative facts pled in the original Complaint or operative First 28 Amended Complaint. The release of the Class Claims shall be effective at all times 7. JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT 1 during the entirety ofthe Class Period. "Released PAGA Claims" means all PAGA 2 Claims that were actually alleged or could have been alleged in the original 3 Complaint or First Amended Complaint in this Action by Named Plaintiff, on behalf 4 of the State of Califomia, himself, and PAGA Employees. The release of the 5 Released PAGA Claims shall be effective during the entirely ofthe PAGA Period. 6 37. "Released Parties" shall mean Defendant Primeritus Financial Services, Inc. and each 7 of thefr respective parents, subsidiaries, affiliates, shareholders, members, agents 8 (including, without limitation, any investment bankers, accountants, insurers, 9 attomeys and any past, present or fiiture officers (including but not limited to 10 dismissed Defendant Chris McGinness), directors and employees), predecessors, 11 successors, and assigns. 12 38. "Service Payment" shaU mean any additional monetary payment provided to the 13 Class Representative for his efforts on behalf of the Class in this Action. 14 39. "Settlement Adminisfrator" shall mean the company knovra as Simpluris, a qualified, 15 third-party settlement administrator which the Parties have agreed will be responsible 16 for adminisfration of the Settlement and related matters. 17 40. "Settlement Adminisfrator's Expenses" means all costs and expenses relating to the 18 administration of the Settlement, including without limitation, address verification 19 measures, formatting, preparing, and mailing of Notice Packets, accounting for opt- 20 outs and objections, calculation and determination of payments to Participating 21 Settlement Employees, accounting and maintenance of Settlement Fund Account 22 (defined below), posting the necessary information (i.e., regarding the judgment) on 23 the adminisfrators' website, preparation of a report to the Court indicating the total 24 amount that was actuaUy paid to Participating Settlement Employees, administration 25 and payment of unclaimed and/or uncashed checks pursuant to Code of Civil 26 Procedure § 384, preparation and issuance of checks to Class Counsel for attomeys' 27 fees and costs, preparation and issuance ofthe checks to Representative Plaintiff for 28 her Service Payment, and submission of all tax-related documents and any other costs 8. JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT I i-N. -T^r^ . . A _ rr\nr\r\r\ A _ _ £r\ r-1_ r»_<«_i r» -rrt/M A 1 incidental to or associated with the claims adminisfration of this settlement, all 2 pursuant to the terms of this Agreement. All additional expenses related to the 3 payment of the Second Settlement Installment defined herein shall be home by 4 Defendant and shall not be paid out of the Total Settlement Amoimt. 5 41. "Settlement Fund Account" shall mean the Qualified Settlement Fund, as defmed by 6 the Intemal Revenue Code, established pursuant to the terms of this Joint Stipulation 7 from which all monies payable under the terms of this Stipulation shall be paid, as set 8 forth herein. 9 42. "Settling Parties" shall mean Class Representative, the Settlement Class, PAGA 10 Employees, and Defendant. 11 43. "Total Settlement Amount" or "Total Settlement Payment" shall mean the total 12 amount that Defendant will pay to resolve this Action, based on the aggregation of 13 the agreed-upon settlement value of individual claims, which is Three Million Nine 14 Hundred Thousand Dollars ($3,900,000), which includes the payment to the Class, 15 the PAGA Employees, Settlement Adminisfrator's Expenses, Class Representative's 16 Service Payment, payment to Labor and Workforce Development Agency for PAGA 17 penalties, and Class Counsel's attomeys' fees and costs. Defendant will pay its share 18 of applicable employer-side payroll taxes on the wage portion of the Settlement 19 payments separately and in addition to the Total Settlement Amount. In no event will 20 Defendant be required to pay more than the Total Settlement Amount, than its share 21 of applicable employer-side payroll taxes on the wage portion of the Settlement 22 payments and the costs associated with the second installment payment as part of this 23 Agreement. 24 B. PRE-TRIAL PROCEEDINGS AND NEGOTIATIONS 25 1. Investigation, Discovery, and Research 26 Class Counsel have conducted investigation, discovery, and research during the prosecution 27 of the Action. Such efforts included, among other things: (a) conducting a thorough pre-filing 28 investigation; (b) propounding a comprehensive set of written discovery requests and taking 9. JOINT STIPULATION OF CLASS ACTION AND PAGA SETTLEMENT r-\ 11-\, T - f - r\ _ r\r\ A _ er\r\r<,nr\ A r<-»^i_ r\ ^ A -i n -»r» ^ i— A 1 depositions; (c) inspecting and analyzing data and documents produced by Defendants pertaining to 2 Plaintiff and the putative class members; (d) interviewing putative class members; (e) analyzing the 3 legal arguments made by Defendant; (f) preparing an analysis of potential class-wide damages and 4 constmcting a damages model; (g) researching the applicable law with respect to the claims asserted 5 in this Action and the potential defenses thereto. Moreover, the Parties filed cross-motions for 6 summary adjudication, which resolved for purposes of the trial court proceedings a number of 7 disputed legal issues raised in the Action Thus, the Parties have engaged in sufficient investigation, 8 discovery, and research to assess the relative merits of the claims of the Class Representative and of 9 Defendant's defenses to them. 10 2. Allegations of the Class Representative and Benefits of Settlement 11 The investigation and discovery conducted in this matter were adequate to give the Class 12 Representative and Class Counsel a sound understanding of the merits of thefr position and to 13 evaluate the worth of the claims of the Class. This Settlement was reached after arm's-length 14 bargaining by the Parties with the assistance of Mark Rudy, a highly experienced mediator in the 15 wage and hour field and after Class Counsel thoroughly reviewed all relevant evidence. The 16 information obtained from investigation and discovery as well as information exchanged for 17 mediation was sufficient to assess reliably the merits of the respective Parties' positions and to 18 compromise the issues on a fair and equitable basis. 19 The Class Representative and Class Counsel believe that the causes, allegations, and 20 co