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SUPERIOR COURT OF CALIFORNIA,
COUNTY OF SACRAMENTO
GORDON D SCHABER COURTHOUSE
MINUTE ORDER
DATE: 12/14/2021 TIME: 09:00:00 AM DEPT: 37
JUDICIAL OFFICER PRESIDING: Kevin Culhane
CLERK: A O'Donnell
REPORTER/ERM: None
BAILIFF/COURT ATTENDANT: A. Dubra
CASE NO: 34-2018-00247272-CU-OE-GDS CASE INIT.DATE: 12/27/2018
CASE TITLE: Boudreau vs. Primeritus Financial Services Inc
CASE CATEGORY: Civil - Unlimited
EVENT TYPE: Motion for Final Approval of Class Action Settlement - Complex
APPEARANCES
Alejandro P Gutierrez, counsel, present for Plaintiff(s) remotely via video.
Daniel J Palay, counsel, present for Plaintiff(s) remotely via video.
Keith A Jacoby, counsel, present for Defendant(s) remotely via video.
Nature of Proceedings: Motion for Final Approval of Class Action Settlement
The matter came before the Court this date for a Motion for Final Approval of Class Action Settlement
with the above indicated counsel present via Zoom.
The Court affirmed the tentative ruling seeing as there was no objection verbal or written to the motion.
The Court will sign the order once the defendants have paid their complex case fees.
Tentative Ruling:
The Court issues the following tentative ruling for the hearing on December 14, 2021, regarding the
motion for final approval of class action settlement filed by Plaintiff John Boudreau, individually and on
behalf of all others similarly situated. No oppositions have been filed.
While the Court's ruling tentatively indicates that it will grant final approval of the class action settlement,
subject to certain conditions, the Court must still hold a hearing on the motion as it may involve the
receipt of evidence. Although the Court anticipates that no party will request oral argument, and while no
class member indicated any intent to appear at the hearing, this does not relieve the parties from
appearing at the hearing or otherwise render the instant ruling final in the event oral argument is not
requested. The Court will not render a final ruling until it holds the preliminary approval hearing. Any and
all appearances for the hearing must be made via Zoom. To request oral argument on this matter, you
must call Department 37 by 4:00 p.m., the Court day before this hearing and notification of oral argument
must be made to the opposing party/counsel. (Local Rule 1.06.)
MOTION FOR FINAL APPROVAL OF CLASS ACTION SETTLEMENT
APPEARANCE REQUIRED.
The matter shall be held via Zoom with the links below:
DATE: 12/14/2021 MINUTE ORDER Page 1
DEPT: 37 Calendar No.
CASE TITLE: Boudreau vs. Primeritus Financial CASE NO: 34-2018-00247272-CU-OE-GDS
Services Inc
To join by Zoom link: https://saccourt.zoom.us/my/dept37a
To join by Room: Dept37a
Teleconference information: (888) 475-4499/ID 713-594-6086
This motion seeks final approval of a class action settlement. The proposed settlement will dispose of
this action. As noted, no opposition has been filed, nor has any Class Member filed any objections to
the settlement.
Before final approval of a class action settlement, notice must be given to the class. (See CRC, Rule
3.769(e), (f).) Here, the Class Members received notice, which explained the nature of the litigation, the
material terms of the settlement, how a class member may participate in the settlement, object to the
settlement, elect not to participate in the settlement, or how to obtain further information.
Regardless of lack of Opposition, the Court must still hold a hearing on the motion as it may involve the
receipt of additional evidence. Thus, while the Court anticipates that neither Plaintiff nor Defendant will
request oral argument, and while no Class Member has indicated any intent to appear at the hearing,
this does not relieve the parties from appearing at the hearing or otherwise render the instant ruling final
in the event oral argument is not requested. A personal appearance for each party is required via
Zoom.
In this action, Plaintiff alleges violations of the California Labor Code, including Failure to Pay Minimum
Wage (Labor Code §§ 1194, 226.2); (2) Failure to Timely Pay Wages (Labor Code §§ 201-203); (3)
Failure to Authorize and Permit Rest Periods (Labor Code § 226.7); (4) Failure to Provide Meal Periods
and Pay Meal Premiums (Labor Code § 226.7); (5) Failure to Provide Accurate Itemized Wage
Statements (Labor Code §§ 226, 226.2; (6) Unfair Business Practices (Bus. & Prof. Code § 17200 et
seq.); and (7) Private Attorneys General Act of 2004 (PAGA) (Labor Code § 2699 et seq.)
The action was originally filed on December 27, 2018.
The Court granted preliminary approval of the settlement on July 29, 2021, and appointed, for settlement
purposes only, Alejandro Gutierrez, Daniel Palay, and Brian Hefelfinger, are appointed as class counsel
for purposes of settlement. (Order, July 29, 2021 [ROA 181].) The Court accepted Plaintiff John
Boudreau as the Class Representative. (Id.)
The parties selected Simpluris, Inc. ("SSI" or "Claims Administrator"), to act as Claims Administrator.
(Id.)
Simpluris reports that on August 5, 2021, it received the Court-approved Class Notice from Plaintiffs'
Counsel. (Cooley Decl., ¶ 4 and Exh. A thereto.) The Class Notice advised Class Members of their right
to opt out from the Settlement, where applicable, object to the Settlement, or do nothing, and the
implications of each such action. (Id.) The Class Notice advised Class Members of applicable deadlines
and other events, including the Final Approval Hearing, and how Class Members could obtain additional
information. (Id.) The Estimated Settlement Share was pre-printed with the name and address of the
Class Member, start and end date of employment, number of shifts used to calculate his/her estimated
settlement share, and instructions for challenging the dates. (Id.)
On August 12, 2021, defense counsel provided Simpluris with a mailing list containing the name, last
known address, Social Security Number, and pertinent employment information during the Class Period
for the Class Members. (Cooley Decl., ¶ 5.) The Class List contained data for 165 unique Class
Members. (Id.) The mailing addresses contained in the Class List were processed and updated utilizing
the National Change of Address Database ("NCOA") maintained by the U.S. Postal Service. (Cooley
Decl., ¶ 6.) Where a Class Member had filed a USPS change of address request, the address listed with
the NCOA was utilized in connection with the mailing of the Notice Packets. (Id.) After all addresses
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CASE TITLE: Boudreau vs. Primeritus Financial CASE NO: 34-2018-00247272-CU-OE-GDS
Services Inc
were updated, Simpluris mailed Notice Packets to the 165 Class Members on August 23, 2021. (Cooley
Decl., ¶ 7.)
Where USPS thereafter returned a Class Notice Packet as undeliverable and without forwarding
address, Simpluris performed an advanced address search (i.e. skip trace) on all of these addresses by
using Accurint, a research tool, to obtain further updated information. (Cooley Decl., ¶ 8.) According to
Simpluris, received 20 Class Notice Packets returned as undeliverable, but through address searches, it
was able to locate 18 updated addresses and successfully mailed all 18 to Class Members. (Id.) Only
two Notice Packets remained undeliverable. (Id.)
The Notice Packet instructed Class Members that the deadline to submit any requests for exclusion was
October 12, 2021. (Cooley Decl., ¶ 9.) Similarly, Class Members who wished to object to the settlement
were directed to file their objection(s) with the Court and serve a copy of same on all counsel. (Cooley
Decl., ¶ 10.) As of the date of this this ruling, Simpluris had not received any requested for exclusion or
any objections to the settlement. (Cooley Decl., ¶¶ 9, 10.)
Based on these statistics, the Net Settlement Amount available to Settlement Class Members is
estimated to be approximately $ $2,401,300.00, and was calculated by subtracting the requested
Attorneys' Fees ($1,365,000.00), the amount allocated for Litigation Costs and Expenses ($25,000.00),
the requested Service Award Payment ($25,000.00), and the requested Settlement Administration Costs
($8,700.00) from the Gross Settlement Amount ($3.9 million). (Cooley Decl., ¶ 12, 13.) In addition, the
PAGA penalties were estimated to be $75,000.00. (Id.) The highest Settlement Share to be paid is
approximately $55,965.40 and the average Settlement Share to be paid is approximately $14,553.33.
(Cooley Decl., 12.)
Before finally approving a class action settlement, the Court must find that the settlement is "fair,
adequate, and reasonable." (Wershba v. Apple Computer (2001) 91 Cal.App.4th 224, 244, 245.) "[A]
presumption of fairness exists where: (1) the settlement is reached through arm's-length bargaining; (2)
investigation and discovery are sufficient to allow counsel and the court to act intelligently; (3) counsel is
experienced in similar litigation; and (4) the percentage of objectors is small." (Dunk v. Ford Motor Co.
(1996) 48 Cal.App.4th 1794, 1802.) The Court considers such factors as "the strength of plaintiffs' case,
the risk, expense, complexity and likely duration of further litigation, the risk of maintaining class action
status through trial, the amount offered in settlement, the extent of discovery completed and the stage of
the proceedings, the experience and views of counsel, the presence of a governmental participant, and
the reaction of class members to the proposed settlement." (Id. at 1801.)
The terms of the settlement are established as follows:
1. Defendant shall pay a maximum Gross Settlement Amount (GSA) of $3.9 million; the payments shall
be split into two payments of $2.5 million on or before February 1, 2022, and $1.4 million paid on or
before July 1, 2022. The PAGA payment, Service Payment and administrative fees incurred as of the
time of the first payment shall be paid in full from the first payment; the remainder shall be distributed to
pro rata to Class Members and then to Class Counsel. The remaining payments shall be paid from the
second payment. Defendant shall be responsible for the employer's share of payroll taxes. None of the
GSA shall revert to Defendants. (Settl. Agr. at Section D.)
2. An amount up to $25,000 shall be paid to Plaintiff Jerome John Boudreau as a Class Representative
Service Award, which shall be in addition to any amount to which he may be entitled under the terms of
the settlement. This amount will be paid from the Gross Settlement amount under the first payment.
(Settl. Agr. Section D.1.)
3. Administrative costs shall be paid from the settlement proceeds in an amount no greater than
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CASE TITLE: Boudreau vs. Primeritus Financial CASE NO: 34-2018-00247272-CU-OE-GDS
Services Inc
$8,700.00. This amount will be paid from the Gross Settlement Amount. An amount of up to $5,400.00
shall be paid in the first payment installment, and an amount up to $3,300.00 shall be paid in the second
payment installment. Any difference remaining between the actual administrative costs and the
authorized maximum shall be allocated pro rata to the class members. (Settl. Agr. Section C.3.)
4. An amount of $100,000.00 allocated to PAGA claims; the settlement class to receive 25 percent
thereof, which will be included in the Net Settlement Amount. The remaining 75 percent shall be paid to
the LWDA. (Settl. Agr. Sec. D.3.)
5. Up to 35 percent of the Gross Settlement Amount ($1.365 million) to be allocated to Plaintiff's
attorney fees, and an additional amount up to $25,000.00 to compensate class counsel for costs. Notice
of the payment of these fees and costs would be included in the proposed class notice of settlement.
These amounts shall also be paid from the Gross Settlement Amount. Any difference remaining between
this amount and the authorized maximum shall be allocated pro rata to the class members. (Settl. Agr.
Sec. D.2.)
6. Claim forms are not required for Class Members to participate in the settlement. (Settl. Agr. Secs.
C.4, C.5.) Class members who did not timely opt-out of the settlement shall waive all claims alleged in
this action, as well as any that could have been alleged. (Settl. Agr. Sec. E.2.)
7. For settlement checks distributed to class members that are not cashed by the designated
check-cashing deadline, the funds will be remitted to the State of California Unclaimed Property Fund in
the name of each Class Member. (Settl. Agr. Sec. D.5.)
Based on the foregoing, the Court tentatively finds, subject to the hearing, that the Settlement
Agreement and Claims Administration is entitled to a presumption of fairness and that all relevant factors
support final approval. The settlement provides significant benefits to Class Members in the form of
restitution for their claims. Given the causes of action asserted and the forms of relief sought in the
operative Complaint, the Court finds that settlement provides significant value to the Class Members as
it provides them with relief in a manner approximately commensurate with, or greater than, the potential
value of their individual claims in light of the risks of continued litigation. The moving papers also
demonstrate that the settlement was the result of arms-length bargaining between the parties and was
reached after sufficient discovery which allow the parties, and therefore this Court, to act intelligently with
respect to the settlement.
CLASS COUNSEL'S COSTS AND FEES, CLAIMS ADMINISTRATION,
AND CLASS REPRESENTATIVE'S SERVICE AWARD
The settlement agreement provided that class counsel would apply for an award of attorney's fees in an
amount totaling up to 35% of the Gross Settlement Fund, plus reasonable costs.
Class Counsel's Fees
Plaintiff and the class are entitled to recover attorney's fees and costs. (Code Civ. Proc. § 1021.5.) A fee
award is justified where the legal action produces benefits by a voluntary settlement. (Maria P. v. Riles
(1987) 43 Cal.3d 1281, 1290-1291; Westside Community for Independent Living, Inc. v. Obledo (1983)
33 Cal.3d 348, 352-353.) Courts generally recognize two methods for calculating fees in civil class
actions: the lodestar/multiplier method and the percentage-of-recovery method. (Wershba v. Apple
Computer, Inc., supra, 91 Cal.App.4th at 254.)
Pursuant to the Settlement Agreement, the amount of settlement shall not exceed $1.365 million, and
costs not to exceed $25,000.00. Class counsel argues that the attorney's fees are reasonable whether
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Services Inc
examined under a percentage-of-settlement approach or a loadstar calculation.
In determining fees and costs to be awarded to Class Counsel, the Court must exercise its judicial
function and make a decision on the propriety of the fees requested; it should not, and does not,
abdicate its charge to make a decision simply because the parties may have reached their own
agreement in this regard. The choice of a fee calculation method is generally one within the discretion of
the trial court, "the goal . . . being the award of a reasonable fee to compensate counsel for their efforts."
(Laffite v. Robert Half International, Inc. (2016) 1 Cal.5th 480, 504.) "[W]hen class action litigation
establishes a monetary fund for the benefit of the class members, and the trial court in its equitable
powers awards class counsel a fee out of that fund, the court may determine the amount of a reasonable
fee by choosing an appropriate percentage of the fund created." (Id. at 503.) Recognized advantages in
using the percentage method "include[e] relative ease of calculation, alignment of incentives between
counsel and the class, a better approximation of market conditions in a contingency case, and the
encouragement it provides counsel to seek an early settlement and avoid unnecessarily prolonging
litigation." (Id.) Further, trial courts "retain the discretion to forego a lodestar cross-check and use other
means to evaluate the reasonableness of a requested percentage fee." (Id. at 504.) The
percentage-of-the-benefit approach generally is preferred in class and representative actions because "it
better
approximates the workings of the marketplace than the lodestar approach." (Lealao v. Beneficial
California, Inc. (2000) 82 Cal.App.4th 19, 49.) "The ultimate goal... is the award of a 'reasonable' fee to
compensate counsel for their efforts, irrespective of the method of calculation." (Consumer Privacy
Cases (2009) 175 Cal.App.4th 545, 557-558.).) It is not an abuse of discretion to choose one method
over another as long as the method chosen is applied consistently using percentage figures that
accurately reflect the marketplace.
Plaintiff has submitted evidence that class counsel has extensive experience in employment class action
law, including significant experience in wage-and-hour class action litigation. (Hefelfinger Decl., ¶¶ 4-10;
Gutierrez Decl., ¶¶ 26-30.) Counsel for both parties were capable of assessing the strengths and
weaknesses of the claims against Defendant and the benefits of the proposed settlement under the
circumstances of the case and in the context of a private, consensual settlement agreement. The Court
has reviewed the declarations of Class Counsel in support of the requested attorneys' fees and litigation
costs. With respect to fees, Class Counsel argues the propriety of a percentage-based award in amount
of 35 percent of the GSA. Counsel further contends that any "cross-check" based on a lodestar
calculation is unnecessary but if considered would further support the 35 percent share requested.
In determining the lodestar, Class Counsel indicates they have spent a combined total of "more than 750
hours" work over the course of three years – a figure which includes over 200 hours of paralegal time.
(Hefelfinger Decl., ¶ 35.) That said, Plaintiff has failed to provide detailed information concerning the
tasks actually performed by the attorneys. Accordingly, the Court is unable to determine whether the
actual tasks performed were necessary and the time spent performing each task was reasonable,
despite counsel's representation. The Court also finds that several of the hourly rates proposed by Class
Counsel under a lodestar calculation exceed the prevailing rates in this legal community. Plaintiff relies
on the Laffey Matrix for attorneys in the Los Angeles area (See Hefelfinger Decl., ¶ 31), which reflect
reasonable rates of $919 for an attorney in Los Angeles with over 20 years of experience, and hourly
rates ranging from $676 to $764 for attorneys with 8-14 years of experience. This case, however, is
pending in the Sacramento County Superior Court. "The determination of the 'market rate' is generally
based on the rates prevalent in the community where the court is located." (Syers Properties III, Inc. v.
Rankin (2014) 226 Cal.App.4th 691, 701; see also PLCM Group, 22 Cal.4th at 1094.) The prevailing
rates in this community are not the same rates as may be acceptable in Los Angeles and must be
adjusted accordingly. (See Building a Better Redondo, Inc. v. City of Redondo Beach (2012) 203
Cal.App.4th 852, 874 ["[t]he trial court was fully cognizant of the quality of the services performed, the
amount of time devoted to the case and the efforts of counsel"]; Russell v. Foglio (2008) 160 Cal.App.4th
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Services Inc
653, 661 ["[t]he trial court possesses personal expertise in the value of the legal services rendered in the
case before it"].)
In light of the foregoing, while the Court agrees the percentage method remains appropriate for
determining the award of attorney's fees, the Court finds a lower percentage rate should be applied than
the 35 percent requested. Based on its own expertise, the Court's experience with this litigation, and the
information provided in the moving papers, the Court finds an award of 33.33 percent of the gross
settlement is reasonable. (See In re Consumer Privacy Cases (2009 185 Cal.App.4th 545, 558 fn. 13
["[e]mpirical studies show that, regardless whether the percentage method or the loadstar method is
used, fee award in class actions average around one-third of the recovery."].) Accordingly, the Court
awards $1.3 million in attorney's fees to Class Counsel.
Class Counsel's Costs
The Court concludes that the litigation expenses requested are reasonable and are of the type ordinarily
incurred in this sort of litigation. The request for $22,057.52 in litigation costs is approved. (See
Hefelfinger Decl., ¶¶ 38-41.)
Class Representative's Enhancement Award
As noted above, Plaintiff seeks a service enhancement award of $25,000.00 for named Plaintiff John
Boudreau. The Court approves the service enhancement award.
CONCLUSION
In sum, the Court tentatively concludes the settlement is entitled to final approval. Class Counsel's
attorney's fees and costs are tentatively approved as discussed above, as well as the
service/enhancement awards for the named Plaintiff as identified herein and the proposed payment to
Simpluris for administrative expenses. The Court will sign a final order following arguments at hearing.
DATE: 12/14/2021 MINUTE ORDER Page 6
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SUPERIOR COURT OF CALIFORNIA, COUNTY OF SACRAMENTO GORDON D SCHABER COURTHOUSE MINUTE ORDER DATE: 12/14/2021 TIME: 09:00:00 AM DEPT: 37 JUDICIAL OFFICER PRESIDING: Kevin Culhane CLERK: A O'Donnell REPORTER/ERM: None BAILIFF/COURT ATTENDANT: A. Dubra CASE NO: 34-2018-00247272-CU-OE-GDS CASE INIT.DATE: 12/27/2018 CASE TITLE: Boudreau vs. Primeritus Financial Services Inc CASE CATEGORY: Civil - Unlimited EVENT TYPE: Motion for Final Approval of Class Action Settlement - Complex APPEARANCES Alejandro P Gutierrez, counsel, present for Plaintiff(s) remotely via video. Daniel J Palay, counsel, present for Plaintiff(s) remotely via video. Keith A Jacoby, counsel, present for Defendant(s) remotely via video. Nature of Proceedings: Motion for Final Approval of Class Action Settlement The matter came before the Court this date for a Motion for Final Approval of Class Action Settlement with the above indicated counsel present via Zoom. The Court affirmed the tentative ruling seeing as there was no objection verbal or written to the motion. The Court will sign the order once the defendants have paid their complex case fees. Tentative Ruling: The Court issues the following tentative ruling for the hearing on December 14, 2021, regarding the motion for final approval of class action settlement filed by Plaintiff John Boudreau, individually and on behalf of all others similarly situated. No oppositions have been filed. While the Court's ruling tentatively indicates that it will grant final approval of the class action settlement, subject to certain conditions, the Court must still hold a hearing on the motion as it may involve the receipt of evidence. Although the Court anticipates that no party will request oral argument, and while no class member indicated any intent to appear at the hearing, this does not relieve the parties from appearing at the hearing or otherwise render the instant ruling final in the event oral argument is not requested. The Court will not render a final ruling until it holds the preliminary approval hearing. Any and all appearances for the hearing must be made via Zoom. To request oral argument on this matter, you must call Department 37 by 4:00 p.m., the Court day before this hearing and notification of oral argument must be made to the opposing party/counsel. (Local Rule 1.06.) MOTION FOR FINAL APPROVAL OF CLASS ACTION SETTLEMENT APPEARANCE REQUIRED. The matter shall be held via Zoom with the links below: DATE: 12/14/2021 MINUTE ORDER Page 1 DEPT: 37 Calendar No. CASE TITLE: Boudreau vs. Primeritus Financial CASE NO: 34-2018-00247272-CU-OE-GDS Services Inc To join by Zoom link: https://saccourt.zoom.us/my/dept37a To join by Room: Dept37a Teleconference information: (888) 475-4499/ID 713-594-6086 This motion seeks final approval of a class action settlement. The proposed settlement will dispose of this action. As noted, no opposition has been filed, nor has any Class Member filed any objections to the settlement. Before final approval of a class action settlement, notice must be given to the class. (See CRC, Rule 3.769(e), (f).) Here, the Class Members received notice, which explained the nature of the litigation, the material terms of the settlement, how a class member may participate in the settlement, object to the settlement, elect not to participate in the settlement, or how to obtain further information. Regardless of lack of Opposition, the Court must still hold a hearing on the motion as it may involve the receipt of additional evidence. Thus, while the Court anticipates that neither Plaintiff nor Defendant will request oral argument, and while no Class Member has indicated any intent to appear at the hearing, this does not relieve the parties from appearing at the hearing or otherwise render the instant ruling final in the event oral argument is not requested. A personal appearance for each party is required via Zoom. In this action, Plaintiff alleges violations of the California Labor Code, including Failure to Pay Minimum Wage (Labor Code §§ 1194, 226.2); (2) Failure to Timely Pay Wages (Labor Code §§ 201-203); (3) Failure to Authorize and Permit Rest Periods (Labor Code § 226.7); (4) Failure to Provide Meal Periods and Pay Meal Premiums (Labor Code § 226.7); (5) Failure to Provide Accurate Itemized Wage Statements (Labor Code §§ 226, 226.2; (6) Unfair Business Practices (Bus. & Prof. Code § 17200 et seq.); and (7) Private Attorneys General Act of 2004 (PAGA) (Labor Code § 2699 et seq.) The action was originally filed on December 27, 2018. The Court granted preliminary approval of the settlement on July 29, 2021, and appointed, for settlement purposes only, Alejandro Gutierrez, Daniel Palay, and Brian Hefelfinger, are appointed as class counsel for purposes of settlement. (Order, July 29, 2021 [ROA 181].) The Court accepted Plaintiff John Boudreau as the Class Representative. (Id.) The parties selected Simpluris, Inc. ("SSI" or "Claims Administrator"), to act as Claims Administrator. (Id.) Simpluris reports that on August 5, 2021, it received the Court-approved Class Notice from Plaintiffs' Counsel. (Cooley Decl., ¶ 4 and Exh. A thereto.) The Class Notice advised Class Members of their right to opt out from the Settlement, where applicable, object to the Settlement, or do nothing, and the implications of each such action. (Id.) The Class Notice advised Class Members of applicable deadlines and other events, including the Final Approval Hearing, and how Class Members could obtain additional information. (Id.) The Estimated Settlement Share was pre-printed with the name and address of the Class Member, start and end date of employment, number of shifts used to calculate his/her estimated settlement share, and instructions for challenging the dates. (Id.) On August 12, 2021, defense counsel provided Simpluris with a mailing list containing the name, last known address, Social Security Number, and pertinent employment information during the Class Period for the Class Members. (Cooley Decl., ¶ 5.) The Class List contained data for 165 unique Class Members. (Id.) The mailing addresses contained in the Class List were processed and updated utilizing the National Change of Address Database ("NCOA") maintained by the U.S. Postal Service. (Cooley Decl., ¶ 6.) Where a Class Member had filed a USPS change of address request, the address listed with the NCOA was utilized in connection with the mailing of the Notice Packets. (Id.) After all addresses DATE: 12/14/2021 MINUTE ORDER Page 2 DEPT: 37 Calendar No. CASE TITLE: Boudreau vs. Primeritus Financial CASE NO: 34-2018-00247272-CU-OE-GDS Services Inc were updated, Simpluris mailed Notice Packets to the 165 Class Members on August 23, 2021. (Cooley Decl., ¶ 7.) Where USPS thereafter returned a Class Notice Packet as undeliverable and without forwarding address, Simpluris performed an advanced address search (i.e. skip trace) on all of these addresses by using Accurint, a research tool, to obtain further updated information. (Cooley Decl., ¶ 8.) According to Simpluris, received 20 Class Notice Packets returned as undeliverable, but through address searches, it was able to locate 18 updated addresses and successfully mailed all 18 to Class Members. (Id.) Only two Notice Packets remained undeliverable. (Id.) The Notice Packet instructed Class Members that the deadline to submit any requests for exclusion was October 12, 2021. (Cooley Decl., ¶ 9.) Similarly, Class Members who wished to object to the settlement were directed to file their objection(s) with the Court and serve a copy of same on all counsel. (Cooley Decl., ¶ 10.) As of the date of this this ruling, Simpluris had not received any requested for exclusion or any objections to the settlement. (Cooley Decl., ¶¶ 9, 10.) Based on these statistics, the Net Settlement Amount available to Settlement Class Members is estimated to be approximately $ $2,401,300.00, and was calculated by subtracting the requested Attorneys' Fees ($1,365,000.00), the amount allocated for Litigation Costs and Expenses ($25,000.00), the requested Service Award Payment ($25,000.00), and the requested Settlement Administration Costs ($8,700.00) from the Gross Settlement Amount ($3.9 million). (Cooley Decl., ¶ 12, 13.) In addition, the PAGA penalties were estimated to be $75,000.00. (Id.) The highest Settlement Share to be paid is approximately $55,965.40 and the average Settlement Share to be paid is approximately $14,553.33. (Cooley Decl., 12.) Before finally approving a class action settlement, the Court must find that the settlement is "fair, adequate, and reasonable." (Wershba v. Apple Computer (2001) 91 Cal.App.4th 224, 244, 245.) "[A] presumption of fairness exists where: (1) the settlement is reached through arm's-length bargaining; (2) investigation and discovery are sufficient to allow counsel and the court to act intelligently; (3) counsel is experienced in similar litigation; and (4) the percentage of objectors is small." (Dunk v. Ford Motor Co. (1996) 48 Cal.App.4th 1794, 1802.) The Court considers such factors as "the strength of plaintiffs' case, the risk, expense, complexity and likely duration of further litigation, the risk of maintaining class action status through trial, the amount offered in settlement, the extent of discovery completed and the stage of the proceedings, the experience and views of counsel, the presence of a governmental participant, and the reaction of class members to the proposed settlement." (Id. at 1801.) The terms of the settlement are established as follows: 1. Defendant shall pay a maximum Gross Settlement Amount (GSA) of $3.9 million; the payments shall be split into two payments of $2.5 million on or before February 1, 2022, and $1.4 million paid on or before July 1, 2022. The PAGA payment, Service Payment and administrative fees incurred as of the time of the first payment shall be paid in full from the first payment; the remainder shall be distributed to pro rata to Class Members and then to Class Counsel. The remaining payments shall be paid from the second payment. Defendant shall be responsible for the employer's share of payroll taxes. None of the GSA shall revert to Defendants. (Settl. Agr. at Section D.) 2. An amount up to $25,000 shall be paid to Plaintiff Jerome John Boudreau as a Class Representative Service Award, which shall be in addition to any amount to which he may be entitled under the terms of the settlement. This amount will be paid from the Gross Settlement amount under the first payment. (Settl. Agr. Section D.1.) 3. Administrative costs shall be paid from the settlement proceeds in an amount no greater than DATE: 12/14/2021 MINUTE ORDER Page 3 DEPT: 37 Calendar No. CASE TITLE: Boudreau vs. Primeritus Financial CASE NO: 34-2018-00247272-CU-OE-GDS Services Inc $8,700.00. This amount will be paid from the Gross Settlement Amount. An amount of up to $5,400.00 shall be paid in the first payment installment, and an amount up to $3,300.00 shall be paid in the second payment installment. Any difference remaining between the actual administrative costs and the authorized maximum shall be allocated pro rata to the class members. (Settl. Agr. Section C.3.) 4. An amount of $100,000.00 allocated to PAGA claims; the settlement class to receive 25 percent thereof, which will be included in the Net Settlement Amount. The remaining 75 percent shall be paid to the LWDA. (Settl. Agr. Sec. D.3.) 5. Up to 35 percent of the Gross Settlement Amount ($1.365 million) to be allocated to Plaintiff's attorney fees, and an additional amount up to $25,000.00 to compensate class counsel for costs. Notice of the payment of these fees and costs would be included in the proposed class notice of settlement. These amounts shall also be paid from the Gross Settlement Amount. Any difference remaining between this amount and the authorized maximum shall be allocated pro rata to the class members. (Settl. Agr. Sec. D.2.) 6. Claim forms are not required for Class Members to participate in the settlement. (Settl. Agr. Secs. C.4, C.5.) Class members who did not timely opt-out of the settlement shall waive all claims alleged in this action, as well as any that could have been alleged. (Settl. Agr. Sec. E.2.) 7. For settlement checks distributed to class members that are not cashed by the designated check-cashing deadline, the funds will be remitted to the State of California Unclaimed Property Fund in the name of each Class Member. (Settl. Agr. Sec. D.5.) Based on the foregoing, the Court tentatively finds, subject to the hearing, that the Settlement Agreement and Claims Administration is entitled to a presumption of fairness and that all relevant factors support final approval. The settlement provides significant benefits to Class Members in the form of restitution for their claims. Given the causes of action asserted and the forms of relief sought in the operative Complaint, the Court finds that settlement provides significant value to the Class Members as it provides them with relief in a manner approximately commensurate with, or greater than, the potential value of their individual claims in light of the risks of continued litigation. The moving papers also demonstrate that the settlement was the result of arms-length bargaining between the parties and was reached after sufficient discovery which allow the parties, and therefore this Court, to act intelligently with respect to the settlement. CLASS COUNSEL'S COSTS AND FEES, CLAIMS ADMINISTRATION, AND CLASS REPRESENTATIVE'S SERVICE AWARD The settlement agreement provided that class counsel would apply for an award of attorney's fees in an amount totaling up to 35% of the Gross Settlement Fund, plus reasonable costs. Class Counsel's Fees Plaintiff and the class are entitled to recover attorney's fees and costs. (Code Civ. Proc. § 1021.5.) A fee award is justified where the legal action produces benefits by a voluntary settlement. (Maria P. v. Riles (1987) 43 Cal.3d 1281, 1290-1291; Westside Community for Independent Living, Inc. v. Obledo (1983) 33 Cal.3d 348, 352-353.) Courts generally recognize two methods for calculating fees in civil class actions: the lodestar/multiplier method and the percentage-of-recovery method. (Wershba v. Apple Computer, Inc., supra, 91 Cal.App.4th at 254.) Pursuant to the Settlement Agreement, the amount of settlement shall not exceed $1.365 million, and costs not to exceed $25,000.00. Class counsel argues that the attorney's fees are reasonable whether DATE: 12/14/2021 MINUTE ORDER Page 4 DEPT: 37 Calendar No. CASE TITLE: Boudreau vs. Primeritus Financial CASE NO: 34-2018-00247272-CU-OE-GDS Services Inc examined under a percentage-of-settlement approach or a loadstar calculation. In determining fees and costs to be awarded to Class Counsel, the Court must exercise its judicial function and make a decision on the propriety of the fees requested; it should not, and does not, abdicate its charge to make a decision simply because the parties may have reached their own agreement in this regard. The choice of a fee calculation method is generally one within the discretion of the trial court, "the goal . . . being the award of a reasonable fee to compensate counsel for their efforts." (Laffite v. Robert Half International, Inc. (2016) 1 Cal.5th 480, 504.) "[W]hen class action litigation establishes a monetary fund for the benefit of the class members, and the trial court in its equitable powers awards class counsel a fee out of that fund, the court may determine the amount of a reasonable fee by choosing an appropriate percentage of the fund created." (Id. at 503.) Recognized advantages in using the percentage method "include[e] relative ease of calculation, alignment of incentives between counsel and the class, a better approximation of market conditions in a contingency case, and the encouragement it provides counsel to seek an early settlement and avoid unnecessarily prolonging litigation." (Id.) Further, trial courts "retain the discretion to forego a lodestar cross-check and use other means to evaluate the reasonableness of a requested percentage fee." (Id. at 504.) The percentage-of-the-benefit approach generally is preferred in class and representative actions because "it better approximates the workings of the marketplace than the lodestar approach." (Lealao v. Beneficial California, Inc. (2000) 82 Cal.App.4th 19, 49.) "The ultimate goal... is the award of a 'reasonable' fee to compensate counsel for their efforts, irrespective of the method of calculation." (Consumer Privacy Cases (2009) 175 Cal.App.4th 545, 557-558.).) It is not an abuse of discretion to choose one method over another as long as the method chosen is applied consistently using percentage figures that accurately reflect the marketplace. Plaintiff has submitted evidence that class counsel has extensive experience in employment class action law, including significant experience in wage-and-hour class action litigation. (Hefelfinger Decl., ¶¶ 4-10; Gutierrez Decl., ¶¶ 26-30.) Counsel for both parties were capable of assessing the strengths and weaknesses of the claims against Defendant and the benefits of the proposed settlement under the circumstances of the case and in the context of a private, consensual settlement agreement. The Court has reviewed the declarations of Class Counsel in support of the requested attorneys' fees and litigation costs. With respect to fees, Class Counsel argues the propriety of a percentage-based award in amount of 35 percent of the GSA. Counsel further contends that any "cross-check" based on a lodestar calculation is unnecessary but if considered would further support the 35 percent share requested. In determining the lodestar, Class Counsel indicates they have spent a combined total of "more than 750 hours" work over the course of three years – a figure which includes over 200 hours of paralegal time. (Hefelfinger Decl., ¶ 35.) That said, Plaintiff has failed to provide detailed information concerning the tasks actually performed by the attorneys. Accordingly, the Court is unable to determine whether the actual tasks performed were necessary and the time spent performing each task was reasonable, despite counsel's representation. The Court also finds that several of the hourly rates proposed by Class Counsel under a lodestar calculation exceed the prevailing rates in this legal community. Plaintiff relies on the Laffey Matrix for attorneys in the Los Angeles area (See Hefelfinger Decl., ¶ 31), which reflect reasonable rates of $919 for an attorney in Los Angeles with over 20 years of experience, and hourly rates ranging from $676 to $764 for attorneys with 8-14 years of experience. This case, however, is pending in the Sacramento County Superior Court. "The determination of the 'market rate' is generally based on the rates prevalent in the community where the court is located." (Syers Properties III, Inc. v. Rankin (2014) 226 Cal.App.4th 691, 701; see also PLCM Group, 22 Cal.4th at 1094.) The prevailing rates in this community are not the same rates as may be acceptable in Los Angeles and must be adjusted accordingly. (See Building a Better Redondo, Inc. v. City of Redondo Beach (2012) 203 Cal.App.4th 852, 874 ["[t]he trial court was fully cognizant of the quality of the services performed, the amount of time devoted to the case and the efforts of counsel"]; Russell v. Foglio (2008) 160 Cal.App.4th DATE: 12/14/2021 MINUTE ORDER Page 5 DEPT: 37 Calendar No. CASE TITLE: Boudreau vs. Primeritus Financial CASE NO: 34-2018-00247272-CU-OE-GDS Services Inc 653, 661 ["[t]he trial court possesses personal expertise in the value of the legal services rendered in the case before it"].) In light of the foregoing, while the Court agrees the percentage method remains appropriate for determining the award of attorney's fees, the Court finds a lower percentage rate should be applied than the 35 percent requested. Based on its own expertise, the Court's experience with this litigation, and the information provided in the moving papers, the Court finds an award of 33.33 percent of the gross settlement is reasonable. (See In re Consumer Privacy Cases (2009 185 Cal.App.4th 545, 558 fn. 13 ["[e]mpirical studies show that, regardless whether the percentage method or the loadstar method is used, fee award in class actions average around one-third of the recovery."].) Accordingly, the Court awards $1.3 million in attorney's fees to Class Counsel. Class Counsel's Costs The Court concludes that the litigation expenses requested are reasonable and are of the type ordinarily incurred in this sort of litigation. The request for $22,057.52 in litigation costs is approved. (See Hefelfinger Decl., ¶¶ 38-41.) Class Representative's Enhancement Award As noted above, Plaintiff seeks a service enhancement award of $25,000.00 for named Plaintiff John Boudreau. The Court approves the service enhancement award. CONCLUSION In sum, the Court tentatively concludes the settlement is entitled to final approval. Class Counsel's attorney's fees and costs are tentatively approved as discussed above, as well as the service/enhancement awards for the named Plaintiff as identified herein and the proposed payment to Simpluris for administrative expenses. The Court will sign a final order following arguments at hearing. DATE: 12/14/2021 MINUTE ORDER Page 6 DEPT: 37 Calendar No.