Pena v. Taylor Farms Pacific, Inc.
2:13-cv-01282
| E.D. Cal. | Mar 10, 2021Background
- This is a wage-and-hour class action by former hourly employees of two Tracy, CA food-processing plants alleging unpaid donning/doffing time, missed meal/rest breaks, and wage statement/pay timing violations.
- After extensive discovery, motions practice, an interlocutory appeal, and two full-day mediations, the parties agreed to a $5.3 million gross settlement fund.
- Proposed deductions: $1,855,000 attorneys’ fees (35%), $210,164.68 litigation costs, $23,000 administration, $37,500 total incentive payments, and $75,000 to the California Labor & Workforce Development Agency (PAGA), leaving ~$3.099M for class distribution.
- Notice to class members produced >4,100 responses, 20 opt-outs, no objections, and no disputes over shift counts; average payment ≈ $744, largest ≈ $7,111.
- The court reviewed fairness under Fed. R. Civ. P. 23(e), scrutinized fees, incentives, costs, and the PAGA allocation, and held a final fairness hearing by videoconference.
- Court granted final approval of the settlement and approved a stipulation altering funding/disbursement deadlines.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Fairness of settlement under Rule 23(e) | Settlement provides immediate, certain recovery and avoids risks/costs of continued litigation | Defs did not oppose settlement | Approved as fair, reasonable, adequate given litigation risks, discovery, and class reaction (no objections) |
| Attorneys’ fees (35% of fund) | 35% reasonable due to lengthy, risky litigation, contingent fee, complex appellate and trial posture | Defs did not oppose fee request | Approved 35% as reasonable; lodestar cross-check (after modest rate adjustments) supports award |
| Named plaintiffs’ incentive awards ($7,500 each to 5) | Awards compensate time, risk, and participation over lengthy case | Defs did not oppose | Approved as reasonable (total <1% of fund; factors support awards) |
| PAGA allocation and LWDA payment ($100K PAGA, $75K LWDA) | Allocation appropriate given state interest and case risks | Defs did not oppose; LWDA review timing not required here (case filed pre-2016) | Approved; court applied Hanlon factors and PAGA discretion standard to ensure state interest |
Key Cases Cited
- In re Bluetooth Headset Prods. Liab. Litig., 654 F.3d 935 (9th Cir. 2011) (use of lodestar cross-check and scrutiny of agreed fees)
- Vizcaino v. Microsoft Corp., 290 F.3d 1043 (9th Cir. 2002) (percentage method and factors justifying upward adjustments)
- In re Mego Fin. Corp. Sec. Litig., 213 F.3d 454 (9th Cir. 2000) (confirming substantial discounts from theoretical recovery can be fair)
- Radcliffe v. Experian Info. Sols. Inc., 715 F.3d 1157 (9th Cir. 2013) (cautions on routine incentive awards to class reps)
- Sakkab v. Luxottica Retail N. Am. Inc., 803 F.3d 425 (9th Cir. 2015) (PAGA plaintiffs act as agents of the state)
- Hanlon v. Chrysler Corp., 150 F.3d 1011 (9th Cir. 1998) (factors for evaluating class settlement fairness)
- Serrano v. Priest, 20 Cal.3d 25 (Cal. 1977) (California common-fund fee principles)
- Moreno v. City of Sacramento, 534 F.3d 1106 (9th Cir. 2008) (lodestar calculation and reasonableness of hours/rates)
- Rodriguez v. Disner, 688 F.3d 645 (9th Cir. 2012) (state law governs fee entitlement and calculation in diversity cases)
- Roos v. Honeywell Int’l, Inc., 241 Cal. App.4th 1472 (Cal. Ct. App. 2015) (approving comparable percentage fee in long, complex class litigation)