GERRIE DEKKER, individually and on behalf of all others similarly situated v. VIVINT SOLAR, INC., VIVINT SOLAR HOLDINGS, INC., VIVINT SOLAR DEVELOPER, LLC, and VIVINT SOLAR PROVIDER, LLC
No. C 19-07918 WHA
UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA
August 23, 2023
WILLIAM ALSUP, UNITED STATES DISTRICT JUDGE
INTRODUCTION
In this unfair business practices class action, plaintiff moves for final approval of a class settlement. Because the settlement is fair, reasonable, and adequate, final approval is GRANTED.
Separately, plaintiff moves for an award of attorney‘s fees in the amount of $1,859,273, costs in the amount of $168,276.05, and a class representative service award in the amount of $15,000. This order finds that attorney‘s fees should be reduced to $100,000, with the possibility of more to be awarded later if additional benefit to the class materializes. It further finds that costs should be reduced to $25,427.60, and that the class representative service award should be reduced to $500. To the extent stated herein, the motion for attorney‘s fees, costs, and a class representative service award is GRANTED.
STATEMENT
Previous orders described the facts herein (Dkt. Nos. 121, 140, 230). At all relevant times, defendant Vivint Solar, Inc., in its various corporate forms (collectively, “Vivint“), has installed solar panels on customers’ roofs and, as advertised, has sold those customers low-cost, clean energy pursuant to power purchase agreement (“PPA“) contracts. In exchange for Vivint paying the upfront costs of building and operating their solar photovoltaic systems, customers have agreed to buy the electricity that their systems produce over a twenty-year term from Vivint at a set price. Plaintiff Gerrie Dekker alleges that Vivint‘s “Version 1” PPA contracts, issued between 2012 and 2013, contain liquidated damages provisions that impose harsh, unlawful penalties on customers. Ms. Dekker brought this action on behalf of a class of 947 customers who are parties to Version 1 PPA contracts.1
Originally, the action was much broader. The initial complaint, filed in December 2019, named ten plaintiffs (Dkt. No. 1), but a March 2020 order compelled all but two of those plaintiffs to arbitration (Dkt. No. 47). The exceptions were Ms. Dekker, whose Version 1 PPA contract did not include an arbitration clause, and Juan Bautista, a native Spanish speaker with
Then, in May 2020, Vivint dropped the ball on meeting its JAMS filing fee deadlines, a material breach of the arbitration agreements under then-recently enacted
In January 2021, our court of appeals dismissed Vivint‘s first appeal for lack of jurisdiction, “remand[ing] to the district court for it to determine if Plaintiffs should be granted leave to amend the complaint” (Dkt. No. 111). Leave to amend was ultimately granted, formalizing plaintiffs’ reliance on Class Action Fairness Act (“CAFA“) jurisdiction (Dkt. No. 121). In April 2021, Vivint moved for judgment on the pleadings, which was granted with respect to plaintiffs’ claim under California‘s Unfair Competition Law (“UCL“) to the extent that it alleged unfairness based on violations of the Translation Act suffered by Mr. Bautista (Dkt. No. 140). Plaintiffs were subsequently permitted to amend their complaint once more to include a damages claim under California‘s Consumers Legal Remedies Act (“CLRA“), but they were denied leave to include a revised UCL claim alleging unfairness based on violations of the Translation Act, as well as a new restitution claim under the CLRA and UCL (Dkt. No. 157).
In October 2021, the other shoe dropped when our court of appeals ruled on Vivint‘s second appeal, holding that whether Vivint‘s failure to pay the JAMS filing fees qualified as a breach of the arbitration agreements fell within the scope of the delegation clauses of the post-2013, non-Version 1 PPA contracts (Dkt. No. 177). The order compelling plaintiffs who were parties to those contracts to arbitration was hence reinstated (Dkt. No. 178). Some of those plaintiffs opted to settle with Vivint, as did Mr. Bautista (Dkt. No. 185). By November 2021, Ms. Dekker was our only named plaintiff (ibid.; see Dkt. No. 214).
The parties attended settlement conferences and, in July 2022, reached an initial settlement agreement (Dkt. No. 274). The trial date was vacated, and plaintiff moved for preliminary approval in September 2022 (Dkt. Nos. 278, 282). At the hearing on preliminary approval, the judge identified several deficiencies in the proposed settlement agreement and class notice, and ordered the submission of revisions (Dkt. No. 285). The submitted revisions were lacking, and the judge ultimately had to issue two further orders directing counsel to make corrections (Dkt. Nos. 289, 291). Preliminary approval was finally granted in January 2023 (Dkt. No. 293).
Plaintiff now moves for final approval of the class settlement and, separately, for attorney‘s fees, costs, and a class representative service award (Dkt. Nos. 294-95). This order follows full briefing and oral argument.
ANALYSIS
1. MOTION FOR FINAL APPROVAL.
“The class action device, while capable of the fair and efficient adjudication of a large number of claims, is also susceptible to abuse and carries with it certain inherent structural
Our court of appeals has explained that any such finding under
Meanwhile,
In short, in consideration for the dismissal of this action with prejudice and a release of claims related to the alleged liquidated damages provisions, Vivint agrees to modify the Version 1 PPA contracts of class members to reduce the price paid by those who default and buy out their systems from seven dollars per watt to four dollars per watt, with a five percent reduction for each year their systems were in service (Dkt. No. 292-1 ¶ 7.1). This order finds the settlement fit for final approval.
A. THE CHURCHILL FACTORS.
We begin with the eight Churchill factors, which collectively support settlement.
Second, the risk, expense, complexity, and likely duration of further litigation likewise support settlement. Here, the risk of loss identified above applies equally to both sides, as both sides acknowledge (Fairness Br. 11; Fairness ISO Br. 8). The action has already resulted in two appeals, and proceeding to trial would likely result in more and drag this on. Meanwhile, trial and additional appeals would require racking up additional fees beyond the disproportionate fees already incurred.
Third, the risk of maintaining class action status throughout trial is neutral. The class was certified in March 2022 (Dkt. No. 230). Although it is unlikely that the class would be decertified, defendants could have offered evidence that the value of the systems installed at class member homes varies so significantly that ascertaining damages would present individualized questions of fact, precluding class-wide resolution (see Dkt. No. 296-1 ¶ 12).
Fourth, the “amount” offered in settlement supports settlement. Although this settlement provides for the modification of a contract instead of a cash award, the parties agree that the potential savings amount for defaulting customers is similar to that which plaintiff could have achieved had she prevailed at trial (Dkt. Nos. 294-1 ¶ 16, 296-1 ¶ 11). And, as plaintiff acknowledges, even if the default provisions had been invalidated, class members still would
Fifth, the extent of discovery completed and the stage of proceedings support settlement. The narrowed claims have survived dismissal, judgment on the pleadings, partial summary judgment, and class certification (Dkt. Nos. 47, 140, 229, 230). Plaintiff (then plaintiffs) served 25 interrogatories, five sets of requests for production, and two expert reports (Fairness ISO Br. 7). Defendants produced over 16,000 pages of documents and one expert report (Fairness Br. 4-5). There has been ample discovery, and the settlement was reached just two months before the action would have proceeded to trial (see Dkt. No. 278).
Sixth, the experience and views of counsel support settlement. Although it was not always readily apparent, counsel for both sides are sufficiently experienced in complex litigation and class actions. As class counsel observe, with the settlement, class members stand to save, whereas without it, they could be trapped in unfavorable contracts for years to come (Fairness Br. 11). Likewise, defense counsel acknowledge the benefits of settlement for class members, emphasizing the avoidance of damages for breach (Fairness ISO Br. 9).
Seventh, although there was not a governmental participant in this action, defendants notified the California Attorney General and the United States Attorney General, as required by CAFA, in September 2022 (Dkt. Nos. 283, 284). Neither has raised any concerns involving the settlement.
Eighth, the reaction of the class members of the proposed settlement favors settlement. Of the 955 potential class members notified, only four requested exclusion, and more than 99% of the potential class members are participating (Dkt. No. 294-5 ¶ 7-8).
In sum, the Churchill factors support final approval of the settlement.
B. THE RULE 23(e)(2) FACTORS.
“[C]onsideration of these eight Churchill factors alone is not enough . . . .” Kim, 8 F.4th at 1179 (quoting Bluetooth, 654 F.3d at 946).
First, class counsel and the class representative have, by and large, represented the class adequately. As noted before, the relief is similar to what could have been achieved had plaintiff been successful at trial. To the extent that class counsel and the class representative could have done better, that should (and will) be reflected in their compensation, not in the denial of a settlement that has some benefit to the class.
Second, the proposal was negotiated at arm‘s length. Chief Magistrate Judge Donna Ryu supervised settlement negotiations in the lead-up to trial, and the parties did not immediately agree on settlement terms. There is no discussion of attorney‘s fees in the settlement agreement beyond plaintiff‘s right to seek them and defendants’ right to oppose them — and no discussion of plaintiff‘s entitlement to fees in the first place (Dkt. No. 292-1 ¶ 6.2, 6.2.1, 8.4). What‘s more, there is no evidence of collusion and, to the contrary, there is a stark $1,786,773 difference between the attorney‘s fees class counsel and defense counsel believe should be awarded. That is not to mention the $142,848.45 difference in opinion on costs and the $13,000 difference in opinion on the class representative service award. In total, class counsel has requested $1,942,621.45 more than what defense counsel believe is warranted. For all of these reasons, this order concludes that the settlement agreement was the result of arm‘s-length negotiations.2
Third, the relief is adequate, taking into account, as required: (i) the costs, risks, and delay of trial and appeal; (ii) the effectiveness of any proposed method of distributing relief to the class, including the method of processing class-member claims; (iii) the terms of any
Fourth, the settlement treats class members equitably relative to each other. It modifies the contracts on a per watt basis with a standard annual discount such that class members are treated the same no matter the size of their system.
In sum, the
C. THIS COURT‘S FACTORS.
A prior order laid out fourteen factors that would be analyzed in the event of a proposed class settlement (Dkt. No. 12). This order evaluates these factors to the extent relevant to the settlement at issue and not considered in the Churchill and
The fourth factor contemplates whether the release is limited only to the certified claims (id. at 3). The judge had to instruct counsel twice to modify the release in the settlement agreement and class notice such that it was clear that class members would only be releasing claims that were asserted and settled in this action (Dkt. No. 289 at 2-3). The settlement
The eighth factor makes clear that an opt-out option is not a cure-all for a poor-quality settlement (Dkt. No. 12 at 4). Although this settlement has an opt-out option and four potential class members chose to exercise it, that option is not operating as a pernicious cure-all here. As explained in the analysis of Churchill factor eight and
The ninth factor acknowledges the danger of giving incentive payments to named plaintiffs to sweeten an inadequate deal (ibid.). Although class counsel now separately seek a class representative service award for Ms. Dekker, this has no bearing on the settlement itself. Defendants did not offer plaintiff an incentive payment to settle the case.
In sum, the factors laid out in the prior order further support final approval. As such, for the foregoing reasons, final approval of the class settlement is hereby GRANTED.
2. MOTION FOR ATTORNEY‘S FEES, COSTS, AND SERVICE AWARD.
As mentioned above, the settlement agreement did not discuss attorney‘s fees beyond plaintiff‘s right to seek them and defendants’ right to oppose them. Plaintiff now separately moves for $1,859,273 in fees, $168,276.05 in costs, and $15,000 for a class representative service award under
A. ATTORNEY‘S FEES.
Let‘s start with the requested fees, and before that, some context. As the parties are aware, mere months ago, our court of appeals decisively reversed and remanded a 1.7-million-dollar fee award. See Lowery v. Rhapsody Int‘l, Inc., 75 F.4th 985 (9th Cir. 2023).3
In our case, the settlement provides no cash to the class. Rather, it provides a modification to Version 1 PPA contracts. Specifically, the Version 1 PPA contracts of 947 class members will be modified to allow those who default and buy out their systems to purchase them for four dollars per watt, discounted by five percent for each year the systems have been in service, instead of seven dollars per watt, as set out in the original Version 1 PPA contracts (Dkt. No. 292-1 ¶ 7.1). And, it is undisputed that this merely formalizes Vivint‘s existing practice: the record reflects that, in rare cases of default, Vivint has routinely allowed customers to buy out their systems for four dollars per watt, discounted by five percent for each year the systems have been in service, instead of seven dollars per watt, as set out in the original Version 1 PPA contracts (Fees Opp. 4; Fees Reply Br. 11; see Dkt. Nos. 296-11 ¶ 6, 296-12).4 Which is to say, class counsel seek almost two million dollars in fees for changing the default provisions in the contracts of less than one thousand customers to conform to what Vivint was already doing and, for all the record shows, would have continued to do.
As both sides recognize, this no-cash settlement does bind Vivint and its new parent company Sunrun to continue this practice for all class members for the duration of their contracts. Based on the historical default rate of 0.5% for customers with Version 1 PPA
But even so, this was by no means the blockbuster resolution that class counsel previously pursued and that could potentially justify their extraordinary fee request. Remember, they had once sought public injunctive relief and, briefly, damages on behalf of tens of thousands of Vivint customers. Indeed, much of the effort that went into litigating this case was dedicated to the arbitration fights of non-class members, several of whom ultimately settled out — for which class counsel were ostensibly compensated. In other words, as in Lowery, “the benefit from this litigation was minimal” and “the class . . . obtained no meaningful injunctive or nonmonetary relief.” 75 F.4th at 988; see also Stanikzy v. Progressive Direct Ins. Co., No. 22-35524, 2023 WL 4837875, at *2 (9th Cir. July 28, 2023) (upholding a reduced fee award last month based on a district court‘s finding that the requested fees would greatly exceed class recovery); Create-A-Card, Inc. v. Intuit, Inc., No. C 07-06452 WHA, 2009 WL 3073920, at *3 (N.D. Cal. Sept. 22, 2009) (“The determinative factor,
Class counsel emphasized at the hearing that Lowery was a copyright case and federal law was at issue, whereas this is not a copyright case and state law is at issue (Tr. 8:21-9:1). But Lowery was clear that “[t]he district court‘s fee award [was] not reasonable under Rule 23.” 75 F.4th at 991 (emphasis added). Moreover, our court of appeals has held that irrespective of whether a plaintiff was a prevailing party under a state law fee-shifting provision, “the district court needed to do more to assure itself — and us — that the amount awarded was not unreasonably excessive in light of the results achieved.” Bluetooth, 654 F.3d at 943. In other words, Lowery is on point and looms large here. As set out below, this order finds that a reduced fee award is appropriate.
* * *
In a certified class action, a district court may award reasonable attorney‘s fees that are authorized by law or by the parties’ agreement.
In the end, plaintiff asserted an unlawful liquidated damages claim under
Under
Finding the more pragmatic approach more appropriate here, class counsel (narrowly) clear this bar. Plaintiff ultimately sought private injunctive and declaratory relief to invalidate the default provisions in Version 1 PPA contracts. Although there has been no finding that the default provisions were, in fact, liquidated damages provisions, the parties agree that the settlement‘s reduced four dollars per watt annually discounted price is fair and that it does not overcompensate defendants for customer default. In other words, the default provisions can no longer be liquidated damages provisions. In light of that, plaintiff has “succeeded on [a] significant issue in litigation which achieve[d] some of the benefit the parties sought in bringing suit.” Ibid. This order finds plaintiff is therefore a prevailing party under
Separately, class counsel claim to be entitled to fees under
“Whether an award is justified and what amount that award should be are two distinct questions, and the factors relating to each must not be intertwined or merged.” Thayer v. Wells Fargo Bank, N.A., 112 Cal. Rptr. 2d 284, 298 (Cal. Ct. App. 2001) (citation omitted). Defining a plaintiff as a prevailing party when she has succeeded in achieving some benefit sought on a significant issue is “a generous formulation that brings the plaintiff only across the statutory threshold,” which “may say little about whether the expenditure of counsel‘s time was reasonable in relation to the success achieved.” Hensley, 461 U.S. at 433, 436.
Having established that class counsel are entitled to attorney‘s fees under the CLRA, we turn to the amount requested. “Two primary methods of determining a reasonable attorney fee in class action litigation have emerged and been elaborated in recent decades.” Laffitte v. Robert Half Int‘l Inc., 376 P.3d 672, 676 (Cal. 2016); see Lowery, 75 F.4th at 990. One is the percentage-of-recovery method, where the attorney‘s fees are calculated as a share of a common fund or the monetary value of class recovery. The other is the lodestar method, where the attorney‘s fees are calculated by multiplying the number of reasonably spent hours by a reasonable hourly rate, and applying a positive or negative multiplier to “ratchet the attorneys’ fees up or down” based on various factors. Lowery, 75 F.4th at 990.
“Under either approach, ‘[r]easonableness is the goal, and mechanical or formulaic application of either method, where it yields an unreasonable result, can be an abuse of discretion.‘” Bellinghausen v. Tractor Supply Co., 306 F.R.D. 245, 260 (N.D. Cal. 2015) (Judge Jacqueline Scott Corley) (quoting Fischel v. Equitable Life Assurance Soc‘y of U.S., 307 F.3d 997, 1007 (9th Cir. 2002)). “[T]he ultimate goal . . . is the award of a reasonable fee to compensate counsel for their efforts, irrespective of the method of calculation.” Apple Comput., Inc. v. Superior Ct., 24 Cal. Rptr. 3d 818, 826 (Cal. Ct. App. 2005) (internal quotation and citation omitted). After all, “[n]o rational person would spend, say, $1 million in
In this action, class counsel request attorney‘s fees in the amount of $1,859,273 [sic] based on a $929,636 lodestar and a multiplier of 2.0 (Fees Br. 8).6 They assert that California substantive law governs the calculation of attorney‘s fees here and, thus, the use of the lodestar method is mandatory (Fees Br. 13-14; Fees Reply Br. 9 (quoting Serrano v. Priest, 569 P.2d 1303, 1316 n.23 (1977)). Defense counsel counter that our court of appeals has confirmed Erie doctrine does not apply to a federal court‘s assessment of a class action settlement, including attorney‘s fees, under Rule 23(e) (Fees Opp. 6 (quoting Briseno, 998 F.3d at 1029)). This seems like a rather generous read of Briseno, which concluded that ”Erie‘s effect on fee-shifting law, if it even has one, is simply not implicated in this appeal.” Briseno, 998 F.3d at 1030. In any event, we are now considering a motion for attorney‘s fees under
State law governs plaintiff‘s right to fees and the method of calculating those fees. Mangold v. Cal. Pub. Utils. Comm‘n, 67 F.3d 1470, 1478 (9th Cir. 1995). Although there is no blanket “lodestar only” mandate in California, and every fee-shifting statute must be construed on its own merits, the California Supreme Court has endorsed the lodestar method in fee-shifting cases except in limited circumstances. Laffitte, 376 P.3d at 684 (quoting Ketchum v. Moses, 17 P.3d 735, 744 (Cal. 2001)); see ibid. (collecting cases). Of note, “[d]espite its
As the California Supreme Court has recognized, cross-checking the lodestar against the value of the class recovery helps to determine a reasonable fee because it “provides a credible measure of the market value of the legal services provided.” Laffitte, 376 P.3d at 685 (quoting Lealao, 97 Cal. Rptr. 2d at 820). As such, it is “consistent with the mandate of Serrano,” which requires that the fee award be “‘anchored’ in the time spent by counsel on the case.” Lealao, 97 Cal. Rptr. 2d at 816-17 (citing Serrano, 569 P.2d at 1316 n.23); accord Laffitte, 376 P.3d at 685 (citing Lealao, 97 Cal. Rptr. 2d at 816-17). Our court of appeals also expressly encourages cross-checking to avoid unreasonable results and to ensure “that counsel‘s fee does not dwarf class recovery.” Lowery, 75 F.4th at 994 (quoting Bluetooth, 654 F.3d at 945). Indeed, cross-checking is especially important in light of Lowery because, as even the California Supreme Court has acknowledged, “the lodestar method better accounts for the amount of work done, while the percentage of the fund method more accurately reflects the
Class counsel initially put forward a lodestar of $990,801.50 (Fees Br. 8). Following a meet and confer with defense counsel, they reduced the lodestar by $61,165.50 to $929,636 (Fees Reply Br. 6-7, 21). According to class counsel‘s declaration, the time dedicated to tasks exclusively associated with plaintiffs who received individual settlements was not included, but much of the time spent seeking to include additional claims and plaintiffs was (Dkt. No. 298-1 ¶ 12). The thrust of defense counsel‘s remaining objections to class counsel‘s requested fee award is that a great deal of the hours expended were on behalf of claims and plaintiffs that did not prevail, such that the requested fee award cannot be justified by reliance on class counsel‘s billing records. That is true and will be taken up in due course.
But application of the lodestar method “begins with the ‘lodestar,’ i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate.” Graciano, 50 Cal. Rptr. 3d at 285. It is the “basic fee” that later “may be adjusted by the court based on factors.” Ibid. Upon review of class counsel‘s billing records, declarations, and briefing, this order observes that class counsel‘s reduced lodestar generally reflects reasonable hours expended at reasonable rates. Time was fairly devoted, and allegations of block billing and vague entries are misplaced (see Fees Opp. 13). The problem, however, is that class counsel have “achieved only partial or limited success,” such that “the product of hours reasonably expended on the litigation as a whole times a reasonable hourly rate [is] an excessive amount.” Hensley, 461 U.S. at 436. “This will be true even where the plaintiff‘s claims were interrelated, nonfrivolous, and raised in good faith.” Ibid.
Conducting their own cross-check of sorts, class counsel suggest their lodestar is reasonable given the potential savings of up to $8,990,750 in the “highly unlikely” scenario in which all 951 [sic] class members buy out their systems in their ninth year of service (Fees Br. 13).9 Applying class counsel‘s proposed 2.0 multiplier to the $929,636 lodestar, their
For their part, defense counsel arrive at $289,006.33 in estimated class benefit (Fees Opp. 5). First, they measure the average savings per class member in each of the next ten years — the difference between the four dollars and seven dollars per watt rates, discounted by five percent for each year a class member‘s system will have been in service, multiplied by the average system size of 5.184 kilowatts. Next, defense counsel multiply the average savings per class member in each of those years by the number of anticipated defaults in each of those years. Note they display the number of anticipated defaults as five class members per year, but they actually use 0.5% of the 951 [sic] class members minus the number of class members who ostensibly already defaulted, rounded up to the nearest hundredth, which amounts to between 4.5 and 5 class members per year. Finally, defense counsel discount the total savings in each of those years to net present value. Adding up the savings across the years, they propose that an appropriate fee would be a percentage-of-recovery award around $72,500, which corresponds to 25% of the approximate $290,000 class benefit (Fees Opp. 5; Dkt. No. 296-11 ¶ 10). Although this order will make a minor adjustment to defense counsel‘s calculation to correct the number of class members, it finds that they have meaningfully captured the class benefit and the corresponding percentage-of-recovery award.
In line with the “significant trend” of “blending [] the two fee calculation methods, an approach in which one method is used to confirm or question the reasonableness of the other‘s
Courts may increase or decrease the lodestar taking into account a variety of so-called reasonableness factors. Although the factors recognized by California and federal courts differ, both include the results obtained for the class. See, e.g., Laffitte, 376 P.3d at 677; Bluetooth, 654 F.3d at 941-42; see also Lealao, 97 Cal. Rptr. 2d at 815-16. As observed in Lealao, “[a]n adjustment reflecting the amount of the class recovery is not significantly different from an adjustment reflecting a percentage of that amount; and California courts have evaluated a lodestar as a percentage of the benefit.” Lealao, 97 Cal. Rptr. 2d at 818 (citing Glendora Cmty. Redevelopment Agency v. Demeter, 202 Cal. Rptr. 389 (Cal. Ct. App. 1984)). Meanwhile, in Lowery, our court of appeals expressly encouraged the district court to evaluate its lodestar as a percentage of the benefit on remand “and then award attorneys’ fees proportional and reasonable to the benefit received by the class.” 75 F.4th at 993-95. True, Lowery recognized that “assigning a precise dollar amount to the class benefit may prove difficult” where the relief is injunctive in nature and not easily monetized. Id. at 992 n.1. But here, like in Lealao, “[t]hough the settlement did not create a common fund out of which fees are to be paid, the monetary value of the benefit to the class is much less speculative than that of some
This order will adjust the lodestar downward to reflect the results obtained for the class and the benefit conferred by the settlement. Seeing that additional benefit may materialize in the future, however, this order will award attorney‘s fees in two steps if warranted.
For clarity, unlike defense counsel‘s chart, our chart accounts for 947 class members and displays the anticipated defaults as 0.5% of 947 class members minus the number of class members who ostensibly already defaulted, rounded up to the nearest hundredth, instead of as a rounded five class members each year (in column F). With this change, the estimated class benefit is $287,668.01.
Using the updated class benefit estimate, 25% of the value of the benefit obtained for the class is $71,917. Accounting for another reasonableness factor, the novelty of the issues, this order will soften the blow and award class counsel $100,000 in fees at this time. See Laffitte, 376 P.3d at 677; Bluetooth, 654 F.3d at 941-42.
“[W]here the plaintiff has achieved ‘only limited success,’ counting all hours expended on the litigation — even those reasonably spent — may produce an ‘excessive amount,’ and the Supreme Court has instructed district courts to instead ‘award only that amount of fees that is reasonable in relation to the results obtained.‘” Bluetooth, 654 F.3d at 942 (quoting Hensley, 461 U.S. at 436, 440). California courts have embraced this instruction as well. See Mann v. Quality Old Time Serv., Inc., 42 Cal. Rptr. 3d 607, 617-18 (Cal. Ct. App. 2006) (quoting
Recognizing, however, that it is unclear how many (if any) additional class members can be expected to default and buy out their systems now that they are aware of the availability of a reduced price at the outset — and that “we simply will not know for the next several years” (Fees Reply Br. 13) — this order will allow class counsel to seek additional fees based upon realized benefit to the class in three years’ time. Cf. In re Pinterest Derivative Litig., No. C 20-08331 WHA, 2022 WL 2079712, at *1-2 (N.D. Cal. 2022). If more than the anticipated fifteen class members invoke the modified Version 1 PPA contract language (which corresponds to five class members each year for three years) class counsel may move for attorney‘s fees once more. Defense counsel shall keep records of how many class members default and buy out their systems after the issuance of this order. They shall also keep records of how many individuals who have assumed the obligations under class members’ contracts default and buy out their systems after the issuance of this order, in case this could paint a fuller picture. Class counsel may, at reasonable intervals, request these records. Possibly, the records from the three-year period will allow us to extrapolate the full extent of the class benefit over the ten-year period.
In closing, this order would be remiss not to point out that another factor, the quality of representation, supports the downward adjustment. See Laffitte, 376 P.3d at 677; Bluetooth, 654 F.3d at 941-42. It took one hearing and two subsequent orders for class counsel to make the required changes to the settlement agreement and class notice (Dkt. Nos. 285, 289, 291). This included correcting sloppy errors that were introduced while making changes (Dkt.
All told, the request for $1,859,273 in attorney‘s fees is DENIED. An adjusted amount of $100,000 is APPROVED and will be awarded and paid now as attorney‘s fees. Class counsel may move for additional attorney‘s fees, if warranted, in three years.
B. COSTS.
Next, we turn to costs. Class counsel request a total of $168,276.05 for costs, including $110,361 for costs associated with expert witness Bruce McFarlane, $30,294 for costs associated with expert witness Nora Ostrofe, $25,427.60 for miscellaneous litigation costs, and $2,193.45 for the cost of issuing an additional class notice upon the filing of this order (Dkt. No. 295-4).
The CLRA provides that a court must award “costs and attorney‘s fees to a prevailing plaintiff in litigation filed pursuant to [Section 1770].”
C. CLASS REPRESENTATIVE SERVICE AWARD.
Finally, we consider the class representative service award. In brief, class counsel‘s requested $15,000 class representative service award is unreasonably high. Likewise, defense counsel‘s suggested $2,000 class representative service award is unreasonably high. This order finds $500 will reasonably compensate Ms. Dekker for her work on the case.
To support their request for a $15,000 class representative service award, class counsel emphasize that Ms. Dekker assumed a reputational risk by serving as a named plaintiff, citing Billinghausen [sic] and Guippone (Fees Br. 23). 306 F.R.D. 245; Guippone v. BH S & B Holdings, LLC, No. C. 09-01029 CM, 2011 WL 5148650 (S.D.N.Y. Oct. 28, 2011) (Judge Colleen McMahon). But those two cases dealt with employment law claims, and it cannot be said that Ms. Dekker, who is by all accounts retired, risks discrimination by future employers because she served as a named plaintiff in a small class action asserting liquidated damages claims against a solar company. “The trial court is not bound to, and should not, accept conclusory statements about ‘potential stigma’ and ‘potential risk,’ in the absence of supporting evidence.” Wilson v. Tesla, Inc., 833 F. App‘x 59, 62 (9th Cir. 2020) (quoting Clark v. Am. Residential Servs. LLC, 96 Cal. Rptr. 3d 441, 457 (Cal. Ct. App. 2009)).
Additionally, Ms. Dekker‘s lack of involvement in the case and lack of familiarity with the claims asserted made the issue of adequacy at class certification “a closer call than many” (Dkt. No. 230 at 5). To compensate her in an amount corresponding to $250 per hour under such circumstances would be inappropriate — all the more so in view of the glaring
CONCLUSION
For the foregoing reasons, final approval of the class settlement is GRANTED. To the extent stated herein, the motion for attorney‘s fees, expenses, and a class representative service award is GRANTED. Class counsel are presently awarded $100,000 in ATTORNEY‘S FEES and may seek additional fees in three years pursuant to this order. Class counsel‘s costs in the amount of $25,427.60 to be paid immediately are APPROVED. A class representative service award in the amount of $500 to be paid immediately to Ms. Dekker is APPROVED.
IT IS SO ORDERED.
Dated: August 23, 2023.
WILLIAM ALSUP
UNITED STATES DISTRICT JUDGE