Motion for Preliminary Approval of Settlement (Judge Doreen Boxer)

Case Number: 21STCV46202    Hearing Date: June 25, 2025    Dept: 19

21STCV46202

CHRISTOPHER KING vs BAKER PETROLITE LLC, et al.

NATURE OF PROCEEDINGS: Plaintiff’s Motion for Preliminary Approval of Settlement.

RULING:

The Court grants the Motion, as prayed.

The Court intends to sign and to file the proposed Order received-stamped December 11, 2025, and to edit it (1) to correct the hearing date, (2) to insert the future hearing date and time on Plaintiff’s Motion for Final Approval of Settlement, and (3) to update the Judicial Officer name.

1. BACKGROUND

On December 17, 2021, CHRISTOPHER KING (Plaintiff) filed this action against BAKER PETROLITE LLC (Defendant), alleging employer wage-and-hour violations.

Plaintiff’s First Amended Complaint, filed September 13, 2024, as a Class and PAGA action, alleges that Defendant violated law by failing (1) to reimburse employees for business-related expenses; (2) to provide employees with compliant meal periods and rest breaks; (3) to pay all wages owed; (4)  to maintain accurate records or provide employees with accurate itemized wage statements; and (5) to timely pay all wages due.

On December 11, 2024, Plaintiff filed the Motion for preliminary approval of a Class and PAGA Action settlement, on grounds including that the proposed settlement (1) is supported by experienced Counsel, (2) avoids the risk of continued litigation, (3) provides significant financial recovery of $81,000.00 to Class Members, and (4) provides a fair and adequate distribution of Settlement proceeds to the participating Class Members.

No opposition or objection has been filed.

1. LEGAL STANDARD
2. Class Action Settlements
3. Procedure

A settlement or compromise of an entire class action, or of a cause of action in a class action, or as to a party, requires court approval after hearing. (Cal. Rules of Court, rules 3.769(a). See also generally Cal. Practice Guide: Civ. Pro. Before Trial, § 14:138.20 et seq.)

2. Factors Re Settlement Approval

As to whether the settlement is fair, adequate and reasonable to the class, factors to consider include:

1. Settlement amount;
2. Strengths and weaknesses of the case;
3. Case complexity;
4. Litigation expense;
5. Potential risk and duration of litigation;
6. Discovery completed;
7. Stage of the case;
8. Experience and opinions of counsel;
9. Governmental participation, if any; and
10. Any class members’ reactions or objections to the proposed settlement.

(E.g., Wershba v. Apple Computer, Inc. (2001) 91 Cal.App.4th 224, 244-245 (Wershba), disapproved on other grounds by Hernandez v. Restoration Hardware, Inc. (2018) 4 Cal.5th 260.)

Class settlements are presumed fair 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.’” (Chavez v. Netflix (2008) 162 Cal.App.4th 43, 52 (Chavez).)  Courts also decide whether the agreement is a product of fraud or overreaching by, or collusion between, the negotiating parties. Further, the Court’s responsibility is to “prevent fraud, collusion or unfairness to the class” that may be caused by settlement or dismissal of a class action by the negotiators. (Consumer Advocacy Group, Inc. v. Kintetsu Ent. Of Amer. (2006) 141 Cal.App.4th 46, 60.)

“’The trial court has broad discretion to determine whether the settlement is fair.’”  (Cellphone Termination Fee Cases (2009) 180 Cal.App.4th 1110, 1117.) “‘To merit reversal, both an abuse of discretion by the trial court must be ‘clear’ and the demonstration of it on appeal ‘strong.’”’ (Cho v. Seagate Technology Holdings, Inc. (2009) 177 Cal.App.4th 734, 743.) The trial court’s duty is to have sufficient information to determine if the settlement is fair, adequate, and reasonable, as to the absent class members. (7-Eleven Owners for Fair Franchising v. The Southland Corp. (2000) 85 Cal.App.4th 1135, 1151.) Before approving a class-action settlement, courts must be “provided with basic information about the nature and magnitude of the claims in question and the basis for concluding that the consideration being paid for the release of those claims represents a reasonable compromise.” (Kullar v. Foot Locker Retail, Inc. (2008) 168 Cal.App.4th 116, 133.) A motion for approval of a class-action settlement need not “contain evidence in the form of an explicit statement of the maximum amount the plaintiff class could recover if it prevailed on all its claims…” but must include a record allowing “‘an understanding of the amount that is in controversy and the realistic range of outcomes of the litigation.’” (Munoz v. BCI Coca-Cola Bottling Co. of Los Angeles (2010) 186 Cal.App.4th 399, 409 (Munoz).) A trial court abused its discretion in approving a class-action settlement based upon counsel’s mere conclusion of the potential value of the claims, without any substantiated explanation or sufficient basis to determine that the settlement value was within the “ballpark” of reasonableness. (Clark v. American Residential Services LLC (2009) 175 Cal.App.4th 785, 803-04.)

“[I]n the absence of a reversion provision in the settlement agreement, [Code of Civil Procedure] section 384 has eliminated the prospect of reversion of unpaid residue to a defendant, in that it requires payment of such residue to nonprofit organizations.” (Cundiff v. Verizon California, Inc. (2008) 167 Cal.App.4th 718, 728-729.) Settlement provisions allowing unclaimed settlement funds to revert to defendants are permissible if they do not render the settlement unfair, inadequate or unreasonable, and where deterrence of defendants’ conduct is not a factor, such as where defendants have denied any wrongdoing. (Ibid., 167 Cal.App.4th at pp. 728-729.)

3. Notice

“The purpose of the class notice in the context of a settlement is to give class members sufficient information to decide whether they should accept the benefits offered, opt out and pursue their own remedies, or object to the settlement…. As a general rule, class notice must strike a balance between thoroughness and the need to avoid unduly complicating the content of the notice and confusing class members. Here again the trial court has broad discretion….” (Wershba, supra, at 252.)

The California Rules of Court leave substantial room for creativity in designing the means of notifying class members.  (Hypertouch, Inc. v. Sup. Ct. (2005) 128 Cal.App.4th 1527, 1551 (Hypertouch).) “‘[N]o single set of rules or factors has yet emerged, and courts continue to revisit and refine the illusive issue of reasonable notice.’” (Ibid. at 1549.) Trial courts have discretion as to the manner and content of notice to class members, including how to address subjects required by Civil Code Section 1781 and California Rules of Court, Rule 3.766. (Chavez, supra, 162 Cal.App.4th at p. 57.) “The notice must contain an explanation of the proposed settlement and procedures for class members to follow in filing written objections to it and in arranging to appear at the settlement hearing and state any objections to the proposed settlement.” (Cal. Rules of Court, rule 3.769(f).) Also, “[i]f the court grants preliminary approval, its order must include the time, date, and place of the final approval hearing; the notice to be given to the class; and any other matters deemed necessary….” (Ibid., rule 3.769(e).) Notices of settlement to class members must provide adequate information about the effects of settling to allow them to decide whether to accept the benefit, or to opt out, and the available avenues for pursuing an individual claim. (Chavez, supra, 162 Cal.App.4th at p. 56.) A notice of settlement was sufficient, even without a calculation of the monetary amount each class member could receive, where there was no indicator that it related to fairness of the class-action settlement. (See Munoz, supra, 186 Cal.App.4th at pp. 409-412.)

“Ordinarily it is the plaintiff’s responsibility to provide notice and bear the expense of doing so …, but there are circumstances in which courts have required the defendant to assist in identifying class members and/or to bear or share the expense of providing them notice.”  (Hypertouch, supra,128 Cal.App.4th at p.1551.)

4.  Class Certification

Generally, “[t]he party seeking certification has the burden to establish the existence of both an ascertainable class and a well-defined community of interest among class members. …. The ‘community of interest’ requirement embodies three factors: (1) predominant common questions of law or fact; (2) class representatives with claims or defenses typical of the class; and (3) class representatives who can adequately represent the class….” (Sav-on Drug Stores, Inc. v. Sup. Ct. (2004) 34 Cal.4th 319, 326. Accord Fireside Bank v. Sup. Ct. (2007) 40 Cal.4th 1069, 1089; Washington Mutual Bank, FA v. Sup. Ct. (2001) 24 Cal.4th 906, 913.) As to class settlement matters, there is a relaxed standard for class certification, because case-management and trial issues are not concerns. (Dunk v. Ford Motor Co. (1996) 48 Cal.App.4th 1794, 1807 fn. 19; Global Minerals & Metals Corp. v. Sup. Ct. (2003) 113 Cal.App.4th 836, 859.)

5. Releases

“A general release—covering ‘all claims’ that were or could have been raised in the suit—is not uncommon in class action settlements.” (Villacres v. ABM Industries Inc. (2010) 189 Cal.App.4th 562, 588.) Broad and general settlement releases including claims that fall outside the scope of the operative complaint should be closely scrutinized and avoided. (Trotsky v. Los Angeles Fed. Sav. & Loan Assn. (1975) 48 Cal.App.3d 134, 148, disapproved on other grounds by Hernandez v. Restoration Hardware, Inc. (2018) 4 Cal.5th 260, 263.)

6. Attorneys’ Fees

Procedurally, an attorney fee award is handled at the fairness hearing regarding final approval of a class action settlement. (PLCM Group, Inc. v. Drexler (2000) 22 Cal.4th 1084, 1095-1096 (PLCM).)

“Any agreement, express or implied, that has been entered into with respect to the payment of attorney fees or the submission of an application for the approval of attorney fees must be set forth in full in any application for approval of the dismissal or settlement of an action that has been certified as a class action.” (Cal. Rules of Court, rule, 3.769(b).)

One test is whether class counsel are placed in a position that might endanger the fair representation of the clients and whether they will be compensated on some basis other than legal services. (Rebney v. Wells Fargo Bank (1991) 232 Cal.App.3d 1344, 1347.) Alternative discretionary approaches are the common fund theory, and the “lodestar” method, by which the court calculates base amounts from a compilation of time spent and reasonable hourly compensation of each attorney and then adjusts the base amounts. (Ibid.) The primary method for establishing the amount of “reasonable” attorney fees is the lodestar method. (Thayer v. Wells Fargo Bank (2001) 92 Cal.App.4th 819, 833.) “California courts have consistently held that a computation of time spent on a case and the reasonable value of that time is fundamental to a determination of an appropriate attorneys’ fee award…” (PLCM, supra, 22 Cal.4th at p. 1095.) “The trial judge has discretion to determine the value of professional services, based upon a proper utilization of the lodestar adjustment method. (Ramos v. Countrywide Home Loans, Inc. (2000) 82 Cal.App.4th 615, 626.)  “[W]hen a number of persons are entitled in common to a specific fund, and an action brought by a plaintiff or plaintiffs for the benefit of all results in the creation or preservation of that fund, such plaintiff or plaintiffs may be awarded attorney’s fees out of the fund.” (Serrano v. Priest (1977) 20 Cal.3d 25, 34.)  “In referring to ‘reasonable’ compensation, we indicated that trial courts must carefully review attorney documentation of hours expended; ‘padding’ in the form of inefficient or duplicative efforts is not subject to compensation…..Under Serrano III, the lodestar is the basic fee for comparable legal services in the community; it may be adjusted by the court based on factors including, as relevant herein, (1) the novelty and difficulty of the questions involved, (2) the skill displayed in presenting them, (3) the extent to which the nature of the litigation precluded other employment by the attorneys, (4) the contingent nature of the fee award…. The purpose of such adjustment is to fix a fee at the fair market value for the particular action.”  (Ketchum III v. Moses (2000) 24 Cal.4th 1122, 1132.)

Attorney fees determined under either the lodestar method, or the common fund doctrine, must be a reasonable fee to compensate attorneys for their efforts, and percentage figures must accurately reflect the marketplace. (Consumer Privacy Cases (2009) 175 Cal.App.4th 545, 558. While fee awards of 25 percent of a fund are regarded as the “benchmark” award that should be given, also awards of one-third have been regarded as being within a reasonable range. (Ibid.)

7. Enhancement Fees

An award of a service fee to class representatives has been upheld, where the evidence supports a finding that the proposed service payment to Plaintiff is fair and reasonable. (E.g., Bell v. Farmers Ins. Exch. (2004) 115 Cal.App.4th 715, 726).  “[S]pecificity, in the form of quantification of time and effort expended on the litigation, and in the form of reasoned explanation of financial or other risks incurred by the named plaintiffs, is required in order for the trial court to conclude that an enhancement was ‘necessary to induce [the named plaintiff] to participate in the suit ….’” (Clark v. Amer. Residential Services LLC (2009) 175 Cal.App.4th 785, 807.)

8. Order

A proposed order must be lodged. (Cal. Rules of Court, rule 3.769(c).) Additional items might be ordered for counsel to include in a proposed order. (See generally, ibid., rule 3.769(e).)

1. PAGA Settlements

“The superior court shall review and approve any proposed [PAGA] settlement of alleged violations of the provisions of Division 5 (commencing with Section 6300) to ensure that the settlement provisions are at least as effective as the protections or remedies provided by state and federal law or regulation for the alleged violation. The provisions of the settlement relating to health and safety laws shall be submitted to the division at the same time that they are submitted to the court. This requirement shall be construed to authorize and permit the division to comment on those settlement provisions, and the court shall grant the division’s commentary the appropriate weight.” (Lab. Code § 2699.3, subd. (b)(4).)

Judges are to apply an appropriate standard of review of Private Attorneys General Act (PAGA) case settlements, by inquiring whether settlements are “‘fair, adequate, and reasonable’” and “meaningful and consistent with the purposes of PAGA….” (Moniz v. Adecco USA, Inc. (2021) 72 Cal.App.5th 56, 64.)

“If parties in a PAGA lawsuit agree to settle, the ‘proposed settlement shall be submitted to the [LWDA],’ and the ‘court shall review and approve [the] settlement.’” ([Labor Code] § 2699, subd. (l)(2).) Although our Supreme Court has stated that this provision ensures that ‘any negotiated resolution is fair to those affected’…, California courts have not determined the standards by which a trial court reviews and approves a proposed settlement.” (Starks v. Vortex Indus., Inc. (2020) 53 Cal.App.5th 1113, 1124. Accord Williams v. Superior Court (2017) 3 Cal.5th 531, 549 [“PAGA settlements are subject to trial court review and approval, ensuring that any negotiated resolution is fair to those affected.”].)

“There is no willful failure to pay wages if the employer and employee have a good faith dispute as to whether and when the wages were due.” (Nordstrom Com. Cases (2010) 186 Cal.App.4th 576, 584.)

Additionally, settling parties commonly advocate grafting class-action rules onto the legislative procedure, which involves somewhat analogous procedure. Fundamentally, a PAGA representative action is not a class action, because there is no collection of individual claims in a PAGA action, but instead a representative action on behalf of the state. (Kim v. Reins Int’l California, Inc. (2020) 9 Cal.5th 73, 87.)

In deciding whether to approve a PAGA settlement, courts are not required to receive and consider intervenors’ objections to a proposed settlement, but considering State of California objections may be different. (Turrieta v. Lyft, Inc. (2024) 16 Cal.5th 664, 716.)

III.            ANALYSIS

Plaintiff Christopher King, individually, and on behalf of the putative class and similarly aggrieved employees, requests an Order: 1) Preliminarily approving a settlement of the class claims; 2) provisionally certifying a settlement class; 3) approving the proposed class notice and notice plan; 4) appointing Plaintiff as the class representative and Plaintiff’s counsel as counsel for the class; 5) appointing the proposed settlement administrator; and 6) scheduling a hearing for final settlement approval.

The Court finds that the evidence filed with the motion (e.g., Kelly Y. Chen Declaration, filed December 11, 2024), provides sufficient information about the nature and magnitude of the claims, amounts in controversy, the realistic range of outcomes of litigation, and the bases for settlement amounts, to enable the Court to intelligently ascertain that this proposed compromise is fair, adequate, and reasonable as to the class members and aggrieved employees.

Additionally, the Court finds that the proposed notices to class members are clearly organized, uncomplicated and clear, and sufficiently contain explanations of the settlement, procedures for class members to object at a specified hearing, and information about the effects of settling, in order to enable them to decide whether to accept the benefits, to opt out, to do nothing, or to pursue claims individually.

Further, the Court finds that the subject settlement is fair, adequate, and reasonable, meaningful and consistent with the purposes of the PAGA statute, as to all subject, affected employees.

1. CONCLUSION

Accordingly, the Court grants the Motion.