Arredondo, et al. vs. Delano Farms Company, et al.

Filing 533

ORDER REGARDING ENHANCEMENT AWARDS AND ATTORNEY'S FEES AND COSTS, signed by Magistrate Judge Michael J. Seng on 9/29/2017. (Kusamura, W)

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1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 EASTERN DISTRICT OF CALIFORNIA 9 10 SABAS ARREDONDO, et al., Plaintiffs, 11 12 13 14 v. Case No. 1:09-cv-01247-MJS ORDER REGARDING ENHANCEMENT AWARDS AND ATTORNEY’S FEES AND COSTS DELANO FARMS COMPANY, et al., Defendants. 15 16 17 18 On February 15, 2017, this Court entered an order preliminarily approving the 19 Joint Stipulation of Settlement of Class Actions (“Settlement Agreement”) resolving the 20 claims in this action (“Arredondo”) and Paniagua v. Delano Farms Company, et al., Case 21 No. 1:16-cv-00907-MJS, also pending before this Court (“Paniagua”). (ECF. No. 484; 22 “Order of Certification and Preliminary Approval”). The Court’s Order of Certification and 23 Preliminary Approval also (1) certified the Settlement Class; (2) directed distribution of 24 the Class Notice and of the certification of the Settlement Class; and (3) set the Fairness 25 and Approval Hearing. The Court further ordered Plaintiffs to submit a motion for 26 attorney’s fees and costs and enhancement awards to the Representative Plaintiffs for 27 consideration with their motion for final approval of the Settlement Agreement. 28 1 On August 4, 2017, Plaintiffs’ counsel filed a motion for attorney’s fees and costs. 2 (ECF No. 501, as amended and supplemented by ECF Nos. 502, 521, 523-29.) On 3 August 29, 2017, Plaintiffs filed their motion seeking final approval of the Settlement 4 Agreement, wherein they requested enhancement awards to the Representative 5 Plaintiffs. (ECF No. 505.) Defendants responded to the motions on September 8, 2017. 6 (ECF No. 513.) Plaintiffs replied on September 15, 2017. (ECF No. 520.) 7 The Court held the Fairness and Approval Hearing on September 22, 2017. (ECF 8 No. 530.) Mario Martinez and Anna Walther appeared on behalf of Plaintiffs. Leonard 9 Comden and Kelton Lee Gibson appeared on behalf of former class counsel. Named 10 Plaintiffs Sabas Arredondo, Hilario Gomez, Irma Landeros, and Rosalba Landeros also 11 were present. William Hahesy, Sarah Bigelow, and David Bruce appeared on behalf of 12 Defendant Delano Farms Company. D. Greg Durbin and Laura Wolfe appeared on 13 behalf of the remaining Defendants. 14 The matter is submitted and stands ready for adjudication. The Court herein sets 15 forth its findings and conclusions with respect to the requested enhancement awards, 16 attorney’s fees, and costs. These findings and conclusions will be expressly incorporated 17 in the Court’s final order and judgment. 18 I. Overview of Settlement Fund 19 The Settlement Agreement requires Defendants to pay a total of $6,000,000.00 20 into a Qualified Settlement Fund (“QSF”). The following amounts are expected to be 21 deducted or set aside from the QSF prior to any payments on class members’ claims: 22 Attorney’s Fees: $1,500,000 23 Attorney’s Costs: $$476,289.17 24 Enhancement Payments: $37,000 25 Taxes: $300,000 (estimated) 26 Administration: $185,000 (estimated) 27 28 2 1 The remaining net settlement fund is estimated to be $3,501,710.83. This amount 2 will be distributed to the approximately 5,656 class members who have submitted claims 3 forms. Accordingly, the average recovery for each class member is approximately 4 $619.11. 5 To the extent taxes and administration costs are lower than estimated, the 6 difference will be distributed to class members in a supplemental payment. 7 II. Enhancement Awards to Named Class Representatives 8 A. Applicable Law 9 “Incentive awards are fairly typical in class action cases.” Rodriguez v. W. Publ'g 10 Corp., 563 F.3d 948, 958 (9th Cir. 2009) (citations omitted). However, the decision to 11 approve an incentive award is a matter within the court’s discretion. See In re Mego Fin. 12 Corp. Sec. Litig., 213 F.3d 454, 463 (9th Cir. 2000). Generally speaking, incentive 13 awards are meant to “compensate class representatives for work done on behalf of the 14 class, to make up for financial or reputational risk undertaking in bringing the action, and, 15 sometimes, to recognize their willingness to act as a private attorney general.” 16 Rodriguez, 563 F.3d at 958-59. The Ninth Circuit has emphasized that district courts 17 must be vigilant in scrutinizing all incentive awards to determine whether they destroy 18 the adequacy of the class representatives. Radcliffe v. Experian Info. Solutions, Inc., 715 19 F.3d 1157, 1165 (9th Cir. 2013). A class representative must justify an incentive award 20 through “evidence demonstrating the quality of plaintiff's representative service,” such as 21 “substantial efforts taken as class representative to justify the discrepancy between [his 22 or] her award and those of the unnamed plaintiffs.” Alberto v. GMRI, Inc., 252 F.R.D. 23 652, 669 (E.D. Cal. 2008). 24 In the Ninth Circuit, $5,000 is considered presumptively reasonable for an 25 incentive award. Deatrick v. Securitas Sec. Servs. USA, Inc., 2016 WL 5394016, at *8 26 (N.D. Cal. Sept. 27, 2016). See also In re Online DVD-Rental Antitrust Litig., 779 F.3d 27 934, 947 (9th Cir. 2015); In re Mego Fin. Corp. Sec. Litig., 213 F.3d at 463; Harris v. 28 3 1 Vector Marketing Corp., No. C-08-5198 EMC, 2012 WL 381202, at *7 (N.D. Cal. Feb. 6, 2 2012) (“Several courts in this District have indicated that incentive payments of $10,000 3 or $25,000 are quite high and/or that, as a general matter, $5,000 is a reasonable 4 amount.” (citations omitted)). While larger incentive payments are sometimes awarded, 5 they generally occur in cases with substantially greater settlement funds. E.g., Van 6 Vranken v. Atl. Richfield Co., 901 F. Supp. 294, 299-300 (N.D. Cal. 1995) (awarding 7 incentive award of $50,000 out of $76 million settlement fund to sole class 8 representative who represented class through trial); Glass v. UBS Fin. Servs., Inc., No. 9 C-06-4068 MMC, 2007 WL 221862, at * 17 (awarding incentive awards of $25,000 each, 10 for a total of $100,000, out of $45 million settlement fund). Plaintiffs’ Request 11 B. 12 The issue of enhancement awards has been a matter of some dispute and 13 discussion in this matter. Four of the representative plaintiffs initially refused to sign the 14 settlement agreement. Mr. Arredondo, Ms. Irma Landeros, Ms. Rosalba Landeros, and 15 Mr. Gomez sought enhancement awards of $50,000 each. (ECF No. 469.) After some 16 discussion between counsel and client and discussions in open court, the involved 17 parties agreed to proceed with the proposed settlement while, apparently, reserving the 18 right to seek additional enhancements later. (ECF Nos. 476, 478, 484.) They have done 19 so here. 20 The Court preliminarily approved $37,000 in enhancement awards as set out in 21 the settlement agreement1: $7,000 each for each of the five Arredondo plaintiffs and 22 $2,000 for Mr. Paniagua. (ECF No. 484.) In the motion for final approval, class counsel 23 seeks to increase the enhancement award to $77,000: $15,000 each for the five 24 Arredondo plaintiffs and $2,000 for Mr. Paniagua. 25 In declarations submitted with the motion for final approval, the five Arredondo 26 plaintiffs seek enhancement awards of $25,000 each which, when added to Mr. 27 28 1 And later corrected by notice of errata. (See ECF No. 484 at 4 n.1.) 4 1 Paniagua’s $2,000 request, would yield a total award of $127,000. (ECF Nos. 505-5, 2 505-6, and 505-8 through 505-10.) Mr. Arredondo estimates that he spent 352 hours on 3 the case and missed work because of his efforts on behalf of the class. He states he has 4 been criticized by coworkers and supervisors, blacklisted from other agricultural work, 5 and accused of being greedy and trying to benefit himself at others’ expense. He states 6 also that he has seen his family ridiculed. In quite similar declarations, Ms. I. Landeros, 7 Ms. R. Landeros, Mr. Gomez, and Mr. Cuevas claim to have spent 309, 319, 335.5, and 8 257 hours, respectively, on the case, and faced the same criticisms. Mr. Paniagua 9 claims to have spent 60 hours. He does not seek an enhancement award above the 10 $2,000 preliminarily approved. (ECF No. 513 at 3-7.) 11 Defendants object to any increase. They argue that the increased enhancement, 12 if granted, would represent too large a share of the settlement fund and would produce a 13 grossly disproportionate recovery for the representatives as compared to class 14 members. They argue that the hours allegedly spent and the requested rate of 15 compensation appears inflated. They opine that such increased requests may require re- 16 notification to the class. Finally, and most significantly, they argue that the requests are 17 outside the scope of what has been found to be reasonable in other cases and are 18 unlikely to withstand scrutiny. 19 C. Analysis 20 The Court begins its analysis by recognizing the significant contributions of the 21 representative plaintiffs in this action, and particularly the Arredondo plaintiffs. This 22 matter has been vigorously litigated for more than eight years and, during that time, the 23 Arredondo plaintiffs have worked closely with counsel despite concerns of retaliation2 24 and public scrutiny. They have devoted hours of their time to the litigation, including 25 hours they otherwise may have spent gainfully employed. The Court, as previously 26 27 28 2 No one suggests that any of the plaintiffs were threatened with or suffered actual retaliation by any of the defendants, and the Court has no reason to believe any such retaliation occurred. Nonetheless, concerns over retaliation would not be unusual in this type of case. 5 1 indicated, is sympathetic to their claims. That is why it preliminarily approved more than 2 the $5,000 amount deemed “presumptively reasonable” in the 9th Circuit. 3 However, as also previously indicated and discussed with the representatives in 4 open Court, the Court believes it cannot in good faith increase the amount awarded. An 5 enhancement award of $77,000 would constitute 2.2% of the net settlement fund. An 6 award of $127,000 would constitute 3.6% of the net settlement fund. These awards 7 would result in a recovery for the representative plaintiffs that is 24 to 40 times greater 8 than that of the average class member. The requested amounts are simply out of 9 proportion with the size of the common fund and the recovery of the class as a whole. 10 See 2 Joseph McLaughlin, McLaughlin on Class Actions: Law and Practice § 6:28 (13th 11 ed. 2016) (“Regardless of the dollar amount, a proposed incentive award that is at or 12 near one percent of the common fund payable to the class will receive intense scrutiny 13 and require exceptional justification.” (citing Ontiveros v. Zamora, No. 2:08–567 WBS 14 DAD, 2014 WL 3057506, at *9 (E.D. Cal. July 7, 2014)). 15 It is recognition of the Arredondo representatives’ extra efforts that the proposed 16 $37,000 award will come up to that one percent cautionary level mentioned in Ontiveros. 17 It will provide the Arredondo Plaintiffs with more than ten times that which the average 18 class member will receive. It will compensate each of the five Arredondo plaintiffs at a 19 rate of between $20 and $27 per hour for each hour they spent on behalf of the class; 20 that is no windfall by any means, but it is reasonable compensation and not out of 21 proportion with the hourly rate approved for attorney time. (As discussed below, if the 22 $1.500,000 attorney’s fee award is divided by the total number of attorney hours claimed 23 (and not including paralegal time), the average hourly rate for counsel would be 24 approximately $100 per hour.) Furthermore, doubling the amount the five would take 25 from the settlement fund as requested would only exacerbate, not lesson, the likelihood 26 of their being ostracized by co-workers and employers. 27 28 6 1 Accordingly, the Court will award $7,000 in enhancement payments to each of the 2 Arredondo plaintiffs and $2,000 to Mr. Paniagua, for a total award of $37,000, as 3 preliminarily approved. 4 III. Attorney’s Fees 5 Class counsel requests an award of $1,500,000 in attorney’s fees. (ECF No. 501.) 6 They also request that any unclaimed funds and any refunded taxes on those funds be 7 distributed to counsel as fees, so long as such distribution, when combined with the 8 $1,500,000 fee award, does not exceed 33% of the settlement fund. Counsel estimates 9 that such unclaimed funds and associated taxes will not exceed $50,000. The Court will 10 first address the $1,500,000 request alone. 11 A. Applicable Law 12 Attorney’s fees “authorized by law or by the parties’ agreement” may be awarded 13 pursuant to Rule 23(h). However, the court “ha[s] an independent obligation to ensure 14 that the award [of attorney’s fees], like the settlement itself, is reasonable, even if the 15 parties have already agreed to an amount.” In re Bluetooth Headset Prods. Liab. Litig. 16 (“Bluetooth”), 654 F.3d 935, 941 (9th Cir. 2011); see also Zucker v. Occidental 17 Petroleum Corp., 192 F.3d 1323, 1328 (9th Cir. 1999) (“[T]he district court must exercise 18 its inherent authority to assure that the amount and mode of payment of attorneys’ fees 19 are fair and proper.”). 20 Where, as here, fees are to be paid from a common fund, the relationship 21 between the class members and class counsel “turns adversarial.” In re Wash. Pub. 22 Power Supply Sys. Sec. Litig., 19 F.3d 1291, 1302 (9th Cir. 1994). In such cases, the 23 district court must assume a fiduciary role for the class members in evaluating the 24 request for attorney’s fees. Id.; Rodriguez, 563 F.3d at 968 ("[W]hen fees are to come 25 out of the settlement fund, the district court has a fiduciary role for the class”). 26 The Ninth Circuit has approved two methods of evaluating requests for attorney’s 27 fees in cases where the attorney’s fee award is taken from the common fund: the 28 7 1 “percentage of the fund” method and the “lodestar” method. Vizcaino v. Microsoft Corp., 2 290 F.3d 1043, 1047 (9th Cir. 2002) (citation omitted). The district court retains 3 discretion to choose either method. Id. Under either approach, “[r]easonableness is the 4 goal, and mechanical or formulaic application of either method, where it yields an 5 unreasonable result, can be an abuse of discretion.” Fischel v. Equitable Life Assurance 6 Soc'y of the U.S., 307 F.3d 997, 1007 (9th Cir. 2002). 7 Because this case involves a common settlement fund with an easily quantifiable 8 benefit to the class, the Court first will evaluate attorney’s fees using the percentage of 9 fund method, but will cross-check the reasonableness of that award by applying a 10 lodestar analysis. See Bluetooth 654 F.3d at 944, Vizcaino, 290 F.3d at 1047. 11 B. Percentage of Fund 12 Under the percentage of the fund method, the court may award class counsel a 13 given percentage of the common fund recovered for the class. The percentage method 14 is particularly appropriate in common fund cases because “the benefit to the class is 15 easily quantified.” Bluetooth, 654 F.3d at 942. In the Ninth Circuit, 25 percent of the 16 common fund is the “benchmark” for a reasonable attorney’s fee award. Id. (quoting Six 17 (6) Mexican Workers v. Ariz. Citrus Growers, 904 F.2d 1301, 1311 (9th Cir. 1990)). 18 However, courts may adjust this figure upwards or downwards if the record shows 19 “‘special circumstances’ justifying a departure.” Id. 20 To assess whether the percentage requested is reasonable, courts may consider 21 a number of factors, including “the extent to which class counsel achieved exceptional 22 results for the class, whether the case was risky for class counsel, whether counsel's 23 performance generated benefits beyond the cash settlement fund, the market rate for 24 the particular field of law (in some circumstances), the burdens class counsel 25 experienced while litigating the case (e.g., cost, duration, foregoing other work), and 26 whether the case was handled on a contingency basis.” In re Online DVD-Rental 27 Antitrust Litigation, 779 F.3d at 954-55 (internal quotation marks omitted). 28 8 1 Here, the requested award of $1,500,000 is 25 percent of the common fund and 2 therefore presumptively reasonable. The results obtained and amount of work counsel 3 performed on this case support the benchmark award. See Hensley v. Eckerhart, 461 4 U.S. 424, 436 (1983) (noting that the “most critical factor” to the reasonableness of an 5 attorney fee award is “the degree of success obtained”). There was never any certainty 6 of recovery in this case; it, like most contingency fee cases, presented risk and, further, 7 seems to have required devotion of an unusual commitment of attorney time and 8 resources in hopes that the risk would be justified. Class counsel was genuinely and 9 effectively focused on seeing that the action did the maximum good for the maximum 10 deserving claimants and has received an excellent result for the class despite numerous 11 challenges. The settlement will result in recovery that individual class members most 12 certainly would not have obtained on their own. There is every indication that counsel 13 who negotiated this settlement did so with the objective of benefiting their clients, the 14 class, first. 15 There is ample support for an award of 25% of the common fund. 16 C. 17 There is a strong presumption that the lodestar is a reasonable fee. Gonzalez Lodestar v. 18 City of Maywood, 729 F.3d 1196, 1202 (9th Cir. 2013); Camacho v. Bridgeport Fin., Inc., 19 523 F.3d 973, 978 (9th Cir. 2008). The Court determines the lodestar amount by 20 multiplying a reasonable hourly rate by the number of hours reasonably spent litigating 21 the case. See Ferland v. Conrad Credit Corp., 244 F.3d 1145, 1149 n.4 (9th Cir. 2001). 22 To determine a reasonable hourly rate, the Court must examine “the prevailing 23 market rates in the community charged for similar services by lawyers of reasonably 24 comparable skill, experience, and reputation.” Cotton v. City of Eureka, 889 F. Supp. 2d 25 1154, 1166 (N.D. Cal. 2012) (internal quotation marks and citation omitted); see also 26 Camacho, 523 F.3d at 979. The “relevant community” for the purposes of determining 27 the reasonable hourly rate is the district in which the lawsuit proceeds. Barjon v. Dalton, 28 9 1 132 F.3d 496, 500 (9th Cir. 1997). Thus, when a case is filed in the Fresno Division of 2 the Eastern District of California, “[t]he Eastern District of California, Fresno Division, is 3 the appropriate forum to establish the lodestar hourly rate . . .” See Jadwin v. Cnty. of 4 Kern, 767 F. Supp. 2d 1069, 1129 (E.D. Cal. 2011). 5 In the Sacramento Division of the Eastern District of California, the Court recently 6 calculated the lodestar in a wage and hour class action using $400 as the hourly rate for 7 more seasoned attorneys and $175 as the rate for associate attorneys. Ontiveros v. 8 Zamora, 303 F.R.D. 356, 373 (E.D. Cal. 2014). “[H]ourly rates generally accepted in the 9 Fresno Division for competent experienced attorneys [are] between $250 and $380, with 10 the highest rates generally reserved for those attorneys who are regarded as competent 11 and reputable and who possess in excess of 20 years of experience.” Silvester v. Harris, 12 No. 1:11-CV-2137 AWI SAB, 2014 WL 7239371, at *4 (E.D. Cal. Dec. 17, 2014). For 13 attorneys with “less than ten years of experience . . . the accepted range is between 14 $175 and $300 per hour.” Id. (citations omitted). 15 Current class counsel submits time records showing 11,730 hours of work 16 (inclusive of paralegal time) and $4,434,941.00 in fees.3 The law firms of Martinez, 17 Aguilasocho & Lynch and Marcos Camacho4 billed 8,791.5 hours of attorney time at 18 rates between $250 and $500 per hour. They also billed 2,077.87 hours of paralegal 19 time at a rate of $150 per hour. Wilcoxen Callaham estimates 275 hours of attorney time 20 at a rate of $500 per hour, although no billing is submitted. Ball & York submits billing for 21 590.03 hours of apparent attorney time at a rate of $350 per hour, and 4.25 hours of 22 apparent paralegal time at $150 per hour. 23 The hourly rates charged are substantially in excess of those charged by 24 competent attorneys in the Fresno Division. Nonetheless, the Court can envision no 25 reduction in hours, downward adjustment of rates, or other modification which would 26 27 28 3 They seek only about 34% of the $4.4 million they claimed to have accrued in fees in this action. The Marcos Camacho firm is no longer counsel in this action and has not made a separate claim for attorney’s fees. It is unclear whether the Martinez firm may claim fees on behalf of Marcos Camacho. The allocation of any such fees is reserved and will be decided after final approval of the settlement. 4 10 1 result in a lodestar less than the requested $1,500,000 in fees. Assuming the 2 documented 9,381.53 hours of attorney time claimed by the Martinez and Ball & York 3 firms were reasonably expended, the $1,500,000 award would result in an average 4 hourly rate for them of only $160 per hour, before taking into account paralegal time or 5 estimated hours by Mr. Callaham. This is lower than competent attorneys in this Division 6 charge for standard hourly work and certainly provides no extra compensation for the 7 risk involved in a contingency fee case such as this. Additionally, former class counsel 8 has submitted a notice of claim for attorney’s fees in relation to the fee allocation dispute. 9 (ECF Nos. 493-95, 499, 506.) Without resolving the competing claims or commenting on 10 their propriety, adding all attorney hours and dividing them into the $1.5M would result in 11 an average hourly rate of approximately $100. 12 13 The requested fees are well within the range of any reasonable lodestar calculation. They will be awarded in full. 14 D. Unclaimed Funds and Related Taxes 15 As stated, Class Counsel requests that any unclaimed funds and any refunded 16 taxes on those funds be distributed to counsel as attorney’s fees, so long as such 17 distribution, when combined with the $1,500,000 fee award, does not exceed 33% of the 18 settlement fund. In essence, counsel asks the Court to award up to $480,000 in 19 additional attorney’s fees, even though they estimate the unclaimed funds and 20 associated taxes to amount to less than $50,000. 21 Based on the analysis in the preceding section, the Court finds that an award of 22 up to and even exceeding $50,000 in additional attorney’s fees would certainly be 23 reasonable. Such an increase would be negligible under the percentage of fund method 24 and fully supported by any reasonable lodestar calculation. The Court, however, is not 25 prepared at this juncture to approve in advance payment over to counsel of amounts in 26 excess of $50,000 without knowing how much in excess they may be. Thus, any amount 27 of unclaimed funds and taxes in excess of $50,000 shall be held in the Qualified 28 11 1 Settlement Fund for distribution by order of the Court on motion made once the amount 2 thereof is finally determined. 3 E. Fee Allocation Dispute 4 As noted, former class counsel has also submitted claims for attorney’s fees. 5 (ECF Nos. 493-95, 499, 506.) They do not seek fees in addition to the $1,500,000 6 awarded herein, but rather a share of that award. (See ECF Nos. 508, 509.) Numerous 7 filings have been submitted by current and former class counsel, reflecting various and 8 generally competing positions as to how fees should be allocated and awarded. (See 9 ECF Nos. 493-495, 497-499, 501-503, 506, and 515). 10 On August 23, 2017, the Court directed the parties to brief the issue of whether it 11 could proceed to address the motion for final approval of settlement before determining 12 how fees are to be distributed among counsel. (ECF No. 504.) All agreed, and the Court 13 has concluded, that it may so proceed. The Court has entered a separate order 14 providing for the parties to propose procedures for resolution of class counsel’s various 15 fee claims after final approval of the settlement. (ECF No. 517.) The final approval order 16 will expressly retain continuing jurisdiction over these claims. Thus, they are not 17 addressed further herein. 18 IV. Costs 19 Plaintiffs request the reimbursement of costs incurred by five law firms that 20 represented Plaintiffs during the lengthy course of this action. Each firm’s request is 21 addressed in turn. 22 A. Applicable Law 23 “[I]t is the duty of this Court to ensure that any costs awarded from the common 24 fund are reasonable.” Ridgeway v. Wal-Mart Stores Inc., No. 08-CV-05221-SI, 2017 WL 25 4071293, at *17 (N.D. Cal. Sept. 14, 2017). “There is no doubt that an attorney who has 26 created a common fund for the benefit of the class is entitled to reimbursement of 27 reasonable litigation expenses from that fund.” Ontiveros, 303 F.R.D. at 375 (citations 28 12 1 omitted). “[L]litigation related costs are reimbursable as long as they are necessary 2 expenses incurred in furnishing effective representation.” In re Media Vision Tech. Sec. 3 Litig., 913 F. Supp. 1362, 1372 (N.D. Cal. 1996). “Attorneys may recover their 4 reasonable expenses that would typically be billed to paying clients in non-contingency 5 matters.” In re Omnivision Techs., Inc., 559 F. Supp. 2d 1036, 1048 (N.D. Cal. 2008) 6 (citing Harris v. Marhoefer, 24 F.3d 16, 19 (9th Cir. 1994)). “Expenses such as 7 reimbursement for travel, meals, lodging, photocopying, long-distance telephone calls, 8 computer legal research, postage, courier service, mediation, exhibits, documents 9 scanning, and visual equipment are typically recoverable.” Rutti v. Lojack Corp., Inc., No. 10 SACV 06–350 DOC (JCx), 2012 WL 3151077, *12 (C.D. Cal. July 31, 2012). On the 11 other hand, courts should not award reimbursement for duplicative or unreasonable 12 costs, such as “first class airplane tickets, luxury hotel accommodations, and gourmet 13 dinner meetings” at the expense of a common fund recovery. In re Media Vision, 913 14 F.Supp. at 1372. 15 B. 16 On September 15, 2017, after having preliminarily reviewed the request for 17 reimbursement of costs, the Court ordered counsel to supplement their requests by 18 identifying, by date, description, and amount sought, all costs associated with the failed, 19 apparently falsified, survey conducted by California Survey Research Services, including 20 costs of the survey, depositions, expert services, travel expenses, copying and 21 messenger services, or any other costs associated therewith or occasioned thereby. For 22 each such expense, counsel was ordered to indicate when the expense was incurred in 23 relation to which stage of the survey. Counsel also was ordered to provide a declaration 24 stating whether any reimbursements were sought or received in relation to this survey. 25 (ECF No. 522.) Preliminary Issues 26 Each firm responded to this request on September 19, 2017. (ECF Nos. 524-29.) 27 Martinez, Aguilasoch & Lynch identified $4,640.28 in costs relating to the failed survey. 28 13 1 (ECF No. 527.) Wilcoxen Callaham, LLP, identified $33,400 in such costs. (ECF No. 2 528.) Ball & Yorke identified $57,131.40 in such costs, although $21,888.00 was 3 incurred in relation to analysis of Defendants’ Pilot Study, prior to the survey. (ECF No. 4 529.) Wasserman, Comden & Casselman, LLP, identified no such costs and they 5 apparently were no longer counsel for the class at the time of the failed survey. (See 6 ECF No. 524.) Myers, Widders, Gibson, Jones & Feingold, LLP, identified $8,848.24 7 paid to Philips Fractor, but counsel believes these sums were unrelated to the failed 8 survey. (ECF No. 525.) Thus, in total, counsel incurred over $73,000 in costs in relation 9 to the survey. 10 Allen R. Ball, current class counsel, has provided a declaration stating that, on 11 March 30, 2017, he filed suit in Los Angeles County Superior Court in relation to the 12 failed survey. Jose Cuevas, et al., v. Phillips Fractor & Company, LLC; CSRS, and 13 Bakersfield Market Research. The suit seeks damages in the amount expended on 14 behalf of the class for the survey and, potentially, for diminished value of the recovery in 15 this case because of the absence of such a survey. Counsel has represented that the 16 Superior Court action is brought on behalf of, and any recovery is to benefit, the very 17 same class members as those in the instant action. Any sums produced via settlement 18 or judgement in that Superior Court suit, less reasonable attorney fees and costs, will go 19 to class members in the instant action, not to the attorneys here. (ECF No. 529.) 20 It appears to the Court that sums paid for the failed survey were paid in good faith 21 and for the benefit of the class. Given the reassurance of counsel about payment to the 22 class of amounts recovered in the Superior Court action, no double recovery will accrue 23 to counsel if the costs are awarded as requested. Accordingly, the Court finds that the 24 costs of the failed survey are recoverable by counsel here. 25 26 C. Martinez, Aguilasocho & Lynch, APLC 27 28 14 1 The Martinez firm requests reimbursement of $21,977.40 in costs incurred in 2 relation to this action.5 The cost billing submitted by the Martinez firm is exemplary in its 3 level of detail. There can be no real question that the requested costs were reasonably 4 and necessarily incurred in advancing the interest of the class. Furthermore, the 5 requested costs are far from luxurious. In re Media Vision Tech. Sec. Litig., 913 F. Supp. 6 1362, 1372 (N.D. Cal. 1996) (counsel should not be reimbursed for “first class airplane 7 tickets, luxury hotel accommodations, and gourmet dinner meetings” at the expense of a 8 common fund recovery). The modest charges for travel, per diem, and meals reflect that 9 counsel acted with the best interests of the class in mind. 10 The requested amount of $21,977.40 will be granted in full. 11 D. 12 The Wilcoxen firm requests reimbursement of $96,223.87 in costs incurred in 13 relation to this action. Nearly half of these costs are attributable to various expert 14 expenses. The remaining costs are primarily attributable to deposition transcripts (over 15 $14,000), mediation fees (over $14,000), and minimal travel expenses ($3,283.97). Wilcoxen Callaham, LLP 16 In its September 15, 2017 order, the Court invited counsel to provide further 17 support for $10,573.38 in unspecified costs from Jay-Allen Eisen Law Group. (ECF No. 18 522.) Counsel since has explained that these costs were incurred 19 for consultation, legal research and analysis provided by Mr. Eisen prior to and during the trial conducted in January 2013 before the Honorable William B. Shubb in Sacramento. Mr. Eisen has 48 years’ experience practicing law in California and specializes in Appellate Law. He has been counsel in more than 400 appeals and appellate writs throughout the California State and Federal Courts. 20 21 22 23 (ECF No. 528 at 2-3.) 24 25 26 27 28 5 The firm originally requested $21,987.12, but reduced this request after realizing that its billing included a $9.72 duplicate charge for a rotisserie chicken purchased for a meeting with experts. (ECF No. 527 at 23.) 15 1 In light of this explanation, the costs attributable to Jay-Allen Eisen Law Group are 2 reasonable, as are the remainder of the requested costs. The requested amount of 3 $96,223.87 will be granted in full. 4 E. 5 The Law Office of Ball & Yorke requests reimbursement of $96,055.48 in costs 6 Law Office of Ball & Yorke incurred in this action. (ECF No. 501-1 at 60-62, 531.) 7 The costs requested are reasonable. Nearly $16,000 is attributable to deposition 8 transcripts. Based on the invoice numbers provided with counsel’s supplemental 9 declaration (ECF No. 529), it appears the cost of transcripts was split with co-counsel. 10 Substantial additional expenses – over $77,000 are attributable to the services of 11 various experts, consultants, and surveyors (including the aforementioned failed survey). 12 The remaining costs are primarily attributable to minimal travel expenses. 13 14 The Court finds the amounts requested are reasonable and the request for $96,055.48 in costs will be granted in full. 15 F. Myers, Widders, Gibson, Jones & Feingold, LLP 16 Myers Widders requests $122,808.09 in costs.6 17 The Court invited the firm to provide further support for nearly $75,000 in 18 unspecified professional services from Morrison & Foerster LLP. Kelton Lee Gibson of 19 Myers Widders explains, through his declaration, that these costs were incurred for 20 expert witness services provided by Lloyd W. Aubry, Jr., for purposes of establishing that 21 Defendant Delano Farms jointly employed the class along with the farm labor contractor 22 defendants. Mr. Aubrey billed for 106.5 hours at a rate between $675 and $705 per hour. 23 He also billed approximately $419.78 in costs associated with his services. Having 24 reviewed the declaration and associated billing, the Court has determined that, while 25 retention of such an expert was reasonable, the costs expended here were excessive. 26 27 28 6 Class counsel originally sought $122,610.34 on behalf of Myers Widders. (ECF Nos. 501 at 26; 501-1 at 58.) However, this amount apparently was in error, as Myers Widders later increased their request to $122,808.09. (ECF No. 525 at 11.) 16 1 Some might suggest that the expert fee was adequate to cover the entire cost of 2 litigating the issue the expert addressed. Given its size, one might ask why both the 3 expert and the Plaintiff’s attorneys were necessary. Or, perhaps the expert’s billing 4 should have been challenged and reduced. Regardless of the answers to the foregoing 5 queries, as noted above, other courts have determined that a reasonable rate for a 6 seasoned attorney in the Sacramento Division (where Mr. Aubry ultimately testified) is 7 $400 per hour. Ontiveros, 303 F.R.D. at 373. The reasonable rate for cases brought in 8 the Fresno Division is somewhat lower. Silvester, 2014 WL 7239371, at *4. Even 9 increasing the allowable rate to $500 per hour in light of Mr. Aubrey’s apparently unique 10 expertise would produce a fee of $53,250. That is the most the court can in good 11 conscience approve. That amount plus $419.78 in costs, or a total of $53,669.78, is what 12 the Court will approve. 13 The firm also was invited to provide further support for travel-related costs. 14 Attorneys Gregory J. Ramirez and James E. Perero incurred travel costs in the amount 15 of $15,044.05. The Court's review of the nature and extent of the individual costs leads it 16 to conclude that, although actually incurred, some were incurred at a rate greater than 17 necessary and with little regard for the needs of the firm’s clients. For example, counsel 18 enjoyed more than one sushi dinner in excess of $507, as well as dinner at One Market 19 at a cost of nearly $100 per person. (ECF No. 525-1 at 28, 30-31.) Meanwhile, the 20 Martinez firm rarely, if ever, incurred costs above $15 per person for meals for attorneys, 21 witnesses, or class members during this same period. (ECF No. 523-1.) The Court can 22 hardly justify reimbursing counsel from the common fund for dinner at One Market while 23 the representative Plaintiffs are eating at Jack in the Box. (ECF No. 521-2 at 28.) For 24 these reasons, and particularly in light of the nature of the claims and recovery in this 25 action, the Court finds that a 10% reduction in the firm’s requested travel costs is 26 warranted. Only $13,539.65 of these costs will be awarded 27 28 7 While leaving a $3 tip. 17 1 2 3 In sum, Myers Widders will be awarded costs in the reduced amount of $100,216.17. 4 G. 5 Wasserman requests $171,299.47 in costs. 6 The travel costs billed by Wasserman reflect an even more profound resort to 7 luxury than those incurred by Myers Widders. To illustrate by example, the Court refers 8 to the $7,039.55 in expenses incurred by the firm in relation to attendance at the 9 September 2011 mediation. The firm was invited to provide additional support for these 10 Wasserman, Comden & Casselman, LLP costs. They did so. Review of those records demonstrates:  11 12 Counsel incurred $3,600 in hotel charges for three attorneys for two nights, at an average rate of $600 per night.  13 Ms. Harnett flew first class from Los Angeles to San Francisco at a cost of 14 $950, not including an apparent duplicate charge of $593.40 for her return 15 flight, for which no documentation could be located, but for which the firm 16 nonetheless seeks compensation.8  17 18 Counsel, co-counsel and their expert enjoyed dinner at The Waterfront at a rate of approximately $92 per person. 19 Again, contrast is telling: The representative Plaintiffs travelled to San Francisco 20 to attend a mediation in 2016. There, they shared hotel rooms at an average rate of 21 $147 per person per night. (ECF No. 523-1 at 23.) And, as stated, their meals rarely, if 22 ever, exceeded $15 per person. In contrast to the $7,039.55 spent by Wasserman, the 23 Martinez firm spent approximately $1,655 for a very similar trip. 24 25 26 27 28 8 Counsel for Wasserman stated at the final approval hearing that medical issues required Ms. Harnett to fly first class. The Court would think that some lesser accommodation would have sufficed. The duplicate charge was not explained. It also appears that other duplicate charges may plague the billing. For example, on March 12, 2010, the firm incurred two identical charges of $276.82 from two different sources for meals for two attorneys, for a total of $553.64 in meals. As no further detail regarding these charges is provided, the Court is unable to evaluate their legitimacy. 18 1 These travel costs are far outside the scope of what is recoverable in this action. 2 In re Media Vision, 913 F.Supp. at 1372 (noting that courts should not award 3 reimbursement for unreasonable costs, such as “first class airplane tickets, luxury hotel 4 accommodations, and gourmet dinner meetings” at the expense of a common fund 5 recovery). By the Court’s calculation, the firm expended $15,645.89 on travel and meals. 6 As stated, $7,039.55 of that figure is attributable to a single mediation. When compared 7 with the expenditures of the Martinez firm, it would appear that Wasserman could have 8 reduced these costs by up to 76 percent. Moreover, even if the Court was willing to 9 review the firm’s travel expenses line by line, it could not do so. With the exception of the 10 $7,039.55 in mediation expenses, the firm has not provided the type of detail that would 11 allow the Court to assess the reasonableness of these expenses. Based on all of these 12 factors, the Court concludes that a 50 percent reduction in all travel expenses is 13 warranted. The firm may recover travel and meal costs in the amount of $7,822.95 14 Such excessive costs cast serious doubt on the reasonableness of the firm’s cost 15 billing. An additional area of concern is copying and printings costs which, by the Court’s 16 calculation, amount to $6,641.12 of the firm’s request. Only minimal detail is provided 17 regarding what was copied, and nothing about the number of pages or the rate per page. 18 Although this case has involved substantial briefing, investigation, and discovery, the 19 charges nonetheless appear high. Given the skepticism raised by excessive travel cost 20 charges and the meager explanation given for copying costs, the court will reduce them 21 by 25%. See In re Am. Apparel, Inc. S'holder Litig., No. CV 10-6352 MMM (JCGx), 2014 22 WL 10212865, at *29 (C.D. Cal. July 28, 2014) (reducing by 50% request for $9,099.90 23 in copying costs over four years). For copying and printing, $4980.84 will be awarded. 24 In sum, Wasserman will be awarded costs in the reduced amount of $161,816.25. 25 H. 26 The total cost award in this action shall be $476,289.17, to be awarded as follows: Total Cost Award 27 28 19 1 Martinez, Aguilasocho & Lynch $21,977.40 Ball & York $96,055.48 Wilcoxen Callaham $96,223.87 Myers Widders Wasserman, Comden & Casselman 2 $100,216.17 3 4 5 6 7 8 9 10 11 12 13 14 V. $161,816.25 Conclusion Based on the foregoing, the following deductions from the QSF will be incorporated into the final approval order: Attorney’s Fees: $1,500,000 Attorney’s Costs: $$476,289.17 Enhancement Payments: $37,000 Taxes: $300,000 (estimated) Administration: $185,000 (estimated) 15 16 IT IS SO ORDERED. 17 18 19 Dated: September 29, 2017 /s/ Michael J. Seng UNITED STATES MAGISTRATE JUDGE 20 21 22 23 24 25 26 27 28 20

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