Nix v. Anka Behavioral Health, Inc.

Filing 126

ORDER for supplemental briefing and ORDER continuing hearing on 119 Plaintiffs' motion for preliminary approval of class action settlement. Joint supplemental brief due by 11/26/12. Motion hearing set for 12/10/12 at 10:00 AM in Courtroom 2, 17th Floor, San Francisco. Signed by Judge Thelton E. Henderson on 11/14/12. (tehlc3, COURT STAFF) (Filed on 11/14/2012)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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JULIE CARLSON and ROBERT
STARK,

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Plaintiffs,
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v.
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For the Northern District of California

United States District Court

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ANKA BEHAVIORAL HEALTH,
INC.,

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NO. C10-3914 TEH
ORDER FOR SUPPLEMENTAL
BRIEFING AND ORDER
CONTINUING HEARING ON
PLAINTIFFS’ MOTION FOR
PRELIMINARY APPROVAL OF
CLASS ACTION SETTLEMENT

Defendant.

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This matter is scheduled for hearing on Plaintiffs’ unopposed motion for preliminary

15 approval of class action settlement on November 19, 2012. After reviewing the papers, the
16 Court has serious questions, including the following, about the proposed settlement:
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1. How can the Court evaluate the proposed settlement when the parties have

18 presented no estimation of the value of Plaintiffs’ claims if they were to prevail at trial?
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2. What evidence or calculations support counsel’s assertion that the approximately

20 200 workers making up “the core of the settlement class,” Mallison Decl. ¶ 32, are expected
21 to receive as much as “several thousand dollars per employee,” Mot. at 9?
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3. If the remaining approximately 80% of the estimated 1000 class members receive

23 only approximately one hundred dollars on average, is the proposed settlement fair to them?
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4. Why is it reasonable for class members to wait up to two years to receive a

25 settlement check? If it is reasonable to wait that long, how will the order of distribution be
26 decided? Will counsel receive any payments, and will the proposed class representatives
27 receive their proposed incentive payments, before all settlement shares have been
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5. Is it overbroad to require the release of all claims that “could have been pled,”

2 Settlement at 9 (Ex. 1 to Mallison Decl.)? Likewise, does the release violate the Fair Labor
3 Standards Act, which allows only for opt-in collective actions under 29 U.S.C. § 216(b)?
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6. The proposed timeline runs afoul of the requirement that class members must have

5 an adequate opportunity to evaluate Plaintiffs’ motion for attorneys’ fees before the deadline
6 for filing objections. In re Mercury Interactive Corp. Sec. Litig., 618 F.3d 988, 995 (9th Cir.
7 2010).
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7. The class notice should not be on pleading paper, nor should it bear the signature

9 of the Court. As written, it also appears to contain too much legalese to be comprehensible

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For the Northern District of California

United States District Court

10 to the average class member.
8. Has Defendant complied with the notice requirements of 28 U.S.C. § 1715(b)?

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The parties shall address these issues in a joint filing to be submitted on or before

13 November 26, 2012. The November 19, 2012 hearing is continued to December 10, 2012,
14 at 10:00 AM. If, as a result of conferring on the Court’s questions, the parties decide to
15 renegotiate the proposed settlement, then Plaintiffs shall file a notice withdrawing their
16 motion for preliminary approval. Such withdrawal would be without prejudice to filing a
17 subsequent motion for approval of a different settlement agreement.
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19 IT IS SO ORDERED.
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21 Dated: 11/14/12
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THELTON E. HENDERSON, JUDGE
UNITED STATES DISTRICT COURT

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