Nunez v. BAE Systems San Diego Ship Repair Inc. et al

Filing 18

ORDER: (1) Conditionally Certifying Settlement Class Action; (2) Preliminarily Approving Proposed Settlement; (3) Approving Notice To Class; And (4) Setting Final Approval Hearing Date (ECF No. 15 ). The Court grants the parties' Joint Motion for preliminary approval of class action settlement. It is ordered that a Final Approving Hearing is set for 7/27/2017 at 1:30 p.m. in courtroom 4A.Signed by Judge Janis L. Sammartino on 2/13/2017. (dxj)

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UNITED STATES DISTRICT COURT

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SOUTHERN DISTRICT OF CALIFORNIA

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EDUARDO NUNEZ, individually and on
behalf of others similarly situated,

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ORDER: (1) CONDITIONALLY
CERTIFYING SETTLEMENT
CLASS ACTION; (2)
PRELIMINARILY APPROVING
PROPOSED SETTLEMENT; (3)
APPROVING NOTICE TO CLASS;
AND (4) SETTING FINAL
APPROVAL HEARING DATE

Plaintiff,

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Case No.: 16-CV-2162 JLS (NLS)

v.
BAE SYSTEMS SAN DIEGO SHIP
REPAIR INC., a California Corporation;
and DOES 1 through 50 inclusive,
Defendants.

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(ECF No. 15)

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Presently before the Court is Plaintiff Eduardo Nunez’s and Defendant BAE

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Systems San Diego Ship Repair Inc.’s (the “Parties”) Joint Motion for Order (1)

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Conditionally Certifying Settlement Class Action; (2) Preliminarily Approving Proposed

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Settlement; (3) Approving Notice to Class; and (4) Setting Final Approval Hearing Date.

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(“Prelim. Settlement Mot.”) (ECF No. 15). Because the settlement is fundamentally fair,

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reasonable, and adequate, the Court GRANTS the Parties’ Preliminary Settlement Motion.

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BACKGROUND

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Plaintiff Eduardo Nunez brings a class action suit seeking compensation on behalf

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of all non-exempt employees of Defendant BAE Systems San Diego Ship Repair Inc.

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(“SDSR”) for unpaid wages and penalties, as well as other violations of California law.

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(Prelim. Settlement Mot. 9,1 ECF No. 15-1.) Defendant SDSR is an international defense,

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aerospace, and security company that maintains a single shipyard in San Diego Bay, where

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it works on virtually all types of government and commercial vessels (e.g., the U.S. Navy

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fleet). (FAC ¶ 14, ECF No. 11.) The proposed class includes all non-exempt employees at

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SDSR who worked at any time during the period May 27, 2012 through October 13, 2016

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(“Settlement Class / Class Members”). (Prelim. Settlement Mot. 10, ECF No. 15-1.)
Plaintiff’s Amended Complaint asserts seven claims for relief under various

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provisions of California law:

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1.
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3.
4.
5.
6.
7.

Failure to Pay Straight-Time & Overtime Wages
Violation of the Unfair Competition Law
Cal. Bus. & Prof. Code §§ 17200, et seq.
Failure to Provide Accurate Wage Statements
Failure to Provide Rest Periods
Failure to Reimburse Employees for Business Expenses
Failure to Provide All Compensation Owed Upon Termination of
Employment
8. Violation of the Private Attorney General Act

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(See generally FAC, ECF No. 11.) Plaintiff generally alleges that because there would

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typically be 100 SDSR workers waiting in line to pass through a checkpoint before they

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could break their shift for lunch, Plaintiff and other workers were not provided with a full

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30-minute meal break due to the time spent waiting in line. (Id. ¶ 10.) Thus, Plaintiff argues

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Defendant failed to provide Plaintiff and other workers with a duty-free 30-minute meal

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period and failed to pay them wages for their time spent disembarking from the ship,

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Pin citations refer to the CM/ECF page numbers electronically stamped at the top of each page.
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returning tools, and waiting in the security line, among other activities. (Id.) Plaintiff

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additionally alleges that Defendant improperly forced him and others to purchase clothes

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and shoes from Defendant and that Defendant did not provide reimbursements for these

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purchases. (Id.) As a result of this fraudulent behavior, the wage statements that Defendant

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provided were inaccurate. (Id. ¶ 11.)

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The Parties entered into extensive pre-suit negotiations for the purpose of settling

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their disputes, such as (1) voluntary exchange of information, including SDSR’s

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employment policies, sworn declarations from putative class members, and thousands of

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electronic records containing class member data (e.g., individualized rates of pay,

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employment dates, time records, and badge-swipe data); and (2) a full-day mediation in

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San Francisco with Antonio Piazza, Esq., of Mediated Negotiations. (Prelim. Settlement

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Mot. 10, ECF No. 15-1.) The mediation was successful and resulted in a non-reversionary

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settlement of $2.9 million, (id.), though Defendant SDSR maintains its complete denial of

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wrongdoing, (id. at 9 n.1).

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The Parties present to the Court a Joint Motion for an Order: (1) conditionally

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certifying the proposed Settlement Class, defined below; (2) preliminarily approving the

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proposed settlement of $2.9 million; (3) approving the proposed Notice and directing

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distribution of the Notice and related documents; and (4) setting a schedule for final

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approval. As noted above, although SDSR stipulates both to certification of a Settlement

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Class and the proposed Settlement, Defendant continues to deny all allegations of unlawful

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conduct alleged in the Complaint, and does not admit or concede that it has, in any manner,

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violated federal or California laws or committed any other unlawful action that would

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entitle Plaintiff or any class to any recovery.

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SETTLEMENT TERMS

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The Parties have submitted a comprehensive settlement document with

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approximately twenty-three pages of substantive terms, and a five-page proposed class

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notice. (Joint Stipulation of Settlement and Release (“Settlement Agreement”) 31–60, ECF

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No. 15-1.) The settlement provides monetary relief but no programmatic relief. Plaintiff

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Eduardo Nunez, as class representative, supports the Settlement Agreement. (Id. at 54.)

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I.

Monetary Relief

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SDSR proposes to pay a Maximum Settlement Amount of $2.9 million. (Prelim.

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Settlement Mot. 10, ECF No. 15-1.) From this amount will be deducted: (a) all Settlement

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payments to Class Members eligible for Settlement payments; (b) the Class Representative

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service payment approved by the Court; (c) Class Counsel’s attorneys’ fees and expenses

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approved by the Court; (d) the Settlement Administrator’s fees and expenses; (e) payment

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made to the State of California Labor Workforce and Development Agency (“LWDA”);

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(f) the employer’s portion of FICA, FUTA, and all other state and federal payroll taxes on

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the “wage” portion of the Settlement payments to Class Members; and (g) an additional

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flat amount of $250 for each employee who separated employment during the Covered

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Period (“Wait Time Penalties”). (Id. at 11.) SDSR will automatically make Settlement

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payments to Class Members (unless they choose to opt out) based on the following

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formula:

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After deductions of the Court-approved service payment to the Class
Representative, the Court-approved attorneys’ fees and costs for Class
Counsel, a payment for the Settlement Administrator’s fees and
expenses, payment to the LWDA, the employer’s portion of state and
federal payroll taxes and payment of Wait Time Penalties, the
Remainder of the Maximum Payment will be available for distribution
to the Payment-Eligible Class Members (the “Class Settlement
Proceeds”). The Remainder shall be distributed as follows:
Payment-Eligible Class Members will receive a payment based on each
person’s compensable work weeks, which shall be all weeks worked as
non-exempt employees by the Payment-Eligible Class Members during
the Covered Period (“Compensable Work Weeks”). The dollars per
Compensable Work Week will be calculated by dividing the total
Compensable Work Weeks into the Remainder. That amount (dollars
per week) will be multiplied by the number of Compensable Work
Weeks for each Payment-Eligible Class Member.
(Id.) The check will escheat to the State of California or any other State having jurisdiction
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over the Class Member’s assets if the Class Member fails to cash his or her check within

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120 days after it is mailed. (Id. at 12.)

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RULE 23 SETTLEMENT CLASS CERTIFICATION

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Before granting preliminary approval of a class action settlement agreement, the

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Court must first determine whether the proposed class can be certified. Amchem Prods. v.

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Windsor, 521 U.S. 591, 620 (1997) (indicating that a district court must apply “undiluted,

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even heightened, attention [to class certification] in the settlement context” in order to

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protect absentees).

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Class actions are governed by Federal Rule of Civil Procedure 23. In order to certify

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a class, each of the four requirements of Rule 23(a) must first be met. Zinser v. Accufix

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Research Inst., Inc., 253 F.3d 1180, 1186 (9th Cir. 2001). Rule 23(a) allows a class to be

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certified only if:

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(1) the class is so numerous that joinder of all members is
impracticable;
(2) there are questions of law or fact common to the class;
(3) the claims or defenses of the representative parties are typical
of the claims or defenses of the class; and
(4) the representative parties will fairly and adequately protect
the interests of the class.

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Next, in addition to Rule 23(a)’s requirements, the proposed class must satisfy the

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requirements of one of the subdivisions of Rule 23(b). Zinser, 253 F.3d at 1186. Here,

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Plaintiff seeks to certify the Settlement Class under subdivision Rule 23(b)(3), which

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permits certification if “questions of law or fact common to class members predominate

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over any questions affecting only individual class members,” and “a class action is superior

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to other available methods for fairly and efficiently adjudicating the controversy.” The

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Court addresses each of these requirements in turn.

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I.

Rule 23(a)(1): Numerosity

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Federal Rule of Civil Procedure 23(a)(1) requires that a class must be “so numerous

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that joinder of all members is impracticable.” “[C]ourts generally find that the numerosity
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factor is satisfied if the class comprises 40 or more members and will find that it has not

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been satisfied when the class comprises 21 or fewer.” Celano v. Marriott Int’l, Inc., 242

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F.R.D. 544, 549 (N.D. Cal. 2007).

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Here, the proposed Settlement Class consists of approximately 1,930 individuals, all

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of which are identifiable from SDSR’s data. (Prelim. Settlement Mot. 16, ECF No. 15-1.)

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Accordingly, joinder of all members would be impracticable for purposes of Rule 23(a)(1),

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and the numerosity requirement is therefore satisfied.

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II.

Rule 23(a)(2): Commonality

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Federal Rule of Civil Procedure 23(a)(2) requires that there be “questions of law or

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fact common to the class.” Commonality requires that “the class members ‘have suffered

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the same injury.’” Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 349–50 (2011) (quoting

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Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 157 (1982)). “The existence of shared legal

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issues with divergent factual predicates is sufficient, as is a common core of salient facts

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coupled with disparate legal remedies within the class.” Hanlon v. Chrysler Corp., 150

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F.3d 1011, 1019 (9th Cir. 1998).

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Here, the Parties have carefully defined the Settlement Class to encompass all SDSR

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employees adversely affected by the allegedly fraudulent policies and practices set forth

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above. All common questions thus revolve around whether the alleged fraudulent policies

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and practices in fact were fraudulent and impacted the class members. Accordingly, it is

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appropriate for these issues to be adjudicated on a class-wide basis, and Rule 23(a)(2) is

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satisfied.

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III.

Rule 23(a)(3): Typicality

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To satisfy Federal Rule of Civil Procedure 23(a)(3), Plaintiff’s claims must be

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typical of the claims of the Class. The typicality requirement is “permissive” and requires

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only that Plaintiff’s claims “are reasonably coextensive with those of absent class

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members.” Hanlon, 150 F.3d at 1020. “The test of typicality ‘is whether other members

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have the same or similar injury, whether the action is based on conduct which is not unique

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to the named plaintiffs, and whether other class members have been injured by the same
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course of conduct.’” Hanon v. Dataproducts Corp., 976 F.2d 497, 508 (9th Cir. 1992)

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(quoting Schwartz v. Harp, 108 F.R.D. 279, 282 (C.D. Cal. 1985)). “[C]lass certification

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should not be granted if ‘there is a danger that absent class members will suffer if their

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representative is preoccupied with defenses unique to it.’” Id. (citation omitted).

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Here, Plaintiff is an SDSR employee whose claims allegedly arise out of the same

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underlying SDSR policies and practices as those pertaining to the proposed Settlement

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Class. (Prelim. Settlement Mot. 17–18, ECF No. 15-1.) Accordingly, Plaintiff’s claims are

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typical of the claims of the members of the proposed Settlement Class, thus satisfying Rule

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23(a)(3).

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IV.

Rule 23(a)(4): Adequacy

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Federal Rule of Civil Procedure 23(a)(4) requires that the named representatives

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fairly and adequately protect the interests of the class. “To satisfy constitutional due

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process concerns, absent class members must be afforded adequate representation before

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entry of judgment which binds them.” Hanlon, 150 F.3d at 1020 (citing Hansberry v. Lee,

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311 U.S. 32, 42–43 (1940)). To determine legal adequacy, the Court must resolve two

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questions: “(1) do the named plaintiffs and their counsel have any conflicts of interest with

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other class members, and (2) will the named plaintiffs and their counsel prosecute the

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action vigorously on behalf of the class?” Id.

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Here, there is no reason to believe that the named representative and Class Counsel

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have any conflict of interest with the proposed Settlement Class members. There is also no

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reason to believe that the named representative and Class Counsel have thus far failed to

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vigorously investigate and litigate this case. Plaintiff has retained competent counsel, who

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have conducted extensive investigation, research, and informal discovery in this case.

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(Prelim. Settlement Mot. 18–19, ECF No. 15-1.) Furthermore, Class Counsel have

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significant class action litigation experience, are knowledgeable about the applicable law,

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and will continue to commit their resources to further the interests of the Class. (Id. at 19.)

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Accordingly, the named representative and Class Counsel adequately represent the

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proposed Settlement Class members, and Rule 23(a)(4)’s adequacy requirement is met.
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V.

Rule 23(b)(3)

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Federal Rule of Civil Procedure 23(b)(3) permits certification if “questions of law

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or fact common to class members predominate over any questions affecting only individual

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class members,” and “a class action is superior to other available methods for fairly and

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efficiently adjudicating the controversy.”

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A.

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“The Rule 23(b)(3) predominance inquiry tests whether the proposed classes are

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sufficiently cohesive to warrant adjudication by representation.” Amchem Prods., 521 U.S.

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at 623. “Rule 23(b)(3) focuses on the relationship between the common and individual

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Predominance

issues.” Hanlon, 150 F.3d at 1022.

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Here, the common issues of whether Defendant’s policies and practices failed to, for

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example, compensate Class Members for all time worked, provide an opportunity for

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compliant meal and rest periods, and provide accurate wage statements predominate over

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the individual issues such as length of employment and particularized grievances. (See

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Prelim. Settlement Mot. 19–20, ECF No. 15-1.) Further, for purposes of settlement, Class

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Members are not required to prove any evidentiary or factual issues that could arise in

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litigation. Accordingly, the predominance requirement of Rule 23(b)(3) is satisfied.

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B.

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The final requirement for certification pursuant to Federal Rule of Civil Procedure

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23(b)(3) is “that a class action [be] superior to other available methods for fairly and

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efficiently adjudicating the controversy.” The superiority inquiry requires the Court to

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consider the four factors listed in Rule 23(b)(3):

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Superiority

(A) the class members’ interests in individually controlling the
prosecution or defense of separate actions;
(B) the extent and nature of any litigation concerning the
controversy already begun by or against class members;
(C) the desirability or undesirability of concentrating the
litigation of the claims in the particular forum; and
(D) the likely difficulties in managing a class action.

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See also Zinser, 253 F.3d at 1190. A court need not consider the fourth factor, however,

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when certification is solely for the purpose of settlement. See True v. Am. Honda Motor

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Co., 749 F. Supp. 2d 1052, 1066 n.12 (C.D. Cal. 2010); see also Amchem, 521 U.S. at 620

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(“Confronted with a request for settlement-only class certification, a district court need not

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inquire whether the case, if tried, would present intractable management problems, for the

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proposal is that there be no trial.”). The superiority inquiry focuses “‘on the efficiency and

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economy elements of the class action so that cases allowed under [Rule 23(b)(3)] are those

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that can be adjudicated most profitably on a representative basis.’” Zinser, 253 F.3d at 1190

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(quoting 7A Charles Alan Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice

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and Procedure § 1780, at 562 (2d ed. 1986)). A district court has “broad discretion” in

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determining whether class treatment is superior. Kamm v. Cal. City Dev. Co., 509 F.2d

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205, 210 (9th Cir. 1975).

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Here, Class Members’ claims involve the same issues arising from the same factual

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bases. If Class Members’ claims were considered on an individual basis, almost 1,930 cases

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would follow a similar trajectory, and each would come to a similar result. Furthermore,

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individual cases would consume a significant amount of the Court’s and the Class

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Members’ resources. It is also likely that Class Members would not pursue litigation on an

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individual basis due to the high costs of pursuing individual claims. The interests of the

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Settlement Class Members in individually controlling the litigation are minimal, especially

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given the same broad-based policy and practices would be at issue. Additionally, because

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the majority of SDSR’s employees are located in San Diego, many of the individual cases

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would likely be filed in this district, and thus it is desirable to concentrate the litigation in

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a single forum. Given all of the above, class treatment is the superior method of

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adjudicating this controversy, and the superiority requirement of Rule 23(b)(3) is met.

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VI.

Conclusion

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For the reasons stated above, the Court finds certification of the Settlement Class

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proper under Rule 23(b)(3). Accordingly, the Settlement Class is CERTIFIED for

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settlement purposes only.
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RULE 23 PRELIMINARY FAIRNESS DETERMINATION

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Having certified the Settlement Class, the Court must next make a preliminary

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determination as to whether the proposed settlement is “fair, reasonable, and adequate”

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pursuant to Federal Rule of Civil Procedure 23(e). Relevant factors to this determination

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include:
The strength of the plaintiffs’ case; the risk, expense, complexity, and
likely duration of further litigation; the risk of maintaining class action
status throughout the trial; the amount offered in settlement; the extent
of discovery completed and the stage of the proceedings; the experience
and views of counsel; the presence of a governmental participant; and
the reaction of the class members to the proposed settlement.

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Hanlon, 150 F.3d at 1026. Furthermore, due to the “dangers of collusion between class

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counsel and the defendant, as well as the need for additional protections when the

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settlement is not negotiated by a court designated class representative,” any “settlement

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approval that takes place prior to formal class certification requires a higher standard of

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fairness.” Id. Additionally, although in the present case the Court has not been presented

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with formal applications for Class Counsel’s attorney fees or class service awards, the

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Court nonetheless considers these potential fees because they form part of the settlement

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agreement.

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I.

Strength of Plaintiff’s Case

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In order to succeed on the merits, Plaintiff would have to prove that Defendant’s

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practices and policies were fraudulent. (See generally FAC, ECF No. 11.) SDSR denies

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any wrongdoing, that Plaintiff is entitled to any relief at law or equity, and that Plaintiff

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would be able to validly certify a class in the absence of the settlement agreement. (See

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Def.’s Answer to FAC, ECF No. 14.) Plaintiff, however, estimates SDSR’s potential

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liability exposure on the underlying Labor Code claims to be approximately $11.5 million.

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(Prelim. Settlement Mot. 23, ECF No. 15-1.) Additionally, the Settlement is the result of

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arm’s-length negotiations conducted over several months, including each Party’s

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individual discovery and valuation of the case and one full-day mediation session before
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an experienced and nationally renowned mediator. (Id. at 22–23.) Given this disagreement

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and neutral third-party evaluation of the same, the Court thus finds that this factor weighs

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in favor of the $2.9 million settlement being fair, reasonable, and adequate.

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II.

Risk, Expense, Complexity, and Likely Duration of Further Litigation

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Were the case to proceed to further litigation rather than settlement, the Parties

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would each bear substantial risk and a strong likelihood of protracted and contentious

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litigation. Even though the Parties have agreed to settle this action, they fundamentally

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disagree regarding the validity of Plaintiff’s claims. (Prelim. Settlement Mot. 23–26, ECF

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No. 15-1.) Additionally, the Parties document a number of risks in litigating Plaintiff’s

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claims—including the fact that a class might not even be certified—and thus argue that the

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present Settlement affords class members at least some compensation where there might

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be none. (Id.) Indeed, the fact that Defendant disputes all aspects of Plaintiff’s claims,

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including the propriety of class certification in the absence of the settlement agreement,

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suggests that these issues would be vigorously (and therefore costly) litigated were there

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to be further litigation. Given the foregoing, this factor weighs in favor the settlement being

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fair, reasonable, and adequate.

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III.

Risk of Maintaining Class Action Status Throughout Trial

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The Parties dispute whether the classes can be validly certified in the absence of the

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Settlement Agreement. Implicit in this disagreement is the likelihood of initial challenges

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to class certification and the potential for decertification motions even if class status is

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granted. Weighed against the fact that Defendant does not object to a finding that the class

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elements are met for purposes of this settlement, this factor also weighs in favor of the

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settlement being fair, reasonable, and adequate.

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IV.

Amount Offered in Settlement

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SDSR has agreed to pay $2.9 million to settle this lawsuit. (Prelim. Settlement Mot.

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26, ECF No. 15-1.) The crux of Plaintiff’s claims are that SDSR failed to pay the class

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members the entirety of their earned wages. Because SDSR has data regarding each

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affected class member, which it provided to Plaintiff prior to negotiating the Settlement
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Agreement, the proof of each class member’s damages is largely calculable and less prone

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to subjective considerations. Indeed, the Parties note that the Settlement Agreement

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provides for Settlement Shares that are divided proportionally based on each Participating

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Class Member’s number of workweeks, and that each former employee will additionally

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receive a flat amount of $250 in full satisfaction of wait time penalties. (Id. at 27.)

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Accordingly, this factor weighs in favor of the settlement being fair, reasonable, and

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adequate.

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V.

Extent of Discovery Completed and Stage of Proceedings

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Prior to the agreed-upon settlement, the Parties engaged in substantial informal

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discovery, including payroll, timekeeping, and other records. (Prelim. Settlement Mot. 23,

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ECF No. 15-1.) Defendant also performed its own investigation, interviewing

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approximately ninety potential class members and collecting approximately eighty-three

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declarations, on which it relied to demonstrate the disparity of class member experiences

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and that proper compensation was paid for time worked. (Id.) And as discussed, the Parties

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engaged a neutral third-party mediator who fully examined and discussed with each party

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the strengths and weaknesses of each party’s case. (Id.) Both Class Counsel and Defense

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Counsel gained significant knowledge of the relevant facts and law throughout the

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discovery process and through independent investigation and evaluation. Accordingly, it

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appears the Parties have entered into the Settlement Agreement with a strong working

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knowledge of the relevant facts, law, and strengths and weaknesses of their claims and

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defenses. Given all of the above, this factor weighs in favor of the proposed settlement

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being fair, reasonable, and adequate.

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VI.

Experience and Views of Counsel

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“The recommendations of plaintiffs’ counsel should be given a presumption of

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reasonableness.” Boyd v. Bechtel Corp., 485 F. Supp. 610, 622 (N.D. Cal. 1979). And here,

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Class Counsel believes the Settlement Agreement is fair, reasonable, adequate, and in the

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best interest of the Settlement Class. (Settlement Agreement ¶ 63, ECF No. 15-1.)

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Furthermore, in the present case the presumption of reasonableness is warranted based on
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Class Counsel’s expertise in complex litigation, familiarity with the relevant facts and law,

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and significant experience negotiating other class and collective action settlements. Given

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the foregoing, and according the appropriate weight to the judgment of these experienced

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counsel, this factor weighs in favor the proposed settlement being fair, reasonable, and

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adequate.

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VII. Settlement Attorneys’ Fees Provision

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In the Ninth Circuit, a district court has discretion to apply either a lodestar method

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or a percentage-of-the-fund method in calculating a class fee award in a common fund case.

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Fischel v. Equitable Life Assur. Soc’y of U.S., 307 F.3d 997, 1006 (9th Cir. 2002). When

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applying the percentage-of-the-fund method, an attorneys’ fees award of “twenty-five

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percent is the ‘benchmark’ that district courts should award . . . .” In re Pac. Enters. Sec.

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Litig., 47 F.3d 373, 379 (9th Cir. 1995) (citing Six (6) Mexican Workers v. Ariz. Citrus

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Growers, 904 F.2d 1301, 1311 (9th Cir. 1990)); Fischel, 307 F.3d at 1006. However, a

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district court “may adjust the benchmark when special circumstances indicate a higher or

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lower percentage would be appropriate.” In re Pac. Enters. Sec. Litig., 47 F.3d at 379

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(citing Six (6) Mexican Workers, 904 F.2d at 1311). “Reasonableness is the goal, and

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mechanical or formulaic application of either method, where it yields an unreasonable

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result, can be an abuse of discretion.” Fischel, 307 F.3d at 1007.

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In the present case, the Settlement Agreement specifies that SDSR will not oppose

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Class Counsel’s request to the Court for approval of attorneys’ fees in the amount equal to

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25% of the Maximum Settlement Amount ($725,000), and reasonable costs in an amount

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not to exceed $20,000. (Settlement Agreement ¶ 29, ECF No. 15-1.) In support of this

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provision, Class Counsel note that the provision is completely consistent with the Ninth

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Circuit’s benchmark for reasonableness. (Prelim. Settlement Mot. 23, ECF No. 15-1 (citing

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Vasquez v. Coast Valley Roofing, Inc., 266 F.R.D. 482, 491 (E.D. Cal. 2010) (stating that

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“[t]he typical range of acceptable attorneys’ fees in the Ninth Circuit is 20% to 33 1/3% of

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the total settlement value, with 25% considered the benchmark”)).) Because Class

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Counsel’s attorneys’ fees provision is set at the benchmark, the Court concludes that the

2

provision is reasonable.

3

VIII. Class Representative Service Award Provision

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The Ninth Circuit recognizes that named plaintiffs in class action litigation are

5

eligible for reasonable incentive payments. Staton v. Boeing Co., 327 F.3d 938, 977 (9th

6

Cir. 2003). The district court must evaluate each incentive award individually, using

7

“‘relevant factors includ[ing] the actions the plaintiff has taken to protect the interests of

8

the class, the degree to which the class has benefitted from those actions, . . . the amount

9

of time and effort the plaintiff expended in pursuing the litigation . . . and reasonabl[e]

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fear[s of] workplace retaliation.’” Id. (citing Cook v. Niedert, 142 F.3d 1004, 1016 (7th

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Cir. 1998)).

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In the present case, the Settlement Agreement provides up to $5,000 to the Class

13

Representative, to be paid from the Maximum Payment, in addition to the Settlement

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payment he may otherwise receive as a class member. (Settlement Agreement ¶ 30, ECF

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No. 15-1.) The Class Notice states that this award is “an enhancement fee to the named

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plaintiff to compensate him for the time, work, and risks undertaken in bringing this Class

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Action.” (Id. at 57.) Given the foregoing, the Court concludes that the current Settlement

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Agreement Class Representative Payment provision should not bar preliminary approval

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of the Settlement Agreement.

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IX.

For the reasons stated above, the Parties’ Joint Motion for Preliminary Approval of

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Conclusion

Class Settlement is GRANTED regarding the Settlement Agreement.

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NOTICE OF CLASS CERTIFICATION AND SETTLEMENT

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Pursuant to Federal Rule of Civil Procedure 23(c)(2)(B), “[f]or any class certified

25

under Rule 23(b)(3) the court must direct to class members the best notice that is

26

practicable under the circumstances, including individual notice to all members who can

27

be identified through reasonable effort.” Because the Court has determined that

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certification is appropriate under Rule 23(b)(3), the mandatory notice procedures required

2

by Rule 23(c)(2)(B) must be followed.

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Where there is a class settlement, Federal Rule of Procedure 23(e)(1) requires the

4

court to “direct notice in a reasonable manner to all class members who would be bound

5

by the proposal.” “Notice is satisfactory if it ‘generally describes the terms of the settlement

6

in sufficient detail to alert those with adverse viewpoints to investigate and to come forward

7

and be heard.’” Rodriguez v. W. Publ’g Corp., 563 F.3d 948, 962 (9th Cir. 2009) (quoting

8

Churchill Vill., LLC v. Gen. Elec., 361 F.3d 566, 575 (9th Cir. 2004)); see also Grunin v.

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Int’l House of Pancakes, 513 F.2d 114, 120 (8th Cir. 1975) (“[T]he mechanics of the notice

10

process are left to the discretion of the court subject only to the broad ‘reasonableness’

11

standards imposed by due process.”).

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The Parties have agreed to notify the Class Members in writing by mailing all class

13

members a Notice of Pendency of Class Action (“Notice”). (Prelim. Settlement Mot. 14,

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ECF No. 15-1.) Given that some Class Members may only read Spanish, the proposed

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Notice will also be translated into and distributed in Spanish. (Id.) The Parties have agreed

16

to have the Settlement Administrator send the Class Notice Packets to all identified Class

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Members using the mailing address information provided by SDSR, including use of all

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standard skip tracing to verify the accuracy of all addresses. (Id. at 27; Settlement

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Agreement ¶ 38, ECF No. 15-1.) If the packet is returned because of an incorrect address,

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the Settlement Administrator will make reasonable efforts to locate Class Members and re-

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send the notices. (Prelim. Settlement Mot. 27, ECF No. 15-1.) The proposed Notice

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explains:

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24
25
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(i) the nature of the action; (ii) the definition of class certified; (iii) the
class claims, issues, or defenses; (iv) that class members may enter an
appearance through counsel if the member so desires; (v) that the court
will exclude from the class any member who requests exclusion; (vi)
the time and manner for requesting exclusion; and (v) the binding effect
of a class judgment on class members under Rule 23(c)(3).

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(Id.) Having thoroughly reviewed the jointly drafted Notice, the Court finds that the method
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and content of the Notice comply with Rule 23. Accordingly, the Court approves the

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Parties’ proposed notification plan.

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CONCLUSION

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For the reasons stated above, the Court GRANTS the Parties’ Joint Motion for

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Preliminary Approval of Class Action Settlement (ECF No. 15). The Court ORDERS as

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follows:

7

1.

8

AGREEMENT: The Settlement Agreement is preliminarily approved as fair, reasonable,

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and adequate pursuant to Federal Rule of Civil Procedure 23(e).

PRELIMINARY

APPROVAL

OF

PROPOSED

SETTLEMENT

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2.

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Procedure 23(b)(3), the action is preliminarily certified, for settlement purposes only, as a

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class action on behalf of the following Settlement Class Members with respect to the claims

13

asserted in this Action:

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PRELIMINARY CLASS CERTIFICATION: Pursuant to Federal Rule of Civil

Settlement Class: All non-exempt employees at BAE Systems San
Diego Ship Repair Inc. who worked at any time during the period May
27, 2012 through October 13, 2016.

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3.

CLASS REPRESENTATIVE, CLASS COUNSEL, AND SETTLEMENT

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ADMINISTRATOR: Pursuant to Federal Rule of Civil Procedure 23, the Court

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preliminarily certifies, for settlement purposes only, Plaintiff Eduardo Nunez as the Class

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Representative, and Alexander Dychter, of Dychter Law Offices, APC, and Walter Haines,

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of United Employees Law Group, PC, as Class Counsel. Additionally, the Court approves

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and appoints Rust Consulting, Inc. as the Settlement Administrator.

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4.

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forth in the Settlement Agreement and the Notice attached as Exhibit A to the Settlement

25

Agreement. (Settlement Agreement Ex. A, ECF No. 15-1.) The form and method for

26

notifying the Class Members of the Settlement and its terms and conditions satisfies the

27

requirements of Federal Rules of Civil Procedure 23(c)(2)(B) and 23(e). The Court finds

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that the Notice Procedure submitted by the Parties constitutes the best notice practicable

NOTICE: The Court approves the form and substance of the proposed notice set

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under the circumstances. As provided in the Settlement Agreement, the Settlement

2

Administrator SHALL provide notice to the Class Members and respond to Class Member

3

inquiries.

4

Within thirty (30) days of the date on which this Order is electronically docketed,

5

the Parties SHALL disseminate the Notice in the form attached as Exhibit A to the

6

Settlement Agreement and in the manner and form provided in the Settlement Agreement.

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5.

8

Approval Hearing on July 27, 2017 at 1:30 p.m. at 221 W. Broadway, Courtroom 4A, 4th

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Floor, San Diego, CA 92101, to consider:

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FINAL APPROVAL HEARING: Judge Sammartino shall conduct a Final

a.

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13

b.
c.
d.

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e.

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the fairness, reasonableness, and adequacy of the proposed
settlement;
Plaintiff’s request for the award of attorneys’ fees and costs;
the Class Representative enhancement;
dismissal with prejudice of the class action with respect to
Defendant; and
the entry of final judgment in this action.

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At the Final Approval Hearing, the Parties shall also be prepared to update the Court on

17

any new developments since the filing of the motion, including any untimely submitted

18

opt-outs, objections, and claims, or any other issues as the Court deems appropriate.
The date and time of the Final Approval Hearing shall be included in the Notice to

19
20

be mailed to all class members.

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6.

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No later than twenty-one (21) days before the Final Approval Hearing, the Parties shall file

23

a Motion for Final Approval of Class Action Settlement. The Motion shall include and

24

address any objections received as of the filing date. In addition to the class certification

25

and settlement fairness factors, the motion shall address the number of putative Settlement

26

Class members who have opted out and the corresponding number of claims.

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7.

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REPRESENTATIVE SERVICE AWARDS: No later than twenty-one (21) days before

MOTION FOR FINAL APPROVAL OF CLASS ACTION SETTLEMENT:

APPLICATION

FOR

ATTORNEYS’

FEES,

COSTS,

AND

CLASS

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1

the Final Approval Hearing, Class Counsel shall file an application for attorneys’ fees,

2

costs, and class representative service awards. Class Counsel shall provide documentation

3

detailing the number of hours incurred by attorneys in litigating this action, supported by

4

detailed time records, as well as hourly compensation to which those attorneys are

5

reasonably entitled. Class Counsel should address the appropriateness of any upward or

6

downward departure in the lodestar calculation, as well as reasons why a percentage-of-

7

the-fund approach to awarding attorney fees may be more preferable in this case. Class

8

Counsel should be prepared to address any questions the Court may have regarding the

9

application for fees at the Final Approval Hearing.

10

8.

11

consummated for any reason, the conditional class certification shall be of no further force

12

or effect. Should the settlement not become final, the fact that the Parties were willing to

13

stipulate to class certification as part of the settlement shall have no bearing on, nor be

14

admissible in connection with, the issue of whether a class should be certified in a non-

15

settlement context.

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9.

MISCELLANEOUS PROVISIONS: In the event the proposed settlement is not

SCHEDULE: The Court orders the following schedule for further proceedings:

17

Event

18

Defendant to Deliver Class List to Within 7 days of the date on which

19

Settlement Administrator

20

Settlement Administrator to Send Within 30 days of the date on which

21

Notice to Class Members

22

Last Day for Class Members to File No later than 60 days from the date of

23

Request

24

Settlement

25

Last Day for Class Members to File No later than 60 days from the date of

26

Objections to the Settlement

Date

for

Exclusion

this Order is electronically docketed

this Order is electronically docketed

from mailing the Notice

mailing the Notice

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1

Last Day for Class Members to File No later than 60 days from the date of

2

Notice of Intention to Appear at Final mailing the Notice

3

Approval Hearing

4

Parties to File Motion for Final No later than 21 days before the Final

5

Approval

6

Class Counsel to File Motion for No later than 21 days before the Final

7

Attorneys’ Fees and Costs and Approval Hearing

8

Incentive Fees

9

Final Approval Hearing

Approval Hearing

July 27, 2017 at 1:30 p.m.

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12

IT IS SO ORDERED.
Dated: February 13, 2017

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