Adams et al v. City and County of Honolulu

Filing 106

REPORT AND RECOMMENDATIONS OF SPECIAL MASTER PURSUANT TO FED. R. CIV. P. 53 AND L.R. 53.3; ORDER - Signed by MAGISTRATE JUDGE BARRY M. KURREN. "Upon filing of this Report and Recommendations and Order and the filing under seal of Exhibit 3 hereto and distribution of the Payments, attorneys' fees and costs, it is recommended that the parties file a Stipulation to Dismiss All Claims and All Parties With Prejudice in this case." "The Court having been fully advise d in the premises and finding good cause appearing therefor, the foregoing Report and Recommendations are hereby APPROVED AND SO ORDERED": by MAGISTRATE JUDGE BARRY M. KURREN. (Attachments: # 1 Exhibit 1, # 2 Exhibit 2) (emt, )CERTIFICATE OF SERVICEParticipants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Participants not regist ered to receive electronic notifications were served by first class mail on the date of this docket entry (Additional attachment(s) added on 7/10/2017: # 3 Exhibit 3 (SEALED) ) (emt, ). Modified on 7/10/2017 -- Viewing of Exhibit 3 is restricted to the Court and counsel of record. (emt, ).

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAI`I
SONYA ADAMS, et al.,
CIVIL NO. 12-00667 BMK
Plaintiffs,
v.

CITY AND COUNTY OF
HONOLULU,
Defendant.

(Other Civil Action -FLSA)
REPORT AND
RECOMMENDATIONS OF
SPECIAL MASTER PURSUANT
TO FED. R. CIV. P. 53 AND L.R.
53.3; ORDER
Trial Date: November 7, 2017

REPORT AND RECOMMENDATIONS OF SPECIAL MASTER
PURSUANT TO FED. R. CIV. P. 53AND L.R. 53.3
Pursuant to Fed. R. Civ. P. 53 and L.R. 53.3, the Special Master hereby
submits the following report and recommendations to the Court:
1.

This a Fair Labor Standards Act (hereinafter “FLSA”) case in under

29 U.S.C. § 201, et seq. case, initiated by lead plaintiff Sonya Adams (hereafter the
“Collective Representative”) on December 12, 2012, and, as of June 1, 2017,
joined by 317 other named Plaintiffs employed by Defendant City and County of
Honolulu (“Defendant”) as Emergency Medical Technicians (“EMTs”) and
Paramedics (hereafter the EMTs and Paramedics are referred to collectively as
“Plaintiffs”).
2.

The FLSA collective class is defined as all EMT's and Paramedics

who worked for Defendant City and County of Honolulu, during the period from
December 1, 2009, through the present (the “Claims Period”), who allege they

were not paid overtime wages as required by the FLSA.
3.

At the status conference on December 8, 2015, the parties agreed upon

and the Court approved a method to advance the case to resolution at trial or
determination by motion, mediation or other settlement. The plan was to prepare
and present 10 representative bell weather cases (the “Bell Weathers”) for the
Court's consideration, from which damages for the rest of the collective members
could be determined by extrapolation, based on weekly averages for the Bell
Weathers, applied to each non-bell weather plaintiff (the “Non-Bell Weathers”) for
each week they worked during the Claim Period. The Court approved this process
and the parties then selected the Bell Weathers by agreement.
4.

At the status conference held January 21, 2016, the Court ordered

Defendant to provide the time records and payroll record information for the Bell
Weathers to Plaintiffs' counsel.
5.

Defendant agreed to produce time sheets from December 1, 2009, to

the present or their electronic equivalent for the Bell Weathers. Similarly,
Defendant agreed to produce payroll records, in the form of the C2HERPS records
from February 26, 2010, to present, or their electronic equivalent. Records
equivalent to the C2HERPS would be produced documenting regular time, shift
premium, FLSA overtime and collective bargaining agreement overtime for
December 1, 2009, through February 26, 2010. The time sheets and payroll records
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are referred to collectively as the “Payroll Data.” Production of Payroll Data for
the Bell Weathers was completed in April 2017.
6.

Pursuant to Fed. R. Civ. P. 53, L.R. 53.3 and Fed. R. Evid. 706, on

August 12, 2016, the parties agreed and the Court appointed David M. Breshears,
CPA/CFF of the forensic accounting firm of Hemming Morse, as Special Master
and Expert (hereafter the “Special Master”) to evaluate the Payroll Data and
calculate: (1) the “regular rate of pay” pursuant to 29 U.S.C. § 207(e), for each of
the Bell Weathers during the period from February 7, 2010 to October 1, 2016; (2)
the amount of asserted FLSA overtime owed for each week for each of the Bell
Weathers, if any; (3) the amount of asserted FLSA overtime paid for each week
for each of the Bell Weathers, if any; (4) the amount of asserted FLSA overtime
unpaid for each week for each of the Bell Weathers, if any; (5) the amount of
asserted FLSA overtime paid late for each week for each of the Bell Weathers, if
any; and (6) the amount of asserted overtime unpaid for each week for each of the
Bell Weathers, if any (collectively the “Unpaid Overtime”). See Stipulation to
Appointment of Special Master Pursuant to Fed. R. Civ. P. 53, L.R. 53.3 and Court
Experts Pursuant to Fed. R. Evid. 706 [Filed 8/12/16] Doc. No. 78 (the
“Appointment Order”).
7.

Pursuant to the Appointment Order, the parties are bound by the

Special Master's report and recommendations regarding the Bell Weathers pursuant
to Fed. R. Civ. Pro. 53(a)(1)(A). Id. ¶ 8.f.
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8.

The Payroll Data were analyzed pursuant to the Appointment Order

and, utilizing the data provided by Defendant:
a.

Pursuant to 29 U.S.C. § 207(e), the “regular rate of pay” was
calculated for each of the Bell Weathers during the period from
February 7, 2010 to October 1, 2016;

b.

The amount of FLSA overtime owed for each week for each of
the Bell Weathers was calculated;

c.

The amount of FLSA overtime paid for each week for each of
the Bell Weathers was calculated;

d.

The amount of FLSA overtime unpaid for each week for each
of the Bell Weathers was calculated;

e.

The amount of FLSA overtime paid late for each week for each
of the Bell Weathers was calculated; and

f.

The amount of overtime unpaid for each week for each of the
Bell Weathers was calculated.

Collectively, these calculations are referred to herein as the “Unpaid Overtime.”
9.

Average Unpaid Overtime for each work week from February 7, 2010

to October 2, 2016, was calculated and applied to each of the weeks worked by
each Bell Weather from December 2009 to February 6, 2010 and from October 2,
2016 to June 1, 2016, as well as to each of the weeks worked from December 2009
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to June 1, 2016 by each Non-Bell Weather plaintiff who has opted into this action
(the “Collective Formula”). The Unpaid Overtime and Collective Formula
calculations have been provided to the parties for their analysis and discussions,
and to the Court.
10.

The Unpaid Overtime and Collective Formula calculations are based

on the production of the records and/or data described herein.
11.

Based on Defendant's payment of overtime to the Plaintiffs during the

Claims Period; identified in the Unpaid Overtime and Collective Formula
calculations; reviewed by the parties and the Court in numerous status, discovery
and conferences with the Court; and continuing issues related to timely overtime
payments, and as discussed between the parties and the Special Master, the
following is recommended:
a.

The three-year statute of limitations period pursuant to 29
U.S.C. § 255(a) will be applied to this case (Haro v. City of
L.A., 745 F.3d 1249, 1259 (9th Cir. 2014); and

b.

The “good faith” exemption for liquidated damages under 29
U.S.C. § 216(b) will not be applied to this case.

c.

This recommendation that has been agreed upon between the
parties is based solely on and limited to the unique facts of this
case only and is not intended to be binding nor precedential for
any other case and/or claim that may be asserted against the
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City.
12.

The parties’ attorneys reported that:
a.

On or before April 10, 2017, Defendant distributed to Plaintiffs
currently employed as EMTs or Paramedics, via e-mail, the opt
in notice and consent to participate form attached hereto as
Exhibits 1 and 2. All Non-Bell Weather employees who did not
receive the initial e-mail distribution were notified and received
the forms not later than April 30, 2017.

b.

On or before April 26, 2017, Plaintiffs' attorney distributed to
143 Plaintiffs formerly employed as EMTs or Paramedics, the
opt in notice and consent to participate forms, via United States
postal mail. Plaintiffs' attorney received 35 returned envelopes
identified as “undeliverable” from this mailing. The envelopes
returned before June 1, 2017, as undeliverable were re-mailed
to more current addresses immediately upon return, except: (a)
in four cases where collective representative Sonya Adams had
more current contact information and was able to contact the
Plaintiffs directly; and, (b) in four cases in which the consent to
participate forms were received before the re-mailing. Twentysix notices then were re-mailed. Of the 26 re-mailed notices
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four (4) were returned undeliverable.
c.

Of the 436 current and former EMTs and paramedics who
potentially had claims for Unpaid Overtime during the
Collective Period, 318 signed consent to participate forms
which have been received by Plaintiffs’ attorney.

13.

The period for any employee to consent to opt into this action has

closed. The Special Master was notified of the identities of all Plaintiffs
consenting to opt in and has completed the Unpaid Overtime and Collective
Formula calculations for all Plaintiffs.
14.

A Third Amended Complaint has been prepared joining all 318

Plaintiffs and has been presented to the Court by stipulation for approval and
subsequent filing. The Third Amended Complaint has been approved for filing
and filed. CM/ECF Doc. No. 105.
15.

Plaintiffs and Defendant, by their respective counsel, with the

assistance of the Court and Special Master, have engaged in intensive discussions
regarding this case and the claims and defenses.
16.

Based on these discussions, the Special Master herein makes the

following recommendations for the payment of Unpaid Overtime and Collective
Formula calculations:
a.

Defendant is recommended to pay a maximum amount of Eight
Hundred Ninety Thousand, Six Hundred Seventy Seven Dollars
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($890,677), exclusive of Plaintiffs' attorneys' fees and costs.

b.

Distribution shall be made to individual Plaintiffs according to
the amounts set forth in Exhibit 3 to these Recommendations
and Report, filed under seal (the “Payments”). The Payments to
each eligible Plaintiff have been calculated based on the
Collective Formula calculations as the basis for reaching a pro
rata amount for each Plaintiff, based on the number of weeks
worked during the Claims Period.

17.

Based on the parties’ discussions and resolution of their disputes

regarding attorneys’ fees it is recommended, without objection from the parties,
that the following factors should be and have been considered for assessment of
reasonable attorneys’ fees: (a) the time and labor required to conclude the dispute;
(b) the novelty and difficulty of the questions involved; (c) the skill requisite to
perform the legal service properly; (d) the preclusion of other employment by the
attorneys due to acceptance of a case of this size and duration; (e) the customary
contingent fees charged by attorneys in Hawai‘i; (f) that the fee here is contingent
and involved significant risk; (g) time limitations imposed by lengthy delays in
discovery which delayed the work of the Special Master; (h) the amount involved
and the results obtained; (i) the “undesirability” of the case and the lack of local
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attorneys representing plaintiffs in wage-hour cases; (j) the nature and length of the
professional relationship with the clients, nearly thirty-four percent (34%) of whom
no longer are employed by Defendant; (k) awards in similar cases in Hawai‘i; and
(l) the fact that, after the instant action was filed, Defendant recognized it had not
paid Plaintiffs' overtime correctly and made unannounced payments to Plaintiffs on
September 13, 2013, and February 28, 2014, for both contract and FLSA overtime.
Kerr v. Screen Extras Guild, Inc., 526 F.2d 67, 70 (9th Cir. 1975), cert. denied sub
nom Perkins v. Screen Extras Guild, Inc., 425 U.S. 951 (1976).
18.

Based on the parties’ discussions and resolution of their

disputes regarding reasonable attorneys’ fees, it is recommended that attorneys'
fees in the amount of Two Hundred Fifty Thousand Dollars ($250,000.00) and
general excise tax on that amount in the amount of Eleven Thousand Seven
Hundred-Eighty Dollars ($11,780.00) should be paid to Plaintiffs’ attorneys by
Defendant.
19.

Based on the parties’ discussions and resolution of their

disputes regarding litigation costs, it is recommended that Plaintiffs’ litigation
costs in the amount of Four Thousand Dollars ($4,000.00) should be paid to
Plaintiffs’ attorneys by Defendant.
20.

Based on the parties’ discussions and inability to resolve their

disputes regarding litigation costs, payment of “incentive pay” to the collective
class representative, Sonya Adams, if any, it is recommended that the “incentive
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pay” shall be determined by the Court upon motion to be filed within 14 days of
submission of this Report and Recommendations.
21.

Exhibit 3 to these Recommendations, lists each Plaintiff indicating the

gross Payment amount that was determined as set forth above, which shall be
disbursed by Defendant as follows:
a.

Defendant will issue an IRS Form W-2 for the calculated
FLSA overtime wages paid to each Plaintiff; and

b.

Defendant will issue a Form 1099 for the liquidated damages
paid to each Plaintiff, in the regular course of Defendant’s
business.

22.

All payments and disbursements to be made pursuant to these

Recommendations shall be made not later than August 1, 2017.
23.

Pursuant to Fed. R. Civ. P. 53(f)(2), a party may file objections or

statement of no objections this Report and Recommendations. The Special Master
is advised by the parties that no such objections to these Recommendations will be
filed by any party.
24.

The Special Master recognizes and notes that Defendant has

taken steps to correct, address, and minimize FLSA miscalculations and/or
inadvertent/human error and/or oversights in its payroll practices and calculations.
While such inadvertent/human error and/or oversights and/or late (or untimely)
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input of time by employees may occur from time to time, the Special Master
recognizes Defendant has made good faith efforts, including the adoption of an
electronic time recording system, to comply with the requirements under the FLSA
as a consequence of this litigation.
25.

Upon filing of this Report and Recommendations and Order

and the filing of Exhibit 3 hereto the Special Master shall be discharged.
26.

Upon filing of this Report and Recommendations and Order

and the filing under seal of Exhibit 3 hereto and distribution of the Payments ,
attorneys’ fees and costs, it is recommended that the parties file a Stipulation to
Dismiss All Claims and All Parties With Prejudice in this case.
DATED: Chicago, Illinois, July 10, 2017.
/s/ David M. Breshears
David M. Breshears
SPECIAL MASTER

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ORDER
The Court having been fully advised in the premises and finding good cause
appearing therefor, the foregoing Report and Recommendations are hereby
APPROVED AND SO ORDERED:

UNITED STATES MAGISTRATE JUDGE

Adams, et al. v. City and County of Honolulu, CIVIL NO. 12-00667 BMK;
REPORT AND RECOMMENDATIONS OF SPECIAL MASTER
PURSUANT TO FED. R. CIV. P. 53 AND L.R. 53.3 ; ORDER

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