Howerton v. Cargill, Inc.

Filing 121

ORDER GRANTING PLAINTIFFS' MOTION FOR FINAL APPROVAL OF CLASS ACTION SETTLEMENT AND REQUEST FOR ENTRY OF FINAL JUDGMENT; AND MOTION FOR APPROVAL OF ATTORNEYS' FEE AWARD, EXPENSE REIMBURSEMENT, AND INCENTIVE AWARDS. Signed by JUDGE LESLIE E. KOBAYASHI on 11/26/2014. Re: 100 103 ~ 1. The Court FINDS that the requirements of Federal Rules of Civil Procedure Rule 23(e) have been satisfied and that the Settlement Agreement is fair, reasonable, and adequate. 2. Th e Court DENIES the Objections as not being supported by the applicable law of this Circuit. 3. The Court therefore GRANTS final approval of the settlement and GRANTS Plaintiffs' Motion for Final Approval of Class Action Settlement and Request for Entry of Final Judgment, filed on September 12, 2014; and Plaintiffs Motion for Approval of Attorneys Fee Award, Expense Reimbursement, and Incentive Awards, filed September 12, 2014. 4. The Court CERTIFIES the Class, as described in the Class S ettlement. 5. The Court ORDERS the parties to implement the terms of the settlement. 6. The Court finally APPOINTS Halunen and Associates, Reese Richman LLP and Scott+Scott Attorneys at Law LLP as Class counsel under Fed. R. Civ. P. 23(g). 7. The Cou rt ORDERS payment of the attorneys' fees and expenses from the Settlement Fund. 8. The Court BARS the class representatives and all class members, including all members who did not opt out of the Class Settlement, from bringing any related clai ms covered by this lawsuit. 9. This Court RETAINS exclusive jurisdiction over the parties and the class members for all matters related to this litigation, including the administration and implementation of the Class Settlement. Associat ed Cases: 1:13-cv-00336-LEK-BMK, 1:14-cv-00218-LEK-BMK(ecs, )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 registered to receive electronic notifications were served by first class mail on the date of this docket entry

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
DENISE HOWERTON, ERIC
CALDERON, and RUTH PASARELL,
Individually and on Behalf of
All Others Similarly
Situated,

)
)
)
)
)
)
Plaintiffs,
)
)
vs.
)
)
CARGILL, INC.,
)
)
Defendant.
)
_____________________________ )
MOLLY MARTIN and LAUREN
)
BARRY, on behalf of
)
themselves and others
)
similarly situated,
)
)
Plaintiffs,
)
)
vs.
)
)
CARGILL, INC.,
)
)
Defendant
)
_____________________________ )

CIVIL 13-00336 LEK-BMK

CIVIL 14-00218 LEK-BMK

ORDER GRANTING PLAINTIFFS’ MOTION FOR FINAL APPROVAL OF
CLASS ACTION SETTLEMENT AND REQUEST FOR ENTRY OF FINAL
JUDGMENT; AND MOTION FOR APPROVAL OF ATTORNEYS’ FEE
AWARD, EXPENSE REIMBURSEMENT, AND INCENTIVE AWARDS
Before the Court is Plaintiffs Denise Howerton,
Erin Calderon, Ruth Pasarell, Molly Martin, and Lauren Barry’s
(collectively, “Plaintiffs”): Motion for Final Approval of Class
Action Settlement and Request for Entry of Final Judgment, filed
on September 12, 2014 (“Final Approval Motion”); and Motion for
Approval of Attorneys’ Fee Award, Expense Reimbursement, and

Incentive Awards, filed on September 12, 2014 (“Fee Motion”
collectively, “Motions”).

[Dkt. nos. 100, 103.]

Plaintiffs also

filed various errata and supplements on September 15, 2014, and
October 17, 2014.

[Dkt. nos. 104, 105, 106, 110.]

Three class

members filed objections on September 26, 2014, (collectively,
“Objections”) [dkt. nos. 107 (Muller Objection), 108 (Mager
Objection), 115 (Palmer Objection),1] Defendant Cargill,
Incorporated (“Defendant”) filed its response to the Objections
on October 20, 2014, [dkt. no. 114,] and Plaintiffs filed their
reply in support of the Motions, which addressed the objections,
also on October 20, 2014 [dkt no. 113].
This Court held a final fairness hearing and a hearing
on the Motions on October 27, 2014.2

For the reasons set forth

below, and after due consideration of the evidence and arguments
presented by the parties and the objectors and the record in this
case, the Court CONCLUDES that good cause exists to GRANT final
approval of the settlement agreement in this action pursuant to

1

On October 16, 2014, this Court issued an entering order
regarding the timeliness of the objections since there was a
delay between the receipt of the objections, in particular, the
Palmer Objection, and their filing on the docket in this case.
[Dkt. no. 109.] The Objections cited herein were timely
received, and thus the Court has considered them in reaching its
decision on the Motions.
2

This Court issued its Order Preliminarily Approving Class
Action Settlement Agreement, Certifying Settlement Class,
Approving Notice Plan, and Scheduling Date for Final Fairness
Hearing on July 24, 2014 (“Preliminary Approval Order”). [Dkt.
no. 97.]
2

Federal Rules of Civil Procedure Rule 23(e) and to GRANT
Plaintiffs’ Motions.
BACKGROUND
This action was originally brought as four separate
putative class action lawsuits in four different states initiated
in July and September 2013 relating to the labeling and marketing
of Truvia Natural Sweetener (“Truvia” or “the Product”), and was
consolidated by this district court on May 19, 2014.
[Stipulation for Consolidation, filed 5/16/14 (dkt. no. 81);
Entering Order, filed 5/19/14 (dkt. no. 82).]

Plaintiffs allege

that Defendant misled consumers by advertising Truvia as a
natural sweetener, when in actuality it is largely synthetic and
chemically-produced, and that consumers were injured because they
purchased Truvia on that basis since Truvia is more expensive
than its sugar-alternative competitors, like Sweet ‘N Low and
Splenda.
Plaintiffs contend that this misconduct constitutes:
unjust enrichment; violations of Haw. Rev. Stat. §§ 480-1 et
seq., 481A-1 et seq.; violations of other states’ deceptive
practice acts; breach of express and implied warranties; and
violation of state consumer fraud laws.

The Amended Class Action

Complaint (“Amended Complaint”), [filed 5/12/14 (dkt. no. 80),]
seeks: certification of the nationwide and/or Hawai`i, Florida
and California classes; preliminary and permanent injunctions;

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corrective advertising and information campaigns; restitution;
disgorgement; damages compensating the classes; attorneys’ fees
and costs; and any other relief that they are entitled to
receive.
DISCUSSION
I.

Final Approval Motion
On June 19, 2014, Plaintiffs filed their Unopposed

Motion for Preliminary Approval of Class Action Settlement
(“Motion for Preliminary Approval”).

[Dkt. no. 92.]

The

parties’ Class Settlement Agreement (“Settlement Agreement”) is
attached to the Motion for Preliminary Approval as Exhibit 1.
[Motion for Preliminary Approval, Decl. of Joseph P. Guglielmo in
Supp. of Pltfs.’ Unopposed Motion for Preliminary Approval of
Class Action Settlement (“Guglielmo Decl.”), Exh. 1.]

The

parties agreed to the following definition of the settlement
class (“the Class”):
All persons who, during the Class Period July 1,
2008 to July 24, 2014 both reside in the United
States and purchased in the United States and
purchased in the United States any of the Truvia
Consumer Products for their household use or
personal consumption and not for resale. Excluded
from the Settlement Class are: (a) Cargill’s board
members or executive-level officers, including its
attorneys; (b) governmental entities; (c) the
Court, the Court’s immediate family, and the Court
staff; and (d) any person that timely and properly
excluded himself or herself from the Settlement
Class in accordance with the procedures approved
by the Court.
[Settlement Agreement at ¶ 2.29.]
4

The key terms of the settlement are as follows:
- Defendant shall establish a settlement fund (“Settlement Fund”)
of $6.1 million composed of cash and vouchers;
- Defendant will make changes to its Truvia labeling within
ninety days of the effective date of the Settlement
Agreement;
- Defendant will provide more information to consumers about the
ingredients in Truvia;
- Plaintiffs agree that Class counsel will receive an award of
attorneys’ fees and costs of no more than thirty percent of
the Settlement Fund, which represents $1.83 million; and
- the five Plaintiffs would request incentive payments of
$2,000.00 each to be paid from the Settlement Fund.
[Id. at ¶¶ 4.1, 4.7, 4.8, 8.1, 8.5.]
This Court granted preliminary approval of the
settlement, finding that it was “within the range of possible
approval as fair, reasonable, and adequate, within the meaning of
Rule 23 and the Class Action Fairness Act of 2005.”
Approval Order at 7.]

[Prelim.

The Court scheduled the final fairness

hearing for October 27, 2014.
As of September 10, 2014, the claims administrator has
received 26,192 claims, 25,788 of which were filed online at
www.TruviaSweetnerLawsuit.com.

Of the online claims, ninety-five

percent have selected the cash option.
no objections.

Further, he has received

Since the deadline is December 5, 2014, the

claims administrator expects a total of between 75,000 and
100,000 claims, which is 1.5 to 2.0% of the estimated class.
[Final Approval Motion, Decl. of Jeffrey D. Dahl with Respect to
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Implementation of the Notice Plan and Performance of Required
Settlement Administration Activities (“Dahl Decl.”) at ¶¶ 32-34.]
The Court therefore FINDS that, as required by Federal
Rules of Civil Procedure Rule 23(e)(1), notice of the settlement
was directed in a reasonable manner to all Class members who
would be bound by the settlement.
Regarding final approval of the terms of the
settlement, Federal Rule of Civil Procedure 23(e) states, in
pertinent part:
The claims, issues, or defenses of a certified
class may be settled, voluntarily dismissed, or
compromised only with the court’s approval. The
following procedures apply to a proposed
settlement, voluntary dismissal, or compromise:
(1) The court must direct notice in a
reasonable manner to all class members who would
be bound by the proposal.
(2) If the proposal would bind class members,
the court may approve it only after a hearing and
on finding that it is fair, reasonable, and
adequate.
(3) The parties seeking approval must file a
statement identifying any agreement made in
connection with the proposal.
. . . .
(5) Any class member may object to the
proposal if it requires court approval under this
subdivision (e); the objection may be withdrawn
only with the court’s approval.
“The purpose of Rule 23(e) is to protect the unnamed members of
the class from unjust or unfair settlements affecting their

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rights.”

In re Syncor ERISA Litig., 516 F.3d 1095, 1100 (9th

Cir. 2008) (citation omitted).
This Court must examine the parties’ settlement as a
whole for overall fairness.

This Court must approve or reject

the settlement in this case in its entirety; this Court cannot
alter certain provisions.

See Hanlon v. Chrysler Corp., 150 F.3d

1011, 1026 (9th Cir. 1998).

This Court must balance the

following factors:
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.
Id. (citations omitted).
Despite being duly notified of the settlement, only
three class members have submitted objections to the settlement,
and no class member appeared at the final fairness hearing to
object to the settlement.

The Court has reviewed the Objections

and finds they have no merit.

Each of the Objections included

arguments that the attorneys’ fees were not reasonable.

The

Court addresses the attorneys’ fees in the Class Settlement supra
Section II below.
The Court specifically DENIES the Objections insofar
as: class members had sufficient time to review the Fee Motion,

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see In re Mercury Interactive Corp. Sec. Litig., 618 F.3d 988,
995 (9th Cir. 2010) (fairness of timing in discretion of court so
long as there is a review period before objections); requiring
opt-out by mail is not unduly financially burdensome, and the
claims process is fair; there is a substantial nexus between the
organizations selected as cy pres recipients and the interests of
the class members as alleged in the Complaint, see Lane v.
Facebook, Inc., 696 F.3d 811, 820-21 (9th Cir. 2012) (“We do not
require as part of that doctrine that settling parties select a
cy pres recipient that the court or class members would find
ideal.”); and the vouchers offered to class members, and only
five percent of the claimants have opted for so far, are not
coupons, and are appropriate, see CLRB Hanson Indus., LLC v.
Weiss & Associates, PC, 465 F. App’x 617, 619 (9th Cir. 2012)
(finding cash equivalent voucher was “not a ‘coupon
settlement’”).3
Finally, Plaintiffs have presented evidence that no
class member has requested exclusion from the Class.

The Court

has reviewed the memoranda, the objections, and the applicable
law, and FINDS the Settlement Agreement fair, reasonable, and
adequate.

3

To the extent that the Objections raised other arguments,
the Court rejects those arguments as well.
8

II.

Fee Motion
Insofar as the parties have allocated a portion of the

settlement amount for Plaintiffs’ attorneys’ fees and expenses,
this Court must examine the reasonableness of the award before it
can grant final approval of the settlement.
A.

Entitlement to Attorneys’ Fees and Expenses
The Class Settlement between Plaintiffs and Defendant

provides that thirty percent of the settlement amount be
allocated for an award of Plaintiffs’ attorneys’ fees and
expenses.

Plaintiffs argue that this is reasonable, and have

provided a lodestar cross-check, which is within a multiplier of
.62 and 1.39, depending on geographic valuation.

[Fee Motion at

2-3.]
Federal Rule of Civil Procedure 23(h) states: “In a
certified class action, the court may award reasonable attorney’s
fees and nontaxable costs that are authorized by law or by the
parties’ agreement.”

Thus, pursuant to Rule 23(h), the parties’

Settlement Agreement alone is a sufficient basis for an award of
reasonable attorneys’ fees to Plaintiffs.

The Court, however,

emphasizes that it has only relied upon the parties’ agreement as
the basis for the entitlement to award; the Court has not relied
upon the parties’ representation that the requested award is
reasonable.

The Court will independently review the requested

award for reasonableness.

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B.

Amount of the Award
Under federal law, reasonable attorneys’ fees are

generally based on the traditional “lodestar” calculation set
forth in Hensley v. Eckerhart, 461 U.S. 424, 433 (1983).
v. SJB-P.D., Inc., 214 F.3d 1115, 1119 (9th Cir. 2000).

Fischer
The

court must determine a reasonable fee by multiplying “the number
of hours reasonably expended on the litigation” by “a reasonable
hourly rate.”

Hensley, 461 U.S. at 433.

Second, the court must

decide whether to adjust the lodestar amount based on an
evaluation of the factors articulated in Kerr v. Screen Extras
Guild, Inc., 526 F.2d 67, 70 (9th Cir. 1975), which have not been
subsumed in the lodestar calculation.

Fischer, 214 F.3d at 1119.

The factors the Ninth Circuit articulated in Kerr are:
(1) the time and labor required, (2) the novelty
and difficulty of the questions involved, (3) the
skill requisite to perform the legal service
properly, (4) the preclusion of other employment
by the attorney due to acceptance of the case,
(5) the customary fee, (6) whether the fee is
fixed or contingent, (7) time limitations imposed
by the client or the circumstances, (8) the amount
involved and the results obtained, (9) the
experience, reputation, and ability of the
attorneys, (10) the “undesirability” of the case,
(11) the nature and length of the professional
relationship with the client, and (12) awards in
similar cases.
526 F.2d at 70.

Factors one through five have been subsumed in

the lodestar calculation.

Morales v. City of San Rafael, 96 F.3d

359, 364 n.9 (9th Cir. 1996).

Further, the Ninth Circuit,

extending City of Burlington v. Dague, 505 U.S. 557, 567 (1992),
10

held that the sixth factor, whether the fee is fixed or
contingent, may not be considered in the lodestar calculation.
Davis v. City & Cnty. of San Francisco, 976 F.2d 1536, 1549 (9th
Cir. 1992), vacated in part on other grounds, 984 F.2d 345 (9th
Cir. 1993).

Once calculated, the “lodestar” is presumptively

reasonable.

Pennsylvania v. Del. Valley Citizens’ Council for

Clean Air, 483 U.S. 711, 728 (1987); see also Fischer, 214 F.3d
at 1119 n.4 (stating that the lodestar figure should only be
adjusted in rare and exceptional cases).
Although Plaintiffs do not request a lodestar award of
attorneys’ fees in this case, this Court uses the fees that it
could have awarded Plaintiffs under the lodestar analysis as a
gauge of the reasonableness of the attorneys’ fees provided for
in the Settlement Agreement.

See, e.g., Villon, et al. v.

Marriott Hotel Servs., Inc., CV 08-00529 LEK-RLP, Order Granting
Final Approval of Class Action Settlement and Granting Pltfs.’
Motion for Final Approval of Class Action Settlement, filed
5/30/14 (dkt. no. 211), at 8 (using the lodestar method as a
guide to review the agreed upon attorneys’ fees); Almodova v.
City & Cnty. of Honolulu, Civil No. 07–00378 LEK–RLP, 2011 WL
4625692, at *5 (D. Hawai`i Sept. 30, 2011) (using the lodestar
method as a guide to review the agreed upon attorneys’ fees in a
Fair Labor Standards Act settlement for reasonableness); Shea v.
Kahuku Hous. Found., Inc., Civil No. 09–00480 LEK–RLP, 2011 WL

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1261150, at *6 (D. Hawai`i Mar. 31, 2011) (citation omitted)
(using the lodestar analysis as a guide to evaluate the
reasonableness of the agreed upon attorneys’ fees in a settlement
of action pursuant to Rule 23(h)).
This Court has used the hourly calculation as supplied
by Plaintiffs’ counsel.

[Notice of Errata Relating to the Decl.

of Joseph P. Guglielmo filed at ECF No. 103-2, Corrected Decl.,
at ¶¶ 50-51.]

Counsel included both the attorneys’ regular rates

as well as the Hawai`i adjusted rate to produce a loadstar of
attorneys fees and expenses of $1,318,212.10.

In determining

whether an hourly rate is reasonable, the Court considers the
experience, skill, and reputation of the attorney requesting
fees.
2002).

Webb v. Ada Cnty., 285 F.3d 829, 840 & n.6 (9th Cir.
Under the lodestar method, this Court must generally

award out-of-state counsel attorneys’ fees according to the
prevailing market rates in Hawai`i.

See id.; see also Gates v.

Deukmejian, 987 F.2d 1392, 1405 (9th Cir. 1992), as amended on
denial of reh’g, (1993) (noting that the rate awarded should
reflect “the rates of attorneys practicing in the forum
district”).
The Court has thoroughly reviewed the presentation of
the fees and, with the exception of a few attorneys, the fees
charged are in line with this district.

Counsel supplied a chart

explaining the correlation between the attorney’s years in

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practice and the Hawai`i hourly rate.

The Court finds that these

rates – for example, using $300 hourly rate for an attorney
practicing twenty or more years, and $150 for an attorney with
one to four years experience – comport with this Court’s past
orders, and are reasonable.

The Court, however, has adjusted

down those few rates where there was a significant departure –
where a local attorney used a Hawai`i rate of $445 and New York
attorneys with only three years experience applied a rate of
$175.
Calculating the lodestar based on hours worked, counsel
represents that this creates a multiplier of 1.3882.

This is

well within the reasonable range as recognized by the Ninth
Circuit.

See Vizcaino v. Microsoft Corp., 290 F.3d 1043, 1051

(9th Cir. 2002) (“[M]ultiples ranging from one to four are
frequently awarded in common fund cases when the lodestar method
is applied.” (alteration in Vizcaino) (citations and internal
quotation marks omitted)); In re Apple iPhone/iPod Warranty
Litig., No. C 10-1610 RS, 2014 WL 1478707, at *3-4 (N.D. Cal.
Apr. 14, 2014).

Even when the Court adjusts the few attorneys

whose rates were above the Hawai`i rate, the multiplier is still
within the permissible and reasonable range.
C.

Hours Reasonably Expended

Beyond establishing a reasonable hourly rate, a party
seeking attorneys’ fees bears the burden of proving that the fees

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and costs taxed are associated with the relief requested and are
reasonably necessary to achieve the results obtained.

See Tirona

v. State Farm Mut. Auto. Ins. Co., 821 F. Supp. 632, 636 (D.
Hawai`i 1993) (citations omitted).

A court must guard against

awarding fees and costs which are excessive, and must determine
which fees and costs were self-imposed and avoidable.

See id. at

637 (citing INVST Fin. Group v. Chem-Nuclear Sys., 815 F.2d 391,
404 (6th Cir. 1987)).

A court has “discretion to ‘trim fat’

from, or otherwise reduce, the number of hours claimed to have
been spent on the case.”

Soler v. G & U, Inc., 801 F. Supp.

1056, 1060 (S.D.N.Y. 1992) (citation omitted).

Time expended on

work deemed “excessive, redundant, or otherwise unnecessary”
shall not be compensated.

See Gates, 987 F.2d at 1399 (quoting

Hensley, 461 U.S. at 433-34).
Under the traditional lodestar analysis, this Court
would apply various deductions, such as for insufficiently
described tasks and clerical items.

Insofar as this Court is

only using the lodestar analysis as a guide in this case, and
this Court has already applied reductions to some of counsel’s
hourly rates, this Court will not apply its standard deductions
to the number of counsel’s hours.

The Court finds that, for

purposes of the instant Motion, the hours that Plaintiffs’
counsel incurred in this case would be compensable under the
lodestar analysis.

This Court therefore FINDS that the proposed

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allocation of thirty percent of the fund or $1.83 million of the
settlement for an award of Plaintiffs’ attorneys’ fees and
expenses is reasonable.
CONCLUSION
In light of the foregoing, the Court ORDERS as follows:
1.

The Court FINDS that the requirements of Federal

Rules of Civil Procedure Rule 23(e) have been satisfied and that
the Settlement Agreement is fair, reasonable, and adequate.
2.

The Court DENIES the Objections as not being

supported by the applicable law of this Circuit.
3.

The Court therefore GRANTS final approval of the

settlement and GRANTS Plaintiffs’ Motion for Final Approval of
Class Action Settlement and Request for Entry of Final Judgment,
filed on September 12, 2014; and Plaintiffs’ Motion for Approval
of Attorneys’ Fee Award, Expense Reimbursement, and Incentive
Awards, filed September 12, 2014.
4.

The Court CERTIFIES the Class, as described in the

Class Settlement.
5.

The Court ORDERS the parties to implement the

terms of the settlement.
6.

The Court finally APPOINTS Halunen and Associates,

Reese Richman LLP and Scott+Scott Attorneys at Law LLP as Class
counsel under Fed. R. Civ. P. 23(g).
7.

The Court ORDERS payment of the attorneys’ fees

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and expenses from the Settlement Fund.
8.

The Court BARS the class representatives and all

class members, including all members who did not opt out of the
Class Settlement, from bringing any related claims covered by
this lawsuit.
9.

This Court RETAINS exclusive jurisdiction over the

parties and the class members for all matters related to this
litigation, including the administration and implementation of
the Class Settlement.
IT IS SO ORDERED.
DATED AT HONOLULU, HAWAII, November 26, 2014.

/s/ Leslie E. Kobayashi
Leslie E. Kobayashi
United States District Judge

DENISE HOWERTON, ET AL. VS. CARGILL, INC.; CV 13-00336 LEK; MOLLY
MARTIN VS. CARGILL, INC.; CV 14-00218 LEK-BMK; ORDER GRANTING
PLAINTIFFS’ MOTION FOR FINAL APPROVAL OF CLASS ACTION SETTLEMENT
AND REQUEST FOR ENTRY OF FINAL JUDGMENT; AND MOTION FOR APPROVAL
OF ATTORNEYS’ FEE AWARD, EXPENSE REIMBURSEMENT, AND INCENTIVE
AWARDS

16