Reamer v. Zolman Tire Inc
Filing
42
OPINION AND ORDER: granting 36 joint motion pursuant to Rule 23 of the Federal Rules of Civil Procedure for conditional certification of the class and preliminary approval of the proposed settlement 36 , 37 , as supplemented 40 , 41 . Reamers motion to strike the offer of judgment is DENIED WITH LEAVE TO REINSTATE the motion 13 . Reamers initial motion to certify the class is DENIED WITH LEAVE TO REINSTATE the motion 7 as of the date upon which it was originally filed. Release of cla ims Form to be submitted by 2/9/2015. Opt-Outform to be submitted by 2/9/2015. Objections to be submitted by 2/26/2015. HEARING to be held before The Honorable Jon E. DeGuilio at the U.S. District Court, 204 S. Main Street, South Bend, Indiana on 4/15/2015 at 10:00 a.m. (EDT). Signed by Judge Jon E DeGuilio on 11/13/2014. (rmn) Modified on 11/14/2014 text added and docket entry regenerated(rmn).
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF INDIANA
SOUTH BEND DIVISION
THOMAS REAMER on Behalf of
Himself and All Others Similarly
Situated,
Plaintiffs,
vs.
ZOLMAN TIRE, INC.,
Defendant.
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CASE NO. 3:14-CV-1601 JD
OPINION AND ORDER
Now before the Court is a joint motion pursuant to Rule 23 of the Federal Rules of Civil
Procedure for conditional certification of the class and preliminary approval of the proposed
settlement [DE 36; DE 37], as supplemented [DE 40; DE 41]. Therein, the parties seek
conditional certification of a class consisting of current and former employees of Defendant
Zolman Tire, Inc. (“Zolman”), who had monies deducted from their wages for uniform rental or
cleaning between May 6, 2012 and May 31, 2014.1 The parties also request the Court’s
preliminary approval of the class settlement as set forth in the Settlement Agreement [DE 36-1]
(“Settlement Agreement”) signed by Zolman’s President Nathan Zolman, representative plaintiff
Thomas Reamer (“Reamer”), and Roland Weldy of Weldy & Associates (“Class Counsel”). In
addition, the parties want the Court to approve the amended Notice of Class Settlement [DE 411], the Opt-Out Form [DE 37 at 21, Exb. 5], and the amended Release of Claims Form [DE 412].
As a preliminary matter, to address jurisdictional issues raised by the Court in a status
conference held on November 4, 2014, the parties have stipulated [DE 40] to the withdrawal of
1
Since May 31, 2014, Zolman has changed its wage deduction practices.
Zolman’s offer of judgment upon the Court’s final approval of the parties’ Proposed Settlement.
See Damasco v. Clearwire Corp., 262 F.3d 891 (7th Cir. 2012). Accordingly, Reamer’s motion
to strike the offer of judgment is DENIED WITH LEAVE TO REINSTATE the motion [DE 13],
in the event that the offer of judgment is not ultimately withdrawn. Any response to the offer of
judgment shall not be due until further order of the Court, not to exceed 14 days after notice is
provided to the parties by the Court in the event that the class action settlement will not be finally
approved. In addition, in light of the joint motion to conditionally approve the class certification,
Reamer’s initial motion to certify the class is DENIED WITH LEAVE TO REINSTATE the
motion [DE 7] as of the date upon which it was originally filed. Finally, the Court would note
that during the November 4 status conference, counsel agreed that for the purpose of settlement,
Reamer is an adequate class representative2 and that a pre-certification hearing is unnecessary
given that the parties’ submissions adequately allow the Court to determine that the proposed
settlement is “within the range of possible approval” and there is reason to notify the class
members of the proposed settlement and to proceed with a fairness hearing. See Gautreaux v.
Pierce, 690 F.2d 616, 621 n. 3 (7th Cir. 1982).
CLASS CERTIFICATION
This class action seeks to recover monetary damages on behalf of all current and former
employees (collectively “Proposed Class”) who worked in Indiana for Zolman, an automotive
repair, tire, and wheel retailer located in Indiana and Michigan, who have had monies deducted
from their wages for uniform rental or cleaning between May 6, 2012 and May 31, 2014, by
Zolman in violation of Indiana’s Wage Payment Statute, Ind. Code § 22-2-5 et seq. and Wage
Deduction Statute, Ind. Code § 22-2-6 et seq. Reamer also stands to recover on his individual
2
Zolman’s counsel confirmed that it knows of no reason why Reamer would not be a proper class
representative, but reserved the right to contest the viability of his claims and representative
status should the settlement not be finally approved.
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claim under the same statutes for deductions taken from his wages by Zolman for training costs
and on his individual claim under the Fair Labor Standards Act (“FLSA”) for Zolman’s failure to
pay Reamer certain overtime wages. See 29 U.S.C. § 207(a)(1) (requiring overtime pay of at
least one and one-half times an employee’s regular rate of pay). The parties agree, and the Court
finds, that jurisdiction over the case is proper under 28 U.S.C. §§ 1331 and 1367.
Relative to the class action claim under Indiana law, the Court of Appeals of Indiana has
specifically held that an employer is only permitted to deduct monies from the wages of an
employee for a purpose delineated by the Wage Deduction Statute located at Ind. Code § 22-2-62. E&L Rental Equipment, Inc. v. Bresland, 782 N.E.2d 1068, 1070-71 (Ind. Ct. App. 2003). To
be valid, an assignment of wages must be in writing, signed by the employee, and revocable at
any time by the employee upon written notice to the employer, and agreed to in writing by the
employer. Id. In Bresland, the Court of Appeals held that an employer is liable pursuant to the
Wage Payment Statute for failure to timely pay all wages in the correct amount when a deduction
is made in violation of the Wage Deduction Statute. Bresland, 782 N.E.2d at 1070-71.
Although Zolman does not concede liability and believes that the deductions were legal
(and thus Zolman could have asserted such a counterclaim),3 the amount of the Proposed
Settlement reflects the parties’ agreement relative to the value of settling at an early stage while
avoiding protracted ligation on such issues. See, e.g., St. Vincent Hosp. and Health Care Center,
Inc. v. Steele, 766 N.E.2d 699, 706 (Ind. 2002) (Boehm, J., concurring) (“[T]he vast majority of
workers [ ] are dependent on their paychecks for their day-to-day expenses. These employees
need the money currently, not at the end of protracted litigation, and often do not have the
economic staying power to engage in a court battle over relatively small amounts . . .”.). In
summary, Zolman has agreed to pay a total of $27,357.59 to the Proposed Class (not including
3
Zolman did not require employees to wear uniforms, and thus employees would still owe
Zolman for uniform costs paid on their behalf by Zolman.
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Reamer’s recovery, as separately detailed below), which includes 70 current and former
employees. The settlement amount to the Proposed Class includes one hundred percent of wages
deducted and about one third of the maximum liquidated damages available under Ind. Code §
22-2-5-2, 4 which indicates that liquidated damages are to be paid in an amount of ten percent
owed, but not to exceed double the amount of wages due. As for the class representative,
Thomas Reamer, a former employee of Zolman employed between October 26, 2011 and
November 8, 2013, he will recover $2,731.68. Not only will he recover one hundred percent of
his deducted wages for uniform related expenses, he will also receive $220 for non-uniform
related (or training) deductions, $375.84 in unpaid overtime under the FLSA, along with one
hundred percent of the liquidated damages for all of his claims against Zolman. The parties’
amended Notice of Class Settlement and Settlement Agreement make clear what Reamer, as the
representative plaintiff, will receive from the settlement [DE 36-1 at 12; DE 41-1 at 3-4, §§ 3.d,
3.e]. With approximately $16,600.00 in attorney fees and costs (as disclosed in the amended
Notice of Class Settlement [DE 41-1 at 3-4, §§ 3.c, 3.j-l]), the total settlement is valued at
roughly $46,000.00.
Conditional certification of the class is jointly sought pursuant to Fed. R. Civ. P. 23(a)
and (b)(3).
Federal Rule of Civil Procedure 23 governs the certification of class actions in federal
court. It allows a member of a class to sue as a representative party on behalf of all the class
members if:
(1)
(2)
(3)
4
the class is so numerous that joinder of all members is impracticable;
there are questions of law or fact common to the class;
the claims or defenses of the representative parties are typical of the
claims or defenses of the class; and
The specific amount to be paid to each Proposed Class member is set forth in Exhibit 1 [DE 37
at 2-3].
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(4)
the representative parties will fairly and adequately protect the interests of
the class.
Fed. R. Civ. P. 23(a). If all of these prerequisites are met, a court must also find that at least one
of the subsections of Rule 23(b) is satisfied. Pertinent to this case, Rule 23(b)(3) states:
the court finds that the questions of law or fact common to class members
predominate over any questions affecting only individual members, and that a
class action is superior to other available methods for fairly and efficiently
adjudicating the controversy. The matters pertinent to these findings include:
(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.
Fed. R. Civ. P. 23(b)(3).
The United States Supreme Court has made clear that the district court is to perform a
“rigorous analysis” to determine that the prerequisites of Rule 23 are satisfied when a class is to
be certified because actual, not presumed, conformance with Rule 23(a) remains indispensable.
Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 160-61 (1982). For a class to be certified, each
requirement of Rule 23(a), that is, numerosity, commonality, typicality, and adequacy of
representation, must be satisfied, as well as, one subsection of Rule 23(b). Fed. R. Civ. P. 23;
Harper v. Sheriff of Cook Cnty., 581 F.3d 511, 513 (7th Cir. 2009). “Failure to meet any of the
Rule’s requirements precludes class certification.” Arreola v. Godinez, 546 F.3d 788, 794 (7th
Cir. 2008). A district court has broad discretion to determine whether certification of a class
action lawsuit is appropriate. Arreola, 546 F.3d at 794.
The parties agree, and the Court finds, that they have satisfied Rule 23(a)(1)–(4) and Rule
23(b)(3).
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1.
Numerosity
The first requirement under Rule 23(a) is that the purported class be “so numerous that
joinder of all members is impracticable.” Fed. R. Civ. P. 23(a)(1). To be impracticable, joinder
need not be impossible, but instead must be shown to be inconvenient and difficult. See 32B Am.
Jur. 2d Federal Courts, When Joinder is Impracticable § 1608 (2014). When determining if
joinder of all class members is impracticable, the court may consider many factors, including:
the class size; judicial economy arising from the avoidance of a multiplicity of actions; the ease
of identification of members of the proposed class; the geographic dispersion of class members;
the inconvenience of trying individual suits; the nature of the action; the size of each plaintiff’s
claim; the financial resources of the class members; requests for prospective injunctive relief
which would involve future class members; and any other factors relevant to the practicability of
joining all the class members. Id. A court must rely on simple common sense when determining
whether a class size meets the numerosity requirement. See Flood v. Dominguez, 270 F.R.D.
413, 417 (N.D. Ind. 2009) (citing Redmon v. Uncle Julio's of Ill., Inc., 249 F.R.D. 290, 294 (N.D.
Ill. 2008)). Generally speaking, when the putative class consists of more than 40 members,
numerosity is met, but there is nothing magical about that number. See id. (citations omitted).
The Court agrees with the parties that the numerosity requirement is met because
discovery already conducted shows that there are 71 identified class members, including Reamer,
who are current or former employees of Zolman in Indiana, and had money deducted from their
wages for uniform cleaning and rental during the relevant period. The Court finds that the class
size, in addition to the fact that individual claims are small enough to likely inhibit class
members from pursuing their own claims [DE 37 at 2-3], renders joinder impracticable.
Moreover, by joinder of each plaintiff, problems with management and administration would be
rendered extremely cumbersome and difficult, such as by requiring service of separate notice and
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pleadings and entry of a separate order as to each joinder. Joinder would tend to result in
multiplicity and a waste of judicial resources, factors which Rule 23 seeks to prevent.
Accordingly, the numerosity requirement has been met.
2.
Commonality
The second requirement under Rule 23(a) is the need to have “questions of law or fact
common to the class.” Fed. R. Civ. P. 23(a)(2). Claims of individual class members may arise
from a “common nucleus of operative fact,” which is typically satisfied where the defendant
engaged in standardized conduct towards members of the proposed class. Keele v. Wexler, 149
F.3d 589, 594 (7th Cir. 1998). Class certification cannot be defeated simply because there are
some factual variances among the proposed members. Rosario v. Livaditis, 963 F.2d 1013, 1017
(7th Cir. 1992).
The commonality requirement is met because the potential class members share a
common, if not identical, nucleus of operative facts, in that, the operative facts are the same for
every member of the Proposed Class: Zolman deducted monies from its employees’ wages for
uniform rental and cleaning costs based on the proposed class member’s use of uniforms and
responsibility for a portion of the costs associated with their use and cleaning, which plaintiffs
claim caused wages to be paid untimely or in less than the full amount owed as required by Ind.
Code § 22-2-5 et seq. According to the proposed class’ theory of the case, these are the only
undisputed facts necessary to establish liability under the Indiana Wage Deduction and Wage
Payment Statutes.5 For purposes of settlement, Zolman, while not conceding liability, is
5
Reamer’s individual claims do not negate the fact that the class claim under Indiana law for
unlawful uniform rental/cleaning deductions meets the requirements for commonality and
typicality. See Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2556 (2011) (“We consider
dissimilarities not in order to determine (as Rule 23(b)(3) requires) whether common questions
predominate, but in order to determine (as Rule 23(a)(2) requires) whether there is ‘[e]ven a
single [common] question.’” (emphasis in original)). The Court later discusses Reamer’s
individual claims with respect to determining whether questions of law or fact common to the
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agreeing to pay the full amount of the wages that were deducted and more than the legally
required minimum amount of liquidated damages. Accordingly, the parties have satisfied the
element of commonality in that the elements of each cause of action will be common to all of the
persons affected given Zolman’s standardized conduct towards the members of the Proposed
Class.
3.
Typicality
The third requirement under Rule 23(a) is the need to show that “the claims or defenses
of the representative parties are typical of the claims or defenses of the class.” Fed. R. Civ. P.
23(a)(3). The question of typicality is closely related to the proceeding question of commonality.
Rosario, 963 F.2d at 1018. A claim is typical if it “arises from the same event or practice or
course of conduct that gives rise to the claims of other class members and . . . are based on the
same legal theory.” Id. Some factual variations may not defeat typicality, rather, the requirement
is meant to ensure that the named representative’s claims have the same essential characteristics
as the claims of the class at large. Oshana v. Coca-Cola Co., 472 F.3d 506, 514 (7th Cir. 2006)
(citations omitted).
Here too, the Court is satisfied that Reamer has raised a claim under Indiana’s Wage
Payment and Deduction Statutes which is typical of the class’ claim which arises from Zolman’s
same practice or course of conduct—standard wage deductions for uniform rental and cleaning.
As such, Reamer’s claim based on illegal deductions for uniform rental/cleaning are typical of
those of his potential fellow class members, and the typicality requirement has been satisfied.
4.
Adequacy of Representation
The fourth and final requirement of Rule 23(a) is that “the representative parties will
fairly and adequately protect the interests of the class.” Fed. R. Civ. P. 23(a)(4). Adequacy of
class members predominate over any questions affecting only individual members, consistent
with Fed. R. Civ. P. 23(b)(3). See infra.
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representation is composed of two parts: “the adequacy of the named plaintiff’s counsel, and the
adequacy of representation provided in protecting the different, separate, and distinct interest” of
the class members. Retired Chicago Police Ass’n v. City of Chi., 7 F.3d 584, 598 (7th Cir. 1993).
“A class is not fairly and adequately represented if class members have antagonistic or
conflicting claims.” Rosario, 963 F.2d at 1018. Also, counsel for the named plaintiffs must be
experienced and qualified and generally be able to conduct the litigation. See Eggleston v. Chi.
Journeymen Plumbers’ Local Union No. 130, 657 F.2d 890, 896 (7th Cir. 1981).
Counsel agree that representation of the class by Thomas Reamer is adequate, and rely on
Class Counsel’s familiarity with similar class action litigation to support their position that Class
Counsel will also provide adequate representation of the class interests. The Court concludes
that from all appearances Reamer will fairly and adequately represent the class because he has a
common interest in the success of the litigation. To the extent that Reamer stands to recover
additional monies based on his individual claims, this is fully disclosed in the notice of
settlement and these claims do not create a conflict between Reamer’s interests and those of the
class. Moreover, Class Counsel represents he is experienced in prosecuting class actions under
the Wage Payment Statute, and has shown his adept prosecution of this action in an attempt to
obtain the most favorable benefits possible for all members of the Proposed Class. The Court
believes that the class representative and Class Counsel will protect the due process rights of
class members whose rights will be adjudicated despite their absence.
Accordingly, the Plaintiffs have met the adequacy requirement and satisfied all of the
Rule 23(a) requirements for class certification.
5.
Rule 23(b)(3)
In addition to meeting class certification requirements under Rule 23(a), the proposed
class must satisfy the requirements of one of the three subsections of Rule 23(b). “A court
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should endeavor to select the most appropriate subsection, not just the first linguistically
applicable one in the list.” Jefferson v. Ingersoll Int’l, Inc., 195 F.3d 894, 898 (7th Cir. 1999).
Counsel agree that the Proposed Class satisfies all of the conditions of Rule 23(b)(3), because the
class seeks monetary damages, common issues to the class predominate, and a class action is the
superior method of resolving the controversy.
The United States Supreme Court has explained that the “predominance” and
“superiority” requirements of Rule 23(b)(3) serve to limit class certification to cases where “a
class action would achieve economies of time, effort, and expense, and promote . . . uniformity
of decision as to persons similarly situated, without sacrificing procedural fairness or bringing
about other undesirable results.” Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 615 (1997)
(citation omitted). “Predominance” tests the “legal or factual questions that qualify each class
member’s case as a genuine controversy” and is similar to Rule 23(a)(3)’s requirement of
typicality. Amchem Prods., 521 U.S. at 623. Relative to superiority, in assessing whether the
requirement has been met, courts should consider:
(A)
(B)
(C)
(D)
the class members’ interests in individually controlling the prosecution or
defense of separate actions;
the extent and nature of any litigation concerning the controversy already
begun by or against class members;
the desirability or undesirability of concentrating the litigation of the
claims in the particular forum; and
the likely difficulties in managing a class action.
Fed. R. Civ. P. 23(b)(3).
In the instant case, even if the amount of damages will vary for each member of the class
because employees worked various lengths of time for Zolman during the relevant period, the
predominate question in this class claim, common to the proposed class members, is whether
Zolman’s payroll practice of deducting standard uniform rental/cleaning fees violates the Wage
Deduction and Wage Payment Statutes. Resolution of each class member’s claim will hinge on
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the same operative facts relative to Zolman’s standardized conduct. In addition, the wages
deducted are easily calculated, as demonstrated by the parties’ chart which indicates the amount
of deductions and liquidated damages to be paid to each class member [DE 37 at 2-3]. Thus, the
significant and common issue of unlawful wage deductions based on uniform rental/cleaning
fees outweighs any individualized damages issues, and the Court finds that the Proposed Class is
sufficiently cohesive to warrant adjudication by representation. See Messner v. Northshore
University HealthSystem, 669 F.3d 802, 815 (7th Cir. 2012) (citations omitted) (“It is well
established that the presence of individualized questions regarding damages does not prevent
certification under Rule 23(b)(3).”).
Further, Reamer’s two individual claims resulting in relatively minimal recoveries with
respect to illegal deductions for training costs and unpaid overtime, do not negate the fact that
questions of law and fact common to the class predominate over any questions affecting his
individual claims. In short, Rule 23(b)(3) does not require that common issues be dispositive of
the entire litigation or that there be a unanimity of common questions and a total absence of
individual questions. See 32B Am. Jur. 2d Federal Courts, Considerations in determining
predominance § 1723 (2014). In other words, when one or more of the central issues in the
action are common to the class and can be said to predominate, the action is proper under Rule
23(b)(3) even though other matters will have to be tried separately. Id. Because the class claim
concerning alleged unlawful uniform related deductions is not only central to the case, but
predominates the litigation, the predominance requirement of Rule 23(b)(3) has been met.
Moreover, the interests of individual class members in controlling the prosecution of their
claims does not weigh against class certification. It is doubtful that many individual claims
would be pursued in light of the expense of litigation and the documentation showing that
separate damage awards will be such that separate lawsuits would be uneconomical for potential
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class members. In addition, there is no indication that other litigation is already pending
concerning the controversy, nor is there any indication that resolution of these claims in this
Court is undesirable. Further, no facts indicate that there will be any difficulty managing this
class action, especially in light of already identified class members, the easily calculable
damages, and the pending settlement. The personal notice and opt-out requirements of Rule
23(b)(3) will further protect the interests of those who will qualify as class members.
Accordingly, resolution of the claims asserted in Reamer’s complaint by way of a class action
would be superior to other available methods of pursuing these claims.
Because the parties have demonstrated that certification is appropriate pursuant to Fed. R.
Civ. P. 23(a) and (b)(3), the Court ORDERS that this case be preliminarily certified as a class
action.
The class action consists of damages sought for the violation of the Indiana’s Wage
Payment Statute, Ind. Code § 22-2-5 et seq. and Wage Deduction Statute, Ind. Code § 22-2-6 et
seq. wherein, current and former employees who worked in Indiana for Zolman had monies
deducted from their wages for uniform rental or cleaning between May 6, 2012 and May 31,
2014. Specifically, the class certified is comprised of:
Any individual employed in the State of Indiana by Zolman during any portion of
the Claims Period (from and including May 6, 2012 through and including May
31, 2014) who had monies deducted from their wages for uniform rental and
cleaning.
Rule 23 requires that a court certifying a class also appoint class counsel. Fed. R. Civ. P.
23(c)(1)(B), (g). Class counsel must fairly and adequately represent the interests of the class.
Fed. R. Civ. P. 23(a)(4). In appointing class counsel, the court must consider the following: “the
work counsel has done in identifying or investigating potential claims in the action; counsel’s
experience in handling class actions, other complex litigation, and the types of claims asserted in
the action; counsel’s knowledge of the applicable law; and the resources that counsel will
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commit to representing the class.” Fed. R. Civ. P. 23(g)(1)(A). The court may also consider “any
other matter pertinent to counsel’s ability to fairly and adequately represent the interests of the
class.” Fed. R. Civ. P. 23(g)(1)(B).
No doubt Mr. Weldy has put extensive work into reviewing and investigating the
potential claims in this case; he has experience in handling class action litigation and has
demonstrated his knowledge of the Indiana Wage Payment and Deduction Statutes; and, he has
thus far committed the resources necessary to representing the class and administrating the
proposed settlement. No doubt, Mr. Weldy will fairly and adequately represent the interests of
the class; and therefore, in compliance with Rule 23(g)(1), it is ORDERED that Ronald Weldy is
appointed Class Counsel.
CLASS NOTICE AND SETTLEMENT
For classes certified under Rule 23(b)(3), the following notice must be given to the class
members concerning the class certification:
[T]he best notice that is practicable under the circumstances, including individual
notice to all members who can be identified through reasonable effort. The notice
must clearly and concisely state in plain, easily understood language:
(i)
the nature of the action;
(ii)
the definition of the class certified;
(iii) the class claims, issues, or defenses;
(iv)
that a class member may enter an appearance through an attorney 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
(vii) the binding effect of a class judgment on members under Rule 23(c)(3).
Fed. R. Civ. P. 23(c)(2)(B); see Smith v. Shawnee Library System, 60 F.3d 317, 321 (7th Cir.
1995) (noting that class members of a Rule 23(b)(3) class must receive reasonable notice and an
opportunity to opt out, which is an absolute requirement for a court to exercise jurisdiction over
those class members) (citations omitted).
And relative to the settlement or compromise of class action claims, as presented by the
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parties’ proposed Settlement Agreement, Rule 23(e) states:
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.
(4)
If the class action was previously certified under Rule 23(b)(3), the court
may refuse to approve a settlement unless it affords a new opportunity to
request exclusion to individual class members who had an earlier
opportunity to request exclusion but did not do so.
(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.
Fed. R. Civ. P. 23(e).
Here, the proposed settlement provides at least 100% reimbursement of the deducted
wages along with a portion of the maximum allowable liquidated damages, in accordance with
the Indiana Wage Deduction and Payment Statutes. This settlement appears to represent a fair,
reasonable, and adequate settlement in light of the possibility of protracted litigation and
disputed issues of liability given that Zolman did not mandate the use of uniforms and employees
would still owe Zolman for the uniform costs paid on their behalf by Zolman.
The Court having heard the representations of counsel during the status hearing, and
having reviewed the Settlement Agreement and other submissions of the parties, and being
otherwise fully advised, HEREBY ORDERS, pursuant to Rule 23(e) of the Federal Rules of
Civil Procedure, that:
1.
The representations, agreements, terms, and conditions of the parties’ Proposed
Settlement, as embodied in the Settlement Agreement [DE 36-1] and Exhibit 1 attached thereto
[DE 37 at 2-3], are preliminarily approved pending a final hearing on the Proposed Settlement as
provided herein.
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2.
As previously indicated, for purposes of the Proposed Settlement only, the Court
hereby preliminarily certifies a plaintiff class, pursuant to FED. R. CIV. P. 23(b)(3), as follows:
Any individual employed in the State of Indiana by Zolman during any portion of
the Claims Period (from and including May 6, 2012 through and including May
31, 2014) who had monies deducted from their wages for uniform rental and
cleaning.
The foregoing is the “Settlement Class,” and its members are “Class Members.”
3.
If for any reason the Settlement Agreement ultimately does not become effective,
Zolman’s conditional withdrawal of its objections to the certification of a settlement class shall
be null and void in its entirety; this Order certifying a class shall be vacated; the parties shall
return to their respective positions in this lawsuit as those positions existed immediately before
the parties executed the Settlement Agreement; and nothing stated in the Settlement Agreement
or in this Order shall be deemed an admission or waiver of any kind by any of the parties or used
as evidence against, or over the objection of, any party for any purpose in this action or in any
other action or proceeding of any kind.
4.
Having reviewed the parties proposed forms entitled:
-
Amended “Notice of (1) Proposed Class Action Settlement and (2) Final
Settlement Approval Hearing” [DE 41-1] (“Notice of Hearing”);
-
Amended “Claim Form & Release of Claims” [DE 41-2] (“Release of
Claims”); and
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“Opt-Out Form” [DE 37]
the Court hereby APPROVES them (except with respect to revisions ordered below)
and directs that:
a. Zolman will provide to Class Counsel a list of the Class Members’ last known
addresses, within 10 days of entry of this Preliminary Approval Order. This
information is to be used solely for providing notice as directed herein, and as limited
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by the parties’ Settlement Agreement [DE 36-1 at 6]. Class Counsel shall be
responsible for confirming addresses of Class Members, either himself or through a
third party, using available reference materials and databases, and for finding
addresses of Class Members whose last known address provided by Zolman cannot
be confirmed through such process.
b. Class Counsel shall provide notice to Class Members by first class mail via the U.S.
Postal Service, to the last known address for each Class Member, within 30 days of
entry of this Preliminary Approval Order. Class Counsel’s obligation to send this
notice will be complete upon mailing. Within 20 days after mailing the notices, Class
Counsel shall file with this Court a status report identifying those potential class
members that could not be located. The Notice of Hearing form shall be substantially
similar to the form provided and approved herein [DE 41-1], EXCEPT the following
revisions are ORDERED to be made:
-
Paragraph 1.d shall be modified to read in its entirety:
How to Participate in This Settlement. If you wish to receive any monetary
benefit from the settlement of this class action, you MUST properly submit
the enclosed Release of Claims Form. If you do not wish to receive any
monetary benefit from the settlement of this class action, you can do nothing,
but if you fit the class description then you may forever lose certain rights to
compensation (described in § 3.f and 3.g, below) and be bound by the
judgment rendered in this lawsuit. If you do not wish to participate in the
settlement and do not want to be a Class Member, then you MUST submit the
enclosed Opt Out Form (described in § 4.f., below).
-
At the end of paragraph 2.c, the following language shall be added:
If you are a member of the class, you designate the class representative as
your agent to make decisions on your behalf concerning the litigation, the
method and manner of conducting the litigation, the entering of an agreement
with plaintiffs’ counsel concerning attorneys’ fees and costs, and all other
matters pertaining to this lawsuit. If you are a member of this class, you are
giving the class representative and class counsel the authority to negotiate and
accept a settlement of your claims in this matter, subject to objections and the
Court’s final approval. These decisions and agreements made and entered
into by the representative plaintiff will be binding on you if you are a member
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of this class. If you desire, you may also retain a lawyer of your choice and
have that lawyer enter an appearance in this case, at your own cost.
-
The last sentence of paragraph 3.k will be modified to read:
Class Counsel has filed or will file prior to the Final Approval Hearing an
Unopposed Motion for Attorney Fees and Costs requesting the Court’s
approval of this amount.
-
The paragraph on page 6, now incorrectly labeled § 1.e. Opting Out, shall
be labeled § 4.f. Opting Out.
-
At the end of the notice, the following language shall be added:
This notice has been authorized by the United States District Court for the
Northern District of Indiana. The Court has taken no position in this case
regarding the merits of the claims, and the Court takes no position on whether
any individual should opt-out of the class action.
-
The following deadlines (per the parties’ Settlement Agreement) shall be
included in the Notice:
Pages 3 and 5:
Release of Claims Form to be submitted by Monday,
February 9, 2015.
Page 6:
Opt-Out Form to be submitted by Monday, February 9,
2015.
Pages 5 and 6:
Objections to be submitted by Monday, January 26, 2015.
The date of the final fairness hearing as set forth at the end of this Order
shall be included in the Notice in the space provided on page 6.
c. The Notice of Hearing mailing shall also include a copy of the “Release of
Claims” form and the “Opt-Out Form.” The “Release of Claims” form [DE 41-2]
and “Opt-Out Form” [DE 37 at 21] shall be substantially similar to the forms
provided and approved herein, EXCEPT the following revisions are ORDERED to
be made:
-
Relative to the Opt-Out Form, it shall indicate that:
If you choose to Opt-Out of the Class Action, then this form must be
submitted to Weldy & Associates by Monday, February 9, 2015.
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-
Relative to the Release of Claims form:
1) Paragraph 5 shall be revised to read:
Fairness of Settlement. I acknowledge that I have opted to receive monetary
benefits resulting from the settlement of this Class Action and that this settlement
is a fair settlement of all my disputed state wage claim(s) against Zolman as
identified in the Settlement Agreement on file with the Court.
2) At the end of the Release of Claims form the following statement must be
included:
If you wish to receive any monetary benefit from the settlement of this Class
Action, then this form must be completed in its entirety and submitted to
Weldy & Associates by Monday, February 9, 2015. Should your claim be
rejected (which must occur within 10 days of its receipt), then you have 30
days from receiving notice of its rejection to seek judicial review.
5.
The Court finds and determines that notice given to Class Members in accordance
with paragraph 4 herein constitutes the best notice practicable under the circumstances, given
that all potential class members have been identified, and constitutes due and sufficient notice of
the matters set forth to all persons entitled to receive notice, and fully satisfies the requirements
of due process and of Rule 23 of the Federal Rules of Civil Procedure.
6.
Any Class Member who objects to the Proposed Settlement and/or the anticipated
Fee Petition, and wish to appear at the Final Approval Hearing and show cause, if any, why the
same should not be approved as fair, reasonable, adequate, and in the best interests of the
Settlement Class, or why a final judgment should not be entered thereon, must serve and file
written objections in the form and manner required by the Notice of Hearing. Objections must
contain the objector’ s full name and current address and include any evidence the objector
intends to offer in support of the objection. Such objections must be filed with the Court and
served upon Class Counsel and counsel for Zolman by the date identified in this Order at the
following addresses:
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United States District Court for the
Northern District of Indiana:
Clerk
United States District Court for the
Northern District of Indiana
204 S. Main Street
South Bend, IN 46601
7.
Zolman’s Counsel:
Alison G. Fox
Faegre Baker Daniels LLP
202 S. Michigan Street
Suite 1400
South Bend, IN 46601
Class Counsel
Ronald Weldy
Weldy & Assoc.
8383 Craig St.
Suite 330
Indianapolis, IN 46520
Persons who seek exclusion from the class must send a written request for
exclusion using the Opt-Out Form to Class Counsel by the date identified in this Order. To
receive any of the benefits provided for under the settlement, a Class Member must submit a
Claim Form to Class Counsel, postmarked (or received by e-mail or fax by Class Counsel) no
later than the date identified in this Order. The notice shall contain these deadlines.
8.
No person shall be entitled to object to the Proposed Settlement, to the final
judgment to be entered in the Action, to any award of Class Representative fees or of attorneys’
fees, costs, expenses, and disbursements to Class Counsel, or otherwise to be heard, except by
serving and filing a written notice of intention to appear and written objections in the form and
manner, and by the date, required in this Order and the Notice of Hearing form. Any person who
fails to object in the manner and by the date required shall be deemed to have waived any
objections, and shall be forever barred from raising such objections in this or any other action or
proceeding.
9.
A hearing will be held before The Honorable Jon E. DeGuilio, United States
District Judge, in his first floor courtroom at the United States Courthouse, 204 S. Main Street,
South Bend, Indiana, 46601 at 10:00 a.m. (EDT) on April 15, 2015, (“Final Approval Hearing”),
to determine: (a) whether the Proposed Settlement set forth in the Settlement Agreement should
be approved as fair, reasonable, adequate, and in the best interests of the Settlement Class;
(b) whether a final judgment should be entered dismissing the claims of Reamer and the Class
Members with prejudice and on the merits, as required by the Settlement Agreement; and
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(c) whether to approve, with or without modification, the Class Representative’s application for
an award of Class Representative fees and of attorneys’ fees, costs, expenses, and disbursements
of Class Counsel (anticipated Fee Petition). The Final Approval Hearing is subject to
continuation or adjournment by the Court without further notice.
10.
14 days after Opt-Out Forms are due, Class Counsel shall file with the Court a
Notice of Class Action Opt-Outs, listing the names of all persons who timely excluded
themselves from the Settlement Class by submitting an Opt-Out Form.
11.
At least 30 days prior to the Final Approval Hearing, Class Counsel shall file with
this Court and serve a declaration certifying that notice has been provided to the Settlement Class
as directed in this Order.
12.
At least 30 days prior to the Final Approval Hearing, the parties (as agreed upon)
are to request Final Approval of the Settlement, with the parties to jointly file a memorandum of
points and authorities in support of the motion, and Class Counsel are to file a motion for
approval of attorney’s fees and costs.
13.
From the date of entry of this Order until the Court holds the Final Approval
Hearing and determines the matters set forth in paragraph 9 of this Order, all Class Members
(except those who have filed a timely objection) shall be barred from asserting against Zolman or
its affiliates any claims for which a Release of Claims form will be given, consistent with
Section V of the Settlement Agreement, if the Court approves the Proposed Settlement.
14.
Upon the entry of final judgment after the Final Approval Hearing, Reamer and
all Class Members shall be forever barred from asserting against Zolman or its affiliates any
claims that are being released in accordance with Section V of the Settlement Agreement, and
Reamer and all Class Members shall be conclusively deemed to have released any and all such
claims.
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15.
Upon the entry of final judgment after the Final Approval Hearing, and upon the
date that the settlement becomes Effective within the meaning of the definition of that term in the
Settlement Agreement, which will occur on the date upon which the judgment in this action
becomes not subject to further appeal or review, only persons who are Class Members, who meet
the eligibility criteria set forth in the Settlement Agreement, including submitting a claim form as
described in Section III. of the Settlement Agreement, and who have not opted-out shall be
entitled to a monetary award as described in Section III., paragraphs 1 and 4 of the Settlement
Agreement.
16.
The parties entered into the Settlement Agreement solely for the purpose of
compromising and settling disputed claims. Zolman has at all times denied, and continues to
deny, any wrongful act or omission alleged by Reamer in this Action and any liability of any sort
to Reamer or any member of the Settlement Class. Nothing contained in the Settlement
Agreement, or attached Exhibits, or in this Order shall be construed, deemed, or offered as an
admission by Zolman, Reamer, or by any member of the Settlement Class, for any purpose in
any judicial or administrative action or proceeding, whether in law or in equity.
17.
The Court reserves the right to adjourn or continue the Final Approval Hearing,
and any adjournment or continuance may be without further notice of any kind other than oral
announcement at the Final Approval Hearing or at any later hearing.
SO ORDERED.
ENTERED: November 13, 2014
/s/ JON E. DEGUILIO
Judge
United States District Court
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