Daniels et al v. Greenkote IPC, Inc. et al
Filing
127
MEMORANDUM. Signed by Magistrate Judge David D. Noce on 5/6/13. (KKS)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
JOHNNY DANIELS, CYNTHIA
)
HUDSON, WILLIAM JOHNSON,
)
MELVIN MCCOMBS, ROBYN PATRICK,)
PIERRE REED, DEBORAH SENTER,
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DONNA SMALLEY, WILLIAM SMITH, )
and BERNARD STEWART,
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On behalf of themselves and a class of
)
similarly situated former employees of
)
defendants,
)
)
Plaintiffs,
)
)
v.
)
)
GREENKOTE IPC, INC. and,
)
GREENKOTE, PLC,
)
)
Defendants.
)
No. 4:10 CV 1954 DDN
MEMORANDUM
On May 2, 2013, the court, pursuant to Federal Rule of Civil Procedure 23(e)(2),
held a final fairness hearing for the final consideration of the proposed class action
settlement that the named parties preliminarily entered. After due consideration, the
court finds that the settlement proposed by the parties through a joint motion is fair,
reasonable, and adequate.
I. BACKGROUND
On October 18, 2010, plaintiffs Johnny Daniels, Cynthia Hudson, William
Johnson, Melvin McCombs, Robyn Patrick, Deborah Senter, and Donna Smalley
commenced this action on behalf of themselves and other similarly situated former
employees of defendants Greenkote IPC, Inc. and Greenkote Plc. On April 18, 2011,
plaintiffs filed an amended complaint that also named Pierre Reed, William Smith, and
Bernard Steward as plaintiffs in this action. In the amended complaint, plaintiffs alleged
that defendants violated their rights under the Worker Adjustment and Retraining
Notification Act (“WARN Act”), 29 U.S.C. §§ 2101-09, by failing to give them notice at
least 60 days prior to terminating their employment and by failing to pay them wages and
benefits owed during this period. (Doc. 35 at ¶¶ 1, 53-59.)
On October 28, 2011, the court sustained plaintiffs’ motion for class certification.
The class is identified as "All persons employed at the Greenkote IPC, Inc. facility
located at 4001 Gratiot Street, St. Louis, Missouri, who were affected employees and
were subjected to an employment loss as a result of Defendants' alleged violations of the
WARN Act." (Doc. 54.)
Thereafter, the class and the defendants filed motions for summary judgment,
which the court denied on November 30, 2012. (Doc. 115.)
On February 8, 2013, the parties filed a joint motion (with supplementation) for
preliminary approval of a settlement, for approval of a proposed class notice, for a
fairness hearing setting, and for final approval of the proposed settlement. (Docs. 119,
122.) On February 28, 2013, the court granted preliminary approval and scheduled a Fed.
R. Civ. P. 23(e)(2) fairness hearing for May 2, 2013.
On May 2, 2013, the fairness hearing was held. Plaintiffs’ class counsel indicated
that he successfully notified all class members except for fourteen class members who
were no longer present at their last known addresses. However, plaintiffs’ counsel
further indicated that following further investigation he believed he found six of those
class members’ current addresses but had not yet confirmed them. Plaintiffs’ counsel
also informed the court that only one class member, Chester Parker, had opted out of the
settlement and was thereby not a party to the action. (Doc. 125-1.) Plaintiffs’ counsel
represented that he knew of no other class member opposition to the settlement, nor has
any class member notified the court of any objection. Additionally, one class member,
Michael Williams, was present at the fairness hearing and stated that he had received
notice and he wished to file no objection to the settlement.
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II. DISCUSSION
Before consideration of whether to approve a class action settlement, “[t]he court
must direct notice in a reasonable manner to all class members who would be bound by
the proposal.” Fed. R. Civ. P. 23(e). The parties detailed the manner of class notice in
their joint motion for settlement. (Doc. 119 at 6.) Based on the representations of
counsel at the hearing and in the joint motion, the court finds that the efforts to notify the
class members of the proposed settlement were reasonable, although they were not
entirely successful.
The court may approve a proposed class action settlement “only after a hearing
and on finding that it is fair, reasonable, and adequate.” Fed. R. Civ. P. 23(e)(2). To
determine whether a settlement is fair, reasonable, and adequate, a court must consider
“the merits of the plaintiff's case, weighed against the terms of the settlement; the
defendant's financial condition; the complexity and expense of further litigation; and the
amount of opposition to the settlement.” Van Horn v. Trickey, 840 F.2d 604, 607 (8th
Cir. 1988). Courts may rely on the judgment of experienced counsel on the merits of a
class action settlement. In re Uponor, Inc., F1807 Plumbing Fittings Products Liab.
Litig., 2012 WL 2512750, *7 (D. Minn. 2012). “Although in approving a settlement the
district court need not undertake the type of detailed investigation that trying the case
would involve, it must nevertheless provide the appellate court with a basis for
determining that its decision rests on well-reasoned conclusions and not mere
boilerplate.” Van Horn, 840 F.2d at 607.
The financial terms of the proposed settlement are:
Under the proposed Agreement, Defendants shall pay a total sum of
$75,000 (the “Settlement Payment”). The Total Settlement Sum is to be
paid in two installments, as follows: (1) Fifty Thousand Dollars ($50,000)
to be paid within ten (10) days of the Court’s final approval of the
settlement in this matter; and (2) the remaining Twenty Five Thousand
Dollars ($25,000) to be paid within six (6) months of the Court’s final
approval of the settlement in this matter. Class Counsel shall receive 28%
of this Settlement Payment, plus actual costs of litigation and settlement
administration, before any other deductions. It is agreed that the
Representative Plaintiffs, Class Members, and their counsel shall be
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responsible for the payment of any and all federal, state, and local taxes
which may become due in connection with such payment to them. Each of
the two above-referenced payments shall be made in the form of a check
made payable to the Representative Plaintiffs’ counsel, the Maurice & Jane
Sugar Law Center for Economic & Social Justice (hereinafter “the Sugar
Law Center”), which shall be then be distributed by the Sugar Law Center
to the Representative Plaintiffs and the Class Members in the appropriate
amounts.
(Doc. 119-1 at 1-2.)
Plaintiffs’ case has some merit as indicated by the court’s denial of defendants’
motion for summary judgment, although the court similarly denied plaintiffs’ motion for
summary judgment.
In the joint motion for settlement, the parties state that the
settlement amount represents one-third of the maximum recoverable amount. (Doc. 119
at 7-8.) The parties explain that defendant Greenkote, IPC, no longer operates and
dissolved in April 2009 and that defendant Greenkote Plc’s financial condition prohibits a
higher settlement amount. (Id. at 18.) The arguments in the memoranda filed with the
motions for summary judgment and the court’s denial due to material fact disputes
illustrate the complexity that further litigation would present. (Docs. 89, 91, 115.)
Counsel for all parties reported to the court that of the 58 identified class members only
one class member opted out. (Docs. 119-2; 125-1.) No other class member has opposed
the proposed settlement.
After consideration of the relevant factors, the court finds and concludes that the
proposed settlement agreement is fair, reasonable, and adequate. Accordingly, the court
approves the proposed settlement. An appropriate Judgment Order is issued herewith.
/S/ David D. Noce
l
UNITED STATES MAGISTRATE JUDGE
Signed on May 6, 2013.
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