Rodriguez Perez v. First Tech Federal Credit Union

Background

Ismael Antonio Rodriguez Perez alleged that First Tech Federal Credit Union denied applicants for residential secured loans because of their immigration or citizenship status. He asserted claims under 42 U.S.C. § 1981 and California’s Unruh Civil Rights Act. The opinion states that Rodriguez Perez had received Deferred Action for Childhood Arrivals, had work authorization and a Social Security number, and applied for a home-equity line of credit in June 2022. First Tech allegedly told him that his employment authorization document and an expired I-94 were insufficient and that DACA recipients were not eligible for the loan. First Tech later denied his application.

Settlement Class and Relief

The settlement class contains 20 California residents and 43 people residing elsewhere in the United States who applied for residential secured loans from First Tech during the specified period, provided an employment authorization document during the application process, and were denied solely because of immigration or citizenship status. First Tech agreed not to deny residential secured loan applications solely on that basis unless required by law, rules, or regulations, and agreed to amend its underwriting criteria accordingly.

The settlement creates an $81,500 fund. Each California class member will receive $3,000, and each national class member will receive $500. First Tech will pay administration costs, court-approved fees and costs, and the incentive award separately from the settlement fund. Class members do not need to submit claim forms. Any uncashed funds will not return to First Tech; instead, the Court approved TheDream.US and Immigrants Rising as cy pres recipients, meaning organizations that will receive qualifying unclaimed funds. Each organization will receive half of any such distribution.

Notice and Class Participation

The settlement administrator mailed court-approved notices to all 63 class members and re-mailed notices after locating updated addresses for the 11 initially returned as undeliverable. The opinion states that no notices remained undeliverable. Notice materials were also available online in English and Spanish, and a toll-free number with bilingual assistance was provided. No class member objected to the settlement or requested exclusion.

Court’s Analysis

The Court had preliminarily approved the settlement class under Federal Rule of Civil Procedure 23(b)(3). At final approval, it found that the notice plan was adequate and the best practicable notice. It evaluated the settlement under Rule 23(e), considering the risks and costs of continued litigation, the settlement amount, the parties’ investigation and negotiations, counsel’s experience, the absence of government objections, and the class’s reaction.

The Court expressly stated that the case settled before it considered the merits and that it was not reaching an ultimate conclusion about the merits of Rodriguez Perez’s claims. It nevertheless found the settlement fair, adequate, and reasonable. It also examined warning signs of possible collusion and concluded that the agreement resulted from arms-length negotiations and was not influenced by collusion.

Fees, Costs, and Service Award

The Court granted the request for $35,000 in attorneys’ fees. It determined that the request represented 23.4 percent of the constructive common fund, below the Ninth Circuit’s stated 25-percent benchmark, and that counsel’s $61,960 lodestar supported the award. A lodestar is a calculation based on reasonable hourly rates multiplied by reasonable hours worked.

The Court also awarded $405 in litigation costs and approved $13,000 in settlement-administration costs. It approved a $5,000 service award for Rodriguez Perez, finding that his contribution and the risks associated with attaching his name to the lawsuit supported the award.

Disposition

The Court GRANTED Rodriguez Perez’s motion for final approval of the parties’ class action settlement. It also GRANTED his motion for attorneys’ fees and costs, awarding $35,000 in attorneys’ fees, $405 in costs, $13,000 in settlement-administration costs, and a $5,000 service award. The parties were ordered to file a proposed judgment by January 30, 2025. Class Counsel must later file a post-distribution accounting containing specified information about notice, payments, uncashed checks, fees, costs, and any cy pres distributions.