Noroma v. Home Point Financial Corporation

Background

Brandon Noroma and Linda Corbin brought a proposed labor-and-employment class action against Home Point Financial Corporation. They alleged that Home Point had a uniform practice of failing to include commissions and bonuses in overtime calculations, pay meal- and rest-break premiums, provide complete wage statements, and pay all wages owed when employees left the company. The plaintiffs asserted claims under the Fair Labor Standards Act (FLSA), California law, and California’s Private Attorneys General Act (PAGA).

The proposed settlement covered two groups. The FLSA group included certain non-exempt Home Point employees who worked outside California and opted into the case. The California class included certain non-exempt Home Point employees who worked in California during the specified period and did not opt out. The settlement provided for up to $500,000 for the FLSA group, $1.725 million for the California class, and $25,000 for PAGA claims. The California class fund had no reversion to Home Point. Participating employees would generally receive shares based on the number of weeks they worked during the covered period.

The settlement administrator mailed notice packets to 1,631 identified individuals. Twenty-six packets were returned as undeliverable as of August 19, 2019. No objections were received, two California class members opted out, and 461 people opted into the FLSA group from an estimated 1,382 people who received notice.

Court’s Analysis

The court incorporated its earlier analysis certifying the California class and FLSA group because no facts affecting certification had changed. After a final fairness hearing, the court evaluated the notice process and the settlement’s fairness, adequacy, and reasonableness. It considered the strength and risks of the plaintiffs’ claims, the risk of maintaining class certification, the settlement amount, the discovery completed, counsel’s experience and views, and the class members’ reaction.

The court found that the notice plan complied with the applicable federal rules and provided the best practicable notice under the circumstances. It also found that the settlement amount was within a reasonable range given the risks and costs of continued litigation. The court noted that the plaintiffs’ expert estimated $127,724 in unpaid overtime for the 461 FLSA participants, while the estimated total distribution to those participants was $130,681.75. The court concluded that the settlement was fair, adequate, and reasonable.

Fees and Incentive Awards

Class counsel requested $749,000 in attorney fees, approximately one-third of the potential settlement fund, plus $10,000 incentive awards for each named plaintiff. The court rejected the request for fees above the 25-percent benchmark because the record did not justify a higher award. It awarded 25 percent of the $2.225 million settlement, or $556,250, in attorney fees.

The court approved a $10,000 incentive award for Brandon Noroma based on his substantial participation in the case. It approved $5,000 for Linda Corbin rather than the requested $10,000 because she joined the case later, contributed for less time, and was part only of the FLSA group, whose members were projected to receive much smaller recoveries.

Disposition

The court ordered that the motion for final approval of the class action settlement was GRANTED. It ordered that the motion for class counsel’s attorney fees, expenses, and service awards was GRANTED IN PART. The court approved the $2.225 million settlement, $556,250 in attorney fees, and incentive awards totaling $15,000: $10,000 for Brandon Noroma and $5,000 for Linda Corbin. The parties and settlement administrator were directed to implement the settlement, and the parties were directed to file a stipulated final judgment within 21 days. Judge Haywood S. Gilliam, Jr. signed the order.