Alabsi v. Savoya, LLC

Background

Billy Alabsi brought employment misclassification claims against Savoya, LLC. The claims included alleged failures to pay minimum wage and overtime, reimburse drivers for expenses, provide meal and rest periods, provide accurate itemized wage statements, and pay waiting-time penalties. The complaint also sought civil penalties under California’s Private Attorneys General Act (PAGA), a law allowing an aggrieved employee to seek certain civil penalties on behalf of the state and other employees.

Alabsi moved for preliminary approval of a proposed class settlement. At this stage, the court examines whether the proposed settlement falls within a reasonable range for possible approval. Because no class had been formally certified, the court explained that the settlement required heightened scrutiny for possible conflicts of interest or collusion.

Reasons for Further Information

Alabsi estimated unpaid wages, including missed meal and rest breaks, at $639,000 and unreimbursed expenses at $637,000, for a total of $1,312,000. The motion did not explain how those estimates were calculated. The court therefore could not verify them or determine whether the proposed settlement was reasonable. The motion also did not estimate the value of the wage-statement, waiting-time, or PAGA claims. The court required that information even though Alabsi argued that penalties did not have to be included in evaluating settlement reasonableness.

The court additionally required the parties to explain the expected costs of administering the class action and update the class notice accordingly. They had to clarify whether the $7,500 PAGA penalty would go only to the California Labor and Workforce Development Agency or would be distributed under California Labor Code section 2699(i), which generally allocates civil penalties between the agency and aggrieved employees. The parties also had to address whether notice of the settlement was required under the Class Action Fairness Act and, if so, when it would be provided to government officials.

Required Class-Notice Changes

The court directed the parties to revise the proposed class notice by identifying the court-appointed settlement administrator and providing contact information. The attorneys’ fee language had to state that class counsel would ask the court to approve a fee and expense award of $187,500, plus reimbursement of reasonable litigation expenses. The notice also had to explain in plain language the claims that class members would release, rather than merely quoting difficult-to-follow settlement language.

The parties had to revise the objection procedures to conform to the Northern District of California’s guidance, remove unnecessary language, provide ways for class members to contact class counsel or the settlement administrator about the final-approval hearing, and place information about that hearing on the settlement website. The website also had to include the class notice, approval motions, the motion for attorneys’ fees, and other important case documents, including the operative complaint. The notice’s website language also had to be corrected to identify the listed email address for class counsel and access to the court docket.

Order

The court ordered the parties to file a joint supplemental brief by December 2, 2019. It continued the hearing on Alabsi’s motion for preliminary approval to December 19, 2019, at 1:30 p.m. The order required further briefing and revisions; it did not state that the settlement was approved or denied. Judge Kandis Westmore issued the order.