Paniani Taafua v. Quantum Global Technologies, LLC

Background

Paniani Taafua brought this proposed class action for himself and a putative class against his former employer, Quantum Global Technologies, LLC (QGT). He alleged that QGT’s employment disclosure and authorization form included an extra liability waiver along with the disclosure about consumer reports. According to Taafua, the form therefore violated the Fair Credit Reporting Act’s requirement that the disclosure be presented by itself and that QGT did not receive proper authorization to obtain reports.

The proposed class covered individuals who applied for employment with or were employed by QGT in the United States and were the subjects of consumer reports obtained or caused to be obtained through First Contact HR from October 30, 2013, through December 31, 2018.

The court previously denied preliminary approval of an earlier settlement. It found concerns about whether Taafua’s claims were typical of the class because a potential statute-of-limitations defense might affect his claims and those of about half the class differently. The court also questioned the earlier request for attorney’s fees exceeding 33 percent of the settlement and found insufficient support for a $5,000 service award.

Revised Settlement

The amended agreement increased the total settlement fund to $174,980. It kept the same class definition, class period, estimated class size, estimated number of reports, and release of claims. It provided for estimated administrator expenses of $16,000, requested attorney’s fees of $41,967.33, costs of $2,200, and a $3,500 service award for Taafua. The requested fees were approximately 24 percent of the total fund.

The remaining estimated $111,312.67 net settlement fund would be distributed based on the number of consumer reports obtained for each class member. Thirteen percent would be allocated to claims outside the two-year limitations period, and 87 percent to claims that were unquestionably timely. The agreement was non-reversionary, meaning unclaimed funds would not return to QGT; instead, they would go to the Education Fund of the National Association of Consumer Advocates as a charitable-use award.

Court’s Analysis

For settlement purposes, the court found that the Rule 23 requirements for a class action were preliminarily satisfied. It relied on its earlier findings concerning numerosity, commonality, and superiority, and concluded that the revised allocation addressed the different statute-of-limitations risks sufficiently to satisfy typicality, adequacy of representation, and predominance.

The court also preliminarily found that the settlement was fair, reasonable, and adequate under Federal Rule of Civil Procedure 23(e)(2). It considered the risks and costs of continued litigation, the proposed recovery, the parties’ negotiations, the requested fees and costs, the service award, the treatment of class members, and the proposed notice. The court found no reason at this stage to deny approval based on the requested fees, costs, or service award, while noting that the final amounts remained subject to final approval.

Order

Judge Virginia K. DeMarchi granted the renewed motion for preliminary approval. The court conditionally certified the settlement class for purposes of implementing the agreement, appointed Taafua as class representative, and appointed the identified attorneys as settlement-class counsel. It approved the settlement and notice documents as to form and content, approved JND Legal Administration as settlement administrator, and approved the procedures for opting out and objecting.

The court ordered notice to the class and set a final approval hearing for February 16, 2021. At that hearing, the court would decide whether to finally approve the settlement, enter judgment, and approve the distribution formula. The order therefore granted preliminary approval only; it did not finally approve the settlement or finally determine the attorney’s fees or service award.