Johnson v. Serenity Transportation, Inc.

Background

The court had previously granted preliminary approval of the proposed class action settlement. Plaintiffs then filed an unopposed motion seeking final approval. Class counsel mailed notice to 99 class members on August 23, 2021. Thirty-five notices were returned as undeliverable without forwarding addresses. No class member objected to the settlement or requested exclusion from it.

Settlement Terms

The settlement fund totals $10,000 and was being held in trust. Upon final approval, the money will be distributed as follows:

- Gary Johnson and Curtis Johnson will each receive a $250 service award. - Class counsel will be reimbursed for the cost of mailing notices and settlement checks. - The remaining money will be distributed to the class pro rata, based on the number of weeks each class member worked. - Settlement checks will be sent to the 64 class members whose notices were not returned. - Funds for the 35 class members whose notices were returned as undeliverable will be sent to the State of California Unclaimed Property Fund.

The settlement releases wage-and-hour claims against Serenity Transportation, Inc. and its owner, David Friedel. The released claims include alleged independent-contractor misclassification, unpaid overtime, unreimbursed business expenses, and related statutory penalties under the California Labor Code, California Wage Orders, and the federal Fair Labor Standards Act. For class members who had not previously joined the Fair Labor Standards Act collective action, those federal claims will be released only when the class member endorses the settlement check, with the signature serving as consent to join those claims and accept the settlement terms.

Court’s Analysis

For final approval, the court considered whether the settlement was fair, adequate, and reasonable. It reviewed factors including the strength of the claims, the risks and costs of further litigation, the amount offered, the stage of the case, counsel’s experience and views, whether a government participant was involved, and the presence or absence of objections or requests for exclusion.

The court also examined whether there were signs that class counsel had put their own interests ahead of the class. It found none of the identified warning signs. Class counsel was receiving no payment under the settlement, and funds for unreachable class members would go to California’s Unclaimed Property Fund rather than return to the defendants.

The court found that the defendants’ insolvency, as supported by arm’s-length negotiations with Magistrate Judge Spero, resolved several of the fairness concerns. The court concluded that the class had nothing to gain from continued litigation and that, although the settlement amount was small, it was adequate under the circumstances. The absence of objections or requests for exclusion also supported approval.

Disposition

Judge Jacqueline Scott Corley vacated the January 13, 2022 hearing and granted the plaintiffs’ motion for final approval of the parties’ class action settlement. She also granted $250 service awards to Gary Johnson and Curtis Johnson. The Clerk was directed to close the case.