Ellis v. Harder Mechanical Contractors, Inc.

Background

Gary Ellis and Jeff Shipe moved without opposition for preliminary approval of a proposed class-action settlement with Harder Mechanical Contractors, Inc. The first amended complaint alleged that the company’s wage policies and practices violated California Labor Code sections 201–203 and 1194. The proposed class consisted of current and former hourly-paid employees who worked for Harder Mechanical in California during the period from May 1, 2016, through June 2, 2022.

Settlement Terms

The maximum settlement amount was $1,500,000, plus Harder Mechanical’s share of payroll taxes. After fees and costs, the estimated net settlement amount was $1,079,000. Settlement payments would be calculated based on each participating class member’s number of qualified shifts compared with the total number of qualified shifts for all participating class members. No gross individual payment would be less than $25, and the estimated average payment was $490.45. Harder Mechanical would have no right to recover unused settlement funds; unclaimed funds would be sent to the State Controller’s Office, Unclaimed Property Division.

The proposed notice described the settlement, the procedures for opting out or objecting, and the applicable deadlines. It would be individualized to include each class member’s number of qualified shifts and estimated payment. Class members would have 45 calendar days after mailing of the notices to request exclusion or object.

Preliminary Class Certification

For settlement purposes only, the court preliminarily found that the requirements for class certification under Federal Rule of Civil Procedure 23 were satisfied. The court found that the estimated 2,200-member class met the requirement that the class be large enough to make individual lawsuits impractical. It also found common questions, typical claims, adequate representation, predominance of common questions, and superiority of the class-action process.

The court preliminarily appointed Jeff Shipe as class representative and Keller Grover LLP and the Law Offices of Scot D. Bernstein, A Professional Corporation, as class counsel. These findings applied only to the settlement and would have no effect if the settlement did not become final.

Preliminary Approval and Notice

The court found, at this stage, that the settlement appeared to result from serious, informed, and non-collusive negotiations; fell within the range of possible final approval; had no obvious deficiencies; and did not improperly favor the class representatives or any segment of the class. The court approved the proposed notice as satisfying Rule 23 and due-process requirements.

The court appointed Phoenix Settlement Administrators as settlement administrator. It directed Harder Mechanical to provide confidential class data to the administrator within 28 calendar days after entry of the order, subject to receiving reasonable assurances that the data would remain confidential. The data was to include each class member’s full name, last-known address, Social Security and employee identification numbers, and number of shifts worked during the class period. The administrator was directed to mail the approved notices within 14 calendar days after receiving the data and to take specified steps for returned mail.

Disposition

Judge Jeffrey White granted the plaintiffs’ motion for preliminary approval. The court provisionally certified the class for settlement purposes, preliminarily approved the proposed settlement as within the range of possible final approval, approved the notice procedures, appointed the class representatives, counsel, and settlement administrator, and stayed other proceedings while the settlement process proceeded. The court scheduled a final approval hearing for January 6, 2023, to consider final approval of the settlement, entry of judgment, attorneys’ fees and expenses, incentive awards, and administration costs. The opinion does not state the result of that later hearing.