Suarez v. Bank of America N.A.

Background

Arianna Suarez and Irma Frausto brought separate putative class actions under Federal Rule of Civil Procedure 23 against Bank of America, National Association. The plaintiffs were current and former nonexempt California employees. They alleged violations of the California Labor Code based on unpaid minimum and overtime wages, off-the-clock work, meal and rest breaks, untimely wage payments, and inaccurate wage statements. They also asserted derivative claims under California’s Unfair Competition Law and the Private Attorneys General Act.

The cases were removed to federal court and related. The court had previously partially dismissed some meal- and rest-break claims and partially granted Bank of America’s summary-judgment motion on two claims while otherwise denying that motion. The court initially granted class certification in part, but later granted Bank of America’s motion for reconsideration and denied class certification, primarily because the plaintiffs lacked sufficient evidence of company-wide policies. The parties then pursued settlement after discovery, damages analysis, and four mediations.

Proposed Settlement

The settlement class consists of Bank of America’s current and former nonexempt employees who worked for the company in California at any time from January 1, 2017, through October 31, 2022. The opinion states that there are approximately 12,000 class members. Certain employees are excluded, including those with pending separate lawsuits asserting the same or similar claims and those who previously released all the claims covered by the settlement.

The proposed settlement provides a non-reversionary gross settlement fund of $1.5 million. The estimated net settlement fund is approximately $560,000 after deductions for proposed class-representative enhancement awards, attorney’s fees and costs, settlement administration costs, PAGA penalties, and employer-side payroll taxes on the wage portion of payments. The PAGA allocation is $100,000, with $75,000 going to the California Labor and Workforce Development Agency and $25,000 going to eligible employees.

Class members do not need to submit claim forms. Each class member and eligible PAGA employee will receive a proportional payment based on the number of qualifying pay periods worked. The settlement administrator will issue checks that remain valid for 180 days. Uncashed checks will go to California’s Unclaimed Property Fund in the class member’s name. The settlement releases the class and PAGA claims that were pleaded or could have been pleaded based on the facts alleged in the complaints, and it includes a broader release by the class representatives.

Court’s Analysis

The court found that it had jurisdiction under the Class Action Fairness Act. For settlement purposes only, it determined that the proposed class met Rule 23’s requirements of numerosity, commonality, typicality, adequacy, predominance, and superiority. The court emphasized that certifying a class for settlement is different from certifying a class for trial because trial manageability is not an issue when there will be no trial.

The court also conducted the heightened review required for a settlement reached before class certification. It preliminarily found that the agreement was fair, reasonable, and adequate and that it was not the product of collusion. The court considered the estimated damages, the risks of continued litigation and obtaining or maintaining class certification, the completed discovery, the mediation process, the settlement amount, and the proposed PAGA allocation. The court noted that the settlement did not establish or admit liability.

The court approved the proposed notice plan, finding that it adequately described the lawsuit, class definition, settlement terms, estimated payments, releases, final-approval hearing, counsel, fees, costs, and service awards. It appointed Irma Frausto and Arianna Suarez as class representatives for settlement purposes only; appointed Justin Marquez and Stephen Noel Ilg as class counsel; and appointed CPT Group, Inc. as settlement administrator. The court deferred consideration of the class representatives’ service awards and attorney’s fees and costs until final approval.

Disposition

Judge Laurel Beeler preliminarily approved the settlement, authorized the notices, approved the notice plan, provisionally appointed the class representatives and class counsel, appointed CPT Group, Inc. as settlement administrator, approved the settlement schedule, stayed other proceedings pending further order, and consolidated the Suarez and Frausto cases for settlement purposes only. The final-approval hearing was set for January 11, 2024. The order disposed of the preliminary-approval motion identified as ECF No. 200 in the Frausto case.