Comin v. International Business Machines Corporation

Background

Mark Comin sued his employer, International Business Machines Corporation (IBM), on behalf of a proposed class. The claims alleged that IBM did not provide sales representatives with written commission contracts as required by California Labor Code section 2751 and did not pay commissions when due. The complaint also asserted claims under California’s Unfair Competition Law and for breach of contract. The court had denied an earlier request for preliminary settlement approval, but later granted preliminary approval after the parties revised the proposed settlement.

Settlement terms and notice

IBM agreed to pay $4,750,000 into a non-reversionary settlement fund, while separately paying settlement-administration costs. Each class member who did not opt out receives $300. About 60 subclass members identified as having potential claims for capped or withheld commissions receive a pro rata share of the remaining fund, based on their alleged reduced commissions. The court found that the settlement amount was reasonable in light of disputed claims and the risk that the plaintiffs could lose at summary judgment or trial.

The settlement also provides a $200,000 payment under California’s Private Attorneys General Act (PAGA). Of that amount, $150,000 goes to the California Labor and Workforce Development Agency and $50,000 is divided equally among PAGA group members. Notice was provided through a case website, email, and U.S. Mail. Of 1,966 identified class members, one requested exclusion and none objected.

Approval and judgment

The court finally certified the class and subclass for settlement purposes only. The class covers people who resided in California while working for IBM under a commissions incentive plan between November 4, 2015, and March 2, 2023. The subclass covers those people who allegedly were not paid the commissions reflected in their individual formulas. The PAGA group covers people meeting the specified conditions between September 5, 2020, and March 2, 2023.

The court approved $2,500 service payments to each named representative, Mark Comin and Mark Briggs. It also approved the settlement’s releases of claims against IBM and other released parties, subject to the settlement’s terms. The order states that the settlement and related proceedings are not admissions of liability, fault, or wrongdoing by IBM.

The court granted final approval of the class and representative settlement as fair, just, adequate, and reasonable; directed the parties to carry it out; and entered final judgment. The court retained continuing jurisdiction to interpret, implement, and enforce the settlement and the order.

Attorneys’ fees and expenses

The court approved a proposed attorneys’ fee award equal to 33% of the settlement fund and approximately 79% of class counsel’s reported lodestar. It also approved $34,396.38 in costs and expenses. Seventy-five percent of the awarded fees and expenses could be paid immediately from the settlement fund, while 25% remained in the fund pending a post-distribution accounting and further court order.