in the united states district court for the western … · 2018-02-25 · in the united states...

IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF NORTH CAROLINA

CHARLOTTE DIVISION

CIVIL NO. 3:11-CV-129

DENISE DIANE CRAWFORD,

individually and on behalf of all persons

similarly situated,

Plaintiff,

v.

ZENTA MORTGAGE SERVICES LLC,

ACCENTURE LLP, and ACCENTURE

CREDIT SERVICES LLC,

Defendants.

MEMORANDUM OF LAW IN SUPPORT OF PLAINTIFF’S UNOPPOSED MOTION

FOR PRELIMINARY APPROVAL OF THE SETTLEMENT AGREEMENT

Case 3:11-cv-00129-GCM Document 52-1 Filed 08/13/12 of 32

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TABLE OF CONTENTS

I. INTRODUCTION .............................................................................................................. 1

II. PROCEDURAL HISTORY................................................................................................ 3

III. THE TERMS OF THE SETTLEMENT AGREEMENT ................................................... 6

A. The First Amended Complaint................................................................................ 6

B. The Settlement Class............................................................................................... 6

C. Distribution Of The Gross Settlement Amount And Release Of Claims ............... 7

D. Notice To Settlement Class Members................................................................... 11

IV. DISCUSSION ................................................................................................................... 12

A. Applicable Legal Standard .................................................................................... 13

B. The Fairness Factors Support Preliminary Approval of the Settlement ............... 14

C. The Adequacy of the Settlement Supports Preliminary Approval ........................ 16

1. The Additional Service Awards To Named Plaintiff Crawford, Joseph

Savitskie, and the Opt-In Plaintiff Declarants Are Justified And Should

Be Approved ............................................................................................. 18

D. The Court Should Provisionally Certify the Settlement Class Under Fed. R. Civ.

P. 23 ...................................................................................................................... 20

1. The Settlement Class Is Sufficiently Numerous ....................................... 21

2. The Settlement Class Seeks Resolution of Common Questions ............... 21

3. The Claims of the Named Plaintiff Are Typical Of the Class .................. 22

4. Class Counsel and Plaintiff Meet The Adequacy Requirements of the

Settlement Class ........................................................................................ 23

5. The Settlement Class Satisfies the Predominance and Superiority

Requirements of Fed. R. Civ. P. 23(b)(3). ................................................ 23

E. The Proposed Notice Provides Adequate Notice To The Class and Satisfies Due

Process .................................................................................................................. 24

F. The Proposed Implementation Schedule .............................................................. 25

V. CONCLUSION ................................................................................................................. 27


ii

TABLE OF AUTHORITIES

Page(s)

CASES

Amchem Products, Inc. v. Windsor,

521 U.S. 591 (1997) .................................................................................................................21

Beaulieu v. EQ Indus. Servs., Inc.,

No. 5:06–CV–00400–BR, 2009 WL 2208131 (E.D.N.C. Jul. 22, 2009) ................................14

Bredbenner v. Liberty Travel, Inc.,

09-cv-905, 2011 WL 1344745 (D.N.J. Apr. 8, 2011) ..............................................................19

Deiter v. Microsoft Corp.,

436 F.3d 461 (4th Cir. 2006) ...................................................................................................22

Dilworth v. Case Farms Processing, Inc.,

2010 WL 776933 (N.D. Ohio Mar. 8, 2010) ...........................................................................20

Fisher v. Virginia Elec. & Power Co.,

217 F.R.D. 201 (E.D. Va. 2003) ........................................................................................21, 22

General Tel. Co. of S.W. v. Falcon,

457 U.S. 147 (1982) .................................................................................................................22

Hoffman v. First Student, Inc.,

No. WDQ–06–1882, 2010 WL 1176641 (D. Md. Mar. 23, 2010) ..........................................13

Horton v. Merrill Lynch, Pierce, Fenner & Smith, Inc.,

855 F. Supp. 825 (E.D.N.C. 1994)...............................................................................13, 14, 16

In re Jiffy Lube Sec. Litig.,

927 F.2d 155 (4th Cir. 1991) .......................................................................................13, 14, 16

In re Mid–Atlantic Toyota Antitrust Litig.,

564 F. Supp. 1379 (D. Md. 1983) ............................................................................................13

In re Rent-Way Sec. Litig.,

305 F. Supp. 2d 491 (W.D. Pa. Dec. 22, 2003) .......................................................................15

In re Shell Oil Refinery,

155 F.R.D. 552 (E.D. La. 1993)...............................................................................................15

In re Wachovia Corp. ERISA Litig.,

No. 3:09-cv-262, 2011 WL 7787962 (W.D.N.C. Oct. 24, 2011) ............................................18


iii

In re Wells Fargo Loan Processor Overtime Pay Litig.,

MDL No. 07-1841, 2011 WL 3352460 (N.D. Cal. Aug. 2, 2011) ..........................................18

In re Wireless Tel. Fed. Cost Recovery Fees Litig.,

393 F.3d 922 (8th Cir. 2005) ...................................................................................................17

Lomascolo v. Parsons Brinkerhoff, Inc.,

2009 WL 2094955 (E.D. Va. Sept. 28, 2009)..........................................................................13

Mullane v. Central Hanover Bank and Trust Co.,

339 U.S. 306 (1950) .................................................................................................................24

Palacio v. E*TRADE Financial Corp.,

No. 10-cv-4030, 2012 WL 2384419 (S.D.N.Y. Jun. 22, 2012) ...............................................18

Reed v. General Motors Corp.,

703 F.2d 170 (5th Cir. 1983) ...................................................................................................15

Romero v. Mountaire Farms, Inc.,

796 F. Supp. 2d 700 (E.D.N.C. 2011)......................................................................................20

Sand v. Greenberg,

No. 08-cv-7840, 2011 WL 7842602 (S.D.N.Y. Oct. 6, 2011) .................................................19

Sharpe v. APAC Customer Serv., Inc.,

No. 09-cv-329, 2010 WL 2698745 (W.D. Wisc. Jun. 16, 2010) .............................................19

Simpson v. Specialty Retail Concepts, Inc.,

149 F.R.D. 94 (M.D.N.C. 1993) ..............................................................................................23

Tenuto v. Transworld Sys., Inc.,

No. Civ. A. 99-4228, 2002 WL 188569 (E.D. Pa. Jan. 31, 2002) ...........................................18

Williams v. Henderson,

129 Fed. Appx. 806 (4th Cir. 2005) .........................................................................................21

Woodard ex rel. Woodard v. Online Info. Servs.,

191 F.R.D. 502 (E.D.N.C. 2000) .............................................................................................21

Wren v. RGIS Inventory Specialists,

No. 06-Civ-5778, 2011 WL 1230826 (N.D. Cal. Apr. 1, 2011) ..............................................18

STATUTES

28 U.S.C. § 1367(a) .........................................................................................................................6

Fair Labor Standards Act, 29 U.S.C. § 201, et seq. (“FLSA”) .............................................. passim

Internal Revenue Code Section 1.468B-1 ........................................................................................7


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North Carolina Wage & Hour Act, N.C. Gen. Stat § 95-25 ......................................................6, 10

OTHER AUTHORITIES

Fed. R. Civ. P. 15 .............................................................................................................................6

Fed. R. Civ. P. 23 ................................................................................................................... passim


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I. INTRODUCTION

This class and collective action wage and hour lawsuit against Defendants Zenta

Mortgage Services LLC, Accenture LLP, and Accenture Credit Services LLC (“Zenta” or

“Defendants”) has been settled, and Plaintiff Denise Diane Crawford (“Plaintiff”) respectfully

submits this memorandum of law in support of Plaintiff‟s Unopposed Motion for Preliminary

Approval of the Settlement Agreement. As discussed herein, the proposed settlement is fair and

reasonable and warrants this Court‟s preliminary approval.

This is a wage-and-hour case alleging a violation of the federal Fair Labor Standards Act,

29 U.S.C. § 201, et seq. (“FLSA”), filed on March 14, 2011, and violation of North Carolina

state wage and hour laws. Plaintiff alleged that Defendants had a policy and practice of

misclassifying their mortgage underwriters as exempt, and failing to pay them overtime for all

hours worked over forty in a workweek. Effective May 1, 2012, after this litigation was filed,

Defendants changed their compensation system to pay their mortgage underwriters an hourly rate

and overtime pay for hours worked in excess of forty. This change was not as a result of this

litigation; however, it obviates any issues Plaintiff has with Defendants‟ compensation system.

The terms of the parties‟ settlement are set forth in a Settlement Agreement (the

“Settlement Agreement” or “Agreement”) (attached hereto as Exhibit 1) that was negotiated after

the parties engaged in extensive arms‟-length settlement negotiations. See Declaration of

Shanon Carson (“Carson Decl.”) ¶ 8. The Settlement includes a gross cash payment of one

million twelve thousand and five hundred dollars ($1,012,500.00) (the “Gross Settlement

Amount”), excluding the employer‟s share of applicable FICA and FUTA payroll taxes, plus any

interest earned thereon. Under no circumstance will Defendants be obligated to pay any

additional monies beyond the Gross Settlement Amount and the employer‟s share of taxes set


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forth in the Settlement Agreement. None of the funds from the Gross Settlement Amount will

revert to Defendants.

In exchange, Plaintiff, FLSA Opt-In Plaintiffs who have already opted into the case or

who complete and return a Claim Form, and Settlement Class Members will dismiss all claims

for unpaid overtime, or any other claim(s) that could have been asserted based on the facts

alleged in this Class and Collective Action, against Defendants between March 14, 2008 and

May 1, 2012.1

Plaintiff‟s counsel believes that the negotiated Settlement Agreement provides a fair,

reasonable and adequate settlement for Plaintiff, and Settlement Class Members with respect to

their claims for allegedly unpaid wages and overtime arising from Defendants‟ alleged improper

wage and hour practices at issue in this case. Carson Decl. ¶ 9. If approved by the Court, the

Settlement would represent a superior and highly beneficial result for Plaintiff and Settlement

Class Members.

Plaintiff respectfully submits that this motion should be granted because the proposed

Settlement Agreement satisfies all of the criteria for preliminary approval under federal law and

falls well within the range of reasonableness. Accordingly, Plaintiff requests that the Court issue

an order: 1) granting preliminary approval of the proposed Settlement Agreement; 2)

preliminarily certifying the Settlement Class as a Rule 23 class and certifying the Settlement

Class under 29 U.S.C. § 216(b) for purposes of settlement on behalf of “all individuals who

worked as mortgage loan underwriters in the State of North Carolina at Zenta Mortgage

Services, LLC, Accenture LLP and/or Accenture Credit Services LLC during the period from

1 Settlement Class Members who do not timely return a Claim Form to the Claims Administrator

will not release any claims under the FLSA; however, will remain subject to any available

defenses should an administrative, judicial, or other proceeding covering the same time period be

brought.


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March 14, 2008 through May 1, 2012” (the “Settlement Class”); 3) appointing Denise Diane

Crawford as the Representative of the Settlement Class; 4) appointing Berger & Montague, P.C.

as Class Counsel for the Settlement Class; 5) approving Heffler, Radetich & Saitta LLP as

Claims Administrator and preliminarily approving the costs of administration; 6) approving the

plan of notice to Settlement Class members, including approving the Notice and Claim Form

attached to the Settlement Agreement as Exhibits A and B; and 7) approving the proposed

schedule and procedure for the final approval of this Settlement. Defendants do not oppose this

Motion.

II. PROCEDURAL HISTORY

Plaintiff Joseph Savitskie originally filed Savitskie v. Zenta Mortgage Services LLC., No.

3:11-cv-129, in the United States District Court for the Western District of North Carolina on

March 14, 2011. Plaintiff Savitskie retained Class Counsel to pursue his legal claims in the

Class and Collective Action.

In the originally filed Complaint, Plaintiff Savitskie alleged that Defendant Zenta

Mortgage Services LLC misclassified its mortgage underwriters and those in similarly titled

positions as exempt, and thereby failed to properly pay overtime compensation under the Fair

Labor Standards Act, 29 U.S.C. § 201, et seq. (the “FLSA”). Defendants deny that they have

any liability for failing to pay overtime compensation to their mortgage underwriters and further

state that they paid their mortgage underwriters in accordance with all applicable federal, state

and local laws.

On June 30, 2011, Plaintiff filed a Motion to Facilitate Notice Under 29 U.S.C. § 216(b),

and moved the Court to send notice of the lawsuit to “all current and former mortgage

underwriters employed by Zenta at any time from three years prior to the Court‟s order to the


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present.” (Dkt. No. 16.) Defendant filed its opposition on July 20, 2011 (Dkt. No. 18), and

Plaintiff filed his reply on August 3, 2012. (Dkt. No. 20.)

Effective November 3, 2011, Accenture LLP acquired Zenta. Thereafter, the parties met

and conferred and agreed to a framework for exploring settlement of the case. (Dkt. No. 33.)

The parties agreed to stay the case and engage in mediation. Id.

On February 15, 2012, following the death of Plaintiff Savitskie on November 22, 2011,

Plaintiff‟s counsel filed an unopposed motion to substitute Plaintiff Denise Diane Crawford as

the Named Plaintiff for this collective action, which the Court granted. (Dkt. Nos. 41, 42.)

So that the parties could engage in meaningful, good faith and informed settlement

discussions, Defendants agreed to produce and did produce the following documents: 1) a list of

the names of all potential Opt-in Plaintiffs; 2) a Microsoft Excel worksheet showing the total

number of hours recorded in Defendants‟ ADP payroll system for each potential Opt-In

Plaintiffs, and the total compensation received for each work-week; 3) a Microsoft Excel

worksheet showing the workweeks that potential Opt-In Plaintiffs worked where Defendants did

not have corresponding timekeeping data; 4) a Microsoft Excel worksheet containing the detailed

ADP time-keeping records for a sample of Opt-In Plaintiffs; and 5) documents summarizing the

policies and procedures for compensating Opt-In Plaintiffs. See Carson Decl. at ¶ 5. In addition,

Plaintiff and Opt-In Plaintiffs produced to Defendants 1) copies of their resumes; 2) documents

that related to their employment with Zenta; 3) any time records kept by Plaintiffs; and 4)

documents reflecting their work, sick, personal, and vacation schedules. Id.

In preparation for the mediation, Plaintiff‟s counsel engaged in a substantial investigation

of the law and the facts at issue in this case. Carson Decl. at ¶ 6. Specifically, Plaintiff‟s counsel

interviewed numerous Opt-In Plaintiffs about their claims and facts relevant to this action, and


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prepared declarations from those Opt-In Plaintiffs about their work experiences to assist the

parties and the mediator. Id. Plaintiff‟s counsel obtained from Plaintiff and other Opt-In

Plaintiffs pay stubs, work logs and time sheets, as well as resumes and documents describing

their job duties and work schedules. Id. Plaintiff‟s counsel analyzed these materials, data and

payroll information to cross-check Defendants‟ records, and used them to address and identify

discrepancies with Defendants‟ data. Id. Plaintiff‟s counsel conducted an extensive analysis of

Defendants‟ potential liability in this case, using spreadsheets and formulae to account for

differing legal and factual scenarios. Id. Plaintiff‟s counsel prepared a detailed mediation

statement summarizing the relevant law and factual background, and submitted the same to

Defendants and the mediator. Id.

Effective May 1, 2012, Defendants reclassified their mortgage underwriters to non-

exempt, and began paying them at an hourly rate, with overtime pay for every hour worked over

forty hours per week. On May 17, 2012, the Parties participated in a full day mediation in

Chicago, Illinois, overseen by mediator Douglas A. Werman, Esq. As a result of the mediation,

and subsequent arms‟-length negotiations, the Parties have agreed to settle this Class and

Collective Action.

Subsequently, the parties entered into the Settlement Agreement that is now presented to

the Court for its approval. The Settlement offers significant advantages over the continued

prosecution of this case: Plaintiffs, Opt-In Plaintiffs who have already opted into the case, and

Settlement Class Members who return a Claim Form will receive significant financial

compensation and will avoid the risks inherent in the continued prosecution of this case in which

Defendants would assert various defenses to its liability. Carson Decl. ¶ 9. The parties have

spent considerable time negotiating and drafting the Settlement Agreement, which ensures that


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potential opt-in Plaintiffs and Settlement Class Members are provided with notice of the

Settlement Agreement and its terms.

III. THE TERMS OF THE SETTLEMENT AGREEMENT

A. The First Amended Complaint

As part of this Settlement Agreement, the parties agreed to settle misclassification claims

under both the FLSA and North Carolina State Law on behalf of Plaintiff and the Settlement

Class. See Ex. 1 at ¶ 15. Accordingly, as part of the Settlement Agreement, Plaintiff has

prepared a First Amended Class and Collective Action Complaint (“First Amended Complaint”),

that pursuant to 28 U.S.C. § 1367(a), adds North Carolina state law class claims under Federal

Rule of Civil Procedure 23. Id. at ¶ 15. A copy of the First Amended Complaint is attached to

the Settlement Agreement as Exhibit C.

Specifically, the First Amended Complaint alleges that, as a result of misclassifying its

mortgage underwriters, Defendants failed to pay Plaintiff and the North Carolina Class all wages

due, for all hours of work, on their regular pay day, in violation of North Carolina Wage & Hour

Act, N.C. Gen. Stat § 95-25.6. See Ex. 1 at ¶ 15. The First Amended Complaint also adds

Accenture LLP and Accenture Credit Services LLC as Defendants. See Ex. C to Ex. 1.

For settlement purposes only, the Parties agree that, pursuant to Fed. R. Civ. P. 15(a)(2),

the First Amended Complaint will be filed with the Court as an attachment to this Settlement

Agreement and will be deemed filed when the Court enters a Preliminary Approval Order. Id.

B. The Settlement Class

The Settlement Agreement provides that the Settlement Class means all individuals who

worked as mortgage loan underwriters in the State of North Carolina at Zenta Mortgage

Services, LLC, Accenture LLP and/or Accenture Credit Services LLC during the period from

March 14, 2008 through May 1, 2012. See Ex. 1 ¶ 2(x). Upon a diligent and good faith review


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of its payroll records, Defendants have identified approximately 340 Settlement Class Members.

Id.

The parties have agreed that, for settlement purposes only, the Settlement Class may be

certified as an FLSA collective action pursuant to 29 U.S.C. § 216(b), and as a class action

pursuant to Fed. R. Civ. P. 23. Id. at ¶ 11. Notice of the settlement will be provided to the

above-defined Settlement Class Members in the form of the proposed Notice attached to the

Settlement Agreement as Exhibit A. Id. at ¶ 2(h). Claim Forms, as attached to the Settlement

Agreement as Exhibit B, will also be sent to Settlement Class Members who have not already

filed an opt-in consent form with the Court. Id. at ¶ 17(e). Every one of the Settlement Class

Members who have opted-in to the case or who submit a valid and timely Claim Form will be

eligible to receive a Settlement Award. Id. at ¶ 2(k); 20.

C. Distribution Of The Gross Settlement Amount And

Release Of Claims

Under the terms of the Settlement Agreement, within five (5) business days after the

Court grants final approval of the settlement, Defendants shall deliver the total amount of the

Gross Settlement Amount to the Claims Administrator. Id. at ¶ 23(a) Upon receipt by the

Claims Administrator, these funds shall be transferred immediately into a Qualified Settlement

Fund pursuant to Internal Revenue Code Section 1.468B-1. Id. The Qualified Settlement Fund

will be administered by a Court-appointed Claims Administrator, Heffler, Radetich & Saitta LLP

(“Heffler”), an independent and highly experienced third-party claims administration company.

Id. at ¶ 2(c).

The Gross Settlement Amount includes amounts to cover: (1) the total of Two Thousand,

Five Hundred Dollars ($2,500.00) set aside for the Named Plaintiff who has participated in this

case, for her efforts in prosecuting this matter, and in exchange for her Claims Released executed


8

in favor of Defendants; (2) the total of Two Thousand, Five Hundred Dollars ($2,500.00) set

aside for the Estate of Joseph A. Savitskie, in place of Joseph A. Savitskie, who was originally

the Named Plaintiff in this matter, for his efforts in bringing and prosecuting this matter prior to

his death; (3) the total of Four Thousand Dollars ($4,000) allocated as One Thousand Dollars

($1,000.00) each to Randall Neal Spivey, Angela Mack, Antoinette Gross, and Lyle David

Harrison, who participated extensively in this litigation and submitted declarations in support of

Plaintiff‟s Motion To Facilitate Notice Under 29 U.S.C. § 216(b); (4) the payment of attorneys‟

fees to Class Counsel, not to exceed Three Hundred Thirty-Seven Thousand, Five Hundred

Dollars ($337,500.00) (which is approximately one third of the Gross Settlement Amount), (5)

the payment of out-of-pocket expenses incurred by Class Counsel, which are currently Ten

Thousand Five Hundred Fifty-Two Dollars and Thirteen Cents ($10,552.13); and (6) a maximum

of Fifteen Thousand Dollars ($15,000.00) for the Claims Administrator‟s estimated costs of the

settlement administration. Id. at ¶ 2(o). Plaintiff‟s Counsel will file a separate Motion for

Approval of Attorneys‟ Fees and Costs prior to the Court‟s final fairness hearing, as described in

the proposed Implementation Schedule, see infra Section F.

Pursuant to the Parties‟ Settlement Agreement, the Net Settlement Amount is currently

estimated at Six Hundred Forty Thousand, Four Hundred Forty-Seven Dollars and Eighty-Seven

Cents ($640,447.87). Id. at ¶ 2(o). The Net Settlement Amount shall be the amount from which

awards to Settlement Class Members will be calculated. Id. at ¶ 25. Each Federal and State

Class member shall be treated the same for the purpose of calculating individual Settlement

Awards (collectively, Eligible Class Members). Id. at ¶ 25(a).

The Claims Administrator will calculate an award for each Eligible Class Member based

on the number of hours over forty in a workweek shown in Defendants‟ time-keeping records for


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each respective Eligible Class Member during the time period between March 14, 2008 and May

1, 2012. Id. at ¶ 25(b). The Claims Administrator will add a total of five (5) hours to each work

week identified in the time keeping data provided by Defendants, and the Claims Administrator

will add all hours over forty per workweek for each Eligible Class Member. Id. For weeks in

which Defendants cannot produce time-keeping records, each week will be credited to each

Eligible Class Member as a 45 hour week. Id. Each hour over forty per workweek will represent

one settlement share. Id. The Claims Administrator will divide the resulting sum into the Net

Settlement Amount to reach a per share dollar figure. Id. That figure will then be multiplied by

each Eligible Class Member‟s number of settlement shares to determine the Eligible Class

Member‟s Settlement Award. Id. The formula for determining awards for Eligible Class

Members shall be set forth in the Class Notice provided to all Settlement Class Members. Id.

The entire Net Settlement Amount will be divided on a pro rata basis pursuant to the above-

stated formula to all of the Eligible Class Members. Id.

Fifty percent (50%) of each Settlement Award will be treated as back wages subject to

W-2 reporting and normal payroll taxes and withholding will be deducted by the Claims

Administrator pursuant to state and federal law on these amounts. Id. at ¶ 25(d). The remaining

fifty percent (50%) of each Settlement Award will be treated by all parties as non-wage penalties

and liquidated damages, and will be reported on an IRS Form 1099 and will not be subject to

FICA and FUTA withholding taxes. Id.

Settlement Awards shall be paid to the Named Plaintiff and Opt-In Plaintiffs within ten

(10) business days following the Effective Date. Id. at ¶ 25(c). All funds from the Net

Settlement Amount will be distributed to the Eligible Class Members, and there will be no

reversion of funds to Defendants.


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All checks for Settlement Awards shall remain valid and negotiable for one hundred

eighty (180) days from the date of their issuance and may thereafter automatically be canceled if

not cashed within that time, at which time the right to recover any Settlement Award will be

deemed void and of no further force and effect. Id. at ¶ 25(f). All funds from checks not cashed

will revert to the Qualified Settlement Fund maintained by the Claims Administrator. Id. If, at

the conclusion of the 180 day check void period, there are any monies remaining in the Qualified

Settlement Fund, those monies shall be paid to a cy pres non-profit organization agreed to by the

parties, the Legal Aid of North Carolina‟s Mortgage Foreclosure Prevention Project.2 Id. at ¶ 27.

In exchange for the Settlement benefits, each Settlement Class Member will release

Defendants from all “all claims arising under any state wage law, including the North Carolina

Wage and Hour Act, N.C. Gen. Stat. Section 95-25.1, et al. (“WHA”), all claims for attorneys‟

fees, costs and expenses, and all claims under North Carolina or any other state, or local law,

whether arising or emanating from statute, executive order, rule, regulation, code, common law,

or other source, including, but not limited to, all actions sounding in tort, contract, and equity

(including, restitution, unjust enrichment and quantum meruit), that were asserted or could have

been asserted based on the facts alleged in this Class and Collective Action, accruing at any time

2 The Mortgage Foreclosure Prevention Project (“MFP”) is a special, state wide project of Legal

Aid of North Carolina, designed to keep “working poor and working families in possession of

their homes and their equity.” See Legal Aid of North Carolina, “Mortgage Foreclosure

Prevision,” available at http://www.legalaidnc.org/public/learn/statewide_projects/MFP/. By

providing quality legal representation in foreclosure actions, the MFP saves homes, preserves

credit ratings and strives to make prohibitive the cost of conducting business for the

unscrupulous brokers and lenders. Id. The MFP also promotes community education to increase

awareness of home finance best practices and the dangers of predatory lending. Id. The MFP

includes a “team” of attorneys and staff who are located in Legal Aid of NC (“LANC”) offices

and who specialize in foreclosure defense and predatory lending law. Id. The MFP team acts on

referrals from LANC offices and community organizations throughout North Carolina. Id.

Plaintiff respectfully submits that the MFP is an appropriate organization to distribute any

residue funds from uncashed checks in this settlement.


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between March 14, 2008 and May 1, 2012” and “all claims arising under the Fair Labor

Standards Act, 29 U.S.C. § 201, et seq., including all claims for attorneys‟ fees, costs and

expenses, whether arising or emanating from statute, executive order, rule, regulation, code,

common law, or other source, that were asserted or could have been asserted based on the facts

alleged in this Class and Collective Action, accruing at any time between March 14, 2008 and

May 1, 2012” Id. at ¶ 2(s)-(u) (defining “Settled Claims under North Carolina Law” and “Settled

Claims Under the Fair Labor Standards Act”); ¶ 13(b)&(c) (describing the releases in the

Agreement). However, no Settlement Class Member shall be deemed to release claims under the

FLSA unless they return a timely Class Member Claim and Opt-In Form. Id. at ¶ 13(b). In

addition, Named Plaintiff Crawford has agreed to a broader release of claims. Id. at ¶ 2(d)

(defining “Claims Released”); ¶ 13(a) (describing the release by Named Plaintiff Crawford).

D. Notice To Settlement Class Members

The Settlement Agreement provides what Plaintiff believes is the fairest and most

practicable procedure for notifying Settlement Class members of the terms of the Settlement

Agreement and their respective rights and obligations under the Agreement. Under the terms of

the Settlement Agreement, within seven (7) calendar days after the Court‟s preliminary approval

of this Settlement Agreement, Defendants will provide a list of all Settlement Class Members,

including their including their the names, last known addresses, dates of employment, records

reflecting hours worked, Social Security numbers, and email addresses for current employees, to

the Claims Administrator. Id. at ¶ 17(b).

In order to provide the best notice practicable, the Claims Administrator will do the

following before mailing the FLSA Notice and Claim Form: (1) run the list of potential Opt-In

Plaintiffs through the U.S. Postal Service‟s National Change of Address database (“NCOA”);

and (2) perform address searches using public and proprietary electronic resources which collect


12

data from various sources such as utility records, property tax records, motor vehicle registration

records (where allowed) and credit bureaus. Id. at ¶ 17(d).

Five (5) business days after receiving the list of Settlement Class members, the Claims

Administrator shall send a copy of the Class Notice to all Settlement Class Members and a copy

of the Claim Form to all Settlement Class Members who have not filed an Opt-In consent form

with the Court, via first-class mail, postage prepaid, using the most current mailing address

information available as set forth above, and the mailing shall include a self-addressed postage

prepaid return envelope. Id. at ¶ 18(e). Any Class Notice returned as non-delivered before the

expiration of the 60-day Claims Submission Period will be re-sent to the forwarding address

provided. Id. at ¶ 18(f); see also id. at ¶ 2(e) (defining “Claims Submission Period”). The

Claims Administrator will send a duplicate notice by mail, and shall send an email duplicate

notice to the currently employed Settlement Class Members thirty (30) days after the notice is

initially mailed. Id. at ¶ 18(g) & (h). The email text shall explain, in language to be agreed upon

by the Parties, the nature of the attached documents, and shall expressly state that anyone

submitting a Claim Form will not be subject to any retaliation for submitting a Claim Form. Id.

at ¶ 18(h).

In order to be considered valid and timely, a Settlement Class Member must submit their

executed Claim Form, and the executed Claim Form must be postmarked within sixty (60) days

of the date the Notice and Claim Form are mailed. Id. at ¶ 2(e).

IV. DISCUSSION

Plaintiff respectfully requests that the Court enter the accompanying proposed order

preliminarily approving the class and collective action settlement. Defendants do not oppose this

Motion.


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A. Applicable Legal Standard

Rule 23 requires court approval of the settlement of the claims of any certified class.3

Fed R. Civ. P. 23(e). The principal underlying concern is protection of class members whose

rights may not have received sufficient consideration in settlement negotiations. In re Jiffy Lube

Sec. Litig., 927 F.2d 155, 158 (4th Cir. 1991).

Proposed settlements that bind class members, like the proposed settlement here, must be

“fair, reasonable, and adequate.” Fed. R. Civ. P. 23(e)(2). In applying this standard, the Fourth

Circuit has bifurcated the analysis into consideration of fairness, which focuses on whether the

proposed settlement was negotiated at arm‟s length, and adequacy, which focuses on whether the

consideration provided the class members is sufficient. Jiffy Lube, 927 F.2d at 158–59; see also

In re Mid–Atlantic Toyota Antitrust Litig., 564 F.Supp. 1379, 1383–84 (D. Md. 1983).

Courts generally follow a two-step process in reviewing proposed class settlements for

approval. Horton v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 855 F. Supp. 825, 827

(E.D.N.C. 1994). First, at the preliminary approval stage, the court determines whether the

proposed settlement is “„within the range of possible approval” or, stated differently, whether

there is “„probable cause‟” to give notice of the proposed settlement to class members. Id.

(quoting Armstrong v. Board of School Directors, 616 F.2d 305, 314 & n. 13 (7th Cir. 1980),

overruled on other grounds, Felzen v. Andreas, 134 F.3d 873 (7th Cir. 1998)). Second, if

preliminary approval is given and class notice is sent, the court conducts a fairness hearing at

which all interested persons may be heard and then makes a final determination on approval.

3 While the United States Court of Appeals for the Fourth Circuit has not definitively articulated

specific standards for assessing FLSA collective action settlement agreements, the factors used

to evaluate class action settlements under Federal Rule of Civil Procedure 23(e) are usually

applied. See Hoffman v. First Student, Inc., No. WDQ–06–1882, 2010 WL 1176641 at *2 (D.

Md. Mar. 23, 2010).; Lomascolo v. Parsons Brinkerhoff, Inc., 2009 WL 2094955 at *11 (E.D.

Va. Sept. 28, 2009).


14

Horton, 855 F. Supp. at 827; Fed. R. Civ. P. 23(e)(2). The determination on approval of a

proposed settlement lies within the court‟s discretion. Jiffy Lube, 927 F.2d at 158.

As indicated, this case is in the preliminary approval stage. The question presented for the

Court is therefore whether the settlement is within the range of possible final approval. As set

forth below, the proposed Settlement in this case falls well within the range of possible approval,

and is both a fair and adequate result for class members. As such, there are no grounds to doubt

the reasonableness of the Settlement, and the Court should grant preliminary approval.

B. The Fairness Factors Support Preliminary Approval of

the Settlement

Factors relating to the fairness of a proposed settlement are: (1) the posture of the case at

the time the proposed settlement was reached, (2) the extent of discovery that had been

conducted, (3) the circumstances surrounding the settlement negotiations, and (4) counsel‟s

experience in the type of case at issue. Jiffy Lube, 927 F.2d at 158–59; Horton, 855 F. Supp. at

828. In other words, the Court should consider whether the settlement could reasonably be

determined to have been reached through good faith bargaining at arm‟s length. Beaulieu v. EQ

Indus. Servs., Inc., No. 5:06–CV–00400–BR, 2009 WL 2208131, at *24 (E.D.N.C. Jul. 22,

2009). The parties respectfully request that the Court find that the settlement falls within the

range of possible final approval with respect to fairness, such that preliminary approval should

be granted.

Here, the posture of the case and the extent of discovery supports preliminary approval.

While the case was settled prior to the beginning of formal discovery, the parties engaged in

substantial informal discovery to ensure that both parties were on an equal footing with respect

to settlement negotiations and had an opportunity to full evaluate Plaintiff‟s claims. See supra at

Section II. Defendants produced information necessary for Plaintiff to conduct a detailed


15

damages analysis, and to assess damages in a variety of different legal circumstances. Once

these documents were analyzed by the parties, along with the other discovery provided and

interviews undertaken, additional discovery would not likely have changed the outcome of the

Settlement. Accordingly, the amount of discovery supports preliminary approval.

Second, the circumstances surrounding the settlement negotiations support preliminary

approval. The settlement was negotiated at arms‟ –length with the assistance of mediator Doug

Werman. Both parties submitted detailed mediation statements, declarations, and damages

analyses to the mediator. As described above, Class Counsel extensively investigated the

applicable law as applied to the relevant facts discovered in this action, and the potential

defenses thereto. This included numerous interviews with Class Members and the exchange of

key documents and analysis with Defendants. The settlement amount is based on an extensive

review of the facts and law. Carson Decl. ¶¶ 5-6. It is well-established that, in determining

whether a proposed settlement should be preliminarily approved, courts may consider whether

“the proposed settlement appears to be the product of serious, informed, non-collusive

negotiations.” In re Shell Oil Refinery, 155 F.R.D. 552, 555 (E.D. La. 1993) (quoting Manual

for Complex Litigation, Second §30.44).

Third, Class Counsel‟s experience in wage and hour cases like this one strongly supports

preliminary approval of the settlement. Courts are to give considerable weight to the experience

of the attorneys who litigated the case and participated in settlement negotiations. See, e.g., Reed

v. General Motors Corp., 703 F.2d 170, 175 (5th Cir. 1983) (“[T]he value of the assessment of

able counsel negotiation at arm‟s length cannot be gainsaid. Lawyers know their strengths and

they know where the bones are buried”); In re Rent-Way Sec. Litig., 305 F. Supp. 2d 491, 509

(W.D. Pa. Dec. 22, 2003) (“settlement negotiations took place at arms length between highly


16

experience[d] and competent counsel. Their assessment of the settlement as fair and reasonable

is entitled to considerable weight”). In this case, Class Counsel are experienced and respected

class action litigators. See Carson Decl. at ¶¶ 2-4; Ex. A. Based on Class Counsel‟s knowledge

and expertise in this area of law, Class Counsel believe this Settlement will provide a substantial

benefit to the Settlement Classes. Id. at ¶ 9.

In summary, the proposed Settlement Agreement is the product of careful factual and

legal research and arms‟-length negotiations between the parties, and the fairness factors support

preliminary approval.

C. The Adequacy of the Settlement Supports Preliminary

Approval

In analyzing the adequacy of these terms, relevant factors to be considered include: (1)

the relative strength of the plaintiff‟s case on the merits, (2) any difficulties of proof or strong

defenses the plaintiffs would likely encounter if the case were to go to trial, (3) the expected

duration and expense of additional litigation, (4) the solvency of the defendants and the

probability of recovery on a litigated judgment, and (5) the degree of opposition to the proposed

settlement. Jiffy Lube, 927 F.2d at 158; Horton, 855 F. Supp. at 829–30. The parties

respectfully request that the Court find that the settlement falls within the range of possible final

approval with respect to adequacy of the consideration provided plaintiff and class members,

such that preliminary approval should be granted.

Although Class Counsel believes that Plaintiff‟s case is very strong, complex wage and

hour litigation like this one poses numerous challenges. Defendants were prepared to

strenuously defend their case, and would have argued that class certification was inappropriate,

and that they had properly classified their mortgage underwriters. Defendants further contend

that their actions were made in good faith and were not willful, and were prepared to argue that


17

the two year statute of limitations rather than the three year statute of limitations under the FLSA

should apply and that liquidated damages should not be awarded. Even if Plaintiff prevailed, the

case may have been tied up in appeals for years. By contrast, this settlement, at a relatively early

stage of litigation, provides a concrete and immediate benefit to Plaintiff and the Opt-In

Plaintiffs.

Here, the proposed Settlement is fair, reasonable and adequate. The Gross Settlement

Amount of $1,025,000.00 provides Settlement Class Members with the recovery of unpaid

overtime hours worked, and was carefully negotiated based on a substantial investigation by

Class Counsel and the review and analysis of documents produced by Defendant. More

specifically, the Gross Settlement Amount is based on an analysis of each work-week that each

Class Member worked for Defendants during the relevant time period, using timekeeping records

that Plaintiff and Opt-In Plaintiff entered into the ADP system each day. Carson Decl. at ¶ 10.

Here, the Net Settlement Amount of approximately $640,447.87 represents more than

100% of unpaid overtime wages due to the Opt-In Plaintiffs based on the ADP time-keeping

records provided by Defendants. Carson Decl. at ¶ 11. This is an excellent result for the Class,

especially considering the risks of continued litigation and maintaining this case as a class and

collective action. Where, in comparison to the proposed Settlement, proceeding with litigation

would require a substantial amount of time to yield a benefit to the Class and would result in a

large increase in Class Counsel‟s fees and costs, it is an indication that the proposed settlement is

fair, reasonable, and adequate. In re Wireless Tel. Fed. Cost Recovery Fees Litig., 393 F.3d 922,

933 (8th Cir. 2005) (“barring settlement, this case would „likely drag on for years, require the

expenditure of millions of dollars, all the while class members would receive nothing‟”).


18

In the instant case, the complexity and expense of proceeding with litigation is clearly

outweighed by the efficiency and financial relief presented by the Settlement Agreement.

1. The Additional Service Awards To Named Plaintiff Crawford, Joseph

Savitskie, and the Opt-In Plaintiff Declarants Are Justified And

Should Be Approved

Pursuant to the Settlement Agreement, Defendant has agreed to pay Service Awards to

the Named Plaintiff, the original Named Plaintiff, and the four individuals who participated

extensively in this litigation and submitted declarations in support of Plaintiff‟s Motion To

Facilitate Notice Under 29 U.S.C. § 216(b), for a combined total of $9,000. See Ex. 1 at ¶ 2(o);

25(a).

“Incentive awards are routinely approved in class actions to encourage socially beneficial

litigation by compensating named plaintiffs for their expenses on travel and other incidental

costs, as well as their personal time spent advancing the litigation on behalf of the class and for

any personal risk they undertook.” In re Wachovia Corp. ERISA Litig., No. 3:09-cv-262, 2011

WL 7787962, at *7 (W.D.N.C. Oct. 24, 2011). It is particularly appropriate to compensate

named representative plaintiffs with incentive awards where they have actively assisted

plaintiffs‟ counsel in their prosecution of the litigation for the benefit of a class. Tenuto v.

Transworld Sys., Inc., No. Civ. A. 99-4228, 2002 WL 188569, at *5 (E.D. Pa. Jan. 31, 2002).

Courts have also approved incentive awards for opt-in plaintiffs who have performed

valuable services to the class. See, e.g., Palacio v. E*TRADE Financial Corp., No. 10-cv-4030,

2012 WL 2384419, at *5-7 (S.D.N.Y. Jun. 22, 2012) (approving service awards of $6,500 to four

named plaintiffs and $3,000 to each of eight opt-in plaintiffs); In re Wells Fargo Loan Processor

Overtime Pay Litig., MDL No. 07-1841, 2011 WL 3352460, at *11 (N.D. Cal. Aug. 2, 2011)

(approving incentive awards of $1,000 each for six opt-in plaintiffs); Wren v. RGIS Inventory

Specialists, No. 06-Civ-5778, 2011 WL 1230826, at *38 (N.D. Cal. Apr. 1, 2011) supplemented,


19

2011 WL 1838562 (N.D. Cal. May 13, 2011) (approving incentive award of $2,500 for opt-in

plaintiff); Sharpe v. APAC Customer Serv., Inc., No. 09-cv-329, 2010 WL 2698745, at *1 (W.D.

Wisc. Jun. 16, 2010) (approving service awards to named plaintiff and opt-in plaintiffs who

participated in discovery).

Here, the proposed service awards are justified by the benefits that the Plaintiff Crawford,

Joseph Savitskie, and the Opt-In Plaintiff declarants‟ diligent efforts have brought to the

Settlement Class Members. Plaintiff Savitskie took the significant risk of coming forward to

represent the interests of his fellow employees. Carson Decl. at ¶ 14. Before his death, he

worked with Plaintiff‟s Counsel, providing background information about his employment, about

Defendants‟ policies and practices and about the allegations in this lawsuit. Id. He risked his

reputation in the community and in his place of employment in order to participate in this case

on behalf of the Class. Id. Similarly, Plaintiff Crawford and the Opt-In Plaintiff declarants

provided substantial information that was critical to Plaintiff‟s success in this action, and took

significant risks by stepping forward in service of the Class. Id. See also Sand v. Greenberg,

No. 08-cv-7840, 2011 WL 7842602, at *3 (S.D.N.Y. Oct. 6, 2011) (approving service awards in

FLSA case as reasonable and finding that plaintiffs “took risks by putting their names on this

lawsuit,” including the risk of “blacklisting and other more subtle forms of retaliation”).

The service awards requested in this case are also in line with, and are in fact less than,

those approved in similar wage and hour collective and class actions throughout the country.

See, e.g., Sand, 2011 WL 7842602, at *3 (approving service award of $10,000 in FLSA case);

Bredbenner v. Liberty Travel, Inc., 09-cv-905, 2011 WL 1344745, at *22-24 (D.N.J. Apr. 8,

2011) (approving service payments of $10,000 to each of eight named plaintiffs in wage and

hour case, and citing 2006 empirical study that found average award per class representative to


20

be $16,000); Dilworth v. Case Farms Processing, Inc., 2010 WL 776933, at *7 (N.D. Ohio Mar.

8, 2010) (approving service awards in wage and hour case of $6,000 and $4,000).

For these reasons, the proposed service awards should be preliminarily approved as fair

and reasonable.

D. The Court Should Provisionally Certify the Settlement

Class Under Fed. R. Civ. P. 23

For settlement purposes, in order to certify a class, Plaintiff must demonstrate that the

proposed certification satisfies the prerequisites set forth in Rule 23(a) and Rule 23(b).4 Rule

23(a) empowers the Court to certify a class action when (1) the class is so numerous that joinder

of all members is impracticable; (2) there are questions of law or fact common to the class; (3)

the claims or defenses of the representative parties are typical of the claims and defenses of the

class as a whole; and (4) the representative parties will fairly and adequately protect the interests

of the class. Fed. R. Civ. P. 23(a). In addition, Rule 23(b) requires that questions of law or fact

common to members of the class predominate over those affecting individual members of the

class and a class action is a superior means of resolving the controversy. Id. at 23(b).

The Fourth Circuit has recognized that a potential settlement is a relevant consideration

when considering class certification. “If not a ground for certification per se, certainly

settlement should be a factor, and an important factor, to be considered when determining

certification.” In re A.H. Robins Co., Inc., 880 F.2d 709, 740 (4th Cir. 1989) abrogated by

Amchem Products, Inc. v. Windsor, 521 U.S. 591 (1997).

4 Plaintiff also requests that the Court provisionally certify the class as a collective action

pursuant to 29 U.S.C. § 216(b) for settlement purposes only. Under the FLSA, the members of

the class must be “similarly situated” to warrant certification. Romero v. Mountaire Farms, Inc.,

796 F. Supp. 2d 700, 709 (E.D.N.C. 2011). As this standard is less stringent than Fed. R. Civ. P.

23 for purposes of conditional certification, the parties have satisfied the requirements for

certification under the FLSA, and the Settlement Class should be certified for purposes of

settlement. See id. (certifying FLSA and North Carolina Wage and Hour Act claims).


21

Plaintiff moves for preliminary certification of the Settlement Class under Rule 23(b)(3),

and requests that the Court preliminarily find that all of the requirements for class certification

are satisfied for settlement purposes only. Pursuant to the terms of the Settlement Agreement,

Defendants have stipulated that, for settlement purposes only, the requisites for establishing class

certification pursuant to Fed. R. Civ. P. 23 and 29 U.S.C. § 216(b) with respect to the Settlement

Class Members, have been and are met. See Ex. 1 at ¶ 11.

1. The Settlement Class Is Sufficiently Numerous

Rule 23(a)(1) demands evidence that “the class is so numerous that joinder of all

members is impracticable.” Id. Although there is no specific rule on how many members a class

must have, the Fourth Circuit has indicated that a class with over thirty members supports

numerosity. Williams v. Henderson, 129 Fed. Appx. 806, 811 (4th Cir. 2005). The proposed

Settlement Class here easily meets the numerosity requirement because over 300 Settlement

Class Members have been identified through Defendants‟ payroll records.

2. The Settlement Class Seeks Resolution of Common Questions

The second requirement under Rule 23(a) is that Class members assert common questions

of law or fact. Commonality is satisfied if only one legal or factual issue is shared by all class

members. Fisher v. Virginia Elec. & Power Co., 217 F.R.D. 201, 212 (E.D. Va. 2003); Woodard

ex rel. Woodard v. Online Info. Servs., 191 F.R.D. 502, 505 (E.D.N.C. 2000) (citing Holsey v.

Armour & Co., 743 F.2d 199, 216–217 (4th Cir. 1984); and Brown v. Eckerd Drugs, Inc., 663

F.2d 1268, 1275 (4th Cir. 1981)).

Rule 23(a) (2)‟s commonality requirement is met where the defendant engaged in a

common course of conduct. Fisher v. Virginia Elec. & Power Co., 217 F.R.D. 201, 223 (E.D.

Va. 2003). This commonality requirement does not, however, mandate complete identity of a

plaintiffs‟ claims with those of the class. Id. at 212.


22

Here. Plaintiff and the Settlement Class Members‟ claims arise from Defendants‟

common pay policies. The alleged common issues include, for example: (1) whether Settlement

Class members were misclassified as exempt; (2) whether Settlement Class members‟ primary

duty involved the performance of office or non-manual work directly related to management

policies or general business operations of Defendants; (3) whether Settlement Class members are

entitled to overtime compensation for their hours worked; (4) whether Settlement Class members

were similarly denied compensation for all hours worked; and (5) whether Defendants‟

compensation policies denied wages to Settlement Class Members at the time they were due.

These sample common questions of law and fact, which Plaintiff contends apply uniformly to all

members of the proposed Settlement Class, are sufficient to satisfy the commonality

requirement. For the purpose of settlement only, Defendants have agreed that the commonality

requirement of Rule 23(a)(2) has been satisfied.

3. The Claims of the Named Plaintiff Are Typical Of the Class

For typicality to be satisfied, the “representative party‟s interest in prosecuting his own

case must simultaneously tend to advance the interests of the absent class members.” Deiter v.

Microsoft Corp., 436 F.3d 461, 466 (4th Cir. 2006). The typicality requirement of Fed. R. Civ. P.

23(a)(3) is satisfied for purposes of preliminarily approving the settlement, because Plaintiff‟s

claims are reasonably coextensive with those of absent class members, and because Plaintiff

possesses the same interest and suffered the same injury as the absent class members. See

General Tel. Co. of S.W. v. Falcon, 457 U.S. 147, 156 (1982). Plaintiff‟s claims for unpaid

overtime compensation are typical of the claims of the Class. For the purpose of settlement only,

Defendants have agreed that the typicality requirement of Rule 23(a)(3) has been satisfied.


23

4. Class Counsel and Plaintiff Meet The Adequacy Requirements of the

Settlement Class

Rule 23(a)(4) requires that “the named [Plaintiff] will fairly and adequately protect the

interests of the class.” Simpson v. Specialty Retail Concepts, Inc., 149 F.R.D. 94, 102 (M.D.N.C.

1993). This requirement is met if it appears that (1) the Plaintiff has interests in common with,

and not antagonistic to, the proposed class‟s interests; and (2) the Plaintiff‟s attorneys are

qualified, experienced and generally able to conduct the litigation. Id.

The adequacy of representation requirement is met here because the Named Plaintiff has

the same interests as the Settlement Class Members. There is no conflict between Plaintiff and

the Settlement Class in this case, and Plaintiff‟s claims are in line with the claims of the class.

Plaintiff has and will continue to aggressively and competently assert the interests of the

Settlement Class, and Plaintiff‟s Counsel is skilled and experienced in wage and hour class

action litigation. See Carson Decl. at ¶¶ 2-4. For the purpose of settlement only, Defendants

have agreed that the adequacy requirement of Rule 23(a)(4) has been satisfied.

5. The Settlement Class Satisfies the Predominance and Superiority

Requirements of Fed. R. Civ. P. 23(b)(3).

Under Federal Rule of Civil Procedure 23(b)(3), class certification is appropriate if “the

court finds that the questions of law or fact common to the members of the class predominate

over any questions affecting only individual members, and that a class action is superior to other

available methods for the fair and efficient adjudication of the controversy.”

For the reasons discussed above, Plaintiff submits that the Settlement Class satisfies the

predominance requirement. Moreover, Plaintiff contends that allowing the Settlement Class

Members the opportunity to participate in a class settlement that yields an immediate and

substantial benefit is highly superior to having a multiplicity of individual and duplicative

proceedings in this Court. It is also superior to the alternative of leaving these important labor


24

rights unaddressed due to the difficulty of finding legal representation and filing claims on an

individual basis.

Accordingly, Plaintiff respectfully requests that the Court provisionally certify the

Settlement Class for settlement purposes only.

E. The Proposed Notice Provides Adequate Notice To The

Class and Satisfies Due Process

The United States Supreme Court has held that notice of a class action settlement must be

“reasonably calculated, under all the circumstances, to apprise interested parties of the pendency

of the action and afford them an opportunity to present their objections.” Mullane v. Central

Hanover Bank and Trust Co., 339 U.S. 306, 314 (1950).

Here, the proposed Notice and manner of distribution negotiated and agreed upon by the

parties is “the best notice practicable,” as required under Fed. R. Civ. P. 23(c)(2)(B). All

members of the Settlement Class have been identified in a class list prepared by Defendants, and

the Notice will be mailed directly to the last known address of each member of the Settlement

Class (and those addresses that the Claims Administrator is able to find using reasonable

investigatory methods). The proposed Notice, which is attached to the Settlement Agreement as

Exhibit A, is clear and straightforward, and provides information on the meaning and nature of

the terms and provisions of the Settlement Agreement, the monetary awards that the Settlement

will provide to members of the State Settlement Class, the procedures and deadlines for making a

claim for a settlement award, opting out of the Settlement or submitting objections. See Ex. 1 at

Ex. A.

Accordingly, the Notice complies with the standards of fairness, completeness, and

neutrality required of a settlement class notice disseminated under authority of the Court.


25

CONTE & NEWBERG at §§ 8.21 and 8.39; MANUAL FOR COMPLEX LITIG. at § 21.311

and 21.312.

F. The Proposed Implementation Schedule

The Settlement Agreement contains a proposed schedule for notice and final approval of

the Settlement Agreement. The proposed schedule, which Plaintiff respectfully requests that this

Court approve, is as follows:

Defendants provide Claims Administrator/

Class Counsel with agreed upon class

member information

7 calendar days after Preliminary Approval Order

Class Counsel provides list of Settlement

Class member to Claims Administrator 8 calendar days after Preliminary Approval Order

CAFA Notice 10 days after preliminary approval order

Claims Administrator mails Notice and

Claim Forms 5 business days after receiving list of Settlement Class

members

Claims Administrator sends duplicate

mailing by mail and email 30 calendar days after initial mailing

Plaintiffs‟ Counsel files Motion for Fees

and Costs 45 days after mailing

Claim Submission Period Closes 60 days after mailing

Defendant‟s Election for Termination of

Settlement 5 business days after Claims Submission Period closes, or 5

days after Claims Administrator provides final report.

Claims Administrator Declaration due 5 business days prior to Final Fairness Hearing

Motion for Final Approval 5 business days prior to Final Fairness Hearing

Final Fairness Hearing TBD (Ripe for scheduling approximately 90 days after

Preliminary Approval Order)

Defendants deposit Gross Settlement

Amount with Claims Administrator 5 business days after Final Approval Order

Defendants execute QSF election 5 business days after deposit of Gross Settlement Amount


26

Effective Date Either: (a) if no objections are timely filed, the date of

Final Approval of this Settlement Agreement by the

Court; (b) if objections are filed but no appeal is filed,

the expiration date of the time for filing notice of any

appeal from the Final Approval Order by the Court; or

(c) if an appeal is filed, the latest of (i) the date of final

affirmance of an appeal of that Order, (ii) the

expiration of the time for a petition for writ of

certiorari to review the Order if affirmed and, if the

certiorari be granted, the date of final affirmance of the

Order following review pursuant to that grant; or (iii)

the date of final dismissal of any appeal from the

Order or the final dismissal of any proceeding on

certiorari to review the Order that has the effect of

confirming the Order.

Claims Administrator provides copies of

all completed Claim Forms and Final

Report listing all Eligible Class Members

with Settlement Awards

5 business days before Settlement Awards are mailed

Claims Administrator Distributes Funds 10 business days after Effective Date

Checks Valid 180 days after date of issue

Cy Pres distribution of uncashed checks Promptly after expiration of 180 day period


27

V. CONCLUSION

For the above reasons, Plaintiff respectfully requests that the Court grant this Unopposed

Motion for Preliminary Approval, and sign the accompanying proposed preliminary approval

order. Pursuant to the terms of the Settlement Agreement, Defendants do not oppose Plaintiff‟s

request.

Dated: August 13, 2012 Respectfully Submitted,

s/ Shanon J. Carson_______________

Shanon J. Carson (PA 85957)

Sarah R. Schalman-Bergen (PA 206211)

BERGER & MONTAGUE, P.C.

1622 Locust Street

Philadelphia, PA 19103

Telephone: (215) 875-4656

Facsimile: (215) 875-4604

[email protected]

[email protected]

Attorneys for Plaintiff and the Class


in the united states district court for the western … · 2018-02-25 · in the united states...

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