Professional Documents
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Campos v. Goode
Campos v. Goode
-against-
Defendants.
AWARDS
Plaintiffs are fonner and current cooks, dishwashers, servers, bussers, runners, and other
similarly situated non-managerial restaurant workers who work or worked at four restaurants in
New York City: B Bar & Grill, Gemma, Matsuri, and La Bottega. The restaurants are owned
and operated by Defendants Eric Goode, Sean MacPherson, and several corporate entities,
including Defendants Garden Cafe Associates LLC, Sulcata Corp., Bowery F&B LLC, Bowery
On January 12, 2010, Plaintiffs Luis Campos, Arnoldo Molina, Gonzalo Vidanos, and
Jose Garcia commenced this action as a putative class action under Federal Rule of Civil
Procedure 23 and as a collective action under 29 U.S.C. 216(b), bringing claims under the Fair
Labor Standards Act ("FLSA") and the New York Labor Law ("NYLL"). Declaration of Rachel
Case 1:10-cv-00224-DCF Document 60 Filed 03/04/11 Page 2 of 15
Bien in Support of Plaintiffs' Motion for Certification of the Settlement Class, Final Approval of
the Class Action Settlement, and Approval of the FLSA Settlement ("Bien Decl.") ~ 4. On
February 8, 2010, Plaintiffs amended their Complaint, adding Sean MacPherson as an individual
Defendant and claims against the corporate entities that own andlor operate Gemma, Matsuri,
and La Bottega. Mr. Jachero and Mr. Gomez also joined the lawsuit as Named Plaintiffs. Bien
Decl. ~ 5. On August 20,2010, Plaintiffs filed a Second Amended Complaint, adding a tip
misappropriation claim against all Defendants pursuant to 196-d of the NYLL. Id. ~ 6 & Ex.
A. Twenty individuals, other than the Named Plaintiffs, have joined this case as Opt-In Plaintiffs
The parties reached this $1,550,000 settlement under the supervision of an experienced
employment law mediator, Ruth D. Raisfeld of Alternative Dispute Resolution Services. Id. ~
11. Thereafter, the parties executed a formal written settlement agreement ("Settlement
settlement; conditionally certifying the settlement class; appointing Outten & Golden LLP as
Class Counsel; and authorizing the dissemination of Plaintiffs' Proposed Notice of Settlement
and Class Action Settlement Procedure (''Notice''). Docket No. 48. The Court entered an Order
on December 16, 2010, adjourning the dates for dissemination of the Notice. Docket No. 49.
On January 7,2011, Garden City Group, Inc., a claims administrator, sent the Notice to
all class members informing them of their right to opt out of or object to the settlement and of
Class Counsel's intention to seek up to one-third of the settlement fund for attorneys' fees and
On February 18, 2011, Plaintiffs filed their Motion for Certification of the Settlement
Class, Final Approval of the Class Action Settlement, and Approval of the FLSA Settlement
("Motion for Final Approval"). That same day, Plaintiffs also filed Motions for Approval of
Attorneys' Fees and Reimbursement of Expenses ("Motion for Attorneys' Fees") and for Class
Representative Service Awards ("Motion for Service Awards"). Defendants took no position
with respect to any of these motions and did not object to the requests for attorneys' fees, costs,
or service payments.
The Court held a fairness hearing on March 2, 2011. No Class Member objected to the
Having considered the Motion for Final Approval, the Motion for Attorneys' Fees and
Reimbursement of Expenses, the Motion for Service Awards, and the supporting declarations,
the oral argument presented at the March 2, 2011 fairness hearing, and the complete record in
this matter, for the reasons set forth therein and stated on the record at the March 2,2011 fairness
1. The Court certifies the following class under Federal Rule of Civil Procedure
All individuals who work or worked at B Bar and Grill, Gemma, La Bottega,
and/or Matsuri as cooks, dishwashers, servers, bussers, runners, porters, and/or
receivers from January 1, 2004 through December 31, 2009, and whose names are
listed on the class lists provided to Class Counsel pursuant to the settlement
agreement and any others who fall within the above definition but whose names
were inadvertently left off the lists with the approval of counsel for the parties,
but shall exclude Sonam Wangdak, Sangay DOIjee, Dhondop Tenpa, and Mingyur
Dorje.
2. Plaintiffs meet all of the requirements for class certification under Federal Rule of
3. Plaintiffs satisfy Federal Rule of Civil Procedure 23(a)(1) because there are over
1,800 Class Members and, thus, joinder is impracticable. See Consolo Rail Corp. V. Town of
Hyde Park, 47 F .3d 473, 483 (2d Cir. 1995) ("[N]umerosity is presumed at a level of 40
members.")
4. The proposed class also satisfies Federal Rule of Civil Procedure 23(a)(2), the
commonality requirement. All class members raise common issues: (1) whether Defendants
misappropriated voluntary customer tips by distributing some to tip ineligible workers; and (2)
whether Defendants failed to pay overtime, spread-of-hours pay, and reimburse uniform
expenses. See deMunecas V. Bold Food, LLC, No. 09 Civ. 00440(DAB), 2010 WL 3322580, at
*1 (S.D.N.Y. Aug. 23,2010); Reyes V. Buddha-Bar NYC, No. 08 Civ. 2494 (DF), 2009 WL
Plaintiffs' claims arise from the same factual and legal circumstances that form the bases of the
Class Members' claims. See Damassia V. Duane Reade, Inc., 250 F.R.D. 152, 158 (S.D.N.Y.
2008). The named plaintiffs suffered the same alleged injury as did the class members
Defendants' failure to pay overtime and their misappropriation oftips. See deMunecas, 2010
Plaintiffs' interests are not antagonistic or at odds with those of the class members, see Toure V.
Cent. Parking Sys., No. 05 Civ. 5237,2007 WL 2872455, at *7 (S.D.N.Y. Sept. 28,2007), and
because Plaintiffs' counsel "has an established record of competent and successful prosecution of
large wage and hour class actions, and the attorneys working on the case are likewise competent
7. Plaintiffs also satisfy Federal Rule of Civil Procedure 23(b)(3). Common factual
allegations that Defendants failed to pay Plaintiffs and the Class overtime and misappropriated
tips and a common legal theory - that Defendants' policies violated the NYLL - predominate
over any factual or legal variations among Class Members. See deMunecas, 2010 WL 3322580,
at *3 (finding that common factual allegations that defendants failed to pay overtime wages and
misappropriated tips and common legal theory that defendants' policies violated the NYLL
will conserve judicial resources and is more efficient for class members, particularly those who
lack the resources to bring their claims individually. See deMunecas, 2010 WL 3322580, at *3;
Reyes, 2009 WL 5841177, at *3. Plaintiffs and the class members have limited financial
resources with which to prosecute individual actions, and Plaintiffs are unaware of any
individual lawsuits that have been filed by class members arising from the same allegations.
Concentrating the litigation in this Court is desirable because the allegedly wrongful conduct
occurred within its jurisdiction. Employing the class device here will not only achieve
economies of scale for putative class members, but will also conserve the resources of the
judicial system and preserve public confidence in the integrity of the system by avoiding the
waste and delay of repetitive proceedings and prevent inconsistent adjudications of similar issues
and claims. See deMunecas, 2010 WL 2399345, at *3; Reyes, 2009 WL 5841177, at *3.
9. The Court hereby grants the Motion for Final Approval and fmally approves the
settlement as set forth in the Settlement Agreement and this Order under Federal Rule of Civil
Procedure 23.
10. Rule 23( e) requires court approval for a class action settlement to ensure that it is
procedurally and substantively fair, reasonable, and adequate. Fed. R. Civ. P. 23(e). To
determine procedural fairness, courts examine the negotiating process leading to the settlement.
Wal-Mart Stores, Inc. v. Visa USA. Inc., 396 F.3d 96,116 (2d Cir. 2005); D'Amato v. Deutsche
Bank, 236 F.3d 78,85 (2d Cir. 2001). To determine substantive fairness, courts determine
whether the settlement's terms are fair, adequate, and reasonable according to the factors set
forth in City o/Detroit v. Grinnell Corp., 495 F.2d 448 (2d Cir. 1974).
11. Courts examine procedural and substantive fairness in light of the "strong judicial
policy favoring settlements" of class action suits. Wal-Mart Stores, 396 F.3d at 116; see also
Spann v. AOL Time Warner, Inc., No. 02 Civ. 8238,2005 WL 1330937, at *6 (S.D.N.Y. June 7,
2005); In re EVCI Career Colis. Holding Corp. Sec. Litig., No. 05 Civ. 10240,2007 WL
12. "In evaluating the settlement, the Court should keep in mind the unique ability of
class and defense counsel to assess the potential risks and rewards of litigation; a presumption of
fairness, adequacy and reasonableness may attach to a class settlement reached in arms-length
2010 WL 3322580, at *4 (internal quotation marks omitted). The Court gives weight to the
parties' judgment that the settlement is fair and reasonable. !d.; Reyes, 2009 WL 5841177, at *3.
Procedural Fairness
13. The settlement is procedurally fair, reasonable, adequate, and not a product of
collusion. See Fed. R. Civ. P. 23(e); deMunecas, 2010 WL 3322580, at *4. The settlement was
reached after Plaintiffs had conducted a thorough investigation and evaluated the claims, and
14. Class counsel reviewed Defendants' payroll data, time records, tip allocation data,
employee handbooks, employee releases, and investigation records from the New York
Department of Labor and other relevant documents. Bien Decl. ~~ 8-10. Class counsel also
interviewed current and former employees of Defendants to obtain factual information as part of
15. To help resolve the case, the parties enlisted the services of experienced
presumption that the settlement they achieved meets the requirements of due process. See
Substantive Fairness
16. The settlement is substantively fair. All of the factors set forth in City o/Detroit
v. Grinnell Corp., 495 F.2d 448 (2d Cir. 1974), which provides the analytical framework for
evaluating the substantive fairness of a class action settlement, weigh in favor of final approval.
17. The "Grinnell factors" are: (1) the complexity, expense and likely duration of the
litigation; (2) the reaction of the class to the settlement; (3) the stage of the proceedings and the
amount of discovery completed; (4) the risks of establishing liability; (5) the risks of establishing
damages; (6) the risks of maintaining the class action through the trial; (7) the ability of the
defendants to withstand a greater judgment; (8) the range of reasonableness of the settlement
fund in light of the best possible recovery; and (9) the range of reasonableness of the settlement
fund to a possible recovery in light of all the attendant risks of litigation. Grinnell, 495 F.2d at
463.
18. Litigation through trial would be complex, expensive, and long. Therefore, the
19. The class's reaction to the settlement was positive. The Notice included an
explanation of the allocation formula and estimated each class member's award. The Notice also
informed class members of their right to object to or exclude themselves from the settlement, and
explained how to do so. No class member objected to the Settlement, and only two class
members requested exclusion. "The fact that the vast majority of class members neither objected
nor opted out is a strong indication" of fairness. Wright v. Stern, 553 F. Supp. 2d 337, 344-45
(S.D.N.Y. 2008). This favorable response recommends final approval. See deMunecas, 2010
WL 3322580, at *5. The second Grinnell factor weighs in favor of final approval.
20. The parties have completed enough discovery to recommend settlement. The
pertinent question is "whether counsel had an adequate appreciation of the merits of the case
discovery to weigh the strengths and weaknesses oftheir claims. Bien Decl. ~~ 8-10. The
parties' 18-hour mediation session allowed them to further explore the claims and defenses. Id. ~
21. The risk of establishing liability and damages further weighs in favor of fmal
quotation marks omitted). One purpose of a settlement is to avoid the uncertainty of a trial on
the merits. Id. Here, the fact-intensive nature of Plaintiffs' misappropriated tip and tip credit
claims presents risk. The settlement eliminates this uncertainty. See deMunecas, 2010 WL
3322580, at *5; Prasker v. Asia Five Eight LLC, No. 08 Civ. 5811(MGC), 2010 WL 476009, at
*5 (S.D.N.Y. Jan. 6,2010). The fourth Grinnell factor weighs in favor of final approval.
22. The risk of maintaining class status throughout trial also weighs in favor of final
approvaL A contested class certification motion would likely require extensive discovery and
briefing. If the Court granted a contested class certification motion, Defendants could seek to
file a Federal Rule of Civil Procedure 23(f) appeal and/or move to decertify, which would
require additional rounds of briefing. Settlement eliminates the risk, expense, and delay inherent
in this process. See deMunecas, 20 I 0 WL 3322580, at *6. The fifth Grinnell factor weighs in
23. It is not certain that Defendants could withstand a greater judgment. Even if they
could, a "defendant's ability to withstand a greater judgment, standing alone, does not suggest
that the settlement is unfair." See deMunecas, 2010 WL 3322580, at *6 (internal quotation
marks omitted). Here, the Settlement Agreement eliminated the risk of collection by requiring
Defendants to pay the Fund into escrow on a date certain. Bien Decl. Ex. B (Settlement
Agreement) ~ 3.l(B). This factor also favors final approvaL See deMunecas, 2010 WL
24. The substantial amount of the settlement weighs in favor of final approvaL The
determination of whether a settlement amount is reasonable "does not involve the use of a
(internal quotation marks omitted). "Instead, there is a range of reasonableness with respect to a
settlement - a range which recognizes the uncertainties of law and fact in any particular case and
the concomitant risks and costs necessarily inherent in taking any litigation to completion." fd.
(internal quotation marks omitted). The seventh Grinnell factor favors final approval.
26. The standard for approval of an FLSA settlement is lower than for a Rule 23
settlement because an FLSA settlement does not implicate the same due process concerns as
27. Courts approve FLSA settlements when they are reached as a result of contested
litigation to resolve bonafide disputes. Id. at *7 (citing Lynn's Food Stores, Inc. v. United
States, 679 F.2d 1350, 1353 n.8 (lIth Cir. 1982)). "Typically, courts regard the adversarial
nature of a litigated FLSA case to be an adequate indicator of the fairness of the settlement." Id.
(citing Lynn's Food Stores, 679 F.2d at 1353-54). "If the proposed settlement reflects a
reasonable compromise over contested issues," the settlement should be approved. !d.
28. The FLSA settlement meets the standard for approval. The settlement was the
result of contested litigation and ann's length negotiation. Bien Dec!. ~~ 11-16. Recognizing the
uncertain legal and factual issues involved, the parties engaged in mediation with an experienced
DISSEMINATION OF NOTICE
29. Pursuant to the Preliminary Approval Order, the Notice was sent by first-class
mail to each class member at his or her last known address (with re-mailing of returned Notices
for which new addresses could be located). This Court finds that the Notice fairly and
adequately advised class members of the terms of the settlement, as well as the right of members
of the class to opt out of the class, to object to the settlement, and to appear at the fairness
hearing conducted on March 2,2011. Class Members were provided the best notice practicable
30. The Court further finds that the Notice and distribution of such Notice comported
31. The Court confirms Garden City Group, Inc. as the Claims Administrator.
32. On November 29, 2011, the Court appointed Outten & Golden LLP as Class
Counsel because they met all of the requirements of Federal Rule of Civil Procedure 23(g).
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33. Class Counsel did substantial work identifying, investigating, prosecuting, and
34. Class Counsel, Outten & Golden LLP, are experienced employment lawyers with
good reputations among the employment law bar. They have prosecuted and favorably settled
many employment law class actions, including wage and hour class actions. See deMunecas,
2010 WL 3322580, at *7; Reyes, 2009 WL 5841177, at *4. The work that Class Counsel has
performed in litigating and settling this case demonstrates their commitment to the Class and to
representing the Class's interests. Class Counsel have committed substantial resources to
35. The Court hereby grants Plaintiffs' Motion for Attorneys' Fees and awards Class
County a/Schenectady, 595 F.3d 411, 417 (2d Cir. 2010); deMunecas, 2010 WL 3322580, at *8;
37. Although the Court has discretion to award attorneys' fees based on the lodestar
method or the percentage-of-recovery method, McDaniel, 595 F.3d at 417, in wage and hour
class action lawsuits, public policy favors a common fund attorneys' fee award, see deMunecas,
2010 WL 3322580, at *7. Fee awards in wage and hour cases are meant to "encourage members
of the bar to provide legal services to those whose wage claims might otherwise be too small to
justify the retention of able, legal counsel." Sand v. Greenberg, No. 08 Civ. 7840 (PAC), 2010
WL 69359, at *3 (S.D.N.Y. Jan. 7,2010). The FLSA and the NYLL are remedial statutes, the
purposes ofwmch are served by adequately compensating attorneys who protect wage and hour
rights. deMunecas, 2010 WL 3322580, at *8; see also Sand, 2010 WL 69359, at *3.
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38. In class action wage and hour lawsuits, public policy favors a common fund
attorneys' fee award. deMunecas, 2010 WL 3322580, at *8. Where relatively small claims can
only be prosecuted through aggregate litigation, and the law relies on prosecution by "private
attorneys general," attorneys who fill the private attorney general role must be adequately
compensated for their efforts. ld.; McMahon v. Olivier Cheng Catering & Events, LLC, No. 08
Civ. 8713,2010 WL 2399328, at *7 (S.D.N.Y. Mar. 2,2010). Ifnot, wage and hour abuses
would go without remedy because attorneys would be unwilling to take on the risk. ld.
39. Common fund recoveries are contingent on a successful litigation outcome. Such
"contingency fees provide access to counsel for individuals who would otherwise have difficulty
obtaining representation ... and transfer a significant portion of the risk of loss to the attorneys
taking a case. Access to the courts would be difficult to achieve without compensating attorneys
for that risk." deMunecas, 2010 WL 3322580, at *8 (internal quotation marks omitted). Many
individual litigants, including the class members here, "cannot afford to retain counsel at fixed
hourly rates ... yet they are willing to pay a portion of any recovery they may receive in return
40. "Plaintiffs may find it difficult to obtain representation if attorneys know their
reward for accepting a contingency case is merely payment at the same rate they could obtain
risk~free for hourly work, while their downside is no payment whatsoever." deMunecas, 20 10
WL 3322580, at *9 (internal quotation marks omitted). Here, Class Counsel risked time and
effort and advanced costs and expenses, with no ultimate guarantee of compensation, and is
therefore entitled to an attorneys' fee award that is approximately 1.06 their lodestar amount in
this case.
41. Class Counsel's request for one-third of the Fund is reasonable under the
circumstances of this case and is '''consistent with the norms of class litigation in this circuit. '"
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deMunecas, 2010 WL 3322580, at *9 (quoting Gilliam v. Addicts Rehab. Ctr. Fund, No. 05 Civ.
3452,2008 WL 782596, at *5 (S.D.N.Y. Mar. 24, 2008)). See deMunecas, 2010 WL 3322580,
at *9 (awarding class counsel 33% of fund in FLSA and NYLL restaurant case); Parker v. Jekyll
& Hyde Entm 't Holdings, LLC, No. 08 Civ. 7670 (BSJ)(JCF), 2010 WL 532960, at *2 (S.D.N.Y.
Feb. 2, 2010) (awarding 33 113% of the fund); Reyes, 2009 WL 5841177, at *3-4 (awarding
33%).
Albany does not address a common fund fee petition, it supports Class Counsel's request for one
third of the fund because "reasonable, paying client[s]," 493 F.3d 110, 111-12 (2d Cir. 2007),
typically pay one-third of their recoveries under private retainer agreements. deMunecas,2010
WL 3322580, at *9.
43. All of the factors in Goldberger v. Integrated Resources, Inc., 209 F.3d 43,51 (2d
44. Applying the lodestar method as a "cross check," see Goldberger, 209 F.3d at 50,
the Court finds that the modest multiplier that Class Counsel seek is reasonable. Courts regularly
award lodestar multipliers from 2 to 6 times lodestar, see, In re Lloyd's Am. Trust Fund
Litig., No. 96 Civ. 1262 (RWS), 2002 WL 31663577, at *27 (S.D.N.Y. Nov. 26, 2002) (a
"multiplier of 2.09 is at the lower end of the range of multipliers awarded by courts within the
Second Circuit"), and here, Class counsel seeks an award in an amount that is approximately
45. The fact that Class Counsel's fee award will not only compensate them for time
and effort already expended, but for time that they will be required to spend administering the
settlement going forward also supports their fee request. See deMunecas, 2010 WL 3322580, at
*10.
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Case 1:10-cv-00224-DCF Document 60 Filed 03/04/11 Page 14 of 15
46. The Court also awards Class Counsel reimbursement of their litigation expenses
in the amount of $25,000. Courts typically allow counsel to recover their reasonable out-of
pocket expenses. deMunecas, 2010 WL 3322580, at *10. Here, Class Counsel's un-reimbursed
expenses - a portion of the mediator's fees, Spanish translation fees, telephone charges, postage,
transportation and working meal costs, photocopies, and electronic research are reasonable and
47. The attorneys' fees awarded and the amount in reimbursement of litigation costs
48. The Court finds reasonable service awards of $5,000 each for Class
Representatives Luis Campos, Arnoldo Molina, Gonzalo Vidanos, Jose Garcia, Edison Jachero,
and Adrian Gomez. These amounts shall be paid from the Settlement Fund.
49. Such service awards are common in class action cases and are important to
compensate plaintiffs for the time and effort expended in assisting the prosecution of the
litigation, the risks incurred by becoming and continuing as a litigant, and any other burdens
sustained by the plaintiff. deMunecas, 2010 WL 3322580, at *9; Reyes, 2009 WL 5841177, at
*5.
CONCLUSION
50. The "Effective Date" of the settlement shall be 31 days after the date of this Order
if no party appeals this Order. If a party appeals this Order, the "Effective Date" of the
settlement shall be the day after all appeals are finally resolved.
51. Within 5 days of the Effective Date, the Claims Administrator shall distribute the
funds in the settlement account by making the following payments in the order below:
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Case 1:10-cv-00224-DCF Document 60 Filed 03/04/11 Page 15 of 15
e. Paying the remainder of the fund to class members in accordance with the
allocation plan described in the Settlement Agreement.
53. The Court retains jurisdiction over this action for the purpose of enforcing the
Settlement Agreement and overseeing the distribution of settlement funds. The parties shall
abide by all terms of the Settlement Agreement, which are incorporated herein, and this Order.
'-I'..!
It is so ORDERED this ~day of ~ ,2011.
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