ADRMOP,CLOSED,STAYED
U.S. District Court California Northern District (San Francisco) CIVIL DOCKET FOR CASE #: 3:17-cv-03972-JD

Huntsman v. Southwest Airlines Co. Assigned to: Judge James Donato Cause: 28:1331 Fed. Question
Plaintiff Jayson Huntsman

Date Filed: 07/14/2017 Date Terminated: 10/04/2019 Jury Demand: Plaintiff Nature of Suit: 790 Labor: Other Jurisdiction: Federal Question
represented by Peter Romer-Friedman Gupta Wessler Gupta Wessler 1900 L Street NW Suite 312 Washington Washington, DC 20036 United Sta 202-888-1741 Email: peter@guptawessler.com LEAD ATTORNEY ATTORNEY TO BE NOTICED
Thomas G. Jarrard Attorney at Law 1020 North Washington Street Spokane, WA 99203 (425) 239-7290 Email: Tjarrard@att.net LEAD ATTORNEY ATTORNEY TO BE NOTICED
Matthew Zachary Crotty Attorney at Law 905 West Riverside Ste. 409 Spokane, WA 99201-0300 (509) 850-7011 Email: matt@crottyandson.com PRO HAC VICE ATTORNEY TO BE NOTICED

V. Defendant Southwest Airlines

Rachel Williams Dempsey Outten Golden LLP One California Street, 12th Floor San Francisco, CA 94111 415-638-8800 Fax: 415-638-8810 Email: rdempsey@outtengolden.com ATTORNEY TO BE NOTICED
Jahan C. Sagafi Outten & Golden LLP One California Street, 12th Floor San Francisco, CA 94111 (415) 638-8800 Fax: (415) 638-8810 Email: jsagafi@outtengolden.com ATTORNEY TO BE NOTICED
represented by Brian Davis Berry Ogletree, Deakins, Nash, Smoak & Stewart, P.C. Steuart Tower, Suite 1300 One Market Plaza San Francisco, CA 94105 (415) 369-3554 Fax: (415) 442-4870 Email: brian.berry@ogletree.com LEAD ATTORNEY ATTORNEY TO BE NOTICED
Douglas J. Farmer Ogletree Deakins Nash Smoak & Stewart, P.C. Steuart Tower, Suite 1300 One Market Plaza San Francisco, CA 94105 (415) 442-4810 Fax: (415) 442-4870 Email: douglas.farmer@ogletree.com

LEAD ATTORNEY ATTORNEY TO BE NOTICED

Date Filed 07/14/2017 07/14/2017 07/17/2017
07/17/2017 07/17/2017 07/17/2017

# Docket Text
1 COMPLAINT against Southwest Airlines Co.. Filed byJayson Huntsman. (Attachments: # 1 Civil Cover Sheet)(Sagafi, Jahan) (Filed on 7/14/2017) (Entered: 07/14/2017)
***PLEASE DISREGARD*** Electronic filing error. Filing fee not paid. Please pay the filing fee through Pay.gov by clicking on Civil > Other Documents > New Case Filing Fee in CM/ECF. [err701] Re: 1 Complaint filed by Jayson Huntsman (jlmS, COURT STAFF) (Filed on 7/14/2017) Modified on 7/17/2017 (jmlS, COURT STAFF). (Entered: 07/14/2017)
2 Case assigned to Magistrate Judge Laurel Beeler.
Counsel for plaintiff or the removing party is responsible for serving the Complaint or Notice of Removal, Summons and the assigned judge's standing orders and all other new case documents upon the opposing parties. For information, visit E-Filing A New Civil Case at http://cand.uscourts.gov/ecf/caseopening.
Standing orders can be downloaded from the court's web page at www.cand.uscourts.gov/judges. Upon receipt, the summons will be issued and returned electronically. Counsel is required to send chambers a copy of the initiating documents pursuant to L.R. 51(e)(7). A scheduling order will be sent by Notice of Electronic Filing (NEF) within two business days. Consent/Declination due by 7/31/2017. (jmlS, COURT STAFF) (Filed on 7/17/2017) (Entered: 07/17/2017)
3 Proposed Summons. (Sagafi, Jahan) (Filed on 7/17/2017) (Entered: 07/17/2017)
4 Initial Case Management Scheduling Order with ADR Deadlines: Case Management Statement due by 10/5/2017. Initial Case Management Conference set for 10/12/2017 11:00 AM in Courtroom C, 15th Floor, San Francisco. (farS, COURT STAFF) (Filed on 7/17/2017) (Entered: 07/17/2017)
5 Summons Issued as to Southwest Airlines Co.. (farS, COURT STAFF) (Filed on 7/17/2017) (Entered: 07/17/2017)

07/21/2017 07/21/2017 07/21/2017 07/21/2017 07/25/2017 07/26/2017 07/28/2017 08/21/2017 08/21/2017 08/21/2017

6 MOTION for leave to appear in Pro Hac Vice application of Thomas Jarrard ( Filing fee $ 310, receipt number 097111565438.) filed by Jayson Huntsman. (Jarrard, Thomas) (Filed on 7/21/2017) (Entered: 07/21/2017)
7 Order by Magistrate Judge Laurel Beeler granting 6 Motion for Pro Hac Vice. Attorney Thomas Jarrad representing plaintiff. (afmS, COURT STAFF) (Filed on 7/21/2017) (Entered: 07/21/2017)
8 MOTION for leave to appear in Pro Hac Vice of Peter RomerFriedman ( Filing fee $ 310, receipt number 0971-11566856.) filed by Jayson Huntsman. (Romer-Friedman, Peter) (Filed on 7/21/2017) (Entered: 07/21/2017)
9 Order by Magistrate Judge Laurel Beeler granting 8 Motion for Pro Hac Vice. Peter Romer-Friedman representing plaintiff. (afmS, COURT STAFF) (Filed on 7/21/2017) (Entered: 07/21/2017)
10 MOTION for leave to appear in Pro Hac Vice Matthew Z. Crotty ( Filing fee $ 310, receipt number 0971-11575678.) filed by Jayson Huntsman. (Crotty, Matthew) (Filed on 7/25/2017) (Entered: 07/25/2017)
11 Order by Magistrate Judge Laurel Beeler granting 10 Motion for Pro Hac Vice. Matthew Z. Crotty representing Jayson Huntsman. (afmS, COURT STAFF) (Filed on 7/26/2017) (Entered: 07/26/2017)
12 CONSENT/DECLINATION to Proceed Before a US Magistrate Judge by Jayson Huntsman.. (Romer-Friedman, Peter) (Filed on 7/28/2017) (Entered: 07/28/2017)
13 WAIVER OF SERVICE Returned Executed filed by Jayson Huntsman. Service waived by Southwest Airlines Co. waiver sent on 8/3/2017, answer due 10/2/2017. (Romer-Friedman, Peter) (Filed on 8/21/2017) (Entered: 08/21/2017)
14 CONSENT/DECLINATION to Proceed Before a US Magistrate Judge by Southwest Airlines Co... (Farmer, Douglas) (Filed on 8/21/2017) (Entered: 08/21/2017)
15 CLERK'S NOTICE OF IMPENDING REASSIGNMENT TO A U.S. DISTRICT COURT JUDGE: The Clerk of this Court will now randomly reassign this case to a District Judge because either (1) a party has not consented to the jurisdiction of a Magistrate Judge, or

08/22/2017
08/23/2017 08/31/2017
08/31/2017 09/11/2017

(2) time is of the essence in deciding a pending judicial action for which the necessary consents to Magistrate Judge jurisdiction have not been secured. You will be informed by separate notice of the district judge to whom this case is reassigned.
ALL HEARING DATES PRESENTLY SCHEDULED BEFORE THE CURRENT MAGISTRATE JUDGE ARE VACATED AND SHOULD BE RE-NOTICED FOR HEARING BEFORE THE JUDGE TO WHOM THIS CASE IS REASSIGNED.
This is a text only docket entry; there is no document associated with this notice. (afmS, COURT STAFF) (Filed on 8/21/2017) (Entered: 08/21/2017)
16 ORDER, Case reassigned to Judge James Donato. Magistrate Judge Laurel Beeler no longer assigned to the case. This case is assigned to a judge who participates in the Cameras in the Courtroom Pilot Project. See General Order 65 and http://cand.uscourts.gov/cameras. Signed by Executive Committee on 8/22/17. (Attachments: # 1 Notice of Eligibility for Video Recording)(haS, COURT STAFF) (Filed on 8/22/2017) (Entered: 08/22/2017)
17 CASE MANAGEMENT SCHEDULING ORDER: Initial Case Management Conference set for 10/19/2017 10:00 AM in Courtroom 11, 19th Floor, San Francisco. Case Management Statement due by 10/12/2017.. Signed by Judge James Donato on 8/23/17. (lrcS, COURT STAFF) (Filed on 8/23/2017) (Entered: 08/23/2017)
18 MOTION to Change Venue filed by Southwest Airlines Co.. Motion Hearing set for 10/5/2017 10:00 AM in Courtroom 11, 19th Floor, San Francisco before Hon. James Donato. Responses due by 9/14/2017. Replies due by 9/21/2017. (Attachments: # 1 Proposed Order Granting Southwest Airlines Co.'s Motion to Transfer Venue, # 2 Declaration of Gregg Thorsen in Support of Defendant's Motion to Transfer Venue)(Farmer, Douglas) (Filed on 8/31/2017) (Entered: 08/31/2017)
19 Request for Judicial Notice re 18 MOTION to Change Venue filed bySouthwest Airlines Co.. (Related document(s) 18 ) (Farmer, Douglas) (Filed on 8/31/2017) (Entered: 08/31/2017)
20 CLERK'S NOTICE. (This is a text-only entry generated by the court. There is no document associated with this entry.) Case Management Statement due by 10/19/2017. Initial Case

09/15/2017 09/21/2017 09/21/2017
12/15/2017 12/18/2017 12/21/2017
01/18/2018

Management Conference set for 10/26/2017 10:00 AM in Courtroom 11, 19th Floor, San Francisco. (lrcS, COURT STAFF) (Filed on 9/11/2017) (Entered: 09/11/2017)
21 STIPULATION WITH PROPOSED ORDER AND JOINT REQUEST FOR STAY OF THE LITIGATION filed by Southwest Airlines Co.. (Berry, Brian) (Filed on 9/15/2017) (Entered: 09/15/2017)
22 OPPOSITION/RESPONSE (re 18 MOTION to Change Venue ) filed byJayson Huntsman. (Attachments: # 1 Declaration Declaration of Jayson Huntsman, # 2 Declaration Declaration of Daniel Stromberg, # 3 Proposed Order Proposed Order)(RomerFriedman, Peter) (Filed on 9/21/2017) (Entered: 09/21/2017)
23 ORDER STAYING CASE. The Court stays this case through January 20, 2018, as jointly requested by the parties. All hearing and case management conference dates are consequently vacated, and the Court also administratively terminates the 18 motion to change venue. The terms of the parties' 21 stipulation and joint request for a stay are approved. Signed by Judge James Donato on 9/21/2017. (This is a text-only entry. There is no document associated with this entry.) (jdlc2S, COURT STAFF) (Filed on 9/21/2017) (Entered: 09/21/2017)
24 ***erroneous docket entry***STIPULATION WITH PROPOSED ORDER [JOINT] filed by Southwest Airlines. (Berry, Brian) (Filed on 12/15/2017) Modified on 12/19/2017 (hdjS, COURT STAFF). (Entered: 12/15/2017)
25 STIPULATION WITH PROPOSED ORDER [JOINT] filed by Southwest Airlines. (Berry, Brian) (Filed on 12/18/2017) (Entered: 12/18/2017)
26 ORDER. The parties' 25 stipulated protective order is approved, except that in those cases where the stipulated protective order conflicts with the Court's standing orders (e.g., with respect to the filing of discovery motions), the Court's standing orders will control. Signed by Judge James Donato on 12/21/2017. (This is a text-only entry generated by the court. There is no document associated with this entry.) (jdlc2S, COURT STAFF) (Filed on 12/21/2017) (Entered: 12/21/2017)
27 NOTICE of Appearance by Rachel Williams Dempsey (Dempsey, Rachel) (Filed on 1/18/2018) (Entered: 01/18/2018)

01/18/2018 01/23/2018
04/05/2018 04/09/2018
05/29/2018 05/29/2018 08/03/2018 08/06/2018

28 STIPULATION WITH PROPOSED ORDER Joint Request to Continue the Stay of the Litigation filed by Jayson Huntsman. (Romer-Friedman, Peter) (Filed on 1/18/2018) (Entered: 01/18/2018)
29 Order by Judge James Donato granting 28 Stipulation and Joint Request to Continue the Stay of the Litigation. At the joint request of the parties and based on their representations about mediation efforts, the Court continues the stay of this case through April 6, 2018, on the terms previously approved. (This is a text-only entry. There is no document associated with this entry.) (jdlc2S, COURT STAFF) (Filed on 1/23/2018) (Entered: 01/23/2018)
30 STIPULATION WITH PROPOSED ORDER Joint Request to Continue the Stay of the Litigation filed by Jayson Huntsman. (Romer-Friedman, Peter) (Filed on 4/5/2018) (Entered: 04/05/2018)
31 Order by Judge James Donato granting 30 Stipulation to Continue Stay of Litigation. At the joint request of the parties and based on their representations about mediation efforts, the Court continues the stay of this case through August 3, 2018, on the terms previously approved. This will be the last extension. (This is a text-only entry. There is no document associated with this entry.) (jdlc2S, COURT STAFF) (Filed on 4/9/2018) (Entered: 04/09/2018)
32 NOTICE of Change of Address by Jahan C. Sagafi (Sagafi, Jahan) (Filed on 5/29/2018) (Entered: 05/29/2018)
33 NOTICE of Change of Address by Rachel Williams Dempsey (Dempsey, Rachel) (Filed on 5/29/2018) (Entered: 05/29/2018)
34 STIPULATION WITH PROPOSED ORDER Joint Request to Continue the Stay of the Litigation filed by Jayson Huntsman. (Romer-Friedman, Peter) (Filed on 8/3/2018) (Entered: 08/03/2018)
35 Order by Judge James Donato granting as modified 34 Stipulation to Continue Stay. This case has been stayed for almost a year. The Court continues the stay for another 30 days, through September 5, 2018. If a preliminary approval motion has not been filed by that time, the case will be restored to the trial calendar on an expedited basis. (This is a text-only entry. There is no document associated with this entry.) (jdlc2S, COURT STAFF) (Filed on 8/6/2018) (Entered: 08/06/2018)

09/05/2018 09/13/2018
09/13/2018 09/13/2018 09/13/2018 09/13/2018 11/08/2018 11/15/2018

36 Statement Regarding Preliminary Approval of Settlement (Joint) by Jayson Huntsman. (Romer-Friedman, Peter) (Filed on 9/5/2018) (Entered: 09/05/2018)
37 MOTION for Settlement Notice of Motion And Unopposed Motion For Order Conditionally Certifying Settlement Class and Granting Preliminary Approval of Settlement filed by Jayson Huntsman. Motion Hearing set for 11/8/2018 10:00 AM in San Francisco, Courtroom 11, 19th Floor before Judge James Donato. Responses due by 9/27/2018. Replies due by 10/4/2018. (Romer-Friedman, Peter) (Filed on 9/13/2018) (Entered: 09/13/2018)
38 Declaration of Peter Romer-Friedman In Support of Class Counsel's Unopposed Motion for Conditional Certification of Settlement Class and Preliminary Approval of Settlement filed byJayson Huntsman. (Attachments: # 1 Exhibit 1, # 2 Exhibit 2, # 3 Exhibit 3)(Romer-Friedman, Peter) (Filed on 9/13/2018) (Entered: 09/13/2018)
39 Declaration of Matthew Crotty in Support of 37 MOTION for Settlement Notice of Motion And Unopposed Motion For Order Conditionally Certifying Settlement Class and Granting Preliminary Approval of Settlement filed byJayson Huntsman. (Related document(s) 37 ) (Romer-Friedman, Peter) (Filed on 9/13/2018) (Entered: 09/13/2018)
40 Declaration of Thomas G. Jarrard in Support of 37 MOTION for Settlement Notice of Motion And Unopposed Motion For Order Conditionally Certifying Settlement Class and Granting Preliminary Approval of Settlement filed byJayson Huntsman. (Related document(s) 37 ) (Romer-Friedman, Peter) (Filed on 9/13/2018) (Entered: 09/13/2018)
41 Proposed Order re 37 MOTION for Settlement Notice of Motion And Unopposed Motion For Order Conditionally Certifying Settlement Class and Granting Preliminary Approval of Settlement by Jayson Huntsman. (Romer-Friedman, Peter) (Filed on 9/13/2018) (Entered: 09/13/2018)
43 Minute Entry for proceedings held before Judge James Donato: Motion Hearing held on 11/8/2018. (jdlc2S, COURT STAFF) (Date Filed: 11/8/2018) (Entered: 11/19/2018)
42 STIPULATION WITH PROPOSED ORDER re 37 MOTION for Settlement Notice of Motion And Unopposed Motion For Order Conditionally Certifying Settlement Class and Granting Preliminary Approval of Settlement Regarding Amended Proposed

12/05/2018 02/19/2019 02/19/2019 02/25/2019 03/01/2019 04/01/2019
04/15/2019

Order filed by Jayson Huntsman. (Attachments: # 1 Proposed Order)(Romer-Friedman, Peter) (Filed on 11/15/2018) (Entered: 11/15/2018)
44 ORDER GRANTING CONDITIONAL CERTIFICATION OF SETTLEMENT CLASS AND PRELIMINARY APPROVAL OF SETTLEMENT. Fairness Hearing set for 6/20/2019 at 10:00 AM. Signed by Judge James Donato on 12/5/2018. (jdlc2S, COURT STAFF) (Filed on 12/5/2018) (Entered: 12/05/2018)
45 ADMINISTRATIVE MOTION to Consider Whether Cases Are Related filed by Jayson Huntsman. Responses due by 2/25/2019. (Attachments: # 1 Exhibit A)(Romer-Friedman, Peter) (Filed on 2/19/2019) (Entered: 02/19/2019)
46 Declaration of Peter Romer-Friedman in Support of 45 ADMINISTRATIVE MOTION to Consider Whether Cases Are Related filed byJayson Huntsman. (Attachments: # 1 Exhibit 1)(Related document(s) 45 ) (Romer-Friedman, Peter) (Filed on 2/19/2019) (Entered: 02/19/2019)
47 OPPOSITION/RESPONSE (re 45 ADMINISTRATIVE MOTION to Consider Whether Cases Are Related ) filed bySouthwest Airlines. (Berry, Brian) (Filed on 2/25/2019) (Entered: 02/25/2019)
48 CLERK'S NOTICE REGARDING MOTION TO RELATE CASES (lrcS, COURT STAFF) (Filed on 3/1/2019) (Entered: 03/01/2019)
49 MOTION for Settlement Notice of Motion and Motion for Awards of Attorneys' Fees, Costs, and Service Award; Memorandum in Support of Motion filed by Jayson Huntsman. Motion Hearing set for 6/20/2019 10:00 AM in San Francisco, Courtroom 11, 19th Floor before Judge James Donato. Responses due by 4/15/2019. Replies due by 4/22/2019. (Attachments: # 1 Declaration of Peter Romer-Friedman, # 2 Exhibit 1, # 3 Exhibit 2, # 4 Exhibit 3, # 5 Exhibit 4, # 6 Exhibit 5, # 7 Exhibit 6, # 8 Exhibit 7, # 9 Declaration of Jayson Huntsman, # 10 Declaration of Mark Patton)(Romer-Friedman, Peter) (Filed on 4/1/2019) (Entered: 04/01/2019)
50 Statement of Non-Opposition re 49 MOTION for Settlement Notice of Motion and Motion for Awards of Attorneys' Fees, Costs, and Service Award; Memorandum in Support of Motion filed bySouthwest Airlines. (Related document(s) 49 ) (Berry, Brian) (Filed on 4/15/2019) (Entered: 04/15/2019)

05/06/2019 05/16/2019
05/30/2019 06/06/2019
06/21/2019 07/02/2019

51 Letter from Brent Dennis. (Attachments: # 1 Envelope)(hdjS, COURT STAFF) (Filed on 5/6/2019) (Entered: 05/15/2019)
52 MOTION for Settlement Notice of Motion and Motion for Final Approval of Settlement; Memorandum in Support of Motion filed by Jayson Huntsman. Motion Hearing set for 6/20/2019 10:00 AM in San Francisco, Courtroom 11, 19th Floor before Judge James Donato. Responses due by 5/30/2019. Replies due by 6/6/2019. (Attachments: # 1 Declaration of Peter Romer-Friedman in Support of Class Counsel's Motion for Final Approval, # 2 Declaration of Mark Patton in Support of Class Counsel's Motion for Final Approval of Settlement, # 3 Proposed Order)(Romer-Friedman, Peter) (Filed on 5/16/2019) (Entered: 05/16/2019)
53 Statement of Non-Opposition re 52 MOTION for Settlement Notice of Motion and Motion for Final Approval of Settlement; Memorandum in Support of Motion filed bySouthwest Airlines. (Related document(s) 52 ) (Berry, Brian) (Filed on 5/30/2019) (Entered: 05/30/2019)
54 REPLY (re 52 MOTION for Settlement Notice of Motion and Motion for Final Approval of Settlement; Memorandum in Support of Motion, 49 MOTION for Settlement Notice of Motion and Motion for Awards of Attorneys' Fees, Costs, and Service Award; Memorandum in Support of Motion ) filed byJayson Huntsman. (Attachments: # 1 Supplemental Declaration of Peter RomerFriedman, # 2 Exhibit 1, # 3 Exhibit 2, # 4 Supplemental Declaration of Mark Patton, # 5 Updated Proposed Order)(RomerFriedman, Peter) (Filed on 6/6/2019) (Entered: 06/06/2019)
55 Minute Entry for proceedings held before Judge James Donato: Motion Hearing held on 6/20/2019. (jdlc2S, COURT STAFF) (Date Filed: 6/21/2019) (Entered: 06/21/2019)
56 Supplemental Brief re 52 MOTION for Settlement Notice of Motion and Motion for Final Approval of Settlement; Memorandum in Support of Motion, 54 Reply to Opposition/Response,, 49 MOTION for Settlement Notice of Motion and Motion for Awards of Attorneys' Fees, Costs, and Service Award; Memorandum in Support of Motion filed byJayson Huntsman. (Attachments: # 1 Second Supplemental Declaration of Peter Romer-Friedman, # 2 Supplemental Declaration of Mark Patton Regarding Costs of Administration, # 3 Proposed Order Granting Final Approval of Settlement and Final Judgment)(Related document(s) 52 , 54 , 49 ) (Romer-Friedman, Peter) (Filed on 7/2/2019) (Entered: 07/02/2019)

10/04/2019 57

ORDER GRANTING FINAL APPROVAL OF SETTLEMENT AND FINAL JUDGMENT. Signed by Judge James Donato on 10/4/2019. (jdlc2S, COURT STAFF) (Filed on 10/4/2019) (Entered: 10/04/2019)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN FRANCISCO DIVISION

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12 JAYSON HUNTSMAN, on behalf of himself 13 and all others similarly situated,

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Plaintiff,

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v.

Case No. 3:17-cv-03972-JD
[PROPOSED] ORDER GRANTING FINAL APPROVAL OF SETTLEMENT AND FINAL JUDGMENT

16 SOUTHWEST AIRLINES CO.,

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Defendant.

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[PROPOSED] FINAL APPROVAL ORDER AND FINAL JUDGMENT
CASE NO. 17-CV-03972-JD

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On June 20, 2019, a hearing was held on the motion of Plaintiff Jayson Huntsman,

2 individually and on behalf of all others similarly situated (“Plaintiff”), for final approval of the

3 class settlement, and on the separate motions of Plaintiff and his counsel for awards of the Class 4 Representative Service Payment and the Class Counsel Attorneys’ Fees and Costs Payment.

5 Peter Romer-Friedman, Rachel Williams Dempsey, and Thomas Jarrard appeared for Plaintiff.

6 Brian D. Berry appeared for Defendant Southwest Airlines Co. (“Southwest”).

7

At the hearing, the Court directed Plaintiff’s counsel to file supplemental briefing to

8 address two issues: (1) the proposed reimbursement amount for the settlement administrator’s

9 costs; and (2) the legal basis and accounting of the reimbursement requested for the named 10 Plaintiff’s hours spent in service to the class. ECF No. 55. In addition, the Court ordered 11 Plaintiff’s counsel to file a revised proposed Final Approval Order. Id.

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On July 2, 2019, Plaintiff submitted supplemental briefing and a revised Final Approval

13 Order. Dkt. No. 56.

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The Parties have also submitted their Settlement Agreement (the “Settlement”), which

15 this Court preliminarily approved in its December 5, 2018 order (the “Preliminary Approval 16 Order”). In accordance with the Preliminary Approval Order, Class Members have been given 17 notice of the terms of the Settlement and the opportunity to submit a claim form, comment on the 18 settlement, and/or opt out of its provisions.

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In addition, pursuant to the Class Action Fairness Act of 2005, 28 U.S.C. § 1715

20 (“CAFA”), Southwest has given the Attorney General of the United States and the appropriate

21 state officials in the states in which the Class Members reside timely notice of the Settlement.

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Having received and considered the Settlement, the supporting papers filed by the Parties,

23 including the post-hearing supplemental briefing, and the evidence and argument received by the 24 Court at the final approval hearing on June 20, 2019, by means of this order (the “Final Approval 25 Order”), the Court grants final approval to the Settlement and orders as follows.

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[PROPOSED] FINAL APPROVAL ORDER AND FINAL JUDGMENT
CASE NO. 17-CV-03972-JD

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Definitions

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1. Except as otherwise specified herein, the Court for purposes of this Final

3 Approval Order adopts all defined terms set forth in the Settlement.

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Jurisdiction

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2. This Court has jurisdiction over the subject matter of this litigation and all claims

6 raised in this action and released in the Settlement, and personal jurisdiction over Southwest and

7 all Class Members (except for Robert J. Waltz, who timely filed an opt-out request).

8 Specifically, this Court has federal question jurisdiction over this action pursuant to 28 U.S.C.

9 § 1331.

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Dissemination of Notice to Class Members

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3. Pursuant to the Preliminary Approval Order, the notice documents were sent to

12 each Class Member by email and by first-class mail. The notice materials informed Class

13 Members of the terms of the Settlement, how their settlement share would be calculated, how to

14 submit a Claim Form, their right to comment on (including object to) the Settlement or opt out of

15 the Settlement to pursue their claims individually, and their right to appear in person or by

16 counsel at the final approval hearing and be heard regarding approval of the Settlement.

17 Adequate periods of time were provided by each of these procedures.

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4. The Court finds and determines that this notice procedure afforded adequate

19 protections to Class Members and provides the basis for the Court to make an informed decision

20 regarding approval of the Settlement based on the responses of Class Members. Notice was

21 accomplished in the manner prescribed by the Settlement. The Court finds and determines that

22 the notice provided in this case was the best notice practicable, which satisfied the requirements

23 of law and due process.

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Notice to Attorneys General Pursuant to CAFA

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5. Pursuant to CAFA, within 10 days after the filing of the motion seeking

26 preliminary approval of the Settlement, Southwest served upon the Attorney General of the

27 United States and the state attorneys general officials of the states in which the Class Members

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[PROPOSED] FINAL APPROVAL ORDER AND FINAL JUDGMENT
CASE NO. 17-CV-03972-JD

1 reside a notice of the Settlement consisting of the appropriate settlement notice documents. This

2 Final Approval Order is being entered at least 90 days after the later of the dates on which the

3 appropriate federal and state officials were served with the notice of proposed settlement.

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6. The Court finds and determines that Southwest’s notice of Settlement was timely,

5 adequate, and compliant with the statutory requirements of CAFA. Accordingly, 28 U.S.C.

6 § 1715(e) has no application to the Settlement.

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Certification Under Fed. R. Civ. P. 23 and the FLSA

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7. For the reasons stated in the Preliminary Approval Order, this Court finds and

9 determines that the proposed Settlement Class, as defined in Section IV.A of the Settlement and

10 in Section II.A of its Preliminary Approval Order, meets all of the legal requirements for class

11 certification under Federal Rule of Civil Procedure 23 (“Rule 23”) (a) and (b)(3), and it is hereby

12 ordered that the Settlement Class is finally approved and certified as a Class for purposes of

13 settlement of this action.

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Fairness

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8. Pursuant to Rule 23(e), the Court further finds and determines that the terms of

16 the Settlement are fair, reasonable, and adequate to the Class and to each Class Member and that

17 the Class Members who have not opted out will be bound by the Settlement, that the Settlement

18 is ordered finally approved, and that all terms and provisions of the Settlement should be and

19 hereby are ordered to be consummated. The Court specifically finds that the Settlement is

20 rationally related to the strength of Plaintiffs’ claims given the risk, expense, complexity, and

21 duration of further litigation. This Court also finds that the Settlement is the result of arms’-

22 length negotiations between experienced counsel representing the interests of the Class Members

23 and Southwest, under the supervision of an experienced and independent third-party mediator,

24 after thorough factual and legal investigation. Staton v. Boeing Co., 327 F.3d 938, 960 (9th Cir.

25 2003); Class Plaintiffs v. City of Seattle, 955 F.2d 1268, 1291 (9th Cir. 1992).

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9. The Court has received and considered the objection of Brent Dennis, which was

27 timely filed on May 6, 2019. ECF No. 51. Mr. Dennis’s objection expressed his concern over

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[PROPOSED] FINAL APPROVAL ORDER AND FINAL JUDGMENT
CASE NO. 17-CV-03972-JD

1 the discount for claims earlier in the class period, as well as his personal concern about

2 harassment and retaliation against servicemembers at Southwest. The Court finds that the Plan

3 of Allocation reasonably and fairly discounted Class Members’ claims for 2001 to 2007 on the

4 basis that Southwest’s defenses as to those claims were stronger than its defenses for claims from

5 2008 and afterwards. In addition, the level of recovery for these claims is still substantial,

6 particularly given that the claims are 11 to 18 years old and face a serious statute of limitations

7 defense. To the extent that Mr. Dennis’s objection concerned alleged retaliation or other

8 hostility against servicemembers, such claims are not at issue in this action and are not released

9 by the Class Settlement. Accordingly, Mr. Dennis’s objection does not alter the Court’s

10 conclusion that the Settlement is fair, reasonable, and adequate.

11

10. The Court finds and determines that the payments to be made to the Class

12 Members as provided for in the Settlement, Section VIII.D, are fair and reasonable. The

13 proposed plan of allocation bases each Class Member’s recovery on (a) all periods of Short-Term

14 Military Leave that are identified by the Class Member between January 1, 2001 and December

15 31, 2007, and (b) all periods of Short-Term Military Leave with one or more dropped trips that

16 the Class Member took between January 1, 2008 and December 31, 2013. The plan of allocation

17 is rational. The Court hereby gives final approval to the payments and orders those amounts be

18 paid to the claimants out of the Net Fund Value in accordance with the terms of the Settlement.

19 The Court also hereby gives final approval to the additional paid sick leave and orders those

20 amounts to be added to their sick leave balances.

21

Class Member Response

22

11. The Court further finds that the response of the Class Members to the Settlement

23 supports settlement approval. Of the 1,999 Class Members and Potential Class Members, only

24 one opted out of the Settlement, and only one objected to the Settlement.

25

12. The Court hereby excludes Robert J. Waltz from the Settlement and Release on

26 the basis of his opt-out request, which was timely provided to the Settlement Administrator on

27 March 12, 2019, in accordance with the procedure set forth in the Class Notice.

28

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[PROPOSED] FINAL APPROVAL ORDER AND FINAL JUDGMENT
CASE NO. 17-CV-03972-JD

1

Late Claim Form

2

13. For good cause shown, the Court permits consideration of the late Claim Form

3 postmarked May 23, 2019.

4

Appointment of Class Representatives and Class Representative Service Awards

5

14. The Court confirms as final the appointment of Jayson Huntsman as Class

6 Representative of the Rule 23 Class.

7

15. The Court approves a $9,969.60 service award to plaintiff Huntsman based on his

8 time spent in service to the Class. In this case, plaintiff has submitted sufficient “evidence of the

9 proposed awardees’ involvement in the case and other justifications for the award,” N.D. Cal.

10 Procedural Guidance for Class Action Settlements, such that the Court is able to make an

11 informed decision on this issue. Of the 100 hours claimed by Huntsman, Dkt. No. 49-9 ¶ 10, the

12 Court deducts 16 hours of travel time and his 24 hours of informal communications with class

13 members. Dkt. No. 49-9 ¶¶ 10(c), (e), (g). The Court accepts Huntsman’s proposed hourly rate

14 of $166.16, Dkt. No. 56 at 3, and consequently grants him an award of $9,969.60.

15

Appointment of Class Counsel; Attorneys’ Fees and Costs

16

17. Class Counsel attest to performing substantial work on behalf of the Class

17 Members, totaling $703,471 in lodestar as of June 6, 2019. The Court finds the hours worked by

18 Class Counsel to be reasonably incurred for the benefit of the Class Members. Class Counsel’s

19 hourly rates, ranging from $250 to $290 for staff and $280 to $900 for attorneys, are reasonable

20 in light of the market for legal services of this type and quality. The Court confirms as final the

21 appointment of Jahan C. Sagafi, Peter Romer-Friedman, and Rachel Williams Dempsey of

22 Outten & Golden LLP, Matthew Z. Crotty from Crotty & Son Law Firm, PLLC, and Thomas

23 Jarrard from Law Office of Thomas G. Jarrard, PLLC as Class Counsel for the Rule 23 Class.

24 Class Counsel has capably and effectively represented the Class Members’ interests. The Court

25 finds and determines that the payment of $1,500,000 in attorneys’ fees and $33,761.32 in

26 litigation costs and expenses is reasonable. See, e.g., Vizcaino v. Microsoft Corp., 290 F.3d 1043

27 (9th Cir. 2002); Chemical Bank v. City of Seattle (In re Washington Public Power Supply Sec.

28

- 5 -

[PROPOSED] FINAL APPROVAL ORDER AND FINAL JUDGMENT
CASE NO. 17-CV-03972-JD

1 Litig.), 19 F.3d 1291, 1297 (9th Cir. 1994). This fee is approximately 26% of the total fund and

2 8% of Plaintiffs’ estimated Settlement value, which is consistent with Ninth Circuit guidance for

3 class action settlements. Under a lodestar cross-check, the lodestar multiplier of 2.13x supports

4 the fee award. The Court hereby gives final approval to that amount and orders that payment be

5 made to Class Counsel out of the Gross Fund Value in accordance with the terms of the

6 Settlement.

7

Settlement Administrator Report and Fees

8

18. Upon completion of administration of the Settlement, the Settlement

9 Administrator will provide written certification of such completion to the Court and counsel for

10 the Parties.

11

19. The Court finds and determines that reimbursement of Settlement Administrator

12 costs in the amount of $54,000 is reasonable and hereby gives final approval to that amount.

13

Release

14

20. By operation of the entry of this Final Approval Order and pursuant to the

15 Settlement, all Qualified Claimants are permanently barred from prosecuting against Southwest

16 any Claim as set forth in Section XIV of the Settlement. The Court has reviewed the release in

17 Section XIV of the Settlement and finds it to be fair, reasonable, and enforceable under Rule 23,

18 and all other applicable law.

19

Contingency on Finality

20

21. If, for any reason, the Settlement ultimately does not become Final (as defined in

21 the Settlement, Section XV), this Final Approval Order will be vacated; the Parties will return to

22 their respective positions in this action as those positions existed immediately before the parties

23 executed the Settlement; and nothing stated in the Settlement or any other papers filed with this

24 Court in connection with the Settlement will be deemed an admission of any kind by any of the

25 Parties or used as evidence against, or over the objection of, any of the Parties for any purpose in

26 this action or in any other action.

27

28

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[PROPOSED] FINAL APPROVAL ORDER AND FINAL JUDGMENT
CASE NO. 17-CV-03972-JD

1

Final Judgment and Dismissal

2

22. By means of this Final Approval Order, this Court hereby enters final judgment in

3 this action, as defined in Federal Rule of Civil Procedure 58(a)(1).

4

23. Without affecting the finality of the Court’s judgment in any way, the Court

5 retains jurisdiction over this matter for purposes of resolving issues relating to interpretation,

6 administration, implementation, effectuation and enforcement of the Settlement. Nothing in this

7 Final Approval Order will preclude any action to enforce the Parties’ obligations under the

8 Settlement or under this order, including the requirement that Southwest make the settlement

9 payments in accordance with the terms of the Settlement.

10

24. The Parties are hereby ordered to comply with the terms of the Settlement.

11

25. This action is dismissed with prejudice, each side to bear its own costs and

12 attorneys’ fees except as provided by the Settlement and the Court’s orders.

13

14

15

Dated: October 4, 2019

16

JAMES DONATO

17

United States District Judge

18

19

20

21

22

23

24

25

26

27

28

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[PROPOSED] FINAL APPROVAL ORDER AND FINAL JUDGMENT
CASE NO. 17-CV-03972-JD

 
 DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 Peter Romer-Friedman (pro hac vice)

OUTTEN & GOLDEN LLP 2 601 Massachusetts Avenue NW,

Second Floor West Suite 3 Washington, D.C. 20001

Telephone: (202) 847-4400 4 Facsimile: (202) 847-4410

Email: 5

prf@outtengolden.com

Jahan C. Sagafi (Cal. Bar No. 224887)

6 Rachel Dempsey (Cal. Bar No. 310424)

OUTTEN & GOLDEN LLP

7 One California Street, 12th Floor,

San Francisco, California 94111

8 Telephone: (415) 638-8800

Facsimile: (415) 638-8810

9 Email:

jsagafi@outtengolden.com

10 Attorneys for Plaintiff and the Proposed Class

Douglas J. Farmer (CA Bar No. 139646) douglas.farmer@ogletree.com Brian D. Berry (CA Bar No. 229893) brian.berry@ogletree.com Jason P. Brown (CA Bar No. 266472) jason.brown@ogletree,com OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. Stueart Tower, Suite 1300 One Market Plaza San Francisco, California 94105 Telephone: 415.442.4810 Facsimile: 415.442.4870
Attorneys for Defendant Southwest Airlines
Co.

11

12

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

13

SAN FRANCISCO DIVISION

14 JAYSON HUNTSMAN, on behalf of himself and all others similarly situated,
15 Plaintiff,
16 v.
17 SOUTHWEST AIRLINES CO.,
18 Defendant.
19

Case No. 3:17-cv-03972-JD SETTLEMENT AGREEMENT

20

21

22

23

24

25

26

27

28

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 I. INTRODUCTION1

2

This case, Huntsman v. Southwest Airlines, Co., No. 4:17-cv-03972-JD (N.D. Cal.), was

3 brought by Jayson Huntsman (“Plaintiff”) on behalf of himself and others similarly situated

4 against Southwest Airlines Co. (“Southwest”) under the Uniformed Services Employment and

5 Reemployment Rights Act (“USERRA”), 38 U.S.C. § 4301 et seq. alleging that Southwest (i)

6 failed to make the proper matching contributions to pilots’ retirement plans based on Deemed

7 Earnings during periods of Short-Term Military Leave from their employment at Southwest; (ii)

8 failed to facilitate pilots’ opportunity to make retirement contributions that could be matched

9 during periods of Short-Term Military Leave, and (iii) failed to provide for the accrual of Sick

10 Leave during pilots’ periods of Short-Term Military Leave.

11

In the interest of resolving this dispute between the Parties without the significant expense,

12 delay, and inconvenience of further litigation of the collective and individual issues raised in the

13 Case, and in reliance upon the representations, mutual promises, covenants, and obligations set out

14 in this Settlement Agreement, and for good and valuable consideration also set out in this

15 Settlement Agreement, the Parties, through their undersigned counsel of record, hereby stipulate

16 and agree as follows.

17 II. DEFINITIONS

18

The following terms, as they are used in this Settlement Agreement, shall have the

19 meanings defined below:

20

A. “401(k) Plan” is the Southwest Airlines Pilots 401(k) Plan, as described in Section

21 19 of the CBA.

22

B. “Agreement” is this Settlement Agreement.

23

C. “Case” or “Litigation” is the action titled Huntsman v. Southwest Airlines, Co., No.

24 4:17-cv-03972-JD (N.D. Cal.).

25

D. “Cash Settlement Amount” is the amount of Five Million Eight Hundred Thousand

26 United States Dollars ($5,800,000).

27

28 1

Capitalized terms have the meanings set forth in the Definitions section below.

- 2 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1

E. “Class Counsel” are Outten & Golden LLP, 601 Massachusetts Ave. NW, Suite

2 200W, Washington DC, 20001; the Law Office of Thomas G. Jarrard PLLC, 1020 N. Washington

3 Street, Spokane, WA 99201; and Crotty & Son Law Firm, PLLC, 421 W. Riverside Ave., Ste.

4 1005, Spokane, WA 99201.

5

F. “Class Member” is any Southwest pilot who satisfies the definition of the Proposed

6 Settlement Class set forth below or satisfies the definition of a class approved by the Court that is

7 substantially similar to the Proposed Settlement Class.

8

G. “Class Period” is the time period between January 1, 2001 and the Preliminary

9 Approval Date.

10

H. “Class Representative” is Plaintiff Jayson Huntsman.

11

I. “Collective Bargaining Agreement” or “CBA” is the collective bargaining

12 agreement between Southwest and the Southwest Airline Pilots’ Association.

13

J. “Court,” unless otherwise specified or clear from the context, is the United States

14 District Court for the Northern District of California.

15

K. “Deemed Earnings” is the amount of earnings Southwest pilots would have earned

16 per pay period if they had not taken Short-Term Military Leave.

17

L. “Effective Date of the Settlement Agreement” or “Effective Date” is the date upon

18 which an order providing Final Approval of this Agreement under Federal Rule of Civil Procedure

19 23(e) becomes non-appealable, or, in the event of any appeals, the date of final resolution of all

20 appeals. When this Agreement refers to the date on which the Agreement became “Effective,”

21 such date is the Effective Date.

22

M. “Escrow Account” is an account to be established pursuant to an escrow deposit

23 agreement by the Settlement Administrator, into which Southwest will deposit the Settlement

24 Fund.

25

N. “Final Approval Date” is the date upon which the Court enters an order granting

26 Final Approval of the Settlement Agreement.

27

28

- 3 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1

O. “Final Approval of the Settlement Agreement” or “Final Approval” is the Court’s

2 decision that the resolution of this Case, as reflected in the Settlement Agreement, is fair,

3 adequate, and reasonable pursuant to the provisions of Federal Rule of Civil Procedure 23(e).

4

P. “Lead Class Counsel” is Outten & Golden LLP, 601 Massachusetts Ave. NW,

5 Suite 200W, Washington DC, 20006.

6

Q. “Net Settlement Fund” is the Settlement Fund minus any amounts deducted for

7 attorneys’ fees, expenses and costs, the Settlement Administrator’s fees and costs, any Service

8 Award approved by the Court, and any taxes owed by the Settlement Fund.

9

R. “Notice Mailing Date” is the date the Notice Packets are mailed to the Class

10 Members.

11

S. “Notice Packet” is the packet of materials that consists of the Notice of Proposed

12 Class Action Settlement and Fairness Hearing.

13

T. “Parties” are Southwest and the Plaintiff in the Case.

14

U. “Plan Amount” is the amount of the Net Settlement Fund that has been allocated to

15 each Class Member, corresponding to each year covered by the Settlement Agreement, that can be

16 contributed to the Class Member’s 401(k) account in compliance with applicable IRS limits for

17 each such year without jeopardizing the tax-qualified status of the 401(k) Plan.

18

V. “Preliminary Approval Date” is the date on which the Court enters an order

19 granting Preliminary Approval of the Settlement Agreement.

20

W. “Proposed Settlement Class” or “Class” is defined as all former or current pilots

21 employed by Southwest who took Short-Term Military Leave from Southwest between January 1,

22 2001 and the Preliminary Approval Date.

23

X. “Service Award” is a monetary award to the Class Representative for his services

24 rendered and/or reimbursement for any lost compensation and out-of-pocket expenses incurred in

25 pursuing the Case and negotiating the Settlement on behalf of the Proposed Settlement Class.

26

Y. “Settlement Administrator” is the firm, to be proposed to and appointed by the

27 Court, as set forth below, that will perform the administrative functions required by this

28 Settlement Agreement, including but not limited to printing and mailing the Notice Packets,

- 4 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 establishing a Qualified Settlement Fund and Bank Account, and distribution of the Settlement

2 Funds to the Class Members.

3

Z. “Settlement Agreement” or “Settlement” is this Settlement Agreement.

4

AA. “Settlement Fund” means the amount of Five Million Eight Hundred Thousand

5 Dollars ($5,800,000), plus any interest accrued on that amount while in escrow, that will be used

6 (i) to make supplemental contributions to Class Members’ 401(k) accounts or, if it is not possible

7 to make any such supplemental contributions to Class Members’ 401(k) accounts, to make cash

8 payments to Class Members for their claims related to USERRA make-up contributions during

9 periods of Short-Term Military Leave, (ii) to make payments of $1,000 each to former employees

10 as consideration for the release of their Sick Leave Claims; (iii) to award attorneys’ fees and costs,

11 (iv) to fund a Service Award to the Class Representative, (v) to fund the costs of providing notice

12 to the Class and administrating the Settlement, and (vi) to pay any taxes owed by the Settlement

13 Fund.

14

BB. “Short-Term Military Leave” is a period of military leave of 14 calendar days or

15 less.

16

CC. “Sick Leave” is paid leave for illness or injury, which accrues at a rate of 1 TFP for

17 each 10 TFP a pilot flies, as described in Section 12 of the SWAPA CBA.

18

DD. “Sick Leave Claim” is a claim by a Class Member that he or she was subject to

19 Southwest’s policy that did not provide for the accrual of Sick Leave for pilots during periods of

20 Short-Term Military Leave from January 1, 2001 through the Preliminary Approval Date.

21

EE. “Southwest” is Southwest Airlines Co.

22

FF. “Southwest Airline Pilots’ Association” or “SWAPA” is the employee union that

23 represents Southwest pilots.

24

GG. “Southwest’s Counsel” is Ogletree, Deakins, Nash, Smoak & Stewart, P.C., Steuart

25 Tower, One Market Plaza, Suite 1300, San Francisco, CA 94105.

26

HH. “Trips For Pay” or “TFP” is a unit of pilot compensation that roughly corresponds

27 with miles flown, as described in Section 4 of the SWAPA CBA.

28

- 5 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1

II. “USERRA” means the federal Uniformed Services Employment and

2 Reemployment Rights Act of 1994, as amended.

3 III. RECITALS

4

A. On July 14, 2017, Plaintiff filed this Case against Southwest alleging that

5 Southwest violated USERRA by failing to provide its pilots (i) appropriate retirement

6 contributions mandated by USERRA for periods of Short-Term Military Leave, (ii) information to

7 facilitate pilots’ opportunity to make retirement contributions that could be matched during

8 periods of Short-Term Military Leave, and (iii) accrued paid Sick Leave for Short-Term Military

9 Leave, even though Southwest provides accrued paid Sick Leave to pilots who take other types of

10 leave. Plaintiff alleged that USERRA requires Southwest to (i) provide matching contributions to

11 pilots’ 401(k) accounts for the Deemed Earnings earned during periods of Short-Term Military

12 Leave for elective deferrals already made to the 401(k) Plan, (ii) provide timely information to

13 pilots on their Deemed Earnings so that they can make make-up retirement contributions into their

14 401(k) accounts pursuant to USERRA, 38 U.S.C. § 4318, and (iii) have their make-up

15 contributions matched by Southwest. Plaintiff also alleged that USERRA, 38 U.S.C. § 4316,

16 requires Southwest to provide for the accrual of Sick Leave when pilots take Short-Term Military

17 Leave, because Southwest provides for the accrual of Sick Leave when pilots engage in jury duty,

18 union leave, and bereavement leave. Southwest denies these allegations and maintains that the

19 claims in the Case have no merit.

20

B. Plaintiff sought, among other things, a declaration that Southwest’s policy with

21 respect to how Southwest matched the retirement contributions of Plaintiff and the Class Members

22 during periods of Short-Term Military Leave violated their rights under USERRA and a

23 declaration that Southwest’s failure to provide accrued paid Sick Leave to pilots who took Short-

24 Term Military Leave violated the rights of Plaintiff and the Class under USERRA. Plaintiff also

25 sought a declaration that Plaintiff and the Class were and are entitled under USERRA to receive

26 contributions to their defined contribution retirement accounts in an amount that is consistent with

27 USERRA § 4318 and that they are entitled to receive accrued paid Sick Leave in an amount that is

28 consistent with USERRA § 4316, and an order that Southwest fully compensate Plaintiff and the

- 6 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 Class for their losses related to the alleged violations. Southwest denies that Plaintiff or any

2 members of the class is entitled to these or any other forms of relief.

3

C. Plaintiff filed the Case as a putative class action pursuant to Rule 23 of the Federal

4 Rules of Civil Procedure and alleged that the Case is maintainable as a class action under Rule

5 23(a) and Rule 23(b)(1), Rule 23(b)(2), or Rule 23(b)(3).

6

D. On August 31, 2017, Southwest moved to transfer venue to the United States

7 District Court for the Northern District of Texas. On September 15, 2017, the parties stipulated to

8 a stay of the litigation to allow them to explore settlement following Plaintiff’s Opposition to the

9 Motion to Transfer Venue. Plaintiff’s opposition was filed on September 21, 2017, and the Court

10 granted the stipulation the same day.

11

E. From September 2017 through June 2018, the Parties engaged in informal

12 discovery on both liability and potential damages for the purpose of exploring a settlement. Using

13 personnel data provided by Southwest, Class Counsel developed a methodology for calculating the

14 potential alleged damages of Class Members.

15

F. On June 26 and 27, 2018, the Parties attended a mediation in Dallas, Texas with the

16 Honorable Deborah Hankinson, an experienced mediator and a former Texas Supreme Court

17 Justice. At the end of two days of arm’s-length negotiation, the Parties agreed to the basic terms

18 set forth in a term sheet. In the weeks that followed, the Parties continued to negotiate the details

19 of a settlement, including how to allocate the Net Settlement Fund among the Settlement Class

20 Members.

21

G. The Parties intend this Settlement Agreement to be a final and complete resolution

22 of all Claims asserted in this Action. The Settlement is a compromise of contested claims and shall

23 not be deemed an admission by any Party as to the merits of any claim or defense. The Parties

24 agree that the terms of the Settlement were negotiated in good faith at arm’s length by the Parties,

25 and were reached voluntarily after consultation with competent legal counsel. The Parties believe

26 that the terms of this Settlement Agreement are fair, reasonable, and adequate to the Proposed

27 Settlement Class as a whole; that this Settlement Agreement provides substantial benefits to the

28 Proposed Settlement Class and the Class Members; and that settlement of the Case on the terms

- 7 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 set forth in this Settlement Agreement is in the best interests of the Proposed Settlement Class and

2 the Class Members.

3

H. The purpose of this Settlement Agreement is to make a full, complete, and final

4 resolution of all the Claims of Class Members that will be released pursuant to Section XIV of this

5 Settlement Agreement

6

I. The Parties agree that Southwest’s agreement not to oppose Plaintiff’s motion for

7 preliminary approval in the Northern District of California is without prejudice to Southwest’s

8 contention that the proper forum for this action is the Northern District of Texas, and further agree

9 that Southwest’s agreement not to oppose Plaintiff’s motion for preliminary approval in the

10 Northern District of California will not be held against Southwest in the event that the Settlement

11 is not approved, the parties return to active litigation, and Southwest re-notices its motion to

12 transfer venue. The Parties agree that upon the filing of the motion for preliminary approval,

13 Southwest or the parties shall request the Court to administratively terminate its motion to transfer

14 venue.

15

NOW, THEREFORE, in reliance on the mutual promises, covenants, releases, and

16 obligations as set out in this Settlement Agreement, and for good and valuable consideration, the

17 Parties hereby stipulate and agree to resolve the Claims of Class Members that will be released

18 pursuant to Section XIV of this Settlement Agreement.

19 IV. THE SETTLEMENT CLASS

20

A. The Parties agree, for purposes of this Settlement Agreement, that the following

21 class should be certified pursuant to Rule 23 of the Federal Rules of Civil Procedure: All former or

22 current pilots employed by Southwest who took Short-Term Military Leave from Southwest

23 between January 1, 2001 and the Preliminary Approval Date.

24

B. The Parties will cooperate and each use their best reasonable efforts to obtain

25 certification of an opt-out class under Rule 23(a) and 23(b)(3) of the Federal Rules of Civil

26 Procedure.

27

C. At the time that Plaintiff moves for preliminary approval of the Settlement, Plaintiff

28 will also seek, and Southwest will not oppose, certification of the Settlement Class solely for the

- 8 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 purpose of Settlement.

2

D. On the Effective Date of the Settlement Agreement, all members of the Settlement

3 Class will be bound by the Settlement Agreement’s terms, except that those Class Members who

4 effectively and timely exercise a right to opt out of the Class and the Settlement will not be bound

5 by the Settlement Agreement.

6

E. In the event that the Court does not certify a class having a definition that is

7 substantially similar to the Class definition set forth in this Settlement Agreement or otherwise

8 requires the modification of material terms of this Settlement Agreement, each Party shall have the

9 right to void this Settlement Agreement so long as notice of the exercise of such right is provided

10 to the Court and the opposing Party within 14 days after the date on which the Court enters the

11 order establishing the non-conforming Class definition or otherwise requiring the modification of

12 material terms of this Settlement Agreement.

13

F. The Parties will cooperate and use their best reasonable efforts to obtain the fullest

14 possible participation of all Class Members in the Settlement.

15 V. NOTICE

16

A. Southwest has identified 1,478 Class Members who dropped a trip to take Short-

17 Term Military Leave from January 1, 2008 to the present (“previously identified Class

18 Members”). In addition, Southwest has identified approximately 500 additional former or current

19 Southwest pilots who had a military status since January 1, 2001—whether or not they took

20 military leave since that date—but have not been identified as part of the 1,478 Class Members

21 (“potential Class Members”).

22

B. If the Court certifies the Class and preliminarily approves the Settlement, the

23 Settlement Administrator will provide the previously identified Class Members and potential Class

24 Members with a copy of the Notice of Proposed Class Action Settlement and Fairness Hearing in

25 the form agreed upon by the Parties, subject to modification and approval by the Court. The

26 Notice will contain a brief description of the Claims advanced by the Class Representative, a

27 summary of the terms of the proposed Settlement, and a notice of a fairness hearing to be held

28

- 9 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 pursuant to Rule 23(e) of the Federal Rules of Civil Procedure.

2

C. Subject to modification and approval by the Court, Notice shall be provided to

3 each previously identified Class Member and potential Class Member as follows: (1) electronic

4 notice by e-mail to all previously identified Class Members and potential Class Members for

5 whom electronic information is available; and (2) direct notice by First Class Mail to all

6 previously identified Class Members and potential Class Members.

7

D. Southwest will cooperate with the Settlement Administrator and Class Counsel to

8 facilitate providing Notice and other court-approved settlement-related communication by

9 electronic means.

10

E. Publication Notice will be provided by a website that will contain information and

11 documents about the Settlement. This website shall be established by the Settlement

12 Administrator and maintained from at least the date on which notice is mailed until the Court no

13 longer maintains jurisdiction over this action.

14

F. A Settlement Administrator will be retained to provide notice to the previously

15 identified Class Members and potential Class Members and perform other services as set forth in

16 this Settlement Agreement. Within ten (10) business days of the Court’s Order Granting

17 Preliminary Approval, Southwest shall provide the Settlement Administrator with the following

18 contact information for each known Class Member and each pilot with military status who was

19 employed by Southwest from January 1, 2001 to December 31, 2007, to the extent they are

20 reasonably available in Southwest’s databases: (1) a street mailing address; (2) telephone

21 number(s); (3) Southwest and personal e-mail address(es), including email accounts provided by

22 Southwest; (4) Social Security number; (5) dates of known days with dropped trips for Short-Term

23 Military Leave; and (6) the average annual rate of pay for pilots.

24 VI. SETTLEMENT CONSIDERATION FROM SOUTHWEST

25

A. In full settlement of all Claims that the Class Members will release pursuant to

26 Section XIV, and in exchange for the consideration Southwest will receive as set forth in this

27 Agreement, Southwest agrees to the following:

28

1. Settlement Fund. Southwest will pay Five Million Eight Hundred

- 10 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1

Thousand Dollars ($5,800,000) into an Escrow Account jointly selected by the

2

parties that earns simple interest. The Escrow Account, including any accrued

3

interest, will be used to (i) make supplemental retirement contributions to Class

4

Members’ 401(k) accounts to the greatest extent permitted under the law or, if it is

5

not possible to make such supplemental retirement contributions to Class

6

Members’ 401(k) accounts, as cash payments to Class Members for their claims

7

related to USERRA make-up contributions during periods of Short-Term Military

8

Leave, which shall be consistent with the Plan of Allocation, (ii) make payments of

9

$1,000 each to former employees as consideration for the release of their Sick

10

Leave Claims; (iii) award attorneys’ fees and costs, (iv) fund a Service Award to

11

the Class Representative, (v) fund the costs of providing notice to the Class and

12

administrating the Settlement, and (vi) pay any applicable taxes.

13

2. Sick Leave Accrual for Periods of Short-Term Military Leave.

14

a. For each day in which a Class Member dropped a trip to take Short-

15

Term Military Leave from January 1, 2008 to the Preliminary Approval Date,

16

Southwest will add to the pilot’s Sick Leave balance 100% of the pilot’s unaccrued

17

Sick Leave TFPs based on a rate of 7.1 TFPs per day with dropped trips for Short-

18

Term Military Leave and a rate of 1 TFP of unaccrued Sick Leave for every 10

19

TFPs of dropped trips.2 For each Class Member who submits a sworn writing to

20

the Settlement Administrator stating each month that he or she took Short-Term

21

Military Leave from January 1, 2001 through December 31, 2007, Southwest will

22

add to the pilot’s Sick Leave balance 8.5 TFPs of Sick Leave per year in which the

23

24 2 For example, if a pilot dropped a single day of scheduled work to perform Short-Term Military

25

Leave between January 1, 2008 and the date of Preliminary Approval, the pilot would receive an additional 0.71 TFP of Sick Leave in the pilot’s Sick Leave balance, based upon an estimated 7.1

26 dropped TFP and a Sick Leave accrual rate of 1 TFP for every 10 TFP. If a pilot dropped 10 days of work to perform Short-Term Military Leave between January 1, 2008 and the date of

27 Preliminary Approval, the pilot would receive 7.1 TFP of Sick Leave in the pilot’s Sick Leave

balance, based upon an estimated 71 dropped TFP and a Sick Leave accrual rate of 1 TFP for 28 every 10 TFP.

- 11 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1

pilot took Short-Term Military Leave. If a Class Member is no longer employed by

2

Southwest 30 days after the Effective Date of the Settlement, the Class Member

3

shall receive a $1,000 share of the Net Settlement Fund, in addition to any

4

supplemental retirement contributions or payments he or she is entitled to receive

5

under the Plan of Allocation, except that if a Class Member has elected to exchange

6

accrued Sick Leave for continued health coverage upon retirement and the Class

7

Member is still receiving those continued benefits on the date of the distribution of

8

Sick Leave, that Class Member will receive additional accrued Sick Leave in the

9

same manner as current Southwest employees. The $1,000 shares of the Settlement

10

Fund shall be allocated to Class Members before the Class Members’ shares are

11

determined for claims related to USERRA make-up contributions.

12

b. The funding of each Class Member’s Sick Leave balance pursuant

13

to this settlement will be capped at 1600 TFPs per pilot, which is the maximum

14

balance that a pilot can accrue pursuant to the CBA.

15

c. The process for Class Members to provide a sworn writing to the

16

Settlement Administrator stating each month that the pilot took Short-Term

17

Military Leave from January 1, 2001 through December 31, 2007, is set forth in

18

Section VII(C). The Settlement Administrator will determine for each Class

19

Member how many accrued Sick Leave TFP will be added to the Class Member’s

20

Sick Leave balance, based upon Southwest’s personnel data from 2008 to the

21

Preliminary Approval Date and Class Members’ claim forms that identify the years

22

in which they took Short-Term Military Leave between January 1, 2001 and

23

December 31, 2007.

24

d. Within 30 days of the Effective Date, Southwest will add to each

25

Class Member’s Sick Leave balance the amount of accrued Sick Leave TFP that

26

the Settlement Administrator determines will be added pursuant to this Section.

27

B. In addition to the consideration described in the preceding paragraphs, and in

28 exchange for the consideration it will receive as set forth in this Agreement, Southwest agrees to

- 12 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 implement the non-monetary relief set forth herein in Section X.

2 VII. IDENTIFYING THE CLASS MEMBERS AND SHORT-TERM MILITARY

3

LEAVE TAKEN FROM 2001 TO 2007

4

A. Although the Class Period in this Case extends as far back as January 1, 2001,

5 Southwest does not possess comprehensive records to identify which Southwest pilots took Short-

6 Term Military Leave from January 1, 2001 through December 31, 2007. Because of this gap in

7 data, it is possible that the parties cannot through Southwest’s own records identify all members of

8 the Settlement Class. And to provide appropriate credit under the Plan of Allocation to Class

9 Members who took Short-Term Military Leave between January 1, 2001 and December 31, 2007,

10 it is necessary for Class Members to identify when they took Short-Term Military Leave between

11 January 1, 2001 and December 31, 2007. The parties agree that persons will have an opportunity

12 to demonstrate their membership in the Class if Southwest has not already identified them as Class

13 Members, and will have the opportunity to identify the amount of time that they took Short-Term

14 Military Leave between January 1, 2001 and December 31, 2007.

15

B. Class membership will be based on the data provided by Southwest to the

16 Settlement Administrator about which pilots took Short-Term Military Leave from January 1,

17 2001 through the Preliminary Approval Date, unless, pursuant to the following procedure (or

18 another procedure ordered by the Court) a person provides the Settlement Administrator with

19 information that demonstrates that the person meets the definition of a Class Member.

20

a. Before the Final Approval date, and by a deadline to be established by the

21

Court, any person who claims to meet the definition of a Class Member but who has not

22

been identified by Southwest as a Class Member will be entitled to demonstrate

23

membership in the Settlement Class to the satisfaction of the Settlement Administrator. A

24

person may make this showing by: (1) submitting a sworn statement to the Settlement

25

Administrator that the person was a Southwest pilot who took Short-Term Military Leave

26

between January 1, 2001 and the date of Preliminary Approval, and (2) demonstrating

27

through documentary evidence or having Southwest verify, upon a request from the

28

Settlement Administrator, that the person was a Southwest pilot during the Class Period.

- 13 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1

Within five business days (or another period ordered by the Court) of when a person

2

submits a sworn statement to demonstrate that he or she is a Class Member, the Settlement

3

Administrator shall submit a request to Southwest for Southwest to identify whether the

4

person was a pilot for Southwest during the Class Period. If Southwest agrees that the

5

person was a pilot for Southwest during the Class Period, the person shall be deemed to

6

have been a Southwest pilot during the Class Period. If Southwest does not agree that the

7

person was a pilot for Southwest during the Class Period, the Settlement Administrator

8

shall send a deficiency letter to the person requiring the person to provide documentary

9

evidence to demonstrate that he or she was a pilot for Southwest during the Class Period

10

and return that evidence within twenty-one (21) days of the date of the deficiency letter (or

11

another period ordered by the Court). If the person submits such documentary evidence,

12

the Settlement Administrator will determine whether the person was employed by

13

Southwest as a pilot during the Class Period.

14

b. To the extent that a person demonstrates membership in the Settlement

15

Class to the satisfaction of the Settlement Administrator, that person will be included in the

16

Settlement Class and Southwest will provide the Settlement Administrator with any

17

available relevant data from the period of January 1, 2008 to December 31, 2013 that is

18

necessary to perform calculations regarding that person’s Sick Leave and share of the Net

19

Settlement Fund pursuant to the Plan of Allocation for the period covering January 1, 2008

20

to December 31, 2013. A person who demonstrates his or her membership in the Class

21

shall have the same opportunity as other Class Members to identify the amount of Short-

22

Term Military Leave that the person took between January 1, 2001 and December 31,

23

2007, as described in Section VII(C).

24

C. For the months between January 1, 2001 and December 31, 2007, Class Members

25 will have an opportunity to identify the number of days each month in which they took Short-

26 Term Military Leave and those days of Short-Term Military Leave shall be taken into account to

27 determine the Class Member’s share of the Net Settlement Fund pursuant to the Plan of Allocation

28 and to determine whether the Class Member will receive 8.5 TFP of accrued Sick Leave for a year

- 14 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 in which the Class Member took Short-Term Military Leave from January 1, 2001 and December

2 31, 2007. Pursuant to the following procedure, Class Members shall provide the Settlement

3 Administrator with information on the number of days each month in which they took Short-Term

4 Military Leave from January 1, 2001 to December 31, 2007.

5

a. Before the Final Approval date, and by 120 days after the date that Notice is

6

mailed to the Class (or a deadline to be established by the Court), any Class Member who

7

took Short-Term Military Leave from January 1, 2001 to December 31, 2007 shall submit

8

to the Settlement Administrator an online claim form signed under oath that identifies for

9

each month between January 1, 2001 to December 31, 2007 the number of days in which

10

the Class Member engaged in military service for a period of 14 consecutive days or less.

11

The claim form will advise pilots that, before singing the claims form under oath, they

12

should make reasonable efforts to confirm their claims with their own personal records of

13

military service or the records of military service reasonably available to them through the

14

military.

15

b. Upon receipt of timely online claim forms, the Settlement Administrator

16

shall determine for each month between January 1, 2001 to December 31, 2007 the number

17

of days of military service for periods of 14 consecutive days or less that each Class

18

Member identified in his or her online claim form. These days of military leave shall be

19

considered for the purpose of the Plan of Allocation that will be approved by the Court.

20

c. Upon receipt of timely online claim forms, the Settlement Administrator

21

shall determine for each year between January 1, 2001 to December 31, 2007 whether each

22

Class Member had any days of military service for periods of 14 consecutive days or less,

23

and for each such year Southwest will add to the pilot’s Sick Leave balance 8.5 TFPs of

24

Sick Leave.

25 VIII. DISTRIBUTION FROM THE SETTLEMENT FUND

26

A. Payment of Cash Settlement Amount into Escrow Account: Within seven (7)

27 calendar days of the Effective Date of this Settlement Agreement, Southwest will deposit the Cash

28 Settlement Amount into an Escrow Account that will accrue simple interest. The Escrow Account

- 15 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 will be established by the Settlement Administrator, with the Settlement Administrator acting at

2 the joint direction of Lead Class Counsel and Southwest in administering the Escrow Account.

3 The Cash Settlement Amount plus any interest on the Cash Settlement Amount while in escrow

4 will constitute the Settlement Fund. The Cash Settlement Amount excludes individual investment

5 earnings and no Class Member is entitled to investment earnings on his or her allocation of the

6 Settlement Fund in accordance with his or her investment directions under the 401(k) Plan.

7

B. Qualified Settlement Fund: To the extent possible and at the earliest date

8 possible, the Settlement Fund is intended by the Parties to be a “qualified settlement fund” for

9 federal income tax purposes pursuant to Treas. Reg. § 1.468B-1.

10

C. Attorneys’ Fees & Expenses: Pursuant to the deadline set by the Court and no

11 later than fourteen (14) days prior to the deadline(s) by which Class Members must object and/or

12 opt out of the Settlement (if opt-outs are permitted), Class Counsel will file any motion requesting

13 the payment of attorneys’ fees, expenses/costs, and/or a Service Award from the Settlement Fund.

14

D. Distribution and Allocation of the Settlement Fund to Class Members:

15

A. Subject to Section VIII(G) below, the Net Settlement Fund will be

16 distributed to Class Members after the payment of any award of attorneys’ fees, reimbursement of

17 any expenses, any Service Award to the Class Representative from the Settlement Fund, and any

18 applicable taxes or withholdings.

19

B. Class Counsel and Southwest will submit a joint Proposed Plan of

20 Allocation to the Court for the distribution of the Net Settlement Fund in the form attached hereto

21 as Exhibit A. The Proposed Plan of Allocation is subject to approval or modification by the Court.

22 If the Court rejects the Proposed Plan of Allocation, the Parties will meet and confer and propose a

23 Revised Proposed Plan of Allocation. If the Court rejects the Revised Proposed Plan of

24 Allocation, the Parties will ask the Court to implement a Plan of Allocation that satisfies the

25 Court. If the Proposed Plan of Allocation is rejected or modified by the Court or on appeal, such

26 modification will not constitute a material modification of the Settlement, will not void the

27 Settlement Agreement, and will not provide a basis for either party to withdraw from the

28 Settlement Agreement.

- 16 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1

C. Before the distribution of the Net Settlement Fund, the Settlement

2 Administrator will determine which persons are Class Members and the share of the Net

3 Settlement Fund that each of the Class Members will receive pursuant to the Plan of Allocation

4 approved by the Court, including all Class Members who identify themselves to the satisfaction of

5 the Settlement Administrator and all periods of Short-Term Military Leave that are identified by

6 Class Members between January 1, 2001 and December 31, 2007, to the satisfaction of the

7 Settlement Administrator, through the process set forth in Section VII of this Settlement

8 Agreement.

9

D. As described in section VIII(I), once the Settlement Administrator has

10 determined the share of the Net Settlement Fund each Class Member will receive, the Settlement

11 Administrator will work with Southwest to determine the amount of each Class Member’s

12 payment that can be put directly into the Class Member’s 401(k) account on a tax-deferred basis.

13 Any payments that can be made directly into the Class Member’s 401(k) account on a tax-deferred

14 basis will be placed directly into each Class Member’s 401(k) account, and whatever amounts

15 cannot be placed into the 401(k) account on a tax-deferred basis will be paid to Class Members

16 through checks less any necessary tax deductions. No payments to Class Members shall be made

17 until Southwest receives a final response from the Internal Revenue Service (“IRS”) on whether

18 the payments can be made into the Class Members’ 401(k) accounts on a tax-deferred basis.

19

E. No portion of the Cash Settlement Amount or the Settlement Fund, including any

20 undistributed monies, will revert to Southwest.

21

F. Maximizing Distributions To the 401(k) Plan: All distributions to the 401(k)

22 Plan, including Plan Amounts, distributed pursuant to this Settlement Agreement are intended to

23 be corrective contributions for specific years covered by this Settlement Agreement. To the

24 maximum extent that such contributions on behalf of the members of the Class can be made in

25 compliance with the applicable IRS limits for each such year without jeopardizing the tax-

26 qualified status of the 401(k) Plan, Southwest will use its best reasonable efforts to obtain and

27 maximize the tax-favored treatment of the distributions made pursuant to this Settlement

28 Agreement, and will submit an application for correction under the Employee Plan Compliance

- 17 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 Resolution System, as set forth in Revenue Procedure 2016-51, or later guidance, so that the Plan

2 Amounts contributed on behalf of each Class Member reflect corrective contributions for the

3 corresponding year(s) in which they allegedly should have been allocated to the Class Member’s

4 Plan account. Southwest will provide copies to Class Counsel of any correspondence to and from

5 the IRS regarding the implementation of such corrective procedures related to the Settlement. The

6 Net Settlement Fund will not be contributed or distributed to Class Members until such time as

7 Southwest receives a favorable compliance statement from the IRS in response to its application

8 under the Employee Plan Compliance Resolution System, which may take one or more years. If

9 Southwest does not receive a compliance statement from the IRS, then contributions will be

10 distributed to Class Members as set forth above and will not be contributed to the Class Members’

11 401(k) Plan accounts.

12

G. Taxes

13

1. Payment of Taxes on the Settlement Fund: Following the Effective Date

14

and the deposit of the Cash Settlement Amount into the Escrow Account, the Settlement

15

Administrator shall to the extent necessary establish a reserve (the “Tax Reserve”) within

16

the Settlement Fund to pay any taxes that are or will be owed (but not yet due) and for

17

expenses related to payment of taxes and filing returns.

18

2. Taxation of Payments to Class Members: As described in Section

19

VIII(G) above, the Parties will work collaboratively to maximize the amount of Class

20

Members’ payments that will be made directly into their 401(k) accounts to defer taxes on

21

those payments. However, to the extent that any amount of a Class Member’s payments

22

must be made to them in cash and not directly into their 401(k) accounts, the Settlement

23

Administrator shall withhold and remit to tax authorities any federal or state taxes, file the

24

required tax forms, and issue the required IRS forms to the Class Members. To the extent

25

that the Settlement Administrator determines that payroll taxes should be withheld from

26

the payments that Class Members receive from the Net Settlement Fund, both the

27

employee and employer share of the payroll taxes shall be paid from the Net Settlement

28

Fund.

- 18 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1

3. IRS Guidance: Southwest will submit an application for correction under

2

the Employee Plan Compliance Resolution System, as set forth in Revenue Procedure

3

2016-51, on what amounts of the Class Members’ payments from the Net Settlement Fund

4

may be deposited directly into the 401(k) Plan, and will use reasonable best efforts to

5

expedite the final guidance from the IRS.

6

4. Responsibility for Tax Liabilities: Southwest will not be held responsible

7

for any tax liabilities associated with payments made to Class Members.

8

H. Distribution By Southwest as the 401(k) Plan Sponsor:

9

1. By no later than 30 days after the Effective Date (or within another period

10

set forth by the Court), the Settlement Administrator will provide counsel for the Parties

11

and Southwest, the 401(k) Plan sponsor, with a spreadsheet that details the monetary

12

allocation from the Net Settlement Fund to which each Class Member is entitled for each

13

year covered by the Settlement Agreement, as determined by the Settlement Administrator

14

under the Plan of Allocation approved by the Court.

15

2. By no later than 30 days after receiving the information in Paragraph 1 (or

16

within another period set by the Court), or 30 days after receiving final confirmation from

17

the IRS about making the Class Members’ payments directly into the 401(k) account on a

18

tax-deferred basis, whichever is later, Southwest will inform the Settlement Administrator

19

in writing for each Class Member (a) the Plan Amount, and (b) what amount of each Class

20

Member’s Settlement Fund allocation, corresponding to each year covered by the

21

Settlement Agreement, cannot be contributed to the Class Member’s 401(k) Account for

22

each such year without jeopardizing the tax-qualified status of the 401(k) Plan under

23

applicable IRS limits (the “Cash Amount”). In the event that Southwest determines that

24

more time than 270 days from the Effective Date is needed to ensure that the allocation of

25

the Net Settlement Fund to Class Member 401(k) accounts will not jeopardize the tax-

26

exempt status of the 401(k) Plan, Southwest shall promptly notify Class Counsel of the

27

reasons for that determination. Should the Parties have a dispute about when the allocation

28

of the Net Settlement Fund or payments should be made, any party may move the Court

- 19 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1

for an order regarding when the allocation or payments should occur.

2

3. Except for those Settlement Fund monies that cannot be paid to a Class

3

Member’s 401(k) account because of applicable IRS limits, the Settlement Administrator

4

will transmit to Southwest in the form of a cash payment the Plan Amounts within the

5

period set by the Court, which shall not in any event be earlier than the Effective Date.

6

4. Once the Plan Amounts have been transmitted from the Settlement

7

Administrator to Southwest in its capacity as Plan sponsor, Southwest will distribute or

8

cause to be distributed the Plan Amounts to each Class Member’s 401(k) account in the

9

amounts previously identified.

10

5. The Settlement Administrator will distribute the respective Cash Amounts,

11

if any, to the Class Members at or about the same time that the Plan Amounts are

12

transmitted from the Settlement Administrator to Southwest, and will withhold and remit

13

to tax authorities any relevant taxes from those Cash Amounts.

14

6. Class Members shall have 180 days to cash their checks for any Cash

15

Amounts received. Any amount remaining unclaimed after that point shall be provided to

16

a cy pres entity agreed upon by the parties. 30 days before the 180 days have expired, the

17

Settlement Administrator will mail a postcard to any Class Members who have not yet

18

cashed their checks reminding them to cash their checks within the 180-day period.

19 IX. SETTLEMENT ADMINISTRATION

20

A. Settlement Administrator: The Settlement Administrator will be agreed to by the

21 Parties and approved by the Court. Any proposed Settlement Administrator will have experience

22 providing notice to Class Members in employment or employee benefit class action settlements,

23 and in supervising and administering large and complex settlement funds. The Parties will issue a

24 request for proposal to at least several potential settlement administrators for bids, and the request

25 for proposal will include a request that the settlement administrators indemnify Southwest for any

26 data breach related to the Class Members. The Settlement Administrator will undertake the

27 following to administer this Settlement consistent with the terms of this Settlement, the Proposed

28 Plan of Allocation as approved by the Court, and such other procedures or provisions as

- 20 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 established or approved by the Court:

2

1. Print and mail and e-mail the Class Notice Packet to the previously

3

identified Class Members and potential Class Members in a manner consistent with that

4

directed by the Court and undertake a single trace and re-mailing for all undeliverable

5

Notice Packets;

6

2. Establish a web site that includes information on the Settlement and that

7

includes a claim form that permits individuals to identify themselves as Class Members

8

and that permits Class Members to identify the number of days that they took Short-Term

9

Military Leave from January 1, 2001 to December 31, 2007;

10

3. Provide Counsel for the Parties with copies of all written objections to the

11

Settlement Agreement, any request for exclusions from the Class, and all claim forms that

12

identify persons as Class Members and/or identify the number of days that they took Short-

13

Term Military Leave from January 1, 2001 to December 31, 2007;

14

4. Maintain and staff a toll-free phone number and a website until the Court

15

no longer exercises jurisdiction over this Case;

16

5. Establish and manage a Qualified Settlement Fund, establish and manage

17

an Escrow Account, and submit any tax return and/or tax payments to tax authorities

18

regarding the Qualified Settlement Fund and the Escrow Account;

19

6. Provide the Plan Amounts and Sick Leave amounts to Southwest, disburse

20

the Cash Amounts to the Class Members, and withhold and remit relevant taxes on the

21

Cash Amounts disbursed to Class Members;

22

7. Track the status of mailing and re-mailing of Notice Packets, the status of

23

Plan Amounts disbursed to Southwest, the status of Cash Amounts disbursed to Class

24

Members, the status of accrued Sick Leave added to the Sick Leave balances of Class

25

Members, and the date of receipt of written objections or challenges filed by any Class

26

Members;

27

8. Provide monthly reporting to the Parties regarding the items above until the

28

Effective Date, and thereafter provide quarterly reporting to the Parties until the Court no

- 21 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1

longer exercises jurisdiction over this Case.

2 X. NON-MONETARY SETTLEMENT CONSIDERATION

3

A. Within 30 days of the Effective Date of the Settlement Agreement, Southwest will

4 modify its policy to allow pilots to accrue Sick Leave during periods of Short-Term Military

5 Leave. Pilots who take Short-Term Military Leave will accrue Sick Leave for Short-Term

6 Military Leave at the same rate that pilots accrue Sick Leave during other forms of leaves of

7 absence for which pilots accrue Sick Leave.

8

B. Within 30 days of the Effective Date of the Settlement Agreement, Southwest will

9 (i) identify in all Southwest pilots’ monthly paystubs the dollar amount of Deemed Earnings TFP

10 associated with their military leave for the relevant month; (ii) provide Southwest pilots individual

11 monthly emails that state the number of TFP for retirement plan purposes that the pilot earned in

12 the prior month (e.g., June’s statement will show the TFPs for May); and (iii) implement a

13 procedure such that a Southwest pilot may ask a designated Southwest human resources employee

14 to provide him or her with detailed information on how the pilot’s Deemed Earnings TFP for the

15 prior month was calculated after the conclusion of each monthly pay period, and Southwest will

16 provide that information as soon as administratively feasible, which ordinarily should not exceed

17 30 days after the request is made and will not exceed 60 days after the request is made. In

18 addition, Southwest will consider the feasibility of automatically providing pilots detailed

19 information on each pilot’s Deemed Earnings TFP for the prior month on a monthly basis, via

20 email or otherwise.

21 XI. ATTORNEYS’ FEES, EXPENSES, COSTS, AND SERVICE AWARD

22

A. Class Counsel will be entitled to seek an award of attorneys’ fees and

23 reimbursement of expenses and costs from the Settlement Fund subject to the approval of and in

24 an amount determined by the Court. Any award of attorneys’ fees or reimbursement of expenses to

25 Class Counsel will be paid out of the Settlement Fund in an amount determined by the Court.

26

B. In recognition of the service that the Class Representative has performed on behalf

27 of the Class and/or for reimbursement of his time and expenses, Class Counsel will be entitled to

28 seek a Service Award to be paid out of the Settlement Fund for the Class Representative, Plaintiff

- 22 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 Jayson Huntsman, subject to the approval of and in an amount to be approved by the Court.

2

C. Southwest will not take any position with respect to Class Counsel’s request for an

3 award of attorneys’ fees, reimbursement of expenses or costs, and the Service Award, so long as

4 the request for such attorneys’ fees does not exceed $1,740,000 plus any expenses. Southwest will

5 not take any position with respect to Plaintiff’s request for an award of a Service Award for the

6 Class Representative, so long as the request for such a Service Award does not exceed $2,000 plus

7 reimbursement for any lost compensation and out-of-pocket expenses that the Class

8 Representative experienced due to his service to the Class and participation in the Litigation.

9

D. On the Effective Date of the Settlement Agreement, Class Counsel will be entitled

10 to a disbursement from the Settlement Fund equal to the amount of attorneys’ fees, expenses/costs

11 and the Service Award as awarded by the Court, and will be entitled to distribute any Service

12 Award to the Class Representative consistent with the Court’s order granting Final Approval. In

13 the event that there is an appeal of the Final Approval of the Settlement Agreement solely on the

14 issue of the amount of attorneys’ fees and costs, within 30 days of the notice of appeal Class

15 Counsel will be entitled to a disbursement from the Settlement Fund of such amount of the

16 attorneys’ fees and/or such amount of expenses/costs as to which there is no objection.

17 XII. PROCEDURES GOVERNING APPROVAL OF THIS SETTLEMENT

18

AGREEMENT

19

A. Within 15 days of the date on which this Settlement Agreement is fully executed by

20 or on behalf of all Parties, Plaintiff shall submit this Settlement Agreement and its Exhibits to the

21 Court along with a motion for its preliminary approval, a motion seeking certification of the class

22 and appointment of Class Counsel, a plan for providing Notice to the Class Members, and a

23 recommendation of a Settlement Administrator to perform their respective duties set forth in this

24 Settlement Agreement. The Motion shall be accompanied by a proposed Preliminary Approval

25 Order. The Motion shall specifically request that the Court:

26

1. Certify the Class for settlement purposes under Rule 23(a) and 23(b)(3);

27

2. Appoint Class Counsel and Class Representative, as defined in this

28

Settlement Agreement, to represent the Class;

- 23 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1

3. Grant preliminary approval to the Settlement Agreement and its Exhibits;

2

4. Establish a date by which the Court will approve the Notice to be provided

3

to Class Members and the manner by which Notice is to be provided pursuant to Rule

4

23(e)(1) of the Federal Rules of Civil Procedure;

5

5. Establish the date by which the Notice will be mailed to Class Members and

6

the date and procedure by which Class Members must opt out (should the Court provide

7

Class Members an opportunity to opt out);

8

6. Appoint a Settlement Administrator to perform the duties set forth in this

9

Settlement Agreement;

10

7. Establish a date by which persons may identify themselves as Class

11

Members and/or identify the months and number of days that they took Short-Term

12

Military Leave from January 1, 2001 to December 31, 2007, and a date by which the

13

Settlement Administrator must make determinations with respect to membership in the

14

Class and the months and number of days that Class Members took Short-Term Military

15

Leave from January 1, 2001 to December 31, 2007;

16

8. Set a date and procedure by which objections from Class Members must be

17

filed and by which individuals must exclude themselves from the Class;

18

9. Set a date for the fairness hearing at which time the Court will determine

19

whether the Settlement Agreement should be approved under Rule 23(e) of the Federal

20

Rules of Civil Procedure.

21

B. Southwest will not oppose Plaintiff’s motions for preliminary approval of the

22 Settlement Agreement, certification of the Class, approval of the Notice, and appointment of

23 Plaintiff’s counsel as Class Counsel.

24

C. No later than thirty (30) days before the Fairness Hearing, the Settlement

25 Administrator shall file with the Court a declaration confirming compliance with the Notice

26 procedures approved by the Court.

27

D. At the fairness hearing, the Parties will jointly request that the Court finally

28 approve this Settlement Agreement pursuant to Rule 23(e) of the Federal Rules of Civil Procedure.

- 24 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 The Parties agree to take all actions necessary to obtain approval of this Settlement Agreement

2 consistent with their ethical duties and obligations to their clients and, as to Class Counsel, the

3 Settlement Class.

4

E. The Parties reserve the right, subject to the Court’s approval, to request any

5 reasonable extensions of time that might be necessary to carry out any of the provisions of this

6 Settlement Agreement. In addition, upon a showing of good cause the Settlement Administrator

7 may extend any deadline for a person to submit information about membership in the Class or

8 submit information on the number of days of Short-Term Military Leave a Class Member took

9 from January 1, 2001 to December 31, 2007.

10

11

12 XIII. COURT SUPERVISION OF THE SETTLEMENT AGREEMENT & DISMISSAL

13

OF THE ACTION

14

A. If the Court preliminarily approves the Settlement, the Parties will jointly agree to

15 seek an order and final judgment dismissing the case with prejudice consistent with Rules 41(a)(2)

16 and 23(e) of the Federal Rules of Civil Procedure, subject to the terms of the Settlement

17 Agreement and subject to the Court’s continuing jurisdiction as set forth in this section.

18

B. The Court shall retain continuing jurisdiction over this action beyond the Final

19 Approval Date for a period of three years from the Final Approval Date. If all payments

20 contemplated by the Settlement Agreement have not been made after three years from the Final

21 Approval Date, the Parties shall inform the Court that certain payments have not yet been made

22 and the Court shall extend its continuing jurisdiction until all such payments have been made.

23

C. The Parties agree to submit to the jurisdiction of the Court and shall be bound by

24 the terms of this Settlement Agreement, including, without limitation, disputes related to

25 interpreting, implementing, and enforcing the Settlement embodied in this Settlement Agreement,

26 and will request that the Court retain jurisdiction to hear any such disputes. If Plaintiff or a

27 member of the Class prevails in securing relief in the event of a violation or breach of the

28 Settlement Agreement by Southwest, the Court shall have discretion to award Class Counsel

- 25 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 attorneys’ fees and costs against Southwest.

2

D. The waiver by one Party of any breach of this Settlement Agreement by any other

3 Party shall not be deemed a waiver of any other breach of this Settlement Agreement. The

4 provisions of this Settlement Agreement may not be waived except by a writing signed by the

5 affected Party, or counsel for that Party, or orally on the record in court proceedings.

6 XIV. RELEASE OF CLAIMS

7

A. Upon the Effective Date of this Settlement Agreement, Plaintiff and all other Class

8 Members (including their respective heirs, beneficiaries, executors, administrators, estates, agents,

9 attorneys, predecessors, successors, and assigns) release and fully and finally settle, relinquish,

10 waive and discharge, any and all claims, actions, demands, damages, rights, obligations, expenses,

11 costs, causes of action, or liabilities, known or unknown, against Southwest, the 401(k) Plan

12 administrator, the 401(k) Plan sponsor, the 401(k) Plan, 401(k) Plan fiduciaries, and their parents,

13 subsidiaries, agents, employees, and other affiliated persons or entities that (1) arise from or relate

14 to the accrual of Sick Leave during periods of Short-Term Military Leave from January 1, 2001

15 through the date of Preliminary Approval, or (2) arise from or relate to employee or employer

16 contributions to Class Members’ 401(k) accounts arising from or related to periods of Short-Term

17 Military Leave from January 1, 2001 through December 31, 2013, including those related to the

18 failure to provide Class Members with information regarding their 401(k) accounts, Short-Term

19 Military Leave, or Deemed Earnings to facilitate additional contributions to Class Members’

20 401(k) accounts based on Short-Term Military Leave.

21

B. In the event that the Court certifies the Class under Rule 23(b)(3) or otherwise

22 permits Class Members to opt out of the Class, this release shall not apply to any Class Member

23 who successfully opts out of the Settlement Agreement pursuant to the deadlines and procedures

24 established by the Court.

25 XV. TERMINATION OF THE SETTLEMENT

26

A. In the event that Final Approval is not entered by the Court or the Settlement is

27 materially modified by the Court, either Class Counsel or Southwest may void this Settlement

28 Agreement.

- 26 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1

B. In the event that the Court certifies the Class under Rule 23(b)(3) or otherwise

2 permits Class Members to opt out of the Class, Southwest will have the unilateral right by no later

3 than seven (7) calendar days before the Final Approval hearing to withdraw from the Settlement

4 and resume the Litigation if more than 50 Class Members opt out of the Class and the Settlement.

5

C. In the event that Final Approval is reversed on appeal, or in the event that either

6 Class Counsel or Southwest exercises a right to withdraw from the Settlement Agreement within

7 the times specified in this Agreement prior to the Final Approval Date, (1) the Settlement Fund

8 (including any interest or other earnings, but excluding any amount paid or owing for taxes or that

9 is necessary to prepare any tax returns, or that is owed to the Settlement Administrator) shall be

10 returned to Southwest, (2) Southwest will not be released from the claims asserted in the

11 Litigation, and (3) the Parties will return to their respective positions in the Litigation as of the day

12 before this Settlement Agreement was executed.

13 XVI. CLASS ACTION FAIRNESS ACT NOTICE

14

A. Pursuant to the Class Action Fairness Act of 2005 (“CAFA”), within ten (10) days

15 of the filing of the Preliminary Approval Motion, Southwest, at its own expense, shall prepare and

16 provide notices and materials required by CAFA set forth in 28 U.S.C. § 1715(b)(1)-(8) to the

17 Attorney General of the United States and the Attorneys General of all states in which any

18 members of the Class reside or any other Appropriate Federal official or Appropriate State Official

19 identified by the Court (“Appropriate State and Federal Officials”).

20

B. At the time that the Preliminary Approval Motion is filed, Southwest will identify

21 to the best of its knowledge and ability, the states in which any Class Members reside. In the

22 Proposed Preliminary Approval Order, Plaintiff and Southwest will request that the Court

23 determine (i) that the Attorney General of the United States and the Attorneys General of the states

24 that the Defendants have identified as being the residence of the members of the Class are the

25 Appropriate State and Federal Officials pursuant to CAFA, 28 U.S.C. § 1715(a) & (b), and (ii) that

26 in light of the terms of the Settlement, it is not feasible to include in the Notices to the Appropriate

27 State and Federal Officials the information described in CAFA, 28 U.S.C. § 1715(b)(7) (A) & (B).

28

C. Southwest will provide Class Counsel with a copy of the proposed notice and

- 27 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 materials that Southwest intends to send to the Appropriate State and Federal Officials as soon as

2 practicable, but no later than 1 business day, before such materials are sent.

3

D. To ensure compliance with CAFA, 28 U.S.C. § 1715(d), the Preliminary Approval

4 Motion will request that the Court set the Final Approval Hearing for a date no earlier than ninety

5 (90) days after the date that Southwest is required to provide notice under 28 U.S.C. § 1715(b).

6 XVII. MISCELLANEOUS PROVISIONS

7

A. This Settlement Agreement is deemed to have been drafted by all Parties, as a

8 result of arm’s-length negotiations among the Parties. Whereas all Parties have contributed

9 substantially and materially to this Settlement Agreement, it shall not be construed more strictly

10 against one Party than another.

11

B. The headings in this Settlement Agreement are used for purposes of convenience

12 and ease of reference only and are not meant to have any legal effect, nor are they intended to

13 influence the construction of this Settlement Agreement in any way.

14

C. All terms of this Settlement Agreement shall be governed by and interpreted

15 according to the laws of the State of Texas without regard to its rules of conflicts of law and in

16 accordance with the laws of the United States.

17

D. This Settlement Agreement shall be binding upon, and inure to the benefit of, the

18 successors, assigns, executors, administrators, heirs and legal representatives of the Parties,

19 provided, however, that no assignment by any Party shall operate to relieve such party of its

20 obligations hereunder.

21

E. This Settlement Agreement may be executed in one or more original, photocopied,

22 or facsimile counterparts. All executed counterparts and each of them shall be deemed to be one

23 and the same instrument.

24

F. No opinion or advice concerning the tax consequences of the Settlement

25 Agreement has been given or will be given by counsel involved in the Case to Southwest, the

26 Settlement Class, or the Class Representative, nor is any representation or warranty in this regard

27 made by or to anyone by virtue of this Settlement Agreement. The tax obligations of Southwest,

28 the Settlement Class, the Class Representative, and Class Counsel and the determination thereof

- 28 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 are the sole responsibility of each of them, and it is understood that the tax consequences may vary

2 depending on the particular circumstances of each member of the Settlement Class.

3

G. All of the Exhibits attached hereto and identified herein are hereby incorporated by

4 reference as though fully set forth herein.

5

H. This Settlement Agreement may be amended or modified only by written

6 instrument signed by, or on behalf of, all Parties or their successors in interest, and approved by

7 the Court.

8

I. This Settlement Agreement constitutes the entire agreement among the Parties, and

9 no representations, warranties or inducements have been made by or to any Party concerning this

10 Settlement Agreement or the Agreement in Principle, other than the representations, warranties,

11 and covenants contained and memorialized in such documents. In the event of any conflicts

12 between this Settlement Agreement, the Agreement in Principle, or any other document, the

13 Parties agree that this Settlement Agreement shall control.

14

J. Southwest shall bear its own attorneys’ fees, costs, and expenses in this Case.

15 Except as provided in this Settlement Agreement, the Class and the Class Representative shall

16 bear their own attorneys’ fees, costs, and expenses in this Case.

17

K. Each signatory to this Settlement Agreement represents that he, she or it is

18 authorized to enter into this Settlement Agreement on behalf of the respective Parties he, she or it

19 represents.

20

L. References in this Settlement Agreement to time and mailing shall be construed in

21 the following manner. All time periods in this Settlement Agreement that are stated in terms of

22 days are calendar days. Unless otherwise specified in this Settlement Agreement, a document shall

23 be deemed timely if it is received, postmarked, or bears a similar reliable verification of delivery

24 before the expiration of the applicable period, or in the absence of a legible postmark, if it is

25 received by mail within three days of the expiration of the applicable period. The first day counted

26 shall be the day after the event from which the time period begins to run and the last day of the

27 period shall be included, unless it falls on a Saturday, Sunday, or Federal holiday, in which case

28 the period shall be extended to include the next business day.

- 29 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1

M. Whenever this Settlement Agreement provides for notice to be given to the Parties,

2 such notice shall be served on the Parties as follows:

3

Notice to Plaintiff, Plaintiff’s Counsel, or Class Counsel Shall Be Sent To:

4

Peter Romer-Friedman

5

Outten & Golden LLP 601 Massachusetts Ave NW, Suite 200W

6

Washington DC, 20001

Fax: (202) 847-4410

7

prf@outtengolden.com

8

Notice to Southwest Shall Be Sent To:

Brian Berry

9

Ogletree, Deakins, Nash, Smoak & Stewart, P.C.

10

Steuart Tower, One Market Plaza, Suite 1300 San Francisco, CA 94105

11

brian.berry@ogletreedeakins.com

12

N. Nothing in this Settlement Agreement, the Exhibits attached hereto, or the term sheet

13 shall be deemed to or construed to constitute an admission or evidence as to any of the claims or

14 allegations in the Complaint or any other matter, including whether this Case is suitable for class

15 treatment except for the purpose of settlement, nor shall this Agreement, the Exhibits attached

16 hereto, or the Agreement in Principle be used by any Party in this proceeding or any other

17 proceeding or context as reflecting upon the validity or invalidity of any claim or as any evidence

18 concerning the amount of or limit on potential alleged damages that may be recovered by the

19 Settlement Class, or as reflecting on whether this Case is suitable for class treatment except for the

20 purpose of settlement.

21

22

23

24

25

26

27

28

- 30 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

1 IT IS HEREBY AGREED by the undersigned.

2

3 ______________________________
4 JAYSON HUNTSMAN
9/12/2018
5 Dated: ________________________

6

7 8 Approved as to Form:

9 Peter Romer-Friedman 10 Dated: September 11, 2018________ 11

12

Peter Romer-Friedman

13 OUTTEN & GOLDEN LLP

601 Massachusetts Avenue NW,

14 Second Floor West Suite

Washington, D.C. 20001

15 Telephone: (202) 847-4400

Facsimile: (202) 847-4410

16 Email:

prf@outtengolden.com

17 Jahan C. Sagafi Rachel Dempsey

18 OUTTEN & GOLDEN LLP One Embarcadero Center, 38th Floor

19 San Francisco, California 94111 Telephone: (415) 638-8800

20 Facsimile: (415) 638-8810

Email:

jsagafi@outtengolden.com

21 Email:

rdempsey@outtengolden.com

22 Thomas G. Jarrard (pro hac vice) LAW OFFICE OF THOMAS JARRARD PLLC

23

1020 N. Washington Dt. Spokane, WA 99201

24

Telephone: (425) 239-7290 Facsimile: (509) 326-2932

25 Email:

Tjarrard@att.net

26

Matthew Z. Crotty (pro hac vice) CROTTY & SON LAW FIRM, PLLC

27

905 W. Riverside Ave, Suite 409 Spokane, WA 99201

28 Telephone: (509) 850-7011

______________________________
SOUTHWEST AIRLINES CO.
By:
Name (print): ______________________
Title: ______________________
Dated: ________________________
Approved as to Form:
______________________________
Dated: ________________________
Douglas J. Farmer (CA Bar No. 139646) douglas.farmer@ogletree.com Brian D. Berry (CA Bar No. 229893) brian.berry@ogletree.com Jason P. Brown (CA Bar No. 266472) jason.brown@ogletree,com OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. Stueart Tower, Suite 1300 One Market Plaza San Francisco, CA 94105 Telephone: 415.442.4810 Facsimile: 415.442.4870
Attorneys for Defendant Southwest Airlines Co.

- 31 -

SETTLEMENT AGREEMENT

DocuSign Envelope ID: BF3C95CD-A2B3-4EA0-8CB3-1A835960588D

Email: 1

matt@crottyandson.com

2 Attorneys for Plaintiff and the Proposed Class

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

- 32 -

SETTLEMENT AGREEMENT

Exhibit A

PLAN OF ALLOCATION 1. The Net Settlement Fund and Authorized Claimants The Net Settlement Fund1 in this case shall be distributed on behalf of or to Class Members who (1) either have been identified as such by Southwest or who have been determined by the Settlement Administrator to be Class Members, and (2) have not successfully opted out of the Settlement (“Authorized Claimants”). 2. Sick Leave Payments for Class Members No Longer Employed Before any shares of the Net Settlement Fund are allocated for Class Members’ claims related to USERRA make-up contributions, each Authorized Claimant who is no longer employed by Southwest 30 days after the Effective Date of the Settlement shall be allocated a $1,000 share of the Net Settlement Fund, except that if a Class Member has elected to exchange accrued sick leave for continued health coverage upon retirement and the Class Member is still receiving those continued benefits on the date of the distribution of sick leave, that Class Member will receive additional accrued sick leave in the same manner as current Southwest employees. The $1,000 shares of the Net Settlement Fund shall not reduce the amount of supplemental retirement contributions or payments the Authorized Claimant who is no longer employed by Southwest at the time of the Effective Date of the Settlement is entitled to receive under this Plan of Allocation. The total amount of these $1,000 shares allocated to Authorized Claimants who are no longer employed by Southwest 30 days after the Effective Date of the Settlement shall be referred to as the “Former Employee Sick Leave Settlement Shares.”
1 Unless otherwise defined in this Plan of Allocation, capitalized terms have the meanings ascribed to them in the Settlement Agreement. In all instances of discrepancy or ambiguity in definitions or otherwise, the terms of the Settlement Agreement shall control.
1

3. Recognized Claims The Settlement Administrator shall determine each Authorized Claimant’s pro rata share of the Net Settlement Fund less the Former Employee Sick Leave Settlement Shares based upon each Authorized Claimant’s “Recognized Claims.” Each Authorized Claimant’s Recognized Claims shall be determined based upon the aggregate of the potential matching retirement contributions described in Section 2(A) and 2(B) below.
A. Potential Matching Retirement Contributions for Short-Term Military Leave From 2008 to 2013
Based upon the personnel data provided by Southwest for the period of January 1, 2008 through December 31, 2013, for every period in which an Authorized Claimant took Short-Term Military Leave and dropped one or more trips between January 1, 2008 and December 31, 2013, the Authorized Claimant shall have potential matching retirement contributions based on the following calculation:
(1) Each day of Short-Term Military Leave in which a trip was dropped shall be multiplied by 7.1 TFP, then multiplied by the average base wage rate of the pilot in the same year, and then multiplied by the maximum percentage of a pilot’s pensionable pay that Southwest would match under the CBA during the same year2 (“matching make-up contributions per period of Short-Term Military Leave”).
(2) For each year from 2008 to 2013, sum the matching make-up contributions per period of Short-Term Military Leave; however, for any single year in which the sum of the matching make-up contributions per period of Short-Term Military Leave plus the amount of matching
2 Southwest matched 7.3% of pensionable pay between January 1, 2001 and December 31, 2008, 7.8% of pensionable pay between January 1, 2009 and December 31, 2009, and 9.3% of pensionable pay between January 1, 2010 and December 31, 2014.
2

retirement contributions that Southwest made for that pilot during that year exceeds $25,000,
then in that year the Authorized Claimant shall have potential matching retirement contributions
equal to $25,000 minus the amount of matching retirement contributions that Southwest previously made for that pilot during that year.3
(3) Sum the annual amounts of matching retirement contributions calculated in (2).
B. Potential Matching Retirement Contributions for Short-Term Military Leave From 2001 to 2007
The potential matching retirement contributions for periods between January 1, 2001 and
December 31, 2007 shall be calculated based upon the number of days of Short-Term Military
Leave that Authorized Claimants identify as having taken between January 1, 2001 and
December 31, 2007, in timely claim forms submitted to and approved by the Settlement
Administrator, based upon the following calculation:
(1) For each month between January 1, 2001 and December 31, 2007 in which an
Authorized Claimant identified himself or herself as having taken Short-Term Military Leave,
the Authorized Claimant will be deemed to have dropped one-half of a day of trips for every day
in which he or she took Short-Term Military Leave, but no Authorized Claimant shall be deemed to have dropped trips for more than 7 days of Short-Term Military Leave in that month,4 and no
3 For example, if an Authorized Claimant already received $24,000 of matching retirement contributions from Southwest in 2013, and in 2013 the Authorized Claimant had an aggregate of $1,500 of matching make-up contributions per period of Short-Term Military Leave, then the Authorized Claimant’s potential matching retirement contributions for 2013 would be $1,000 (the $25,000 maximum annual matching contribution minus the $24,000 retirement contribution the pilot already received that year), rather than $1,500. 4 Thus, if an Authorized Claimant claimed to have taken ten 10 days of Short-Term Military Leave in a specific month between January 1, 2001 and December 31, 2007, the Authorized Claimant shall be deemed to have dropped trips on 5 days in that month. But if an Authorized Claimant claimed to have taken 20 days of Short-Term Military Leave in a specific month between January
3

Authorized Claimant shall be deemed to have dropped more than 21 days of Short-Term Military
Leave in a single year between January 1, 2001 and December 31, 2007 (“monthly dropped trip
days from 2001 to 2007”). Dropped days of Short-Term Military Leave in excess of twenty-one (21) days will be eliminated from the earliest months in a year.5
(2) For any month between January 1, 2001 and October 31, 2004, the Authorized
Claimant’s monthly dropped trip days from 2001 to 2007 shall be reduced by two-thirds to
reflect Southwest’s defense that USERRA claims that accrued on or after October 10, 2004 are
not timely in this action (“monthly dropped trip days from 2001 to 2007 with SOL discount”).
(3) For each month between January 1, 2001 and December 31, 2007, multiply the
monthly dropped trip days from 2001 to 2007 with SOL discount by 7.1 TFP, then multiply the
resulting figure by the average base wage rate of the pilot in the same year, and then multiply the
resulting figure by the maximum percentage of a pilot’s pensionable pay that Southwest would
match under the CBA during the same year (7.3%).
(4) Sum the monthly amounts of matching retirement contributions calculated in (2).
1, 2001 and December 31, 2007, the Authorized Claimant would only be deemed to have dropped trips on 7 days in that month. 5 For example, if an Authorized Claimant reports that he took 14 days of Short-Term Military Leave in June 2004, 14 days of Short-Term Military Leave in November 2004, 14 days of ShortTerm Military Leave in September 2004, and 14 days of Short-Term Military Leave in December 2004, the Authorized Claimant will hit the annual cap of dropped days of Short-Term Military Leave and will receive credit for 21 days of dropped trip days of Short-Term Military Leave in 2004 (this is because 56 days of Short-Term Military Leave converts in to 28 days of dropped days of Short-Term Military Leave for the year). Accordingly, the Authorized Claimant’s 21 days of dropped trip days of Short-Term Military Leave in 2004 will be allocated among the later months that he took Short-Term Military Leave (7 dropped trip days in September 2004, 7 dropped trip days in November 2004, and 7 dropped trip days in December 2004). And the dropped trip days from June 2004 would not be counted towards the Authorized Claimant’s 21 dropped trip days that year.
4

3. Allocation and Distribution of USERRA Make-Up Contributions Each Authorized Claimant shall receive a pro rata share of the Net Settlement Fund less the Former Employee Sick Leave Settlement Shares based on each Authorized Claimant’s total Recognized Claims as compared to the total Recognized Claims for all Authorized Claimants. Each Authorized Claimant’s pro rata share of the Net Settlement Fund less the Former Employee Sick Leave Settlement Shares shall constitute the payment—other than the accrued sick leave benefits and Former Employee Sick Leave Settlement Shares—that the Authorized Claimant shall receive under the Settlement Agreement. Pursuant to the Settlement Agreement, the Authorized Claimant shall receive some or all of the payment—other than the Former Employee Sick Leave Settlement Shares—as an employer contribution to the Authorized Claimant’s 401(k) account subject to the Internal Revenue Service’s guidance in response to Southwest’s application for correction under the Employee Plan Compliance Resolution System, as set forth in Revenue Procedure 2016-51, or later guidance. Whatever amount of the Authorized Claimant’s payment is not permitted to be contributed to the Authorized Claimant’s 401(k) account on a tax-deferred basis shall be paid directly to the Authorized Claimant, subject to tax reporting and withholdings, including the withholding of any employee and employer payroll taxes, which shall be paid out of the Settlement Fund. The distributions of these payments— other than Former Employee Sick Leave Settlement Shares—into the Authorized Claimant’s 401(k) accounts and/or directly to the Authorized Claimant shall be made by deadlines established by the Settlement Agreement or modified by the Court. 4. Remaining Funds After the Distribution If any funds remain in the Net Settlement Fund by reason of uncashed checks or otherwise after 180 days after checks have been mailed to Authorized Claimants, the remaining
5

funds shall be distributed to non-sectarian, non-profit 501(c)(3) charitable organization recommended by Class Counsel and approved by the Court.
6

Exhibit B

Southwest Airlines Pilots USERRA Sick Leave and 401(k) Retirement Account Litigation NOTICE OF PROPOSED CLASS ACTION SETTLEMENT
Huntsman v. Southwest Airlines Co., No. 4:17-cv-03972-JD (N.D. Cal.) A Federal Court authorized this Notice. This is not a solicitation from a lawyer.

If you were a Southwest Airlines pilot who took short-term military leave on or after January 1, 2001, you could get money
or additional benefits from this class action settlement.

• A Southwest Airlines pilot (the “Plaintiff”) has sued Southwest Airlines Co. (“Southwest”) alleging that Southwest violated USERRA by failing to (i) provide its pilots matching contributions to their 401(k) accounts for their deemed earnings during periods of Short-Term Military Leave for elective deferrals made to the 401(k) Plan, (ii) provide timely information to pilots on their deemed earnings from Short-Term Military Leave so that they can make make-up retirement contributions into their 401(k) accounts, and (iii) provide matching contributions to pilots’ make-up contributions to their 401(k) accounts from periods of Short-Term Military Leave. Plaintiff also alleged that Southwest violated USERRA by failing to provide for the accrual of sick leave when pilots take Short-Term Military Leave, because Southwest provides for the accrual of sick leave when pilots engage in jury duty, union leave, and bereavement leave.

• The Court has determined that the lawsuit can proceed as a class action on behalf of a group of all former or current Southwest pilots who took Short-Term Military Leave from Southwest between January 1, 2001 and [the Preliminary Approval Date].

• Under the Settlement, if you are a current or former Southwest pilot you may be eligible to receive an additional employer contribution to your 401(k) Plan account if you took Short-Term Military Leave from Southwest from January 1, 2001 to December 31, 2013. You may also be eligible to have accrued sick leave added to your sick leave balance or receive a cash payment if you took Short-Term Military Leave from Southwest from January 1, 2001 to [the Preliminary Approval Date]. To the extent feasible, any retirement-related payments under this Settlement will be made as an additional employer contribution to your 401(k) Plan account in a tax-deferred manner.

• If, 30 days after the Settlement becomes final and non-appealable (“Effective Date”), you are a current Southwest employee who is eligible to recover under the Settlement, all accrued sick leave that you are entitled to receive will be added to your sick leave balance. If, 30 days after the Effective Date of the Settlement, you are a former Southwest employee who is eligible to recover under the Settlement, you will receive a one-time payment of $1,000, unless you are a retired pilot and have exchanged your accrued sick leave for continued health care coverage and are still receiving continued health care coverage, in which case you will receive all accrued sick leave that you are entitled to receive under the Settlement for use toward continued health coverage.

• You have received this Notice because Southwest has identified you as either as a Class Member or a potential Class Member. To determine whether you need to submit additional information before it is possible to determine whether you qualify as a Class Member, please visit www.southwestpilotsUSERRAsettlement.com and enter your unique code, <XXXX>, and your password, <XXXX>.

• The Court has preliminarily approved the Settlement. For the Settlement to become final and any payments or benefits to

be distributed, the Court will need to issue final approval after a final approval hearing, which is currently scheduled for

XXXX, XX, 2019.

This date is subject to change without further notice.

Please check

www.southwestpilotsUSERRAsettlement.com, or access the docket at www.pacer.gov for the most up-to-date information.

PLEASE READ THIS NOTICE CAREFULLY. IF YOU ARE A MEMBER OF THE CLASS, THIS SETTLEMENT WILL AFFECT YOUR RIGHTS.

QUESTIONS? CALL XX OR VISIT www.southwestpilotsUSERRAsettlement.com

PAGE 1 OF 10

CURRENT SOUTHWEST PILOTS
FORMER SOUTHWEST PILOTS

SUMMARY OF YOUR LEGAL RIGHTS & OPTIONS
OPTION #1: DO NOTHING. If you have been identified by Southwest as a Class Member and the Settlement is approved by the Court, you will receive additional accrued sick leave for periods of Short-Term Military Leave you took from January 1, 2008 to [the Preliminary Approval Date] pursuant to a formula set forth in the Settlement, and you will receive retirement contributions or cash payments for periods of Short-Term Military Leave you took from January 1, 2008 to December 31, 2013, based upon a Plan of Allocation approved by the Court.
OPTION #2: FILE A CLAIM FORM TO RECEIVE ADDITIONAL SETTLEMENT BENEFITS. If you took Short-Term Military Leave from January 1, 2001 to December 31, 2007, you may file a Claim Form to identify the number of days of Short-Term Military Leave that you took during this period. Based on the information in your Claim Form, you may receive additional accrued sick leave and a larger share of the Settlement Fund for your retirement-related claims. In addition, if you have not been identified by Southwest as a Class Member, you may submit a Claim Form to demonstrate that you are a Class Member and be included in the Class and the Settlement.
OPTION #3: OBJECT/COMMENT. You may write to the Court and explain why you do not like one or more aspects of the proposed Settlement. You must do so by no later than XXXX, XX, 2019.
OPTION #4: EXCLUDE. You may opt out of the Settlement by writing to the Court by XXXX, XX, 2019.
OPTION #1: DO NOTHING. If you have been identified by Southwest as a Class Member and the Settlement is approved by the Court, you will receive retirement contributions or cash payments based upon the data that Southwest has for Short-Term Military Leave that you took from January 1, 2008 to December 31, 2013 and based upon a Plan of Allocation approved by the Court. In addition, if, 30 days after the Effective Date of the Settlement, you are a former Southwest employee who is eligible to recover under the Settlement, you will receive a one-time payment of $1,000, unless you are a retired pilot and have exchanged your accrued sick leave for continued health care coverage and are still receiving continued health care coverage, in which case you will receive all accrued sick leave that you are entitled to receive under the Settlement for use toward continued health coverage.
OPTION #2: FILE A CLAIM FORM TO RECEIVE ADDITIONAL SETTLEMENT BENEFITS. If you took Short-Term Military Leave from January 1, 2001 to December 31, 2007, you may file a Claim Form to identify the number of days of Short-Term Military Leave that you took during this 2001-2007 period. By filing such a Claim Form, you may receive a larger share of the Settlement Fund for your retirement-related claims. If you have exchanged your accrued sick leave for continued health care coverage, you may also have additional sick leave added to your sick leave balance. If you are a former Southwest pilot who took Short-Term Military Leave from January 1, 2001 to December 31, 2007 and are not already eligible for a one-time payment of $1,000 based on Short-Term Military Leave taken after December 31, 2007, you may receive the one-time payment of $1,000 by submitting a claim form. In addition, if you have not been identified by Southwest as a Class Member, you may submit a Claim Form to demonstrate that you are a Class Member and be included in the Class and the Settlement.
OPTION #3: OBJECT/COMMENT. You may write to the Court and explain why you do not like one or more aspects of the proposed Settlement. You must do so by no later than XXXX, XX, 2019.
OPTION #4: EXCLUDE. You may opt out of the Settlement by writing to the Court by XXXX, XX, 2019.

If you have any questions after you have read this Notice, contact Class Counsel; PLEASE DO NOT CONTACT THE COURT as they will not be able to answer your questions.

QUESTIONS? CALL XX OR VISIT www.southwestpilotsUSERRAsettlement.com

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WHAT THIS NOTICE CONTAINS
BASIC INFORMATION ................................................................................................................................................................................... 4 1. Why did I receive this Notice? ................................................................................................................................................................. 4 2. What is this lawsuit about? ....................................................................................................................................................................... 4 3. What has happened so far in the lawsuit?................................................................................................................................................. 4
THE CLASS....................................................................................................................................................................................................... 5 4. What is a Class Action?............................................................................................................................................................................ 5 5. Who is included in the Class?................................................................................................................................................................... 5
THE SETTLEMENT ......................................................................................................................................................................................... 5 6. What does the Settlement provide? .......................................................................................................................................................... 5 7. What do I give up as a result of the Settlement?....................................................................................................................................... 6 8. Why is there a Settlement? ....................................................................................................................................................................... 6 9. What additional accrued sick leave will I receive under the dettlement? ................................................................................................. 6 9. What additional retirement contributions or cash payments will I receive under the settlement?............................................................ 6 10. When would I receive my additional sick leave under the Settlement?.................................................................................................. 7 11. When would I receive my additional retirement contributions or payments related to retirement claims? ............................................ 7 12. Will I have to pay taxes on the additional employer retirement contributions that I receive?................................................................. 7
EXCLUSION & OBJECTIONS ........................................................................................................................................................................ 7 13. If I want to get out of the Settlement, what should I do? ......................................................................................................................... 7 14. If I do not exclude myself, can I sue Defendant for the same thing later?.............................................................................................. 8 15. If I exclude myself, can I still get benefits from the Settlement? ............................................................................................................ 8 16. How do I tell the Court what I think about the Settlement? .................................................................................................................... 8 17. What’s the difference between objecting and asking to be excluded?..................................................................................................... 8
THE FINAL APPROVAL HEARING .............................................................................................................................................................. 8 18. When and where will the Court hold the hearing? ................................................................................................................................. 8 19. Do I have to come to the Final Approval Hearing? ................................................................................................................................ 8 20. May I speak at the Final Approval Hearing? .......................................................................................................................................... 9 21. What happens if I do nothing at all? ....................................................................................................................................................... 9
THE LAWYERS REPRESENTING YOU........................................................................................................................................................ 9 22. Do I have a lawyer in this case? ............................................................................................................................................................. 9 23. How will the lawyers for the Class be paid? .......................................................................................................................................... 9
THE SETTLEMENT IS NOT YET FINAL ...................................................................................................................................................... 9 24. Can the Settlement be terminated? ......................................................................................................................................................... 9
GETTING MORE INFORMATION ............................................................................................................................................................... 10 25. How do I get more information? .......................................................................................................................................................... 10 26. How do I ensure that I receive any updates? ........................................................................................................................................ 10 27. Whom do I call about questions?.......................................................................................................................................................... 10

QUESTIONS? CALL XX OR VISIT www.southwestpilotsUSERRAsettlement.com

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BASIC INFORMATION
1. Why did I receive this Notice?
All current or former Southwest pilots who took Short-Term Military Leave (i.e., one or more military leaves each totaling 14 days or less) from Southwest from January 1, 2001 to the [the Preliminary Approval Date] are Class Members in this case. You received this Notice because the Court has ordered that it be sent to the persons whom Defendant Southwest Airlines identified as Class Members or potential Class Members. Southwest’s records show that you either (i) took Short-Term Military Leave from Southwest sometime between January 1, 2008 and [the Preliminary Approval Date], which means that you are a Class Member, or (ii) were a pilot with military status who was employed by Southwest between January 1, 2001 and December 31, 2007, which means that you may be a Class Member. If you do not know whether you are a Class Member or a potential Class Member, please visit www.southwestpilotsUSERRAsettlement.com and enter your unique code, <XXXX>, and your password, <XXXX>. This case is pending in the United States District Court for the Northern District of California, and is called Huntsman v. Southwest Airlines Co., No. 4:17-cv-03972-JD (N.D. Cal.).
This Notice informs you of a proposed settlement (referred to as “Settlement” or “Settlement Agreement”) of this class action consisting of $5,800,000 in cash that will be used to make additional 401(k) retirement contributions to Class Members (“the Settlement Fund”), among other payments, and the recovery of accrued sick leave for eligible Class Members who took Short-Term Military Leave from January 1, 2001 to [the Preliminary Approval Date]. This Notice describes your rights and options in connection with the Settlement.
2. What is this lawsuit about?
The lawsuit is a class action brought under the Uniformed Services Employment and Reemployment Act (“USERRA”). The USERRA law provides servicemembers and veterans with a range of rights and benefits, including protections for reservists who take military leave from civilian employers like Southwest.
The Class Representative who brought the lawsuit is a Southwest pilot who has participated in the Southwest Airlines Pilots 401(k) Plan (“401(k) Plan”). The Defendant is Southwest Airlines.
The lawsuit claims that Southwest violated USERRA by failing to (i) provide its pilots matching contributions to their 401(k) accounts for the deemed earnings during periods of Short-Term Military Leave for elective deferrals made to the 401(k) Plan, (ii) provide timely information to pilots on their deemed earnings from Short-Term Military Leave so that they can make make-up retirement contributions into their 401(k) accounts, and (iii) provide matching contributions to pilots’ make-up contributions to their 401(k) accounts from periods of Short-Term Military Leave. The lawsuit also claims that Southwest violated USERRA by failing to provide for the accrual of sick leave when pilots take Short-Term Military Leave, because Southwest provides for the accrual of sick leave when pilots engage in jury duty, union leave, and bereavement leave. Southwest has denied the claims in this lawsuit.
Additional information about the claims and a copy of the Complaint are available at www.southwestpilotsUSERRAsettlement.com.
3. What has happened so far in the lawsuit?
Plaintiff filed the Complaint on July 14, 2017. On September 15, 2017, Plaintiff and Southwest stipulated to stay the litigation to allow them to explore settlement of the lawsuit. The Court granted the stipulation to stay the case on September 21, 2017. The stay was continued numerous times, with the Court most recently staying this matter until September 5, 2018.
During the stay of the lawsuit, Plaintiff and Southwest engaged in substantial informal discovery (a process through which the parties exchange information without directly involving the court) on issues related to liability, damages, and class certification. Plaintiff and his counsel obtained from Southwest information and documents about Southwest’s policies and practices, as well as personnel data about the Class Members so that the Class Members’ potential damages and relief could be estimated. Numerous conversations took place between the parties and their counsel, including in-person meetings and mediations between the parties’ counsel. After a twoday mediation on June 26 and June 27, 2018, supervised by an experienced mediator who is a former state Supreme Court judge, the parties reached an Agreement in Principle to resolve the lawsuit.
On XXXXXXX, 2018, the Court certified a Class as to all claims and appointed Plaintiff’s counsel as Class Counsel and Plaintiff as the Class Representative. The Court has not ruled on the merits of any claims or defenses.
On XXXXXXX, 2018, the Court preliminarily approved the Settlement and has scheduled a final hearing to evaluate the fairness and adequacy of the Settlement.

QUESTIONS? CALL XX OR VISIT www.southwestpilotsUSERRAsettlement.com

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THE CLASS

4. What is a Class Action?
A class action is a lawsuit in which the claims and rights of many people are decided in a single court proceeding. In a class action, one or more people, called Plaintiffs, file suit on behalf of others with similar claims, called the Class or Class Members. If a class is certified, the Court appoints a person, called the Class Representative, to represent and act on behalf of the class. Here the Class Representative is Jayson Huntsman.

5. Who is included in the Class?
The Class is defined as all former or current pilots employed by Southwest who took Short-Term Military Leave from Southwest between January 1, 2001 and [the Preliminary Approval Date]. The class period for the 401(k) Plan claims is January 1, 2001 to December 31, 2013. The class period for sick leave claims is January 1, 2001 to [the Preliminary Approval Date]. Southwest has only identified pilots who fall within the Class definition who were employed by Southwest from January 1, 2008 to the present. If you fall within this definition but your employment with Southwest terminated between January 1, 2001 and December 31, 2007, you must file a claim form to identify yourself and receive your share of the Settlement. If you do not know whether you have been identified as a Class Member, please visit www.southwestpilotsUSERRAsettlement.com and enter your unique code, <XXXX>, and your password, <XXXX>.
If you are included in the above definition, you will be included in the Class unless you exclude yourself. If you are unsure about whether you are a Class Member, you can contact the lawyers representing the Class by telephone at 212-245-1000 or e-mail at SWASettlement@outtengolden.com. The lawyers’ contact information is listed in the response to Question 22.

THE SETTLEMENT

6. What does the Settlement provide?

The Settlement provides equitable and monetary relief to Class Members who were allegedly denied sick leave and matching retirement contributions for periods of Short-Term Military Leave in the past. In addition, in the future Southwest will agree to provide accrued sick leave for periods in which pilots take Short-Term Military Leave.

The Settlement Agreement provides the following equitable and monetary relief:

• Sick Leave Benefits. If you are a current Southwest pilot who is a Class Member, the Settlement provides you with additional sick leave for periods in which you took Short-Term Military Leave but did not receive accrued sick leave from January 1, 2001 to [the Preliminary Approval Date]. For periods of Short-Term Military Leave from January 1, 2008 to [the Preliminary Approval Date] you will automatically receive an additional 0.71 Trips for Pay (“TFP”) of sick leave in your sick leave balance for every day of work you dropped to take Short-Term Military Leave. Also, if you file a Claim Form identifying yourself as having taken Short-Term Military Leave in any year from 2001 to 2007, you will receive an additional 8.5 TFP of sick leave for the year in which the Short-Term Military Leave was taken. The additional sick leave that you receive cannot increase your sick leave balance beyond the maximum sick leave balance of 1,600 TFP (the 1,600 figure is set by the Collective Bargaining Agreement between Southwest and the Southwest Airlines Pilots Association). If, 30 days after the Effective Date of the Settlement, you are a former Southwest employee who is eligible to recover under the Settlement, you will receive a one-time payment of $1,000, unless you are a retired pilot and have exchanged your accrued sick leave for continued health care coverage and are still receiving continued health care coverage, in which case you will receive all accrued sick leave that you are entitled to receive under the Settlement for use toward continued health coverage. Any $1,000 cash payments associated with sick leave claims will be made from the $5,800,000 Settlement Fund described in the next paragraph.

• Retirement Contributions and Payments. The proposed Settlement provides a common fund of $5,800,000 that will be used (1) to make supplemental retirement contributions to Class Members’ Southwest 401(k) Plan account to the greatest extent permitted under the law or, if it is not possible to make retirement contributions directly into Class Members’ 401(k) Plan account, to make a cash payment for Class Members’ USERRA retirement-related claims; (2) pay attorneys’ fees and costs; (3) pay a service award to the Class Representative; (4) pay for notice and settlement administration costs and related tax expenses; and (5) provide payments to Class Members who are former employees (as described in the prior paragraph). After the payment of any attorneys’ fees and costs, a service award, notice and administration costs, taxes, and payments to Class Members who are former employees, the remaining Settlement Fund will be distributed under a proposed distribution methodology called the Plan of Allocation described below (unless the Court modifies the Plan of Allocation).

The Settlement provides for the following future policy changes and benefits:

• Accrual of Sick Leave in the Future. Under the proposed Settlement, Southwest has agreed to change its policy in the future to provide accrued sick leave for pilots who take Short-Term Military Leave.

• Information on Deemed Earnings for Retirement Contributions. Under the proposed Settlement, Southwest has agreed to regularly provide pilots with information about their deemed earnings related to their military leave, and Southwest will provide

QUESTIONS? CALL XX OR VISIT www.southwestpilotsUSERRAsettlement.com

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more detailed information about the calculation of deemed earnings related to military leave upon request by pilots. This information will help pilots to better and fully understand the retirement contributions that they receive from Southwest for periods of military leave, as required by USERRA.
The Court has not ruled on liability or relief. This Notice is not an expression of opinion by the Court as to the merits of any claim or defense. This Notice does not imply that there has been any violation of law or that the Class will recover if the lawsuit is not settled and instead is resolved in Court by trial or otherwise.

7. What do I give up as a result of the Settlement?
If you are a Class Member, unless you exclude yourself from the Class, you (including your heirs, beneficiaries, executors, administrators, estates, agents, attorneys, predecessors, successors, and assigns) will release and fully and finally settle, relinquish, waive and discharge, any and all claims, actions, demands, damages, rights, obligations, expenses, costs, causes of action, or liabilities, known or unknown, against Southwest, the 401(k) Plan administrator, the 401(k) Plan sponsor, the 401(k) Plan, 401(k) Plan fiduciaries, and their parents, subsidiaries, agents, employees, and other affiliated persons or entities that (1) arise from or relate to the accrual of sick leave during periods of Short-Term Military Leave from January 1, 2001 through the date of Preliminary Approval, or (2) arise from or relate to employee or employer contributions to your 401(k) account arising from or related to periods of Short-Term Military Leave from January 1, 2001 through December 31, 2013, including those related to the failure to provide you with information regarding your 401(k) account, Short-Term Military Leave, or deemed earnings to facilitate additional contributions to your 401(k) account based on Short-Term Military Leave.

8. Why is there a Settlement?
In deciding to settle the lawsuit, the Class Representative and Class Counsel considered, among other things (a) the factual record; (b) the potential monetary recovery and potential to change Southwest’s policies through litigation; (c) the strength of the Class’ claims based on a review of the law and the facts established in discovery and through investigation; (d) the expense and length of continued proceedings, including possible trial and post-trial proceedings and appeals, necessary to prosecute the lawsuit; (e) the risks arising from the existence of unresolved questions of law and fact; (f) the nature and strength of defenses asserted by and available to Southwest; and (g) the risks and uncertainties of continued USERRA class action litigation of this nature. After a thorough review and investigation, the Class Representative and Class Counsel believe that in light of the foregoing considerations, the proposed Settlement is fair, reasonable and adequate and in the best interests of the Class.

9. What additional accrued sick leave will I receive under the settlement?
If you are a current Southwest pilot who is a Class Member, under the proposed Settlement, for every day that you dropped a trip to take Short-Term Military Leave between January 1, 2008 and the Preliminary Approval Date, Southwest will add to your sick leave balance 0.71 TFP of sick leave. This figure assumes that you would have worked approximately 7.1 TFPs each day that you dropped a trip to take Short-Term Military Leave, and applies the standard rate for accruing sick leave under the SWAPA CBA (1 TFP of accrued sick leave for every 10 TFP earned).
In addition, if you elect to submit a Claim Form to the Settlement Administrator stating each year that you dropped a trip to take Short-Term Military Leave from January 1, 2001 through December 31, 2007, Southwest will add to your sick leave balance 8.5 TFPs of sick leave per year that you attest that you dropped a trip to take Short-Term Military Leave. (This 8.5 TFP figure is 77% of the average annual amount of accrued sick leave that Class Members would have received from 2008 to 2013 had they been permitted by Southwest to accrue sick leave during Short-Term Military Leave.) You do not have to submit a Claim Form, but you will not be eligible for additional sick leave benefits for any trips dropped from January 1, 2001 through December 31, 2007 if you do not submit a Claim Form. The additional accrued sick leave that you receive cannot increase your sick leave balance beyond the maximum balance of 1,600 TFP (a figure set by the SWAPA CBA).The amount of additional accrued sick leave that you will receive under the Settlement does not depend on how much accrued sick leave other Class Members took from January 1, 2001 to the Preliminary Approval Date.
If, 30 days after the Effective Date of the Settlement, you are a former Southwest employee who is eligible to recover under the Settlement, you will receive a one-time payment of $1,000, unless you are a retired pilot and have exchanged your accrued sick leave for continued health care coverage and are still receiving continued health care coverage, in which case you will receive all accrued sick leave that you are entitled to receive under the Settlement for use toward continued health coverage.

9. What additional retirement contributions or cash payments will I receive under the settlement?

If you are a Class Member, under the proposed Settlement, for your claims related to retirement contributions under USERRA, you will receive a share of the $5.8 million Settlement Fund after certain expenses are paid for attorneys’ fees and costs, a service award for the Class Representative, the costs of settlement administration, any applicable taxes, and the payments to former Southwest pilots for sick leave claims.

Your share of the Settlement Fund will be based upon Southwest’s personnel data from January 1, 2008 to December 31, 2013, any information that you choose to provide if you submit a Claim Form about the Short-Term Military Leave you took from January 1, 2001 to December 31, 2007, and a Plan of Allocation proposed by the parties and approved by the Court. A copy of the Plan of

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Allocation can be found at www.southwestpilotsUSERRAsettlement.com. Under the proposed Plan of Allocation, Class Members will receive a pro rata share of the Settlement Funds based on their Recognized Claim, as defined below.
Under the proposed Plan of Allocation, for the 2008 to 2013 period, a Recognized Claim is based on: (1) the number of days each Class Member dropped trips to take military leave, times (2) 7.1 TFP per day, times (3) Class Members’ average base rate of pay in the relevant year. For each year during the 2008 to 2013 period, Class Members’ additional retirement contribution will be limited if this formula would result in a retirement contribution that causes them to receive more than the annual maximum of $25,000 of employer contributions for the relevant year.
For each year during the 2001 and 2007 period, a Recognized Claim is based on: (1) one-half of the number of days of Short-Term Military Leave each Class Member took in the year (but this resulting figure shall not exceed 21 days annually or 7 days in a month), times (2) 7.1 TFP, times (3) Class Members’ average base rate of pay in the relevant year. For Short-Term Military Leave that occurred prior to October 2004, the Recognized Claim will be reduced by two-thirds to reflect Southwest’s affirmative defense that such claims are untimely.
The parties intend to take reasonable steps to have the distribution of retirement-related shares of the Settlement Fund be paid directly into Class Members’ individual 401(k) Plan accounts in a tax-deferred manner (just like other previous 401(k) Plan contributions made by Southwest). However, if it is not possible to deposit some or all of a Class Member’s retirement-related share of the Settlement Fund into his or her 401(k) Plan account, the Class Member will receive a cash payment, from which payroll taxes and other applicable taxes will be deducted.
10. When would I receive my additional sick leave under the Settlement?
Class Members’ receipt of additional sick leave (or payment) is conditioned on the Court’s approval of the Settlement and such approval becoming final and no longer subject to any appeals. If additional sick leave is being deposited in your account, within 30 days of the Effective Date of the Settlement (i.e., 60 days after the Court grants final approval if there is no appeal), Southwest will add to your sick leave balance the amount of accrued sick leave TFP that you are entitled to receive under the Settlement.
11. When would I receive my additional retirement contributions or payments related to retirement claims?
Class Members’ receipt of any retirement contributions or retirement-related payments is conditioned on the Court’s approval of the Settlement and such approval becoming Final and no longer subject to any appeals. If there is no appeal, the Settlement will become effective 30 days after the Court enters Final Judgment. Once the Settlement becomes final, it is expected that a distribution to your 401(k) Plan account will occur as soon as possible. However, because Southwest will need to seek and receive guidance from the Internal Revenue Service on whether and what amount of any retirement-related share of the Settlement Fund can be deposited into a 401(k) account and what amount must be paid in cash, and because the Settlement involves 401(k) Plan accounts for a large number of persons, processing all of those distributions may take one or more years. Your patience is appreciated. Updates will be provided at the following web site: www.southwestpilotsUSERRAsettlement.com.
12. Will I have to pay taxes on the additional employer retirement contributions that I receive?
If you are a Class Member and you do nothing, under the Plan of Allocation proposed by Class Counsel and preliminarily approved by the Court, you will receive a pro rata distribution of the Settlement Fund. The parties intend to take reasonable steps to have the distribution made directly into your individual 401(k) Plan accounts in a tax-deferred manner (just like other previous 401(k) Plan contributions made by Southwest). You should, however, consult your own tax advisor about the tax implications of any money or employer contributions that you receive as part of the Settlement.
EXCLUSION & OBJECTIONS
13. If I want to get out of the Settlement, what should I do?
If you are a Class Member and you wish to exclude yourself from the Settlement, you must send a letter to the Settlement Administrator that includes the following:
• Your name, address, and telephone number; • A statement that you want to be excluded from Huntsman v. Southwest Airlines Co., No. 4:17-cv-03972-JD (N.D. Cal.); and • Your signature.
You must mail your exclusion request, postmarked no later than XX, 2019, to:
Settlement Administrator Address

QUESTIONS? CALL XX OR VISIT www.southwestpilotsUSERRAsettlement.com

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14. If I do not exclude myself, can I sue Defendant for the same thing later?
No. Under the release in the Settlement Agreement, if you are a Class Member and you do not opt of the Settlement, you (including your heirs, beneficiaries, executors, administrators, estates, agents, attorneys, predecessors, successors, and assigns) will release and fully and finally settle, relinquish, waive and discharge, any and all claims, actions, demands, damages, rights, obligations, expenses, costs, causes of action, or liabilities, known or unknown, against Southwest, the 401(k) Plan administrator, the 401(k) Plan sponsor, the 401(k) Plan, 401(k) Plan fiduciaries, and their parents, subsidiaries, agents, employees, and other affiliated persons or entities that (1) arise from or relate to the accrual of sick leave during periods of Short-Term Military Leave from January 1, 2001 through the date of Preliminary Approval, or (2) arise from or relate to employee or employer contributions to your 401(k) account arising from or related to periods of Short-Term Military Leave from January 1, 2001 through December 31, 2013, including those related to the failure to provide you with information regarding your 401(k) account, Short-Term Military Leave, or deemed earnings to facilitate additional contributions to your 401(k) account based on Short-Term Military Leave. If you have a pending lawsuit, speak to your lawyer in that lawsuit immediately.

15. If I exclude myself, can I still get benefits from the Settlement?
No. If you are a Class Member and you exclude yourself from the Settlement, you will not receive any additional sick leave or any monetary payment from the Settlement Fund.

16. How do I tell the Court what I think about the Settlement?
Any Class Member may object to any aspect of the Settlement or attorneys’ fees or expenses by filing a written objection with the Court. To object, you must send a letter or other written statement to the Court saying that you object to the Settlement, the Plan of Allocation and/or the attorneys’ fee award. Include your name, address, telephone number, signature, the title of the case, Huntsman v. Southwest Airlines Co., No. 4:17-cv-03972-JD (N.D. Cal.), and an explanation of all reasons you object to the Settlement. Please be advised that failure to include these details may result in the Court refusing to consider your objection.
Your written objection must be filed or postmarked no later than XX, 2019, and either (1) mailed to the Class Action Clerk, Phillip Burton Federal Building & United States Courthouse, 450 Golden Gate Avenue, San Francisco, CA, 94102, or (2) filed in person at any location of the United States District Court for the Northern District of California.
Your objection should state the supporting bases and reasons for the objection, identify any and all witnesses, documents or other evidence you would like to present at the Final Approval Hearing, and describe the substance of any testimony provided by you or other witnesses.
IF YOU DO NOT OBJECT IN THE MANNER DESCRIBED IN THIS NOTICE, THE COURT MAY CONCLUDE THAT YOU HAVE WAIVED ANY OBJECTION AND MAY NOT PERMIT YOU TO SPEAK AT THE FAIRNESS HEARING.

17. What’s the difference between objecting and asking to be excluded?
Objecting is simply telling the Court that you do not like or disagree with an aspect of the Settlement. You can object to the Settlement only if you are a Class Member and you do not exclude yourself from the Settlement. Excluding yourself from the Settlement is telling the Court that you do not want to be part of the Settlement. If you exclude yourself from the Settlement, you cannot object to the Settlement because you will not be bound by the Settlement.

THE FINAL APPROVAL HEARING

18. When and where will the Court hold the hearing?
The Final Approval Hearing (also called the Fairness Hearing) will take place before the Honorable James Donato in Courtroom 11 of the United States District Court for the Northern District of California, located at 450 Golden Gate Avenue, 19th Floor, San Francisco, California 94102, at 10 am, on XXXXXX, 2019. The hearing may be moved to a different date or time without additional notice, so it is a good idea to check www.southwestpilotsUSERRAsettlement.com for updates. At the hearing, the Court will consider whether the Settlement is fair, reasonable, and adequate, how much to pay Class Counsel in fees, what to reimburse Class Counsel for their expenses, and whether to provide Plaintiff with a service award because of his time and expense to bring this lawsuit. If there are objections or comments, the Court will consider them at the hearing. After the hearing, the Court will decide whether to approve the Settlement and enter Final Judgment. We do not know how long these decisions will take. Please be patient.

19. Do I have to come to the Final Approval Hearing?

Your attendance is not required, even if you submit a written response. Class Counsel will answer questions the Court may have at the Final Approval Hearing, including any questions about objections. If you or your personal attorney wants to attend the hearing, you

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may attend at your own expense. As long as any objection or comment you filed was postmarked by the deadline, the Court will consider it even if you do not attend the Final Approval Hearing.
20. May I speak at the Final Approval Hearing?
Yes. You may speak at the Final Approval Hearing, so long as you are a member of the Class and have properly and timely submitted a written response as set forth above and have stated in your response your intention to appear at the Final Approval Hearing.

21. What happens if I do nothing at all?
If you do nothing and you are entitled to receive benefits from the Settlement, you will receive those benefits as described above if the Settlement is approved.

THE LAWYERS REPRESENTING YOU

22. Do I have a lawyer in this case? Yes. The Court has appointed the following law firms to serve as the attorneys for the Class:

Lead Class Counsel OUTTEN & GOLDEN LLP Peter Romer-Friedman 601 Massachusetts Avenue NW Second Floor West Suite Washington, D.C. 20001 Telephone: (202) 847-4400 Facsimile: (202) 847-4410 Email: SWASettlement@outtengolden.com
Jahan C. Sagafi Rachel Dempsey One California Street, 12th Floor San Francisco, California 94111 Telephone: (415) 638-8800 Facsimile: (415) 638-8810 Email: SWASettlement@outtengolden.com

Additional Class Counsel CROTTY & SON LAW FIRM, PLLC Matthew Z. Crotty, Esq. 905 W. Riverside Ave., Suite 404 Spokane, WA 99201 Telephone: (509) 850-7011 matt@crottyandson.com
LAW OFFICE OF THOMAS G. JARRARD LLC Thomas G. Jarrard, Esq. 1020 N. Washington Dt. Spokane, WA 99201 Telephone: (425) 239-7290 tjarrard@att.net

The Court has approved these law firms to serve as Class Counsel. You have the right to hire your own attorney (at your own expense), but if you are a member of and remain in the Class, you are not required to hire a separate attorney.

23. How will the lawyers for the Class be paid?
Class Counsel undertook this matter more than a year and a half ago—following an investigation of several years—on a wholly contingent basis. Subject to approval of the Court, Class Counsel is permitted to seek an award of attorneys’ fees to be paid from the Settlement Fund, and reimbursement of expenses incurred during the litigation. These attorneys’ fees pay for work the attorneys have performed on behalf of the Class and for work yet to be done in helping to administer the Settlement. Before the Final Approval Hearing, Class Counsel will seek the Court’s approval of an award of attorneys’ fees in the amount not to exceed $1.74 million of the $5.8 million Settlement Fund plus reimbursement for lawsuit costs and expenses. The maximum amount of attorneys’ fees of $1.74 million is 30% of the $5.8 million Settlement Fund, but in the view of Plaintiff’s counsel it is a much smaller percentage of the total value of the Settlement, which includes the $5.8 million Settlement Fund and providing Class Members with sick leave for periods of Short-Term Military Leave over an 18-year period. Whether the Settlement is approved or not, you will not be required to directly pay any attorneys’ fees or other expenses or costs, which will be paid only from the Settlement Fund in the amount approved by the Court.

THE SETTLEMENT IS NOT YET FINAL

24. Can the Settlement be terminated?
If there is no final Court approval of the proposed Settlement in this case, or if Class Counsel or Defendant withdraws from the Settlement in accordance with the terms of the Settlement Agreement, or if the Settlement is not consummated for any other reason, the Settlement Agreement will become null and void, and the parties will resume their former positions in the lawsuit.

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GETTING MORE INFORMATION

25. How do I get more information?
This Notice contains only a summary of the proposed Settlement and your rights as a Class Member. Full details of the Settlement are set forth in the Settlement Agreement. The Settlement Agreement and certain other documents about the litigation are available on the Settlement Administrator’s website at www.southwestpilotsUSERRAsettlement.com. You may obtain additional information regarding the matters involved in this lawsuit by reviewing the papers on file in this litigation, which may be (a) inspected, during business hours, at the Office of the Clerk of Court, United States District Court for the Northern District of California, 450 Golden Gate Avenue, San Francisco, CA 94102, or (b) accessed online for a fee by obtaining a password at www.pacer.gov.
Please do not contact Southwest Airlines about this Settlement. It may not be able to give you additional information.

26. How do I ensure that I receive any updates?
If your contact information changes after you receive this Notice, you should contact Class Counsel. You may e-mail any updates to your contact information to Class Counsel at SWASettlement@outtengolden.com.

27. Whom do I call about questions? If you have any questions about this Notice, or the lawsuit, contact Class Counsel or the Settlement Administrator listed below.

For Questions About the Settlement:
OUTTEN & GOLDEN LLP Peter Romer-Friedman 601 Massachusetts Avenue NW, Second Floor West Suite Washington, D.C. 20001 Telephone: (202) 847-4400 Facsimile: (202) 847-4410 Email: SWASettlement@outtengolden.com

Southwest Pilot USERRA Settlement Administrator

CROTTY & SON LAW FIRM, PLLC Matthew Z. Crotty, Esq. 905 W. Riverside Ave., Suite 404 Spokane, WA 99201 Telephone: (509) 850-7011 matt@crottyandson.com

LAW OFFICE OF THOMAS G. JARRARD LLC Thomas G. Jarrard, Esq. 1020 N. Washington Dt. Spokane, WA 99201 Telephone: (425) 239-7290 tjarrard@att.net

PLEASE DO NOT CONTACT THE COURT OR THE COURT CLERK’S OFFICE REGARDING THIS NOTICE, THE SETTLEMENT, OR THE CLAIMS PROCESS.
Dated: XX, 2018
BY ORDER OF THE COURT
UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA

QUESTIONS? CALL XX OR VISIT www.southwestpilotsUSERRAsettlement.com

PAGE 10 OF 10

Exhibit C

CLAIM FORM
THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA

JAYSON HUNTSMAN, individually and on behalf of all others similarly situated,
Plaintiff, v.
SOUTHWEST AIRLINES CO.,
Defendant.

Case No. 3:17-cv-03972-JD

You may be eligible to receive additional benefits or payments from a court-approved settlement if you took Short-Term Military Leave from
Southwest Airlines between January 1, 2001 and December 31, 2007.
Please read this Claim Form carefully.
To be eligible for additional benefits related to the Short-Term Military Leave you took between January 1, 2001 and December 31, 2007, you must submit a Claim Form online
at www.[URL].com to be received by the Settlement Administrator no later than XX, 2019.
[FIRST NAME] [LAST NAME] [ADDRESS] [CITY] [STATE] [ZIP] Claim ID: [CLAIM ID] Password: [INITIALS AND GENERATED NUMBER CODE]
Records of Southwest Airlines Co. indicate that you were a pilot who also served in the military sometime between January 1, 2001 and [Preliminary Approval Date] 2018, and that you may have taken Short-Term Military Leave during that time.
More information, including copies of the Notice sent to you by mail and e-mail, is available at www.[insert URL].com. Please read the Notice carefully before completing this form.

- 1 -

TO MAKE A CLAIM FOLLOW THESE INSTRUCTIONS:
It is important to read and follow these instructions carefully. Failure to follow these instructions may result in your losing eligibility for benefits to which you might otherwise be entitled.
You must complete each part and sign and date the Claim Form.
This Claim Form must be submitted online at www.[insert URL].com no later than XX, 2019. Claim Forms deemed late will not be accepted. Failure to submit a timely Claim Form will result in your ineligibility to receive additional benefits related to any Short-Term Military Leave you took from Southwest between January 1, 2001 and December 31, 2007.
Log on to the case website and enter your Claim ID [INSERT CLAIM ID] and password [INITIALS AND GENERATED NUMBER CODE]. Then complete the form online.
PART 1: PERSONAL INFORMATION (Required)

Name (First Middle Last)

Email

Mobile or Home Phone

Street Address

Apartment Number

City

State

Zip Code

Southwest Employee ID

Date of Birth

Social Security Number

Date of Hire at Southwest

- 2 -

PART 2: SHORT-TERM MILITARY LEAVE (Required):
For each month between January 1, 2001 and December 31, 2007 in which you were employed by Southwest, please state the number of days that month that you performed military service that was part of a period of military service of 14 days or less. Before filling out this information, you should make reasonable efforts to confirm these dates with your own personal records of military service or the records of military service reasonably available to you through the military, including, if accessible to you, by submitting an NGB Form 22 or SF Form 180 to obtain your DD Form 214 or equivalent.

2001 January February March April May June July August September October November December

Number of Days of Short Term Military
Service

2002 January February March April May June July August September October November December

Number of Days of Short Term Military
Service

2003 January February March April May June July August September October November December

Number of Days of Short Term Military
Service

2004 January February March April May June July August September October November December

Number of Days of Short Term Military
Service

2005 January February March April May June July August September October November December

Number of Days of Short Term Military
Service

- 3 -

2006 January February March April May June July August September October November December

Number of Days of Short Term Military
Service

2007 January February March April May June July August September October November December

Number of Days of Short Term Military
Service

PART 3: YOUR SIGNATURE (Required)
In order to submit a valid claim and be eligible for additional benefits related to any Short-Term Military Leave you took from Southwest between January 1, 2001 and December 31, 2007, you must sign and date this Claim Form.
I, (print your name) _______________________________________________, declare, under penalty of perjury, that the information I have provided on this form and any supplemental pages submitted with this form is true and correct to the best of my knowledge, and, if called upon to testify under oath, I would testify that the information I have provided is true. I understand that intentionally submitting false information on this form is a violation of the law.
Dated: _____________________________ Signature: _________________________

PART 4: QUESTIONS?
If you have any questions, please visit www.[insert URL].com, or write or call the Settlement Administrator at [ADDRESS]; Toll-Free XX.

If you have questions about the proposed Settlement, you can contact Class Counsel:

Peter Romer-Friedman (pro hac vice) OUTTEN & GOLDEN LLP 601 Massachusetts Avenue NW Second Floor West Suite Washington, D.C. 20001 Telephone: (202) 847-4400 Facsimile: (202) 847-4410 Email: SWASettlement@outtengolden.com

Thomas G. Jarrard (pro hac vice) LAW OFFICE OF THOMAS JARRARD PLLC 1020 N. Washington Dt. Spokane, WA 99201 Telephone: (425) 239-7290 Facsimile: (509) 326-2932 Email: tjarrard@att.net

- 4 -

Jahan C. Sagafi (Cal. Bar No. 224887) Rachel W. Dempsey (Cal. Bar No. 310424) OUTTEN & GOLDEN LLP One California Street, 12th Floor San Francisco, CA 94111 Telephone: (415) 638-8800 Facsimile: (415) 638-8810 Email: SWASettlement@outtengolden.com

Matthew Z. Crotty (pro hac vice) CROTTY & SON LAW FIRM, PLLC 905 W. Riverside Ave, Suite 404 Spokane, WA 99201 Telephone: (509) 850-7011 matt@crottyandson.com

- 5 -

Exhibit D

Settlement Administrator [insert address]
Notice of class action settlement to Southwest pilots who took Short-Term Military Leave
[window]

According to our records, you may be eligible for a settlement payment. This payment may
be increased if you submit a Claim Form by [insert deadline].
Details are in the enclosed legal notice.

 
 Case 3:17-cv-03972-JD Document 44 Filed 12/05/18 Page 1 of 10

1 Peter Romer-Friedman (pro hac vice)
OUTTEN & GOLDEN LLP 2 601 Massachusetts Avenue NW,
3 Second Floor West Suite Washington, D.C. 20001
4 Telephone: (202) 847-4400 Facsimile: (202) 847-4410
5 Email: prf@outtengolden.com

Thomas G. Jarrard (pro hac vice) LAW OFFICE OF THOMAS JARRARD PLLC 1020 N. Washington Street Spokane, WA 99201 Telephone: (425) 239-7290 Facsimile: (509) 326-2932
Email: Tjarrard@att.net

6 Jahan C. Sagafi (Cal. Bar No. 224887)

Matthew Z. Crotty (pro hac vice)

Rachel W. Dempsey (Cal. Bar No. 310424) 7 OUTTEN & GOLDEN LLP
One California Street, 12th Floor 8 San Francisco, CA 94111
9 Telephone: (415) 638-8800 Facsimile: (415) 638-8810

CROTTY & SON LAW FIRM, PLLC 905 W. Riverside Avenue, Suite 404 Spokane, WA 99201 Telephone: (509) 850-7011
Email: matt@crottyandson.com

10 Email:

jsagafi@outtengolden.com

Email: rdempsey@outtengolden.com

11

UNITED STATES DISTRICT COURT

12

NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO DIVISION 13

14 JAYSON HUNTSMAN, on behalf of himself and all others similarly situated,
15 Plaintiff,
16 v.
17 SOUTHWEST AIRLINES, CO.
18 Defendants.
19

Case No. 3:17-cv-03972
[PROPOSED] ORDER GRANTING CONDITIONAL CERTIFICATION OF SETTLEMENT CLASS AND PRELIMINARY APPROVAL OF SETTLEMENT

20

21

22

23

24

25

26

27

28

[PROPOSED] ORDER GRANTING CONDITIONAL CERT. AND PRELIMINARY APPROVAL
CASE NO. 17-CV-03972-JD

Case 3:17-cv-03972-JD Document 44 Filed 12/05/18 Page 2 of 10

1

On November 8, 2018, a hearing was held on the motion of Plaintiff Jayson Huntsman

2 (“Plaintiff”) for an order to: (1) conditionally certify the settlement class; (2) preliminarily

3 approve the parties’ proposed class action settlement (“Settlement”); (3) appoint Plaintiff as the

4 Class Representative, his counsel as Class Counsel, and Settlement Services, Inc. as Settlement

5 Administrator; (4) set the deadlines for filing Claim Forms, written exclusions, or objections to

6 the Settlement; (5) approve the Claim Form and notice to the class of the Settlement; and

7 (6) schedule a hearing on the final approval of the Settlement. Romer-Friedman, Jahan Sagafi,

8 and Rachel Williams Dempsey appeared for Plaintiff. Brian Berry appeared for Defendant

9 Southwest Airlines Co. (“Southwest”).

10

Having considered the papers on the motion, the arguments of counsel, and the law, the

11 Court now enters this Preliminary Approval Order and orders as follows:

12 I. NATURE OF ACTION

13

Plaintiff alleges that Southwest violated the Uniformed Services Employment and

14 Reemployment Rights Act (“USERRA”), 38 U.S.C. §§ 4316, 4318, by failing to: (i) make the

15 proper matching contributions to pilots’ retirement accounts based on Deemed Earnings during

16 periods of Short-Term Military Leave from their employment at Southwest; (ii) facilitate pilots’

17 opportunity to make retirement contributions that could be matched during periods of Short-Term

18 Military Leave; and (iii) provide for the accrual of Sick Leave during pilots’ periods of Short-

19 Term Military Leave. Short-Term Military Leave is defined as leave lasting 14 or fewer

20 consecutive days. Deemed Earnings are the amount of earnings that Southwest pilots would have

21 earned if they had not taken Short-Term Military Leave.

22

Southwest disputes and denies all of Plaintiff’s claims. Southwest contends that it has

23 fully complied with all applicable laws at issue in this matter.

24 II. CONDITIONAL CERTIFICATION OF RULE 23 SETTLEMENT CLASS

25

A. Rule 23 Settlement Class

26

For settlement purposes only, the Parties have proposed conditional certification of a

27 Settlement Class of all former or current pilots employed by Southwest who took Short-Term

28 Military Leave from Southwest between January 1, 2001 and the Preliminary Approval Date.

2
[PROPOSED] ORDER GRANTING CONDITIONAL CERT. AND PRELIMINARY APPROVAL
CASE NO. 17-CV-03972-JD

Case 3:17-cv-03972-JD Document 44 Filed 12/05/18 Page 3 of 10

1

B. Conditional Rule 23 Certification

2

The Court hereby finds and concludes that for purposes of the Settlement only, the

3 Settlement Class satisfies all of the requirements for certification under Rule 23(a) and (b)(3) of

4 the Federal Rules of Civil Procedure.

5

1. The Settlement Class is sufficiently numerous that joinder is impracticable,

6 as the Settlement Class has at least 1,500 members.

7

2. The members of the Settlement Class share common issues of fact and law

8 regarding whether Southwest had uniform practices of denying pilots accrued sick leave for 9 Short-Term Military Leave, failing to match retirement contributions based on their deemed 10 earnings, and denying pilots information on deemed earnings, and whether these practices violate

11 USERRA.

12

3. The Class Representative’s claims are typical of those of the Class he

13 proposes to represent, because they arise out of the same policies and practices and course of

14 conduct that all Class Members challenge in this action.

15

4. The Class Representative is an adequate representative of the Class he

16 proposes to represent, because his interests are co-extensive with those of the Class Members, and

17 he has retained experienced counsel to represent himself and the Class Members.

18

5. Questions of law or fact common to the Class predominate over

19 individualized issues, and a class action is superior to other available methods for the fair and

20 efficient adjudication of this controversy.

21

6. Because certification of the Class is proposed in the context of a settlement,

22 the Court need not inquire whether the case, if tried as a class action, would present intractable

23 management problems.

24

Accordingly, the Court hereby certifies the Settlement Class under Rule 23(a) and (b)(3).

25 III. APPOINTMENT OF CLASS REPRESENTATIVE AND CLASS COUNSEL

26

A. Class Representatives

27

The Court finds and concludes that the Plaintiff Jayson Huntsman has claims that are

28 typical of the members of the Class he proposes to represent, and he is an adequate representative

3
[PROPOSED] ORDER GRANTING CONDITIONAL CERT. AND PRELIMINARY APPROVAL
CASE NO. 17-CV-03972-JD

Case 3:17-cv-03972-JD Document 44 Filed 12/05/18 Page 4 of 10

1 of the Class he seeks to represent. The Court hereby appoints Plaintiff Jayson Huntsman to serve

2 as Class Representative.

3

B. Class Counsel

4

The Court finds and concludes that Outten & Golden LLP, the Law Office of Thomas

5 Jarrard, PLLC, and the Crotty & Son Law Firm, PLLC, have extensive experience and expertise

6 in prosecuting USERRA class actions and other types of class actions. The Court appoints

7 Outten & Golden LLP, the Law Office of Thomas Jarrard, PLLC, and the Crotty & Son Law

8 Firm, PLLC, as Class Counsel, and the Court appoints Outten & Golden LLP as Lead Class

9 Counsel.

10 IV. PRELIMINARY APPROVAL OF SETTLEMENT

11

The Court has reviewed the terms of the Settlement, including the Plan of Allocation and

12 the release of claims. The Court has also read and considered the declarations of Peter Romer-

13 Friedman, Thomas Jarrard, and Matthew Crotty in support of the Preliminary Approval Motion.

14 Based on review of those papers and the Court’s familiarity with this case, the Court finds and

15 concludes that the Settlement is the result of arm’s-length negotiations between the Parties

16 conducted after Class Counsel had adequately investigated Plaintiff’s claims and become familiar

17 with their strengths and weaknesses. The assistance of an experienced mediator in the settlement

18 process supports the finding that the Settlement is non-collusive. Based on all of these factors,

19 the Court concludes that the proposed Settlement meets the criteria for preliminary settlement

20 approval. The Settlement has no obvious defects and falls within the range of possible approval

21 as fair, adequate, and reasonable, such that notice to the Class Members is appropriate.

22 Accordingly, the Settlement is hereby preliminarily approved.

23 V. APPROVAL OF THE NOTICE PLAN

24

The Parties have also submitted for this Court’s approval a proposed class notice. After

25 carefully reviewing this document, the Court finds and concludes as follows:

26

A. Best Notice Practicable

27

The Class Notice is the best notice practicable under the circumstances and allows Class

28 Members a full and fair opportunity to consider the Settlement.

4
[PROPOSED] ORDER GRANTING CONDITIONAL CERT. AND PRELIMINARY APPROVAL
CASE NO. 17-CV-03972-JD

Case 3:17-cv-03972-JD Document 44 Filed 12/05/18 Page 5 of 10

1

The Class Notice, based on the model forms supplied by the Federal Judicial Center,

2 fairly, plainly, accurately, and reasonably informs Class Members of appropriate information

3 about: (1) the nature of this action, the definition of the Class, the identity of Class Counsel, and

4 the essential terms of the Settlement, including the Plan of Allocation; (2) Plaintiff’s forthcoming

5 application for the Class Representative’s Service Award and Class Counsel’s Attorneys’ Fees

6 and Costs Award; (3) how Class Members’ settlement shares will be calculated; (4) this Court’s

7 procedures for final approval of the Settlement, and about Class Members’ right to appear

8 through counsel if they desire; (5) how to submit a claim form, comment on or opt out of the

9 Settlement, if a Class Member wishes to do so; and (6) how to obtain additional information

10 regarding this action and the Settlement.

11

The proposed plan for distributing the Class Notice likewise is a reasonable method

12 calculated to reach all individuals who would be bound by the Settlement. Under this plan, the

13 Settlement Administrator will distribute the Class Notice to all Class Members who took Short-

14 Term Military Leave between January 1, 2008 and the date of preliminary approval, by first-class

15 mail and e-mail to their last known mailing and, if available, e-mail addresses. In addition, the

16 Settlement Administrator will distribute the Class Notice to hundreds of additional potential Class

17 Members by first-class mail and e-mail to their last known mailing and, if available, e-mail

18 addresses: all pilots who were employed at Southwest between January 1, 2001 and December

19 31, 2007 and had a military status during at least part of their employment with Southwest. In

20 addition, information about the Settlement will be published on a web site that the Settlement

21 Administrator will establish. There is no additional method of distribution that is cost-effective

22 and would be reasonably likely to notify Class Members who may not receive notice pursuant to

23 the proposed distribution plan.

24

B. CAFA Notice of Proposed Settlement

25

Within ten (10) days after Plaintiff’s Preliminary Approval Motion was filed, notice of the

26 Settlement was mailed to the Attorney General of the United States of America and the

27 appropriate state official in California and all the other states in which a Class Member is known

28 by Southwest to reside. The notice contains the documents required by 28 U.S.C. § 1715(b)(1)-

5
[PROPOSED] ORDER GRANTING CONDITIONAL CERT. AND PRELIMINARY APPROVAL
CASE NO. 17-CV-03972-JD

Case 3:17-cv-03972-JD Document 44 Filed 12/05/18 Page 6 of 10

1 (8). On this basis, the notice of the Settlement is approved and the Court finds that Southwest has

2 discharged its obligations under CAFA to provide notice to the appropriate federal and state

3 officials.

4

C. Approval

5

Accordingly, the Court finds and concludes that the proposed plan for distributing the

6 Class Notice will provide the best notice practicable, satisfies the notice requirements of Rule

7 23(e), and satisfies all other legal and due process requirements. Accordingly, the Court hereby

8 orders as follows:

9

1. The Class Notice, Claim Form, and Notice Envelope are approved.

10

2. The manner of distributing the Class Notice to the Class Members is approved.

11

3. Promptly following the entry of this order, the Settlement Administrator will

12 prepare final versions of the Class Notice, incorporating into them the relevant dates and

13 deadlines set forth in this order.

14

4. Within ten (10) business days following entry of this order, Southwest will provide

15 the Settlement Administrator with a database in a format reasonably acceptable to the Settlement

16 Administrator (“Settlement Class List”), that lists, for each known Class Member who took Short-

17 Term Military Leave from January 1, 2008 to the date of preliminary approval and each

18 Southwest pilot who had a military status and was employed by Southwest from January 1, 2001

19 to December 31, 2007, to the extent they are reasonably available in Southwest’s databases: (1) a

20 street mailing address; (2) telephone number(s); (3) Southwest and personal e-mail address(es),

21 including email accounts provided by Southwest; and (4) Social Security number. Within ten

22 (10) business days following the deadline for Class Members to submit Claim Forms, Southwest

23 will provide the Settlement Administrator with a database in a format reasonably acceptable to

24 the Settlement Administrator that lists, for each known Class Member, (1) the dates of known

25 days with dropped trips for Short-Term Military Leave; and (2) the average annual rate of pay for

26 each Class Member from 2001 to 2013.

27

28

6
[PROPOSED] ORDER GRANTING CONDITIONAL CERT. AND PRELIMINARY APPROVAL
CASE NO. 17-CV-03972-JD

Case 3:17-cv-03972-JD Document 44 Filed 12/05/18 Page 7 of 10

1

5. The Settlement Administrator will perform one skip-trace and remailing on

2 returned mail and re-mail the Notice to an updated address (if any) as soon as possible upon

3 return of the undeliverable Notice.

4

6. Plaintiff will file with the motion for final approval a declaration from the

5 Settlement Administrator of due diligence and proof of mailing with regard to the mailing of the

6 Notice, and Plaintiff will file prior to the hearing on the motion a supplemental declaration from

7 the Settlement Administrator as applicable.

8

7. The Settlement Administrator will take all other actions in furtherance of

9 settlement administration as are specified in the Settlement.

10 VI. PROCEDURES FOR FINAL APPROVAL OF THE SETTLEMENT

11

A. Final Approval Hearing

12

The Court hereby schedules a hearing to determine whether to grant final approval of the

13 Settlement (the “Final Approval Hearing”) for June 20, 2019, at 10:00 a.m. The date of the

14 hearing may be changed without further notice to the Class. However, Plaintiff is responsible for

15 promptly updating the case web site with information about any such change.

16

B. Deadline to Submit Claim Form

17

All Class Members who wish to submit Claim Forms must do so within one hundred

18 twenty (120) calendar days from the date of the mailing of the Notice. Submissions may be filed

19 by online web site submission.

20

C. Deadline to Opt Out of the Settlement

21

1. Form of Opt-Out Request

22

Any Class Member may opt out of participating in the Settlement by submitting a signed

23 letter to the Settlement Administrator stating that he or she wishes to be excluded from the

24 Settlement. The letter must include the Class Member’s name, address, telephone number, and

25 signature.

26

2. Deadline for Submitting Opt-Out Request

27

A completed opt-out request will be deemed timely submitted to the Settlement

28 Administrator if it is mailed to the Settlement Administrator by first-class mail and postmarked

7
[PROPOSED] ORDER GRANTING CONDITIONAL CERT. AND PRELIMINARY APPROVAL
CASE NO. 17-CV-03972-JD

Case 3:17-cv-03972-JD Document 44 Filed 12/05/18 Page 8 of 10

1 by not later than the opt-out date set by the Court. Pursuant to Rule 23(b)(3) and (c)(2) of the

2 Federal Rules of Civil Procedure, the Settlement will have no binding effect on any Class

3 Member who properly opts out of the Settlement in the manner required by this Order.

4

D. Southwest’s Right to Withdraw from the Settlement

5

If fifty (50) or more of the eligible Class Members validly opt out pursuant to the process

6 set forth herein, Southwest will have the right to withdraw from the Settlement and resume the

7 litigation.

8

E. Deadline for Filing Comments on or Objections to Settlement

9

Any Class Member who wishes to comment on or object to the fairness, reasonableness,

10 or adequacy of the Settlement must do so in writing. Class Members who have timely

11 commented on or objected to the Settlement in writing may also appear at the Final Approval

12 Hearing, in person or through counsel, but only if they (a) have given written notice of their intent

13 to appear at the hearing as provided in the Notice, or (b) can show good cause why they could not

14 provide such notice. To be considered, any comment on or objection to the final approval of the

15 Settlement must (a) clearly identify the person’s name, address, telephone number, signature, and

16 the case name and number (Huntsman v. Southwest Airlines Co., Case No. 17 Civ. 3972), (b) be

17 submitted to the Court either by mailing the comment or objection to the Class Action Clerk,

18 United States District Court for the Northern District of California, 450 Golden Gate Avenue, San

19 Francisco, CA 94102, or by filing them in person at any location of the United States District

20 Court for the Northern District of California, and (c) be filed or postmarked within the deadline

21 set by the Court. Any Class Member who does not timely submit such a written comment or

22 objection will not be permitted to raise such comment or objection or appear at the Final

23 Approval Hearing, except for good cause shown, and any Class Member who fails to object in the

24 manner prescribed by this order will be deemed to have waived, and will be foreclosed from

25 raising, any such comment or objection, except for good cause shown. The Court will only

26 require substantial compliance with the requirements for submitting an objection.

27

28

8
[PROPOSED] ORDER GRANTING CONDITIONAL CERT. AND PRELIMINARY APPROVAL
CASE NO. 17-CV-03972-JD

Case 3:17-cv-03972-JD Document 44 Filed 12/05/18 Page 9 of 10

1

F. Deadline for Mailing and Cashing Settlement Share Checks

2

No later than seven (7) calendar days after the Effective Date of the Settlement, Southwest

3 will deposit the Cash Settlement Amount in to an Escrow Account established and managed by

4 the Settlement Administrator. The Cash Settlement Amount plus any interest on the Cash

5 Settlement Amount while in escrow will constitute the Settlement Fund. Class Members shall

6 have one hundred and eighty (180) days to cash their checks for any Cash Amounts received.

7 Any amount remaining unclaimed after that point shall be provided to a cy pres entity agreed

8 upon by the parties. Thirty (30) days before the one hundred and eighty (180) days have expired,

9 the Settlement Administrator will mail a postcard to any Class Member who has not yet cashed

10 his or her check reminding the person to cash his or her check within the 180-day period.

11 VII. PLAINTIFF’S AND CLASS MEMBERS’ RELEASE

12

If, at the Final Approval Hearing, this Court grants final approval to the Settlement,

13 Plaintiff and every Class Member who does not opt out will, pursuant to the Settlement, be

14 adjudicated to have granted the “Release of Claims” as set forth in Section XIV of the Settlement

15 and the Class Notice.

16 VIII. APPOINTMENT OF SETTLEMENT ADMINISTRATOR

17

Settlement Services, Inc. is hereby appointed Settlement Administrator to carry out the

18 duties set forth in this Preliminary Approval Order and the Settlement.

19 IX. SCHEDULING ORDER

20

The following schedule sets the sequence for the relevant dates and deadlines:

21

Event

Date

Preliminary Approval (“PA”) Hearing 22

November 8, 2018

Entry of PA Order 23

December 5, 2018

Notice disseminated by Settlement Administrator

30 Days After PA

24

Reminder notices

25

Fee and Service Award motions due

60 Days After PA 115 Days After PA

26

Deadline for Class Members to submit requests for

150 Days After PA

exclusion and/or objections 27

Deadline for Class Members to submit Claim Forms

150 Days After PA

28

9
[PROPOSED] ORDER GRANTING CONDITIONAL CERT. AND PRELIMINARY APPROVAL
CASE NO. 17-CV-03972-JD

Case 3:17-cv-03972-JD Document 44 Filed 12/05/18 Page 10 of 10

1

Event

Date

Deadline for Southwest to provide required employment 164 Days After PA

2

information to Settlement Administrator

Final Approval motion due 3

35 Days Before FA Hearing

Final approval, Service Award fee reply briefs

4

Final Approval (“FA”) Hearing

14 Days Before FA Hearing June 20, 2019, at 10:00 a.m.

5

Effective Date (assuming no appeals)

6

31 Days After Final Approval Order

7

8 IT IS SO ORDERED.

9

10 Dated: December 5, 2018 11 12

The Hon. James Donato United States District Judge

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

10
[PROPOSED] ORDER GRANTING CONDITIONAL CERT. AND PRELIMINARY APPROVAL
CASE NO. 17-CV-03972-JD

 
 Case 3:17-cv-03972-JD Document 1 Filed 07/14/17 Page 1 of 18

1 Jahan C. Sagafi (Cal. State Bar No. 224887)

OUTTEN & GOLDEN LLP 2 One Embarcadero Center, 38th Floor

3

San Francisco, California 94111 Telephone: (415) 638-8800

4 Facsimile: (415) 638-8810

Email:

jsagafi@outtengolden.com

5

6

Peter Romer-Friedman (pro hac vice

motion forthcoming)

OUTTEN & GOLDEN LLP

601 Massachusetts Avenue NW,

Second Floor West Suite

Washington, D.C. 20001

Telephone: (202) 847-4400

Facsimile: (202) 847-4410

Email:

prf@outtengolden.com

7

Thomas G. Jarrard (pro hac vice motion forthcoming)

8 LAW OFFICE OF THOMAS JARRARD PLLC

9 1020 N. Washington Dt.

Spokane, WA 99201 10 Telephone: (425) 239-7290

11

Facsimile: Email:

(509) 326-2932 Tjarrard@att.net

Matthew Z. Crotty (pro hac vice motion forthcoming) CROTTY & SON LAW FIRM, PLLC 905 W. Riverside Ave, Suite 409 Spokane, WA 99201 Telephone: (509) 850-7011 Email: matt@crottyandson.com

12 Attorneys for Plaintiff and the Proposed Class
13

UNITED STATES DISTRICT COURT

14

NORTHERN DISTRICT OF CALIFORNIA

15

SAN FRANCISCO DIVISION

16 JAYSON HUNTSMAN, on behalf of himself
and all others similarly situated, 17

18

Plaintiffs,

19

v.

CLASS ACTION COMPLAINT JURY TRIAL DEMANDED EXEMPT FROM FILING FEES UNDER 38 U.S.C. § 4323(h)(1)

20 SOUTHWEST AIRLINES CO.,

21

Defendant.

22

23

Plaintiff Jayson Huntsman, individually and on behalf of all others similarly situated, by

24 and through his attorneys, alleges as follows:

25

NATURE OF THE ACTION

26

1. This is an action brought pursuant to the Uniformed Services Employment and

27 Reemployment Rights Act (“USERRA”), 38 U.S.C. § 4301 et seq., on behalf of a class of current

28 and former pilots employed by Southwest Airlines Co. (“Southwest”) who did not receive the

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1 retirement contributions mandated by USERRA for the short term periods in which the Southwest

2 pilots took leave from Southwest to honorably serve in the Armed Forces.

3

2. Since at least 1994, Southwest has been required by § 4318 of USERRA to make

4 retirement contributions to Southwest pilots for all periods in which they engaged in qualified

5 military service and were subsequently reemployed by Southwest. In addition, under USERRA

6 § 4316, Southwest has been required to provide accrued paid sick leave to Southwest pilots who

7 took short term military leave insofar as Southwest provided accrued paid sick leave to similarly

8 situated pilots who took comparable forms of leave.

9

3. Both in the past and the present, Southwest has not made the proper retirement

10 contributions for pilots who take short term periods of leave from Southwest to serve in the Armed

11 Forces. Nor has Southwest provided accrued paid sick leave to pilots who engaged in short term

12 military leave. Both of these policies or practices violate USERRA.

13

4. Upon information and belief, prior to and through 2014, Southwest did not provide

14 pilots with any retirement contributions for the short term periods in which pilots took military

15 leave (i.e., periods shorter than 30 days), or alternatively made it impossible for pilots to actually

16 make and receive matching retirement contributions for periods of short term military leave. For

17 example, a pilot who was scheduled to fly a specific schedule over a month and dropped

18 scheduled trips over five working days to serve in the Armed Forces would not be given the

19 opportunity to receive any retirement contributions for such a short term period of military leave.

20

5. Upon information and belief, since 2014 Southwest has prevented Southwest pilots

21 from receiving matching retirement contributions for short term periods of military leave that they

22 are entitled to receive under USERRA by refusing to inform pilots of the amount of contributions

23 that they can make for specific short term periods of military leave and that will, in turn, be

24 matched by Southwest, or by delaying the provision of such information to the Southwest pilots.

25

6. In addition, Southwest has violated USERRA § 4316(b) by failing to provide its

26 pilots who take short term military leave with any accrued paid sick leave while simultaneously

27 providing pilots who engage in jury duty, union duty, and bereavement leave with accrued paid

28 sick leave. Although these forms of leave are comparable, Southwest has never provided its pilots

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1 who take short term military leave with accrued paid sick leave.

2

7. Due to these violations of USERRA, Plaintiff Huntsman and other Southwest pilots

3 who served in the Armed Forces during their employment at Southwest have received

4 considerably smaller retirement contributions and amounts of accrued paid sick leave than they

5 were entitled to receive under USERRA. Southwest has known about these violations of

6 USERRA for years and has received complaints from Southwest pilots, but has not taken

7 sufficient action to rectify the problem. Not only does this underscore the willful nature of

8 Southwest’s conduct, but it has forced Plaintiff Huntsman to turn to the federal courts to obtain

9 justice for all of the Southwest pilots who have been harmed by the practices challenged in this

10 action.

11

JURISDICTION AND VENUE

12

8. The Court has subject matter jurisdiction over this action under 28 U.S.C. § 1331,

13 because this action arises under USERRA, a federal law. This Court has subject matter

14 jurisdiction over the USERRA claim pursuant to 38 U.S.C. § 4323(b)(3), which provides the

15 district courts of the United States with jurisdiction over any USERRA action brought against a

16 private employer. Southwest is a private employer because it “pays salary or wages for work

17 performed or that has control over employment opportunities.” 38 U.S.C. § 4303(4)(A).

18

9. Venue is proper in this District under 38 U.S.C. § 4323(c)(2), because Southwest,

19 “the private employer of the person” who has filed this lawsuit, “maintains a place of business” in

20 this District at the Oakland International Airport and the San Francisco International Airport,

21 employing nearly 750 pilots at the Oakland International Airport. Venue is also proper in this

22 District pursuant to 28 U.S.C. § 1391(b)(2), as a substantial part of the events giving rise to the

23 claims in this action occurred in this District.

24

INTRADISTRICT ASSIGNMENT

25

10. A substantial part of the events or omissions which give rise to the claims occurred

26 in Alameda County and/or adjacent counties in the San Francisco/Oakland Division, and therefore

27 this action is properly assigned to the San Francisco/Oakland Division pursuant to Local Rule 3-

28 2(c),(d).

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1

THE PARTIES

2

11. Plaintiff Jayson Huntsman is and has been employed as a pilot by Southwest since

3 February 2012. Huntsman serves as a First Officer flying 737 passenger airplanes for Southwest.

4 The vast majority of Huntsman’s flights originate in the Oakland International Airport, which is

5 located in this District. Following more than 12 years of active duty service in the Air Force,

6 Huntsman joined the Air Force Reserves in 2012. Since the time that Huntsman began working

7 for Southwest in February 2012, Huntsman has routinely taken short term military leave to serve

8 in the Air Force Reserves. Huntsman resides in Sacramento, California.

9

12. Southwest Airlines Co. is a publicly traded company and, according to Southwest’s

10 2016 annual report, as of June 30, 2016, Southwest was the largest domestic air carrier in the

11 United States, as measured by the number of domestic originating passengers boarded. Southwest

12 currently employs more than 8,800 pilots, and a substantial percentage of those pilots currently

13 serve or have served in the United States Armed Forces during their employment with Southwest.

14 Southwest is an employer within the meaning of 38 U.S.C. § 4303(4)(A).

15

CLASS ACTION ALLEGATIONS

16

13. Plaintiff brings this action as a class action pursuant to Rule 23 of the Federal Rules

17 of Civil Procedure on behalf of the following persons:

18

All current and former pilots of Southwest Airlines Co. (Southwest) or any

subsidiary, joint venture, or division of Southwest who since January 1, 2001 (A)

19

took leave from their employment at Southwest to engage in qualified military

20

service for a period of fewer than 30 days, and (B) (1) were eligible to receive retirement contributions under USERRA, 38 U.S.C. § 4318, for such a period of

21

qualified military service, or (2) were not credited with paid sick leave for such a

period of qualified military service, and the beneficiaries of all such persons.

22

Excluded from the Class are the following persons: (a) all former or current individuals who 23

previously reached settlements with or judgments against Southwest resolving or releasing any 24

claims arising during the Class Period under USERRA related to inadequate pension contributions 25

for short term periods of military leave and the failure to provide accrued paid sick leave during 26

short term periods of military leave; and (b) any person who served as a fiduciary of the Plan and 27

their beneficiaries under the Plans and any member of the immediate family of, and any heirs, 28

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1 successors or assigns of any such person.

2 Impracticability of Joinder

3

14. The class is so numerous that joinder of all members is impracticable. According to

4 Southwest’s 2016 annual report, Southwest had 7,900 pilots in 2016. Upon information and belief,

5 at least hundreds and likely over 1,000 former and current Southwest pilots are members of the

6 proposed Class.

7

15. Southwest employs thousands of pilots, including members of the proposed Class,

8 throughout the United States. Upon information and belief, the members of the Class are

9 geographically dispersed.

10 Commonality

11

16. The central question in this case concern whether the Southwest pilots’ federal

12 statutory rights under USERRA were violated by Southwest when Southwest failed to make the

13 proper amount of retirement contributions to the Southwest pilots and to provide accrued paid sick

14 leave for periods of short term military leave.

15

17. As Southwest adopted and applied a uniform policy or practice for calculating and

16 making retirement contributions owed under USERRA with respect to the military leave of

17 Southwest pilots, and for failing to provide accrued paid sick leave for periods of short term

18 military leave, the answers to these questions will produce common answers for all members of

19 the proposed Class.

20

18. Plaintiff’s claims raise subsidiary common questions that will also have common

21 answers for each Class Member, including, but not limited to, the following:

22

(a) Whether Southwest failed to make retirement contributions for short term periods

23

of military leave that Southwest pilots took prior to and through 2014, in violation of

24

USERRA § 4318?

25

(b) Whether Southwest prevented Southwest pilots from receiving retirement

26

contributions for short term periods of military leave since 2014 in violation of

27

USERRA § 4318?

28

(c) Whether Southwest failed to provide accrued paid sick leave to pilots who took

CLASS ACTION COMPLAINT - 5

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1

short term military leave in violation of USERRA § 4316?

2

(d) Whether Southwest’s violations of USERRA were willful, making it appropriate to

3

award liquidated damages under USERRA?

4

(e) What, if any, other relief should be granted?

5

19. Because the retirement contributions and failure to pay accrued paid sick leave for

6 periods of the Southwest pilots’ qualified military service were based on uniform policies or

7 practices, and any recovery can be paid into the Southwest pilots’ individual retirement accounts,

8 or deposited into the sick leave banks of the pilots, or paid directly to the pilots, all issues

9 regarding relief are common.

10

20. Even if the ultimate allocation of recovery into the Southwest pilots’ individual

11 retirement accounts or their sick leave banks is considered, the unifying issues concerning the

12 policies are the failure to make the proper retirement contributions required by USERRA § 4318

13 and the failure to provide accrued paid sick leave in violation of USERRA § 4316. As Southwest

14 acted in a systematic manner with respect to the Class Members, all members of the Class suffered

15 the same type of injuries based on two discrete policies, and resolving the claims of the Class will

16 be based on common legal and factual questions.

17 Typicality

18

21. Plaintiff’s claims are typical of the other members of the proposed Class. Plaintiff

19 challenges two discrete policies by which Southwest made retirement contributions for short term

20 periods of the Southwest pilots’ qualified military service in violation of USERRA and failed to

21 provide accrued paid sick leave in violation of USERRA.

22

22. The relief sought consists primarily of: (1) a declaration establishing that Southwest

23 violated USERRA; (2) an order requiring Southwest to recalculate the retirement contributions

24 owed to members of the Class and provide accrued paid sick leave to the Class; and (3) an order

25 that the restored losses and accrued paid sick leave be allocated into the individual retirement

26 accounts of the members of the Class or be provided to the Class Members.

27

28

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Case 3:17-cv-03972-JD Document 1 Filed 07/14/17 Page 7 of 18

1 Adequacy

2

23. Plaintiff will fairly and adequately protect the interests of other members of the

3 Class. Plaintiff is aware of no conflict with any other member of the Class. Plaintiff understands

4 his obligations as a class representative, has already undertaken steps to fulfill them, and is

5 prepared to continue to fulfill his duties as class representative.

6

24. Southwest has no unique defenses against the Plaintiff that would interfere with

7 Plaintiff’s representation of the Class.

8

25. Plaintiff’s counsel are experienced in federal court class action litigation, including

9 civil rights and employee benefits litigation, and have considerable experience and expertise in the

10 area of USERRA.

11 Rule 23(b)(1)

12

26. This action is properly maintainable as a class action under Rule 23(b)(1) of the

13 Federal Rules of Civil Procedure, because the central questions in this litigation are whether

14 Southwest violated USERRA in connection with calculating and making retirement contributions

15 to the Southwest pilots for short term periods of qualified military service and in failing to provide

16 accrued paid sick leave for periods of short term military leave.

17

27. Administration of a pension plan requires that all similarly situated participants be

18 treated consistently. As a practical matter, resolution of whether the appropriate amount of

19 contributions were made to any participant’s account using the policy applied here would be

20 dispositive of that matter for other members of the Class. Likewise, conflicting interpretations as

21 to the manner by which the amount should have been calculated and contributed or credited to the

22 individual accounts of similarly situated participants would create the risk of establishing

23 inconsistent standards of conduct for the Plan, its administrator, and any subsequently-appointed

24 independent fiduciary.

25

26

27

28

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Case 3:17-cv-03972-JD Document 1 Filed 07/14/17 Page 8 of 18

1 Rule 23(b)(2)

2

28. This action is also properly maintainable as a class action under Rule 23(b)(2) of

3 the Federal Rules of Civil Procedure. Southwest is alleged to have violated USERRA in a manner

4 as to all members of the Class. As such, Southwest has acted or refused to act on grounds that

5 apply generally to the Class. As a result, final declaratory relief is appropriate respecting the Class

6 as a whole.

7

29. The monetary relief that Plaintiff seeks either flows from and/or is incidental to the

8 declaratory relief sought, as it flows directly from the ordering of such declaratory relief and can

9 be calculated in a simple, objective, and mechanical manner.

10 Rule 23(b)(3)

11

30. This action is also properly maintainable as a class action under Rule 23(b)(3) of

12 the Federal Rules of Civil Procedure.

13

31. The questions of law and fact common to the members of the Class predominate

14 over questions affecting only individual members, and a class action is superior to other available

15 methods for the fair and efficient resolution of this controversy.

16

32. By resolving the common issues described above in a single class proceeding, each

17 member of the proposed Class will receive a determination of whether Southwest violated

18 USERRA, and will receive the remedy that should be provided under USERRA.

19

33. Upon information and belief, there is no other pending litigation that has raised

20 similar allegations with respect to Southwest.

21

34. This is an appropriate forum for these claims because, among other reasons,

22 jurisdiction and venue are proper, and, as a result of Southwest’s significant operations and large

23 number of employees in this District, a substantial part of the Class likely earned their retirement

24 contributions in this District, and at least a portion of the Class likely resides in this District.

25

35. There are no difficulties in managing this case as a class action.

26

27

28

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1

FACTUAL ALLEGATIONS

2 The Pension and Retirement Rights Mandated by USERRA

3

36. Since 2001, Southwest has employed hundreds to thousands of pilots who have

4 served their country in the United States Armed Forces during their employment with Southwest.

5

37. When these Southwest pilots take military leave to serve in the Armed Forces,

6 federal law requires Southwest to treat these employees as if they never took leave from their

7 civilian jobs at Southwest. For example, USERRA requires Southwest to reemploy Southwest

8 pilots who take military leave, and restore the rights and benefits related to the employees’

9 positions. 38 U.S.C. §§ 4312, 4316.

10

38. In addition, USERRA mandates that for the purpose of retirement benefits an

11 employee who returns to his job after serving in the military must be treated as if he or she never

12 took a day off from his or her civilian job. 38 U.S.C. § 4318.

13

39. The retirement benefits of servicemembers have been protected for decades,

14 because Congress has understood that a servicemember’s retirement security should not be

15 compromised simply because he or she answers the call to duty—no more than a servicemember

16 should lose his or her civilian job due to serving in the Armed Forces. These rights are central to a

17 statutory scheme that the U.S. Supreme Court has said constitutes the “mechanism for manning

18 the Armed Forces of the United States.” Alabama Power Co. v. Davis, 431 U.S. 581, 583 (1977).

19

40. As an employer within the meaning of USERRA, Southwest has been required to

20 comply with USERRA and ensure that Southwest pilots receive the retirement contributions

21 mandated by 38 U.S.C. § 4318.

22

41. Pursuant to 38 U.S.C. § 4318(a)(1)(A), Southwest and the Plans have been required

23 to comply with USERRA § 4318(a)(2), which provides as follows:

24

(A) A person reemployed under this chapter shall be treated as not having incurred

a break in service with the employer or employers maintaining the plan by reason

25

of such person’s period or periods of service in the uniformed services.

26

(B) Each period served by a person in the uniformed services shall, upon

reemployment under this chapter, be deemed to constitute service with the

27

employer or employers maintaining the plan for the purpose of determining the

nonforfeitability of the person’s accrued benefits and for the purpose of

28

determining the accrual of benefits under the plan.

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Case 3:17-cv-03972-JD Document 1 Filed 07/14/17 Page 10 of 18

1

42. For each period of military service, USERRA § 4318(b)(1) provides that the

2 employer is “liable to an employee pension benefit plan for funding any obligation of the plan to

3 provide the benefits described in subsection (a)(2) [of § 4318] and shall allocate the amount of any

4 employer contribution for the person in the same manner and to the same extent the allocation

5 occurs for other employees during the period of service.”

6

43. Southwest is an employer under USERRA because it “pays salary or wages for

7 work performed or that has control over employment opportunities.” 38 U.S.C. § 4303(4)(a).

8

44. To “comput[e] an employer’s liability” to make retirement contributions under §

9 4318(b)(1), USERRA § 4318(b)(3) provides that “the employee’s compensation during the period

10 of service described in subsection (a)(2)(B) shall be computed”:

11

(A) at the rate the employee would have received but for the period of service described in subsection (a)(2)(B), or (B) in the case that the determination of such

12

rate is not reasonably certain, on the basis of the employee’s average rate of

compensation during the 12-month period immediately preceding such period (or,

13

if shorter, the period of employment immediately preceding such period).

14

45. Under this rule, an employee whose compensation during a period of military leave

15 is reasonably certain is entitled to receive retirement contributions based on the rate of

16 compensation that the employee would have received but for that period of military service, or, if

17 the employee’s compensation is not reasonably certain, based on the 12-month average

18 compensation prior to the period of military service.

19

46. Under USERRA, when a retirement plan requires the employee to make a

20 retirement contribution before the employer will match that contribution or a portion of the

21 employee’s contribution, the employee is required to make a “make-up” USERRA contribution

22 before the employer is required to make its own “make-up” contribution to the employee’s

23 retirement account. 38 U.S.C. § 4318(b)(2).

24

47. For many years, Southwest has maintained a defined contribution retirement plan

25 for its pilots, the Southwest Airlines Pilots Retirement Savings Plan (“the Plan”). Since January 1,

26 2017, under the Plan each pilot is entitled to receive a non-elective contribution that is allocated to

27 the pilot, regardless of whether the pilot made salary reduction contributions during the plan year

28 (13.4% in 2017, 14.2% in 2018, and 15.0% in 2019 and following years). However, prior to

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1 January 1, 2017, Southwest only made a matching contribution for each pilot based on a portion of

2 the pilot’s compensation that the pilot contributed to the Plan, such as 9.3% of the pilot’s

3 compensation in 2016.

4

48. Southwest has stated in its Summary Plan Descriptions (“SPD”) of the Plan that it

5 will count qualified military service towards the compensation that determines the amount of

6 retirement contributions that will be made by the company (on or after January 1, 2017), or that

7 can be made by the pilot and matched by Southwest (prior to January 1, 2017). However, the SPD

8 and related Plan Documents have not identified the formula that Southwest uses to calculate the

9 “deemed” compensation that will be used for periods of qualified military service. Nor have the

10 SPD or related Plan Documents identified any process or method by which Southwest would

11 inform pilots about the amount of retirement contributions that they could make and which

12 Southwest would match for short term periods of military leave prior to January 1, 2017.

13

49. Under Southwest’s Plan, pilots who engage in military service and satisfy

14 USERRA’s reemployment requirements are supposed to be able to make up any missed

15 contributions to their retirement accounts during periods of military leave (even though Southwest

16 has not paid the pilot for that period of time) and have Southwest make a matching contribution to

17 the pilots’ accounts. For example, if a pilot takes military leave for a year and his or her “deemed”

18 compensation for that year is $100,000, then in 2016 the pilot was supposed to be able to

19 contribute up to a 9.3% of that $100,000 of deemed compensation into his defined contribution

20 account, and Southwest would then make a matching 9.3% contribution ($9,300) into the pilot’s

21 account. This make-up contribution procedure is mandated by USERRA. 38 U.S.C. § 4318(b)(2).

22 Southwest Violated the Retirement Provisions of USERRA

23

50. For many years, Southwest has failed to satisfy its obligations under USERRA §

24 4318 with respect to pilots who take short term military leave.

25

51. For pilots’ periods of short term leave (fewer than 30 days), Southwest was

26 obligated to make retirement contributions under § 4318. However, upon information and belief,

27 prior to and through 2014, Southwest did not provide pilots with any retirement contributions for

28 the short term periods in which pilots took military leave—or in the alternative, Southwest failed

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Case 3:17-cv-03972-JD Document 1 Filed 07/14/17 Page 12 of 18

1 to inform Southwest pilots about the amount of retirement contributions that they could make and

2 Southwest would match for the periods of short term military leave, effectively eliminating the

3 ability of pilots to receive matching contributions for such periods of leave. As a result, the pilots

4 who took such short term military leave did not have the opportunity to make employee

5 contributions for such periods of short term leave and have those contributions matched by

6 Southwest. Similarly, during and after 2014, Southwest failed to provide Plaintiff and members of

7 the Class with information about the amount of retirement contributions that they could make and

8 Southwest would match for the periods of short term military leave, denying them the ability to

9 make and have matched by Southwest the appropriate amount of retirement contributions for

10 periods of short term military leave.

11

52. By denying pilots the appropriate amount of retirement contributions for periods of

12 short term military leave, Southwest violated USERRA § 4318.

13

53. For Southwest pilots like Plaintiff Huntsman and other members of the proposed

14 Class who regularly took short term military leave, Southwest’s violations of USERRA § 4318

15 caused the pilots to receive lower amounts of USERRA retirement contributions than the amounts

16 that were required by USERRA § 4318.

17

54. In the case of Plaintiff Huntsman, despite his multiple requests, he was not

18 provided with any information by Southwest about the amount of retirement contributions that he

19 could make (and that Southwest would match) for any short term periods of military leave from

20 2012 to present. From 2012 to present, Plaintiff Huntsman has taken dozens of periods of short

21 term military leave, most of which were between one and six days.

22

55. On multiple occasions during and/or after 2016, Plaintiff Huntsman has

23 communicated with the principal official at Southwest who is responsible for USERRA

24 retirement-related issues and asked the official to provide Plaintiff Huntsman with information on

25 the amount of retirement contributions that he could make and Southwest would match for periods

26 of short term military leave. Plaintiff Huntsman was told by the official that Southwest has no

27 process or procedure for informing him and other Southwest pilots on the amounts of retirement

28 contributions that they could make and Southwest would match for periods of short term military

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Case 3:17-cv-03972-JD Document 1 Filed 07/14/17 Page 13 of 18

1 leave. As a result, Plaintiff Huntsman and other members of the Class have routinely been unable

2 to receive matching retirement contributions for periods of short term military leave that they have

3 taken.

4 Southwest Failed to Provide Southwest Pilots with Accrued Sick Leave During Periods of Military Leave in Violation of USERRA
5

6

56. Ordinarily, when Southwest pilots are working they accrue paid sick leave that they

7 can use in the future.

8

57. Prior to the filing of this Complaint, Southwest has never provided Southwest pilots

9 with any accrued sick leave during the periods in which they engage in military leave, including

10 periods of short term military leave.

11

58. During the same period, however, Southwest provided similarly situated Southwest

12 pilots with accrued sick leave for other comparable forms of leave, including employees on jury

13 duty and duty with the pilots’ union, as well as employees on bereavement leave.

14

59. USERRA § 4316(b) provides in relevant part that “a person who is absent from a

15 position of employment by reason of service in the uniformed services shall be”

16

(A) deemed to be on furlough or leave of absence while performing such service;

and

17

(B) entitled to such other rights and benefits not determined by seniority as are

18

generally provided by the employer of the person to employees having similar

19

seniority, status, and pay who are on furlough or leave of absence under a contract, agreement, policy, practice, or plan in effect at the commencement of such service

20

or established while such person performs such service.

21

60. Accordingly, if an employer provides non-seniority rights and benefits to similarly

22 situated employees, USERRA § 4316 requires the employer to provide the same rights and

23 benefits to employees during their military leave. See id.; 20 C.F.R. § 1002.150(a). As the

24 USERRA regulations state, the “most significant factor to compare” two types of leave to

25 determine if they are a “comparable form of leave” is “the duration of the leave.” 20 C.F.R.

26 § 1002.150(a). In addition, “other factors such as the purpose of the leave and the ability of the

27 employee to choose when to take the leave should also be considered.” Id.

28

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1

61. For Southwest pilots, the duration of jury duty, union duty, and short term military

2 leave is comparable. They can routinely last days to weeks, but usually do not last more than a

3 month. Moreover, with respect to both jury duty and military duty, the employee usually has no

4 choice over whether to take leave from work to engage in such duty. Finally, with respect to jury

5 duty and military duty, the purpose of the leave is to serve our government and to engage in public

6 service for the benefit of our society. Likewise, the purpose of union duty is to engage in service

7 for the good of fellow members of the community—the working men and women of Southwest

8 and Southwest itself.

9

62. Southwest’s policy of refusing to provide accrued paid sick leave to Southwest

10 pilots who engage in short term military leave violates USERRA § 4316, because Southwest

11 denies pilots a non-seniority benefit that Southwest provides to similarly situated employees who

12 are on furlough or leave of absence. 38 U.S.C. § 4316.

13

63. This policy has adversely impacted the amount of accrued paid sick leave that

14 Southwest pilots receive when they engage in short term military leave compared to pilots who

15 receive accrued paid sick leave when they engage in jury duty, union duty, or bereavement leave.

16

COUNT I

17

(Violation of USERRA, 38 U.S.C. § 4318)

18

64. Plaintiff incorporates the allegations contained in the foregoing paragraphs as if

19 fully set forth herein.

20

65. USERRA, 38 U.S.C. § 4318(a)(2)(B), provides that an employee’s service in the

21 uniformed service will be deemed to constitute service with the employer for purposes of

22 determining the accrual of benefits under the retirement plan. This rule applies to the defined

23 contribution plan that Southwest has maintained for its pilots in which Southwest would match

24 retirement contributions that its pilots would make into the plan prior to 2017.

25

66. Pursuant to USERRA, 38 U.S.C. § 4318(b)(1), an employer reemploying a person

26 after a period of service in the uniformed services is liable to the employee benefit pension plan

27 for funding any obligation of the plan to provide benefits, including those accrued under USERRA

28 § 4318(a)(2)(B). An employer must also make a contribution to a pension or retirement plan

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1 where the employer’s contribution is “contingent on” the employee first making a contribution.

2 38 U.S.C. § 4318(b)(2).

3

67. As described in detail above, prior to and after 2014 Southwest violated USERRA

4 § 4318 by not counting periods of short term military leave towards the compensation that it used

5 to determine retirement contributions for periods of short term military leave, and/or by refusing to

6 provide pilots with information that was necessary for them to know the amount of retirement

7 contributions that they could make and Southwest would match. Accordingly, Southwest denied

8 those pilots the retirement contributions they otherwise would have received under USERRA.

9

68. Because Southwest applied its policy in violation of USERRA, Plaintiff and the

10 Class received retirement contributions in their defined contribution accounts that were smaller

11 than what they would have received had Southwest complied with USERRA. Southwest’s

12 violations of USERRA § 4318 was willful and in reckless disregard of the law. Accordingly,

13 Southwest should be required to pay liquidated damages to former and current Southwest pilots

14 whose retirement contributions were reduced due to Southwest’s violations of USERRA. 38

15 U.S.C. § 4323(d)(1)(C).

16

COUNT II

17

(Violation of USERRA, 38 U.S.C. § 4316)

18

69. Plaintiff incorporates the allegations contained in the foregoing paragraphs as if

19 fully set forth herein.

20

70. USERRA requires Southwest to provide its pilots who take military leave with the

21 same non-seniority rights and benefits that it provides to similarly situated pilots who are on

22 furlough or leave of absence. 38 U.S.C. § 4316(b); 20 C.F.R. §§ 1002.149, 1002.150(a).

23

71. As described above, Southwest has violated USERRA § 4316(b) by failing to

24 provide its pilots who take short term military leave with any accrued paid sick leave while

25 simultaneously providing accrued paid sick leave to pilots who engage in jury duty, union duty,

26 and bereavement leave or other comparable types of leave. These types of leave are comparable

27 in terms of duration, purpose, and the ability of the employee to determine whether to take the

28 leave. Accordingly, Southwest was required by USERRA § 4316(b) to provide accrued paid sick

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Case 3:17-cv-03972-JD Document 1 Filed 07/14/17 Page 16 of 18

1 leave to Southwest pilots who took short term military leave, but failed to do so in violation of

2 federal law.

3

COUNT III

4

(Violation of USERRA, 38 U.S.C. § 4323)

5

72. USERRA provides that employees may receive liquidated damages in the event

6 that the trier of fact determines that the defendant willfully violated the statute. 38 U.S.C. §

7 4323(d)(1)(C).

8

73. In this instance Plaintiff Huntsman and the pilots’ union, inter alia, repeatedly

9 informed Southwest’s management and principal decision makers that its actions regarding the

10 company’s retirement and sick leave policies did not comply with USERRA.

11

74. Moreover, Southwest was on notice of USERRA’s requirements as Southwest, like

12 all other employers in America, is required to post the statutorily-mandated workplace poster that

13 informs both workers and management of USERRA’s rights and responsibilities.

14

75. As described above, Southwest’s violations of USERRA § 4318 and USERRA §

15 4316 were willful and occurred in reckless disregard for the law.

16

REQUEST FOR RELIEF

17

WHEREFORE, Plaintiff prays that judgment be entered against Defendant on all claims

18 and respectfully requests that this Court award the following relief:

19

A. Declare that Defendant’s policy with respect to the formula by which any

20 retirement contributions related to Plaintiff and the proposed Class Members’ short term periods

21 of military leave were calculated by Southwest violated the rights of Plaintiff and the Class under

22 USERRA and declare that Defendant’s failure to provide accrued paid sick leave to pilots who

23 took short term military leave violated the rights of Plaintiff and the Class under USERRA.

24

B. Declare that Plaintiff and the Class were and are entitled under USERRA to receive

25 contributions to their defined contribution retirement accounts in an amount that is consistent with

26 USERRA § 4318 and that they are entitled to receive accrued paid sick leave in the amount that is

27 consistent with USERRA § 4316;

28

C. Require Defendant to fully compensate Plaintiff and the Class for the loss of

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Case 3:17-cv-03972-JD Document 1 Filed 07/14/17 Page 17 of 18

1 benefits suffered by reason of its failure to comply with the provisions of USERRA by awarding

2 an amount that fully compensates Plaintiff and the Class for Defendant’s failure to make these

3 retirement contributions and accrued paid sick leave when originally due, including any lost

4 earnings on the unmade contributions or accrued paid sick leave and/or awarding Plaintiff and the

5 Class prejudgment interest on the amount of contributions or accrued paid sick leave that were

6 required to be made under USERRA but which Defendant failed to make (whichever amount is

7 greater);

8

D. Order Defendant to comply with USERRA, 38 U.S.C. § 4318 and § 4316;

9

E. Order the Defendant to pay all members of the Class liquidated damages in an

10 amount to be determined at trial. 38 U.S.C. § 4323(d)(1)(C);

11

F. Require Defendant to pay attorneys’ fees and costs pursuant to 38 U.S.C. §

12 4323(h), and/or this Court’s inherent equitable authority and powers, and ordering the payment of

13 reasonable attorneys’ fees and expenses of this action to Plaintiff’s counsel on the basis of the

14 common benefit and/or common fund doctrine (or other applicable law) out of any money or

15 benefit recovered for the Class or the Plans in this Action.

16

G. Grant such other and further relief as the Court deems proper, appropriate, just

17 and/or equitable including, without limitation, allowing for any adverse tax consequence

18 multiplier to be applied to any jury award.

19

JURY DEMAND

20

Plaintiff hereby demands a trial by jury.

21 Dated: July 14, 2017

Respectfully submitted,

22 By: /s/ Jahan C. Sagafi

23

Jahan C. Sagafi (Cal. State Bar No. 224887) Peter Romer-Friedman (pro hac vice motion

24 OUTTEN & GOLDEN LLP

forthcoming)

One Embarcadero Center, 38th Floor 25 San Francisco, California 94111

OUTTEN & GOLDEN LLP 601 Massachusetts Avenue NW,

Telephone: (415) 638-8800 26 Facsimile: (415) 638-8810

Second Floor West Suite Washington, D.C. 20001

Email: 27

jsagafi@outtengolden.com

Telephone: (202) 847-4400 Facsimile: (202) 847-4410

Email:

prf@outtengolden.com

28

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Case 3:17-cv-03972-JD Document 1 Filed 07/14/17 Page 18 of 18

1 Thomas G. Jarrard (pro hac vice motion forthcoming)
2 LAW OFFICE OF THOMAS JARRARD PLLC
3 1020 N. Washington Dt. Spokane, WA 99201
4 Telephone: (425) 239-7290 Facsimile: (509) 326-2932
5 Email: Tjarrard@att.net

Matthew Z. Crotty (pro hac vice motion forthcoming) CROTTY & SON LAW FIRM, PLLC 905 W. Riverside Ave, Suite 409 Spokane, WA 99201 Telephone: (509) 850-7011 Email: matt@crottyandson.com

6 Attorneys for Plaintiff and the Proposed Class

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