Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_18-cv-01239/USCOURTS-caed-1_18-cv-01239-7/pdf.json

Nature of Suit Code: 710
Nature of Suit: Fair Labor Standards Act
Cause of Action: 29:201 Fair Labor Standards Act

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

CHAD ENGLERT, et al.,

Plaintiffs,

v.

CITY OF MERCED,

Defendant.

Case No. 1:18-cv-01239-NONE-SAB

ORDER REQUIRING SUPPLEMENTAL 

BRIEFING ON JOINT MOTION FOR 

APPROVAL OF SETTLEMENT OF FLSA 

ACTION

SEVEN DAY DEADLINE

On April 6, 2020, a joint motion for approval of a settlement agreement was filed in this 

matter. Upon review of the motion, the Court shall require supplemental briefing on the 

following issues. 

1. Certification of the Class

Federally courts generally use a two-step approach to determine whether to allow a 

collective action to proceed. Tijero v. Aaron Bros., Inc., 301 F.R.D. 314, 323 (N.D. Cal. 2013). 

Initially, the court determines whether the potential class members should receive notice of the 

action, and plaintiffs can satisfy their burden to show that they are “similarly situated.” The 

Ninth Circuit has held that “plaintiffs are similarly situated, and may proceed in a collective, to 

the extent they share a similar issue of law or fact material to the disposition of their FLSA 

claims.” Campbell v. City of Los Angeles, 903 F.3d 1090, 1117 (9th Cir. 2018).

Here, Plaintiffs never moved to conditionally certify the class, nor do they address class 

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certification in their motion for approval of the settlement of this matter. While the parties 

address whether the settlement is a fair and reasonable resolution of a bona fide dispute, they 

have not addressed the requirement that the employees be similarly situated to proceed as a 

collective action. 

Although the statute does not address the procedural mechanism of certification of the 

FLSA class, “district courts, both within this circuit and without, have arrived at a loose 

consensus as to the proper procedure for determining whether the collective mechanism is 

appropriate.” Campbell, 903 F.3d at 1108–09. “Bringing a collective action suit requires 

satisfying a two-step process: conditional certification and actual certification.” Employer’s 

Guide to Fair Labor Standards Act, § 937 COLLECTIVE ACTIONS, 2019 WL 4694205. 

‘[W]hen considering a motion to approve the settlement of either a Rule 23 class or an FLSA 

collective action, before a class or collective has been certified, the Court must first certify the 

class or collective for the purpose of the settlement.” Smith v. Kaiser Found. Hosps., No. 3:18-

CV-00780-KSC, 2019 WL 5864170, at *5 (S.D. Cal. Nov. 7, 2019).

Notably, there has been no conditional certification of the class, no class representative 

was appointed, counsel has not been appointed to represent the class, and no notice was 

approved to be distributed to the class. Plaintiffs shall be required to file supplemental briefing

identifying the class to be certified and addressing whether an FLSA class should be certified in 

this action.

2. Potential Recovery

The district court is to evaluate the potential range of recovery to ensure that the 

settlement amount agreed to bears some reasonable relationship to the true settlement value of 

the claims. Selk v. Pioneers Mem’l Healthcare Dist., 159 F.Supp.3d 1164, 1174 (S.D. Cal. 

2016). “[I]n comparing the amount proposed in the settlement with the amount that plaintiffs 

could have obtained at trial, the court must be satisfied that the amount left on the settlement 

table is fair and reasonable under the circumstances presented.” Selk, 159 F.Supp.3d at 1174. 

“Even a fractional recovery of the possible maximum recovery amount may be fair and adequate 

in light of the uncertainties of trial and difficulties in proving the case.” Millan, 310 F.R.D. at

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611.

Here, the parties dispute the proper method to calculate the overtime compensation under 

the FLSA. In the motion to approve the settlement, the parties have used the amount of damages 

that the defendants have calculated by using 29 C.F.R. § 778.110(b) and have determined that 

damages in this action would be $118,252.05 and liquidated damages would be $118,251.80. 

(ECF No. 38-5 at 64-65.) However, in the motion, Plaintiffs state that damages should be 

calculated using the method set forth in 29 C.F.R. § 778.113. In his declaration, Mr. Mastagni 

states that the method of calculating damages used has a significant effect on the amount of 

overtime owed. Plaintiffs state that the amount agreed to in settlement is near the maximum 

range but this is based on Defendant’s calculation and Plaintiffs have not included the maximum 

compensation based on their calculation although they argue that there would be significant 

deductions if they don’t prevail on various issues. Plaintiffs shall provide the Court with the 

maximum damages that could be recovered in this action so the Court can evaluate whether the

amount offered in settlement is reasonable. 

3. Attorney Fees

Since the settlement agreement includes an award of attorney fees, the Court must access 

the reasonableness of the fee award. Selk, 159 F.Supp.3d at 1180. “Where a settlement 

produces a common fund for the benefit of the entire class, courts may employ either the lodestar 

method or percentage-of-recovery method to determine a reasonable attorney's fee.” Id. As 

Plaintiffs recognize, they seek attorney fees of thirty-one percent of the settlement fund which is 

far in excess of the benchmark in the Ninth Circuit. See In re Bluetooth Headset Products 

Liability Litigation, 654 F.3d 935, 942 (9th Cir. 2011) (in the Ninth Circuit, 25% of the common 

fund is the “benchmark” for a reasonable fee). If a percentage of the common fund method is 

used, then the court uses the lode star method as a cross check for the reasonableness of the fees. 

Vizcaino v. Microsoft Corp., 290 F.3d 1043, 1050 (9th Cir. 2002); see also Kerzich v. Cty. of 

Tuolumne, 335 F.Supp.3d 1179, 1185 (E.D. Cal. 2018) (“Typically, attorneys’ fees under the 

FLSA are determined using the lodestar method.”). 

While Plaintiffs have set forth total hours expended in this by various personnel, they 

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have not included billing records which the Court requires to determine if the hours expended are 

reasonable in conducting a lode star analysis. Accordingly, Plaintiffs shall submit billing records 

for the Court to review.

Accordingly, IT IS HEREBY ORDERED that within seven (7) days of the date of entry 

of this order, Plaintiffs shall submit supplemental briefing regarding the issues identified in this 

order.

IT IS SO ORDERED.

Dated: April 24, 2020 

UNITED STATES MAGISTRATE JUDGE

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