Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_13-cv-00244/USCOURTS-casd-3_13-cv-00244-0/pdf.json

Nature of Suit Code: 710
Nature of Suit: Fair Labor Standards Act
Cause of Action: 28:1331fl Fed. Question: Fair Labor Standards

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

ELENA SELK,

Plaintiff,

Case No. 13-cv-244-BAS-BGS

ORDER GRANTING 

PLAINTIFF’S MOTION FOR 

APPROVAL OF FLSA 

v. SETTLEMENT

PIONEERS MEMORIAL 

HEALTHCARE DISTRICT, 

Defendant.

Plaintiff Elena Selk bringsthis collective action under the Fair Labor Standards 

Act (“FLSA”), 29 U.S.C. §§ 201–219, on behalf of nonexempt employees of 

Defendant Pioneers Memorial Healthcare District (“Pioneers”). (ECF Nos. 1, 48.) 

Selk represents a class of current and former hourly employees of Pioneers who 

worked overtime during the relevant period, and a class of current and formerly 

hourly employees of Pioneers who used an employee cafeteria discount while 

working overtime. (ECF Nos. 48, 96, 102.) The parties are presently before the Court 

on Plaintiff Selk’s unopposed Motion for Approval of Settlement. (ECF No. 125.) 

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The motion came on for hearing on January 13, 2016. (ECF No. 129.) Having 

considered the papers and the representations of counsel at oral argument, the Court 

GRANTS the motion. 

I. BACKGROUND

Plaintiff Selk originally filed this action on January 31, 2013, alleging that her 

former employer, Defendant Pioneers, failed to pay her and other similarly situated 

workers proper wages and overtime in violation of the FLSA and California’s Unfair 

Competition Law (“UCL”), Cal. Bus. & Prof. Code. § 17200 et seq. (ECF No. 1.) On 

April 22, 2014, after Selk had filed a Second Amended Complaint that retained both 

the FLSA and UCL claims, the Court granted Pioneers’ motion for partial summary 

judgment on Selk’s UCL claim, leaving only claims under the FLSA. (ECF No. 96.)

Plaintiff’s core allegations are as follows: (1) that Pioneers’ policy of rounding 

employees’ “clock in” and “clock out” times to the nearest 15 minutes systematically 

undercompensated its employees, denying them properly calculated regular and 

overtime pay; (2) that Pioneers’ policy of excluding the 10% cafeteria meal discount 

it offers to employees from the value of total remuneration used to calculate 

employees’ regular rate of pay denied employees proper wages and overtime; and (3)

that Pioneers’ practice of not accounting for the time employees worked while logged 

into computer systems other than Pioneers’ primary time record system denied 

employees compensation for all hours actually worked. (SAC 7–11.) On January 8, 

2014, Selk sought certification of three classes under Federal Rule of Civil Procedure

23, centered on the aforementioned claims, or in the alternative, certification of three 

collective action classes under the FLSA. (ECF No. 59.) The Court ultimately 

certified two classes under the FLSA: an “Overtime Class” based on Pioneers’ time 

clock rounding policy and practices, and a “Cafeteria Discount Class” based on 

Selk’s claim that the law requires Pioneers to include the 10% cafeteria discount 

when determining the total remuneration used to calculate employees’ regular rate of 

pay. (ECF Nos. 96, 102.) After certification, Selk disseminated notice to 1,065 

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putative class members, 65 of whom opted-in to one or both of the “rounding” and 

“cafeteria discount” claims.1(ECF No. 113.) The FLSA consent forms signed by the 

opt-in plaintiffs were lodged with the Court on December 1, 2014. Id.

On March 23, 2015, while in the midst of one of their several discovery 

disputes, the parties filed a notice of settlement. (ECF No. 121.) Plaintiff’s Motion 

for Approval of Settlement followed on July 14, 2015. (ECF No. 125.) The motion 

seeks approval of: (1) a settlement of all FLSA claims, (2) an award of attorney’s 

fees and costs, (3) an enhancement award to Plaintiff Selk as the named plaintiff, and 

(4) a separate settlement between Selk and Pioneers, including a general release of 

claims for which Selk is to be independently compensated. (Mot. 1:2–7.)

The settlement (“Settlement” or “Settlement Agreement”) provides that 

Pioneers will pay an amount not to exceed $50,000 to settle the claims of the 65 optin plaintiffs and Plaintiff Selk (collectively, the “Parties Plaintiff”). (ECF No. 127, 

Exh. A (“Settlement Agreement”) ¶ C.) The $50,000 settlement fund is to be 

apportioned as follows: the Parties Plaintiff will receive individual settlement 

payments totaling $17,500; Plaintiff Selk will receive a $5,000 service payment;

counsel for Parties Plaintiff will receive $22,000 in attorney’s fees and costs; and 

Plaintiff Selk will receive a separate payment of $5,500 in consideration for signing 

a “full and complete” settlement agreement with Pioneers that includes a general 

release of claims. (Mot. 4:12–6:15.) The amount of each opt-in plaintiff’s individual 

payment varies based upon an agreed upon-formula and the amount of weeks worked 

during the covered time period, but in no case will an opt-in plaintiff receive less than 

$150.2(Sullivan Decl., Exh. 3.)

The Settlement requires the Parties Plaintiff to release a defined category of 

claims. Specifically, the Settlement requires opt-in members to release “any and all 

 

1 Membership in the Rounding/Overtime Class and the Cafeteria Discount Class is largely 

coextensive—only 8 members of the latter are not members of the former. (Sullivan Decl. Exh. 4.)

2

Individual settlement payments to the Parties Plaintiff range from $150 to $462.17. (ECF No. 

127, Exh. 5.) 

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claims . . . for or which relate to the alleged failure to properly pay wages or overtime 

as required by the Fair Labor Standards Act, any state wage laws, any local wage 

laws, any other applicable federal, state or local law, and any other claims alleged in 

the case[.]” (Settlement Agreement ¶ B(10).) Selk’s separate agreement with 

Pioneers (the “Selk Agreement”) contains a general release of claims that covers not 

only the wage and hour claims alleged in the case, but also “any and all claims . . . 

whether known or unknown to Selk . . . (1) arising out of Selk’s employment with 

Pioneers or termination of that employment . . . or (2) arising out of or in any way 

connected with any claim . . . resulting from any act or omission by or on part of” 

Pioneers, its officers, or affiliates. (ECF No. 127, Exh. 6 ¶ 5.) The release of claims 

in both agreements is to become effective upon the Court’s approval of the Settlement 

and dismissal of this action. (Settlement Agreement ¶ K; Selk Agreement ¶ 13.)

II. LEGAL STANDARD

The FLSA was enacted to protect covered workers from substandard wages 

and oppressive working hours. See Barrentine v. Arkansas-Best Freight System, Inc., 

450 U.S. 728, 739 (1981); 29 U.S.C. § 202(a) (characterizing substandard wages as 

a labor condition that undermines “the maintenance of the minimum standard of 

living necessary for health, efficiency, and general well-being of workers”). To 

advance this policy objective, the Act requires employers to pay their employees no 

less than a specified minimum wage for work performed, 29 U.S.C. § 206, and at 

least one and one-half times an employee’s regular rate of pay for hours worked in 

excess of forty hours per week, 29 U.S.C. § 207(a)(1). Under the FLSA, an employer 

who violates Section 206 or 207 is liable to the employees affected for the amount of 

unpaid minimum wages or overtime compensation, and for an additional equal 

amount as liquidated damages. See 29 U.S.C. § 216(b).

“The FLSA places strict limits on an employee’s ability to waive claims for 

unpaid wages or overtime . . . for fear that employers may coerce employees into 

settlement and waiver.” Lopez v. Nights of Cabiria, LLC, 96 F.Supp.3d 170, 175 

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(S.D.N.Y. 2015) (internal quotation marks and citation omitted); see Brooklyn Sav. 

Bank v. O’Neil, 324 U.S. 697, 707 (1945) (finding that the FLSA prohibits waiver of 

the statutory minimum wage and right to liquidated damages as a check against the 

superior bargaining power employers generally enjoy vis-à-vis employees). 

Accordingly, claims for unpaid wages under the FLSA may only be waived or 

otherwise settled if settlement is supervised by the Secretary of Labor or approved 

by a district court. See Lynn’s Food Stores, Inc. v. United States ex rel. U.S. Dept. of 

Labor, Emp’t Standards Admin., Wage & Hour Div., 679 F.2d 1350, 1352–53 (11th 

Cir. 1982); Meza v. 317 Amsterdam Corp., 14-CV-9007 (VSB), 2015 WL 9161791, 

*1 (S.D.N.Y. Dec. 14, 2015) (“Parties may not privately settle FLSA claims with 

prejudice absent the approval of the district court or the Department of Labor.”) 

(citation omitted).

In reviewing a FLSA settlement, a district court must determine whether the 

settlement represents a “fair and reasonable resolution of a bona fide dispute.” Lynn’s 

Food Stores, 679 F.2d at 1355. A bona fide dispute exists when there are legitimate 

questions about “the existence and extent of Defendant’s FLSA liability.” Ambrosino 

v. Home Depot. U.S.A., Inc., No. 11cv1319 L(MDD), 2014 WL 1671489, (S.D. Cal.

Apr. 28, 2014). There must be “some doubt . . . that the plaintiffs would succeed on 

the merits through litigation of their [FLSA] claims.” Collins v. Sanderson Farms,

568 F.Supp.2d 714, 719–20 (E.D. La. 2008); see also Mamani v. Licetti, No. 13–

CV–7002 (KMW) (JCF), 2014 WL 2971050, *2 (S.D.N.Y. July 2, 2014) (explaining 

that to demonstrate a bona fide dispute under the FLSA “[t]he employer should 

articulate the reasons for disputing the employee’s right to a minimum wage or 

overtime, and the employee must articulate the reasons justifying his entitlement to 

the disputed wages”) (internal citation omitted). If there is no question that the FLSA 

entitles plaintiffs to the compensation they seek, then a court will not approve a 

settlement because to do so would allow the employer to avoid the full cost of 

complying with the statute. See Socias v. Vornado Realty L.P., 297 F.R.D. 38, 41 

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(E.D.N.Y. 2014) (Without judicial oversight . . . employers may be more inclined to 

offer, and employees, even when represented by counsel, may be more inclined to 

accept, private settlements that ultimately are cheaper to the employer than 

compliance with [FLSA].”); Hogan v. Allstate Beverage Co., Inc., 821 F.Supp.2d 

1274, 1282 (M.D. Ala. 2011) (“Any amount due that is not in dispute must be paid 

unequivocally; employers may not extract valuable concessions in return for payment 

that is indisputably owed under the FLSA.”).

After a district court is satisfied that a bona fide dispute exists, it must then 

determine whether the settlement is fair and reasonable. In making this 

determination, many courts begin with the well-established criteria for assessing 

whether a class action settlement is “fair, reasonable, adequate” under Fed. R. Civ. 

P. 23(e), and reason by analogy to the FLSA context. See, e.g., Otey v. CrowdFlower, 

Inc., No. 12–cv–05524–JST, 2015 WL 4076620, (N.D. Cal. July 2, 2015) (“To 

determine whether a settlement is fair and reasonable [under the FLSA], district 

courts implicitly or explicitly consider the factors that are used to evaluate Rule 23 

class action settlements[.]”). This approach is generally sound, but runs the risk of 

not giving due weight to the policy purposes behind the FLSA.3 See Goudie v. Cable 

Commc’ns, Inc., No. CV 08–507–AC, 2009 WL 88336, *1 (D. Or. Jan. 12, 2009) 

(“In reviewing a private FLSA settlement, the court’s obligation is not to act as 

caretaker but as gatekeeper; it must ensure that private FLSA settlements are 

appropriate given the FLSA’s purposes and that such settlements do not undermine 

the Act’s purposes.”); Sanderson Farms, 568 F.Supp.2d at 717 (“The Court’s role [in 

reviewing a FLSA settlement] is in many ways comparable to, but in others quite 

distinguishable from, that of a court in a settlement of a class action brought pursuant 

 

3 However, it is also the case that FLSA collective actions do not implicate the same due process 

concerns as class actions brought under Rule 23 because an employee who wishes to join a FLSA 

collective action must affirmatively “opt-in” by filing a written consent to join the suit before she 

can be bound by the outcome. See Ballaris v. Wacker Siltronic Corp., 370 F.3d 901, 906 n. 9 (9th 

Cir. 2004).

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to [Rule 23], and derives from the special character of the substantive labor rights 

involved.”). To mitigate this risk, many courts have adopted a totality of 

circumstances approach that emphasizes the context of the case and the unique 

importance of the substantive labor rights involved. See generally Wolinsky v. 

Scholastic, Inc., 900 F.Supp.2d 332, 335 (S.D.N.Y. 2012). This approach replicates 

the factors relevant to Rule 23 class actions where appropriate, but adjusts or departs

from those factors when necessary to account for the labor rights at issue. This Court 

adopts a variation of the totality of circumstances approach here.

After reviewing the relevant case law, and having considered the history and 

policy of the FLSA, the Court finds that the following factors should be considered 

when determining whether a settlement is fair and reasonable under the FLSA: (1) 

the plaintiff’s range of possible recovery; (2) the stage of proceedings and amount of 

discovery completed; (3) the seriousness of the litigation risks faced by the parties; 

(4) the scope of any release provision in the settlement agreement; (5) the experience 

and views of counsel and the opinion of participating plaintiffs; and (6) the possibility 

of fraud or collusion. See generally Sarceno v. Choi, 78 F.Supp.3d 446, (D.D.C. 

2015); Daniels v. Aeropostale West, Inc., No. C 12–05755 WHA, 2014 WL 2215708, 

(N.D. Cal. May 29, 2014); Ambrosino, 2014 WL 1671489 (S.D. Cal. Apr. 28, 2014); 

Luo v. Zynga, Inc., No. 13–cv–00186 NC, 2014 WL 457742, (N.D. Cal. Jan. 31, 

2014); Lewis v. Vision Value, LLC, No. 1:11–cv–01055–LJO–BAM, 2012 WL 

2930867, (E.D. Cal. July 18, 2012); Wolinsky, 900 F.Supp.2d 332 (S.D.N.Y. 2012); 

Sanderson Farms, 568 F.Supp.2d 714 (E.D. La. 2008). In considering these factors

under a totality of the circumstances approach, a district court must ultimately be 

satisfied that the settlement’s overall effect is to vindicate, rather than frustrate, the 

purposes of the FLSA. See, e.g., Dees v. Hydradry, Inc., 706 F.Supp.2d 1227, 1247

(M.D. Fla. 2010) (“[T]he district court should not become complicit in any scheme 

or mechanism designed to confine or frustrate . . . realization of FLSA rights.”). If 

after considering these factors the court determines that “the settlement reflects a 

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reasonable compromise over issues that are actually in dispute,” then “the court may 

approve the settlement ‘in order to promote the policy of encouraging settlement of 

litigation.’” McKeen-Chaplin v. Franklin Am. Mortg. Co., No. C. 10–5243 SBA, 

2012 WL 6629608, *2 (N.D. Cal. Dec. 19, 2012) (quoting in part Lynn’s Food Stores, 

679 F.2d at 1354).

III. DISCUSSION

A. Bona Fide Dispute

The Court finds that this case reflects a bona fide dispute between the parties 

over potential liability under the FLSA. As the briefing papers make clear, the parties 

dispute whether Pioneers’ rounding practices—including rounding employees’ 

reported work time to the nearest quarter hour and rounding without taking into 

account differences in overtime rates of pay versus regular rates of pay—

undercompensates employees in violation of the FLSA. (Mot. 10:13–11:24.) These

issues raise legitimate questions over whether Pioneers may be liable under the 

statute, particularly given the unsettled nature of the law on the question of when a 

neutral rounding policy may produce consequences that implicate the FLSA. Id. The 

parties also proffer different, non-frivolous readings of case law and federal 

regulations on the question of whether Pioneers is required to include the 10%

cafeteria discount into the calculation for employees’ regular rate of pay. (Pl.’s Mot. 

for Class Cert. 15, 16; Def.’s Opp’n 18, 19.) Thus, the cafeteria discount claim also 

raises legitimate questions about the “existence and extent of Defendant’s FLSA 

liability.” Ambrosino, 2014 WL 1671489, at *1. In light of these contending views

on issues central to the case, and the fact that Parties Plaintiff are not clearly entitled 

to the compensation they seek, the Court is convinced that that this case involves a 

bona fide dispute between the parties.

B. Fair and Reasonable

After considering the six factors under the totality of circumstances approach 

outlined above, the Court finds the Settlement Agreement to be fair and reasonable 

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under the FLSA.

1. Plaintiff’s Range of Possible Recovery

A district court evaluates the plaintiff’s range of potential recovery to ensure 

that the settlement amount agreed to bears some reasonable relationship to the true 

settlement value of the claims. See, e.g., Daniels, 2014 WL 2215708, at *4 (“To 

protect the absent opt-in members, it is critical to know the total triable amount so 

that the judge can evaluate the fairness and reasonableness of the proposed 

settlement.”). The settlement amount need not represent a specific percentage of the 

maximum possible recovery. See Nat’l Rural Telecomm’s Coop. v. DIRECTV, Inc., 

221 F.R.D. 523, 527 (C.D. Cal. 2004) (“[I]t is well-settled law that a proposed 

settlement may be acceptable even though it amounts to only a fraction of the 

potential recovery that might be available to the class members at trial.”) (collecting 

cases). But in 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. See 

Daniels, 2014 WL 2215708, at *4; see also Lewis, 2012 WL 2930867, at *2 

(considering among other things whether the proposed settlement amount is

proportionate to the damages plaintiffs could have obtained if they proceeded to 

trial).

At oral argument, counsel for Parties Plaintiff represented that the $17,500

sought on behalf of the opt-in members is “fairly close” to what Plaintiffs would have 

asked for in damages if the case went to trial. Counsel stressed that once Plaintiff’s

state law claim was dismissed, and once discovery suggested a lack of bad intent on 

the part of Pioneers, the scope of potential recovery narrowed considerably because

Parties Plaintiff would be unlikely to receive liquidated damages based on the 

evidence. See 29 U.S.C. § 260 (“[I]f the employer shows to the satisfaction of the 

court that the act or omission giving rise to such action was in good faith and that he 

had reasonable grounds for believing that his act or omission was not a violation of 

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the [FLSA], the court may . . . award no liquidated damages[.]”).

After reviewing the record, and crediting counsel’s representations, it appears 

that the total settlement fund of $50,000 represents between 26% to 50% of the best 

possible recovery. The 26% lower bound is reached by dividing the total settlement 

fund of $50,000 by the total of all (1) claimed back wages ($17,500) plus (2) an equal 

amount in liquidated damages ($17,500) plus (3) $157,578 in attorney’s fees and 

costs. In setting a 50% upper bound, the Court considered the $17,500 that would go 

to opt-in Plaintiffs under the Settlement Agreement, and divided this figure by the 

$37,500 ($17,500 in back wages plus $17,500 in liquidated damages) that opt-in 

members would receive if awarded liquidated damages. Having made these 

admittedly rough calculations, the Court finds the Settlement to be in the range of 

reasonableness for wage and hour actions. See Bellinghausen v. Tractor Supply Co., 

306 F.R.D. 245, 256 (N.D. Cal. 2015) (finding a wage and hour class settlement fair 

where the settlement fund represented between 9% and 27% of the total potential 

recovery); Jones v. Agilysys, Inc., No: C 12–03516 SBA, 2014 WL 2090034, (N.D. 

Cal. May 19, 2014) (finding a FLSA settlement that constituted between 30% to 60% 

of recoverable damages to be a “tangible monetary benefit” for the class members);

Alleyne v. Time Moving & Storage Inc., 264 F.R.D. 41, 57–58 (E.D.N.Y. 2010) 

(settlement fund within range of reasonableness when it represented approximately 

13% to 17% of the maximum possible recovery); Knight v. Red Door Salons, Inc., 

No. 08–01520 SC, 2009 WL 248367, *5 (N.D. Cal. Feb. 2, 2009) (recovery of 50% 

of possible damages in a wage and hour action was “substantial achievement on 

behalf of the class”). In finding the settlement amount fair and reasonable, the Court 

also stresses the possibility that plaintiffs would recover nothing. Thus, although the 

payouts to individual plaintiffs are small, the certainty of recovery helps prevent the 

additional damage that would befall plaintiffs if the case proceeds and is ultimately 

resolved against them. See, e.g., Glass v. UBS Fin. Serv., Inc., No. C–06–4068, 2007 

WL 221862, at *4 (N.D. Cal. Jan. 26, 2007), aff’d 331 F.App’x 452 (9th Cir. 2009)

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(finding a wage and hour settlement in the range of 25 to 35% of claimed damages 

fair and reasonable in light of the uncertainties involved in the litigation).

2. The Seriousness of the Litigation Risks

The seriousness of the litigation risks also weighsin favor of approval. Plaintiff 

alleges that Pioneers’ rounding practice has denied class members fair compensation 

under the FLSA, but as the parties acknowledge, an employer’s rounding is not per 

se illegal and Plaintiff’s success on this claim at trial is far from assured. (Mot. 10, 

11.) Similarly, although Plaintiff believes her cafeteria discount claim has merit, 

there is a strong argument, supported by statute and case law, that Pioneers has no 

legal obligation to factor in the cafeteria discount to calculate employees’ regular rate 

of pay. (Def.’s Answer 15:6–11; Mot. 11:16–24.) Finally, there is a real possibility 

that Defendant would successfully decertify one or both of the classes. (Mot. 12:28–

13:2.) In light of this substantial uncertainty, “there is a significant risk that litigation 

might result in a lesser recover[y] for the class or no recovery at all.” Bellinghausen, 

306 F.R.D. at 255. Accordingly, this factor weighs in favor of approving the 

Settlement. See, e.g., Chavarria v. New York Airport Serv., LLC, 875 F.Supp.2d 164, 

173 (E.D.N.Y. 2012) (litigation risks favored finding the settlement fair and 

reasonable where “the settlement provide[d] certain compensation to the class 

members now rather than awaiting an eventual resolution that would result in further 

expense without any definite benefit”); Glass, 2007 WL 221862, at *3–4 (seriousness 

of the litigation risks supported approval of settlement where substantial uncertainty 

in the law meant any ruling by the court would have led to further expense, delay and 

uncertainty of litigating an appeal). 

3. Experience and Views of Counsel and Opinions of Participating 

Plaintiffs

Counsel for Parties Plaintiff has almost two decades of experience prosecuting 

and defending class action litigation, including substantial experience as lead counsel 

on wage and hour claims. (Sullivan Decl. ¶ 3.) Pioneers is likewise represented by 

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experienced litigators. Here, Plaintiff’s counsel asserts that the individual settlement

amounts, including the $150.00 minimum payment, are fair and reasonable “based 

on damages calculations and the risk of a defense verdict at trial.” (Mot. 13:11–13.) 

Counsel also finds the scope of the release provisions in both the Settlement and the 

Selk Agreement to be fair and reasonable as the former is “limited to wage and hour 

matters” (Mot. 13:13–15) and the latter is based on separate compensation to Selk 

(Mot. 13:16–25).

In determining whether a settlement is fair and reasonable, “[t]he opinions of 

counsel should be given considerable weight both because of counsel’s familiarity 

with th[e] litigation and previous experience with cases.” Larsen v. Trader Joe’s Co., 

No. 11–cv–05188–WHO, 2014 WL 3404531, *5 (N.D. Cal. Jul. 11, 2014). As the 

Ninth Circuit has emphasized, “[p]arties represented by competent counsel are better 

positioned than courts to produce a settlement that fairly reflects each party’s 

expected outcome in litigation.” Rodriguez v. West Publ’g Corp., 563 F.3d 948, 967 

(9th Cir. 2009) (citing In re Pac. Enters. Sec. Litig., 47 F.3d 373, 378 (9th Cir. 1995)); 

see also Bellinghausen, 306 F.R.D. at 257 (N.D. Cal. 2015) (“Given counsel’s 

experience in [wage and hour litigation], his assertion that the settlement is fair, 

adequate, and reasonable support [sic] final approval of the settlement.”). Here, there 

is nothing in the record that calls into question the experience of counsel or raises 

doubt about counsel’s judgment. As such, this factor weighs in favor of approval.

The opinions of participating plaintiffs in this case eludes definitive 

determination. The opt-in members were not given information on the Settlement 

prior to joining the suit, nor has Plaintiff’s counsel formally notified the class 

members since the parties reached an agreement. Plaintiff’s counsel noted at oral 

argument that approximately two-thirds of the class is aware that a settlement has 

been reached and that the more active members of the class are aware of the actual 

settlement terms. Counsel further represented that out of the plaintiffs who are aware 

of the Settlement, none has objected.

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Although the Court has some concerns that not all of the 65 opt-in plaintiffs 

received formal notification of the settlement terms before the parties moved for 

approval, the lack of objections by the active members of the class weighs in favor 

of finding the Settlement fair and reasonable. See, e.g., DIRECTV, Inc., 221 F.R.D. 

523, 529 (C.D. Cal. 2004) (“It is established that the absence of a large number of 

objections to a proposed class action settlement raises a strong presumption that the 

terms of a proposed class settlement action are favorable to the class members.”) 

(citing cases). The Court notes also that the due process implications of a lack of 

formal notification post-settlement are less worrisome given that the opt-in plaintiffs 

had to affirmatively consent in writing to join the suit. See Ballaris, 370 F.3d at 906 

n. 9. Furthermore, when the Settlement is considered in its totality, the fact that not 

every member of the class received notice of the settlement terms does not, in this 

case, undermine the overall fairness and reasonableness of the Settlement. See Staton 

v. Boeing Co., 327 F.3d 938, 960 (9th Cir. 2003) (“It is the settlement taken as a 

whole, rather than the individual component parts, that must be examined for overall 

fairness, and the settlement must stand or fall in its entirety.”) (quoting Hanlon v. 

Chrysler Corp., 150 F.3d 1011, 1026 (9th Cir. 1998) (quotation marks omitted)).

Thus, the Court finds that the lack of formal notice to each opt-in member does not 

weigh against approval.

4. Stage of Proceedings and Extent of Discovery Completed

The Court assesses the stage of proceedings and the amount of discovery 

completed to ensure the parties have an adequate appreciation of the merits of the 

case before reaching a settlement. See Ontiveros v. Zamora, 303 F.R.D. 356, 371 

(N.D. Cal. 2014) (“A settlement that occurs in an advanced stage of the proceedings 

indicates that the parties carefully investigated the claims before reaching a 

resolution.”). So long as the parties have “sufficient information to make an informed 

decision about settlement,” this factor will weigh in favor of approval. Linney v. 

Cellular Alaska P’ship, 151 F.3d 1234, 1239 (9th Cir. 1998); see also In re Mego 

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Fin. Corp. Sec. Litig., 213 F.3d 454, 459 (9th Cir. 2000) (explaining that a 

combination of investigation, discovery, and research conducted prior to settlement 

can provide sufficient information for class counsel to make an informed decision 

about settlement).

Here, the parties have engaged in meaningful discovery. Plaintiff Selk and 

Pioneers each propounded eight sets of written discovery on the other. (Sullivan Decl. 

¶ 6.) Plaintiff Selk deposed Pioneers’ person most knowledgeable on employee 

compensation, and Pioneers deposed both Plaintiff Selk and Selk’s expert, Dr. Robert 

Fountain. (Id. at ¶¶ 6, 7.) Defendant has produced more than 23,000 pages of 

documents, including employee manuals, policy documents, and time and wage 

records for Plaintiff Selk and the opt-in members. (Id. at ¶ 9.) Plaintiff’s counsel has 

closely analyzed the time and wage records of each of the class members and 

calculated the amount of alleged unpaid wages accordingly. From this investigation,

the parties have been able to narrow the issues in the case and adequately assess the 

likelihood of success at trial. See, e.g., Rodriguez, 563 F.3d at 967 (finding that a 

district court could find that counsel had a good grasp on the merits of the case before 

settlement where “[e]xtensive discovery had been conducted, and the parties had 

gone through one round of summary judgment proceedings”). Accordingly, the Court 

finds that the parties had sufficient information to make an informed decision about 

settlement. The extent of discovery and the stage of proceedings thus favors approval.

See Ching v. Siemens Industry, Inc., No. 11–cv–04838–MEJ, 2014 WL 2926210, *5 

(N.D. Cal. Jun. 27, 2014) (extent of discovery weighed in favor of approving a 

settlement where class counsel “conducted interviews, propounded extensive written 

discovery, discussed the case with opposing counsel, analyzed thousands of pages of 

documents, deposed Defendants’ person most knowledgeable, analyzed damages, 

reviewed time and pay records and policy documents, and collected evidence”).

5. Scope of Release Provision

Courts review the scope of any release provision in a FLSA settlement to 

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ensure that class members are not pressured into forfeiting claims, or waiving rights,

unrelated to the litigation. See Luo, 2014 WL 457742, at *3. The concern is that an 

expansive release of claims would effectively allow employers to use employee 

wages—wages that are guaranteed by statute—as a bargaining chip to extract 

valuable concessions from employees. See Moreno v. Regions Bank, 729 F.Supp.2d 

1346, 1351 (M.D. Fla. 2010) (“An employee who executes a broad release effectively 

gambles, exchanging unknown rights for a few hundred or a few thousand dollars to 

which he is otherwise unconditionally entitled.”). Courts are especially skeptical of 

release provisions that require employees to forfeit claims designed to advance public 

values through private litigation, such as claims for discrimination under Title VII of 

the Civil Rights Act of 1964. See, e.g., Lopez v. Nights of Cabiria, LLC, 96 F.Supp.3d 

170, 181 (S.D.N.Y. 2015); McKeen-Chaplin, 2012 WL 6629608, at *4; Cf. Owen 

Fiss, Against Settlement, 93 Yale L.J. 1073, 1085 (1984) (arguing that settlement 

may present an obstacle to justice because it deprives courts of their duty “to explicate 

and give force to the values embodied in authoritative texts such as the Constitution 

and statutes”). Thus, when a FLSA settlement provides that opt-in members will

receive unpaid wages and related damages, but nothing more, a release provision 

should be limited to the wage and hour claims at issue. See Moreno, 729 F.Supp.2d 

at 1352 (“[A] pervasive release in a FLSA settlement confers an uncompensated, 

unevaluated, and unfair benefit on the employer.”). Only when opt-in plaintiffs 

receive independent compensation, or provide specific evidence that they fully 

understand the breadth of the release, will a broad release of claims survive a 

presumption of unfairness. See Ambrosino, 2014 WL 1671489, at *3; Hogan, 821 

F.Supp.2d at 1284. Otherwise, a gap between the allegations brought in the case and 

the claims released in a settlement agreement will militate against finding the 

settlement fair and reasonable. See Daniels, 2014 WL 2215708, at *4 (finding a 

proposed release overbroad where counsel was authorized to settle only the 

conditionally-certified FLSA claim, but the proposed release went beyond the FLSA 

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claim); McKeen-Chaplin, 2012 WL 6629608, at *5 (rejecting FLSA settlement in 

part because release provision went beyond the breadth of allegations in the action

and released unrelated claims that plaintiffs may have against defendants). 

Here, the Settlement requires the Parties Plaintiff to release “any and all claims 

. . . for or which relate to the alleged failure to properly pay wages or overtime as 

required by the Fair Labor Standards Act, any state wage laws, any local wage laws, 

any other applicable federal, state, or local law, and any other claims alleged in the 

case.” (Settlement Agreement ¶ B(10).) Unlike release provisions that courts have 

found to be overly broad, see, e.g., Garcia v. Jambox, Inc., No. 14–cv–3504 (MHD), 

2015 WL 2359502, *4 (S.D.N.Y. Apr. 27, 2015); Ambrosino, 2014 WL 1671489, at

*2–3, this release provision generally tracks the wage and hour claims asserted in the

lawsuit. At oral argument, counsel for Pioneers represented to the Court that the 

release requires waiver of only the wage and hour claims alleged, and not unrelated 

claims. While the Court believes the language of the release could be more precise, 

the Court is satisfied that the release does not force class members to forfeit unrelated 

claims, or allow Pioneers to purchase a broad-based litigation shield in exchange for 

unpaid wages that class members are entitled to by statute. Thus, the scope of the 

release provision does not weigh against finding the Settlement fair and reasonable.

In her separate settlement agreement with Pioneers, Plaintiff Selk has agreed 

to a general release provision encompassing “any and all claims . . . whether known 

or unknown to Selk . . . (1) arising out of Selk’s employment with Pioneers or 

termination of that employment . . . or arising out of or in any way connected with 

any claim . . . resulting from any act or omission by or on part of” Pioneers, its 

officers, or affiliates. (Selk Agreement, Exh. 6 ¶ 5.) The Selk Agreement further 

provides that Selk waives any right to recovery based on any state or federal antidiscrimination laws, including Title VII of the Civil Rights Act of 1964, the Equal 

Pay Act, the Age Discrimination in Employment Act, and the Americans with 

Disabilities Act. Id. In exchange for this general release, Selk will receive a separate 

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release payment of $5,500. Id. at ¶ 4(a).

The Court finds that this release does not undermine the fairness of the 

Settlement or the Selk Agreement. Although the release extends beyond the FLSA 

claims at issue to include any claim Selk may have against Pioneers, the separate 

release payment of $5,500 justifies the broad release. Courts are less skeptical of a 

broad release of claims when the employee receives independent compensation from 

the employer as consideration for the release. See McKeen-Chaplin, 2012 WL 

6629608, at *5; Hogan, 821 F.Supp.2d at 1284; Robertson v. Ther–Rx Corp., No. 

2:09cv1010–MHT (WO), 2011 WL 1810193, (M.D. Ala. May 12, 2011). The broad 

release is particularly defensible here given that Selk may have potential retaliation, 

discrimination, harassment, and workers compensation claims that are outside the 

scope of this litigation, (Sullivan Decl. ¶ 16.), and the separate payment is being 

offered with these potential claims in mind. See, e.g., Gaspar v. Pers. Touch Moving, 

Inc., 13-cv-8187 (AJN), 2015 WL 7871036, *2 (S.D.N.Y. Dec. 3, 2015) (finding a 

broad release appropriate where the named plaintiff had non-FLSA claims that he did 

not share with other plaintiffs and received a separate payment to relinquish those 

claims). Under these circumstances, the Court does not find the general release of 

claims in the Selk Agreement to be problematic. 

6. Possibility of Fraud or Collusion

The Court finds no evidence that the Settlement resulted from, or was 

influenced by, fraud or collusion. A key factor supporting this finding is that the 

amount of the individual settlement payments to be received by opt-in members is 

based on an analysis of employee time records and an estimate of the degree of undercompensation during the relevant period. (Sullivan Decl. ¶ 13.) This approach guards 

against the arbitrariness that might suggest collusion. For example, to determine the 

amount due under the rounding claim, Plaintiff’s counsel compared the actual 

amount of time worked (as reflected in the “clock in,” “clock-out” times listed in the 

record) with the rounded time, and calculated an amount that compensates the opt-in 

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members for the difference. Similarly, to determine the amount due under the 

cafeteria discount claim, Plaintiff’s counsel used individual employee time records 

to estimate how much each plaintiff lost in wages by not having the meal discount 

included in the calculation for the regular rate of pay. (Sullivan Decl. ¶¶ 9, 10, Exh. 

3.) This is a reasonable approach to calculating potential damages based on relevant, 

objective documentation. In short, there is nothing on the face of the record to suggest 

Plaintiff’s counsel “allowed the pursuit of their own self-interests and that of certain 

class members to infect the negotiation.” In re Bluetooth Prod. Liab. Litig., 654 F.3d 

at 947. Nor does the Court find evidence of more “subtle signs” of collusion, such as 

“when counsel receive a disproportionate distribution of the settlement, or when the 

class receives no monetary distribution but class counsel are amply rewarded.” Id. 

(quoting Hanlon, 150 F.3d at 1021). Counsel has asserted that settlement negotiations 

were at all times adversarial, (Mot. 10:4–6), and the record in this case—two years 

of litigation with extensive discovery, numerous depositions, multiple discovery 

disputes, and a motion for partial summary judgment—supports this assertion. 

Accordingly, the Court finds that the Settlement was the result of arm’s-length 

negotiations and that no evidence of fraud or collusion exists.

7. Conclusion Regarding Fairness and Reasonableness

Having considered the relevant factors and the representations of the parties,

the Court concludes that the Settlement Agreement is a fair and reasonable resolution 

of a bona fide dispute over FLSA coverage. See Lynn’s Food Stores, 679 F.2d at 

1355.

C. Attorney’s Fees and Costs

“Where a proposed settlement of FLSA claims includes the payment of 

attorney’s fees, the court must also assess the reasonableness of the fee award.” 

Wolinsky, 900 F.Supp.2d at 336; see also 29 U.S.C. § 216(b) (providing that, in a 

FLSA action, the court “shall, in addition to any judgment awarded to the plaintiff or 

plaintiffs, allow a reasonable attorney’s fee to be paid by the defendant, and costs of 

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the action”). 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. See In re Bluetooth, 654 F.3d at 

942. Here, the Settlement provides for a $50,000 common fund. Thus, this Court 

applies the percentage-of-recovery method, which typically involves calculating 25% 

of the fund as the “benchmark” for a reasonable fee award. See In re Online DVDRental Antitrust Litig., 779 F.3d 934, 949 (9th Cir. 2015) (“Under the percentage-ofrecovery method, the attorneys’ fees equal some percentage of the common 

settlement fund; in this circuit, the benchmark percentage is 25%.”). 

Plaintiff’s counsel seek $11,782 in attorney’s fees.4(Mot. 16, 17.) This figure

constitutes approximately 24% of the total settlement fund of $50,000 and is thus 

within the benchmark set by the Ninth Circuit. The reasonableness of the fees 

requested is reinforced by the fact that the lodestar figure5($147,360) is more than 

11 times greater than the amount of fees that would be provided under a benchmark 

approach ($12,500). See Vizcaino v. Microsoft Corp., 290 F.3d 1043, 1050 (9th Cir. 

2002) (noting that when applying the percentage-of-the-fund approach, the court may 

use the lodestar as a cross-check on the reasonableness of the fee request). Plaintiff’s 

counsel also has provided adequate documentation supporting the fee request. 

(Sullivan Decl. ¶ 21.) Thus, the Court finds the fees requested to be reasonable and 

appropriate, and awards the amount requested.

Plaintiff’s counsel also requests recovery of $10,218 in litigation costs, 

including filing fees, deposition costs, third party administration fees, and expert fees. 

 

4 Plaintiff’s counsel does not request a specific amount in attorney’s fees, but instead requests 

$22,000 total for attorney’s fees and costs, and documents $10,218 in litigation costs. This, of 

course, leaves $11,782 in attorney’s fees.

5

“The lodestar figure is calculated by multiplying the number of hours the prevailing party 

reasonably expended on the litigation (as supported by adequate documentation) by a reasonable 

hourly rate for the region and for the experience of the lawyer.” In re Bluetooth, 654 F.3d at 941 

(citing Staton v. Boeing Co., 327 F.3d 938, 965 (9th Cir. 2003)). Here, if the Court were to accept 

the hours and reasonable rate documented by counsel, the lodestar figure would be $147,360. 

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(Sullivan Decl. ¶ 21(e).) “There is no doubt that an attorney who has created a 

common fund for the benefit of the class is entitled to reimbursement of reasonable 

litigation expenses from that fund.” Ontiveros, 303 F.R.D. at 375 (citations omitted); 

see also 29 U.S.C. § 216(b). The Court finds that the amount requested in costs is 

reasonable under the circumstances and appropriately documented. The Court 

awards these costs as requested.

D. Incentive Award 

At its discretion, a district court may award an incentive payment to the named 

plaintiffs in a FLSA collective action to compensate them for work done on behalf 

of the class. See Jones, 2014 WL 2090034, at *3. In reviewing whether an incentive 

award is appropriate, the court should consider, among other things, “the actions the 

plaintiff has taken to protect the interests of the class, the degree to which the class 

has benefitted from those actions, and the amount of time and effort the plaintiff 

expended in pursuing the litigation.” Staton v. Boeing Co., 327 F.3d 938, 977 (9th 

Cir. 2003) (quoting Cook v. Niedert, 142 F.3d 1004, 1016 (7th Cir. 1998)). Courts 

will scrutinize large incentive payments to ensure that the prospect of a large 

incentive did not encourage a named plaintiff “to accept [a] suboptimal settlement[] 

at the expense of the class members whose interests they are appointed to guard[.]” 

Staton, 327 F.3d at 977.

Plaintiff Selk seeks a $5,000 service payment “as compensation for bringing 

and prosecuting this action on behalf of herself and others[.]” (Mot. 6:8–9.) Plaintiff’s 

counsel declares that Selk dedicated “significant time and energy” pursuing this 

ligation, including meeting with counsel in person 11 times and telephonically at least 

35 times. (Sullivan Decl. ¶ 18.) Selk also was deposed, assisted counsel in the 

discovery process, and was consistently available to answer questions from counsel 

during the more than two years that transpired between the filing of this action and 

the notice of settlement. Id. at ¶ 19. Finally, Selk’s decision to file suit and pursue 

this action resulted in substantial benefits on behalf of the class: as explained above, 

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a rough estimate suggests that the settlement amount represents between 26% to 50% 

of recoverable damages. In light of this record, the Court finds, in its discretion, that 

the requested incentive payment is reasonable and appropriate. 

IV. CONCLUSION & ORDER

The FLSA was designed “to extend the frontiers of social progress by insuring 

to all our able-bodied men and women a fair day’s pay for a fair day’s work.” A.H. 

Phillips, Inc. v. Walling, 324 U.S. 490, 493 (1945) (quoting Message of the President 

to Congress, May 24, 1934). Consistent with this humanitarian ideal, the substantive 

labor rights provided for in the statute—including the minimum wage and maximum 

hour provisions—are afforded exceptionally strong protection. See Brooklyn Sav. 

Bank v. O’Neil, 324 U.S. 697, 706–07 (1945); D.A. Schulte, Inc., v. Gangi, 328 U.S. 

108, 115–16 (1946); Chao v. Gotham Registry, Inc., 514 F.3d 280, 285 (2d Cir. 2008) 

(“In service of the statute’s remedial and humanitarian goals, the Supreme Court 

consistently has interpreted the [FLSA] liberally and afforded its protections 

exceptionally broad coverage.”). Thus, when private parties submit to a court a

settlement purporting to resolve claims brought under the FLSA, the court must 

scrutinize the settlement to ensure it represents a fair and reasonable resolution of a 

bona fide dispute rather than a “mere waiver of statutory rights brought about by an 

employer’s overreaching.” Lynn’s Food Stores, 679 F.2d at 1354. Here, after 

evaluating the Settlement under the relevant standard, the Court finds it to be a fair 

and reasonable resolution of a bona fide dispute over FLSA provisions. Accordingly, 

the Court GRANTS Plaintiff’s motion for approval of settlement.

The Court further APPROVES the payment of $11,782 in attorney’s fees and 

$10,218 in costs to class counsel, Sullivan Law Group, APC, and APPROVES an 

incentive payment of $5,000 to named plaintiff, Elena Selk. The parties shall follow 

the procedures for settlement administration as outlined in the Settlement Agreement.

(Mot. 6:22–8:16; Settlement Agreement ¶ H.) 

Pursuant to the terms of the Settlement, the instant action is dismissed with 

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prejudice. The Clerk of Court shall close the file.

 IT IS SO ORDERED.

DATED: January 29, 2016

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