Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_18-cv-02835/USCOURTS-cand-3_18-cv-02835-1/pdf.json

Nature of Suit Code: 790
Nature of Suit: Other Labor Litigation
Cause of Action: 28:1332 Diversity-Conversion

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

BRANDON HARVEY,

Plaintiff,

v.

MORGAN STANLEY SMITH BARNEY 

LLC,

Defendant.

Case No. 18-cv-02835-WHO 

ORDER DENYING PROPOSED 

INTERVENORS ADMINISTRATIVE 

MOTION FOR INCLUSION OF 

INFORMATION IN THE CLASS 

NOTICE; GRANTING MOTION TO 

SEAL; DENYING MOTION TO 

INTERVENE

Re: Dkt. Nos. 72, 54, 28

This order relates to two motions filed by the proposed intervenors Tracy Chen and 

Matthew Lucadano (the “Proposed Intervenors”) in relation to the Order Granting Plaintiff’s 

Motion For Preliminary Approval Of Class Action Settlement in this case between plaintiff 

Brandon Harvey and defendant Morgan Stanley Smith Barney LLC (“MSSB”). The Proposed 

Intervenors are both plaintiffs in a state court case, Chen v. Morgan Stanley Smith Barney (Orange 

County Superior Court Case No. 30-2014-00724866-CU-OE-CXC) (“Chen”). 

I. THE MOTION FOR INCLUSION OF INFORMATION IN THE CLASS NOTICE

The Proposed Intervenors have filed an administrative motion seeking to include 

information about their lawsuit into the class notice issued in relation to preliminary approval of 

the proposed settlement in this case. [Dkt. No. 72]. They seek to be allowed one week to meet 

and confer with the Harvey and MSSB (collectively the “Parties”) on how to address Chen in the 

class notice and to then submit a stipulation, or competing proposals, on the topic. The Proposed 

Intervenors argue that including basic information about Chen will benefit the class by providing 

them with fuller information about how the settlement will affect their rights and how to assess the 

value of their claims. According to them, the absence of adequate information about their rights 

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and options is a procedural defect that would affect the fairness analysis at final approval. In the 

alternative, they request that the Class Notice to be amended to include the following paragraph 

into the “Summary of the Case” section: 

In addition, since May 2014, plaintiffs Tracy Chen and Matthew 

Lucadano are pursuing a parallel lawsuit, Chen v. Morgan Stanley 

Smith Barney LLC, Case No. 30-2014-00724866-CU-OE-CXC, in 

California Superior Court in Orange County, asserting civil penalty 

claims on behalf of Morgan Stanley FAs and the State of California 

pursuant to the California Labor Code Private Attorneys General Act. 

Additional information about the Chen lawsuit is available at [Harvey 

settlement website, attaching Chen’s amicus submission].

They would also request a similar paragraph to be added to the comparable section of the proposed 

PAGA Notice.

The Parties both oppose. Harvey argues that the Proposed Intervenor’s motion is 

procedurally improper for three reasons: (i) they are not parties to this action and were only 

granted leave to file an amicus brief in opposition to the motion for preliminary approval;

1

(ii) the 

motion is untimely--this issue should have been raised in the briefing or at the oral argument that 

took place on June 12, 2019; and (iii) an administrative motion is not the correct method of 

seeking the relief requested because Local Rule 7-11 reserves such motions for “miscellaneous 

administrative matters” such as requests to exceed page limits or to file documents under seal. 

[Dkt. No. 73]. At minimum, Harvey contends, the Proposed Intervenors should be required to file 

a properly noticed motion after providing a satisfactory explanation why these concerns were not 

raised earlier. 

Harvey also argues that the motion should be denied on the merits because there is no 

authority for the Proposed Intervenors’ request. He notes that there have been no “judicial 

findings” or “rulings on the merits of the claims” in Chen as described by the Proposed 

Intervenors. Further, in light of the litigation risks, Harvey states that it is unclear what the class 

notice could say about Chen that would assist the class members in deciding whether to participate 

in the proposed settlement because any statement about Chen’s likely outcome would be highly 

 

1 The Proposed Intervenors filed a 25 page brief and over 600 pages of declarations and supporting 

exhibits in support of their opposition to preliminary approval.

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speculative at best, or confusing and misleading at worst. Harvey states that if there is any

mention of Chen in the class notice, it should be limited to the name, case number, and court 

where Chen is pending. If Chen is mentioned, Harvey requests a reminder to all litigants and their 

counsel that it is improper to encourage class members to object or opt-out of the proposed 

settlement. Lastly, Harvey contends that I should not require the Parties to post the Proposed 

Intervenor’s amicus brief on their settlement website because it is permeated with unfounded and 

incendiary accusations against the parties and their counsel. Harvey also disputes the Proposed 

Intervenors’ damages calculations as lacking foundation and highly speculative.

MSSB argues that the Proposed Intervenor’s motion should be denied on additional

grounds as well. [Dkt. No. 74]. It contends that the purpose of providing information about 

parallel proceedings in a class notice is to provide individuals with the information necessary to 

opt out and pursue their own separate recovery in that separate proceeding. But here, potentially 

aggrieved employees under PAGA do not have the right to object or opt out of a PAGA 

settlement. Therefore, identifying Chen, which is a PAGA only action, in a Rule 23 notice would 

give the mistaken impression that potential class members have a right to opt out as PAGA 

aggrieved employees. These class members, MSSB states, are already provided information on 

how to opt out of the class action. MSSB also asserts that the Proposed Intervenors’ citations are 

irrelevant because they are all Rule 23 class action cases and do not involve listing PAGA-only 

cases. 

The Parties’ arguments on procedural grounds are all correct. An administrative motion is 

the incorrect vehicle for the Proposed Intervenors’ motion and they had the opportunity to make 

their request in the amicus brief and at the hearing on the preliminary approval motion. Moreover, 

I agree with the Parties on the merits. Potentially aggrieved employees do not have the right to opt 

out or object to a PAGA settlement. The cases relied on by the Proposed Intervenors all involve 

multiple Rule 23 class actions, not PAGA-only cases like Chen. See Mata v. Manpower Inc., No. 

14-CV-03787-LHK, 2016 WL 4702744, at *8–9 (N.D. Cal. Sept. 8, 2016) (parallel cases also 

class actions); Chavez v. PVH Corp., No. 13-CV-01797-LHK, 2015 WL 581382, at *4 (N.D. Cal. 

Feb. 11, 2015) (same). And although the Ninth Circuit in Churchill Vill., L.L.C. v. Gen. Elec., 361 

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F.3d 566, 575 (9th Cir. 2004) found that the notice of settlement there adequate where it “listed 

the names, case numbers, and courts of pending actions in Illinois, Florida, New York, and 

Connecticut” that were related to the settling litigation, it did not state that such a list was required. 

If there is any slight value for class members in listing Chen in the class notice, it is substantially 

outweighed by the confusion it would cause; it is not likely to be of benefit to class members in 

deciding whether to opt out of or object to this action. The Proposed Intervenors’ motion is 

denied.

II. THE PROPOSED INTERVENORS’ MOTION TO SEAL

The Proposed Intervenors also seek to file under seal the following documents: (i) 

Declaration of Laura Sullivan in Support of Brief of Amici Curiae Tracy Chen and Matthew 

Lucadano in Opposition to Plaintiff’s Motion for Preliminary Approval; (ii) Declaration of Mark 

Humenik in Support of Brief of Amici Curiae Tracy Chen and Matthew Lucadano in Opposition 

to Plaintiff’s Motion for Preliminary Approval; (iii) Exhibits 7, 14, 17, 19-26, 28, 30-36, and 38 to 

the Declaration of Laura Sullivan in Support of Brief of Amici Curiae Tracy Chen and Matthew 

Lucadano in Opposition to Plaintiff’s Motion for Preliminary Approval; and (iv) Exhibit 49 to the 

Declaration of Mark Humenik in Support of Brief of Amici Curiae Tracy Chen and Matthew 

Lucadano in Opposition to Plaintiff’s Motion for Preliminary Approval. [Dkt. No. 54]. They state 

that these documents and exhibits contain information designated as confidential by MSSB 

pursuant to the stipulated protective order in Chen.

Where information is submitted in connection with a pleading that “is more than 

tangentially related to the merits,” the compelling justifications standard must be met to seal that 

information. Ctr. for Auto Safety v. Chrysler Group, LLC, 809 F.3d 1092, 1103 (9th Cir. 2016). 

The information at issue here – information submitted in support of the Proposed Intervenors’ 

opposition to the motion for preliminary approval – is on its face related to the merits of the matter 

and dispositive issues before the Court; whether to preliminarily approve the settlement, approve 

notice, and move the case towards Final Approval of the settlement. See also Kamakana v. City & 

Cnty. of Honolulu, 447 F.3d 1172, 1179-80 (9th Cir. 2006) (drawing distinctions between 

materials submitted in support of non-dispositive motion and materials submitted in support of 

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dispositive motions). 

MSSB filed a declaration in support of the motion to seal. [Dkt. No. 56]. It represents that 

the information at issue was designated confidential in Chen and should remain under seal because 

it is confidential and proprietary information regarding its compensation structures, release of 

which could be prejudicial to MSSB’s business or operations or would violate the privacy interests 

of third-parties. Id. ¶¶ 6-29. The very detailed declaration in support provides adequate 

justification to meet the compelling justification standard for purposes of sealing information 

submitted in conjunction with the preliminary approval motion. The administrative motion to seal 

(Dkt. No. 54) is GRANTED.

III. THE MOTION TO INTERVENE

At a hearing on February 27, 2019, I stated that the Proposed Intervenors’ motion to 

intervene [Dkt. No. 28] would be held until after the motion for preliminary approval, and that I

would revisit it at or after the hearing on preliminary approval. [Dkt. No. 41]. I allowed the 

Proposed Intervenors to file an amicus brief and to present oral argument at the hearing on 

preliminary approval. At the hearing, the Proposed Intervenors asked that the motion to intervene 

be granted to ensure that they could be heard on behalf of the state at final approval with respect to 

the PAGA issues. [Dkt. No. 70]. 

The motion to intervene is DENIED. It is my job to consider the interest of the state at the 

final approval stage; I am well aware of the Proposed Intervenors’ position that the PAGA 

payment should be larger. Intervention is also unnecessary to protect the interest of the Proposed 

Intervenors. Lucadano is a class member. He may object or opt out. Chen is not, but he has made 

his position clear at the hearing for preliminary approval. I will assume that his position has not 

changed when ruling on the sufficiency of the settlement at the final approval hearing.

IT IS SO ORDERED.

Dated: September 5, 2019

William H. Orrick

United States District Judge

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