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SHAUN SETAREH (SBN 204514) 

shaun@setarehlaw.com 

2 THOMAS SEGAL (SBN 222791) 

thomas@setarehlaw.com 

3 SET AREH LAW GROUP 

9454 Wilshire Boulevard, Suite 907 

4 Beverly Hills, CA 90212 

Telephone: (310) 888-7771 

5 Facsimile: (310) 888-0109 

6 Attorneys for Plaintiff 

MARCUS CHISM 

7 THOMAS M. MCINERNEY (SBN 162055) 

8 tmm@ogletree.com 

JASON P. BROWN (SBN 266472) 

jason.brown@ogletree.com 9 OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. 

10 Steuart Tower, Suite 1300 

One Market Plaza 

San Francisco, CA 94105 

11 Telephone: (415) 442-4810 

12 

Facsimile: ( 415) 442-4870 

STEPHEN R. WOODS, (pro hac vice) 

13 stephen.woods@ogletree.com 

JAMES R. SILVERS, (pro hac vice) 

14 james.silvers@ogletree.com 

OGLETREE, DEAKINS, NASH, SMOAK & STEW ART, P.C. 

15 300 North Main Street, Suite 500 

Greenville, SC 29601 

16 Telephone: (864) 271-1300 

Facsimile: (864) 235-8806 

17 

Attorneys for Defendant 

18 FRITO-LAY, INC. 

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20 

UNITED ST A TES DISTRICT COURT 

NORTHERN DISTRICT OF CALIFORNIA 

21 MARCUS CHISM, on behalf of himself, all 

others similarly situated, 

22 Plaintiffs, 

23 V. 

24 PEPSICO, INC., a North Carolina 

Corporation; FRITO-LAY, INC., a Delaware 

25 Corporation; FIRST ADV ANT AGE 

BACKGROUND SERVICES CORP., a 

26 Florida Corporation; and DOES 1 to 100, 

Inclusive, 27 

Defendants. 

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Case No. 3:17-cv-00152-VC 

STIPULATION OF SETTLEMENT OF 

CLASS ACTION AND RELEASE OF 

CLAIMS 

Complaint Filed: January 12, 2017 

Before the Hon. District Judge Vince Chhabria 

Case No. 3: I 7-cv-00 152-VC 

STIPULATION OF SETTLEMENT OF CLASS ACTION AND RELEASE OF CLAIMS 

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Case 3:17-cv-00152-VC Document 88-3 Filed 04/12/18 Page 3 of 29

1 This Stipulation of Settlement of Class Action and Release of Claims is entered into 

2 between plaintiff Marcus Chism on behalf of the Class, and defendant Frito-Lay North America, 

3 Inc., and any of its or their parents, officers, directors, shareholders, managers, members 

4 employees, attorneys, representatives, insurers and their claim managers and each of their 

5 successors and assigns ("FLI") 

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A. 

B. 

C. 

D. 

E. 

I. DEFINITIONS 

"Action" means Marcus Chism, on behalf of himself, all others similarly situated v. 

PEPSCO, INC. a North Carolina Corporation; Frito-Lay, Inc., a Delaware 

Corporation; FIRST ADVANTAGE BACKGROUND SERVICES CORP., a Florida 

Corporation; and DOES 1 to JOO, Inclusive, filed on January 12, 2017, in the U.S. 

District Court for the Northern District of California, and assigned Case Number 

3: l 7-cv-00152-VC. 

"Agreement" or "Settlement Agreement" means this Stipulation of Settlement of 

Class Action and Release of Claims. 

"Class" or "Class Members" means "all applicants for employment in the United 

States who applied for a job with Frito-Lay North America, Inc. and on whom 

background checks were conducted dming the Covered Periods; excludes 

individuals who were members of a separate class in a prior background check class 

action, Roe v. Frito-Lay, Inc., 4:14-cv-00751-HSG (N.D. Ca.). There are 

approximately 38,174 class members, after deducting the Roe class members. 

"Class Counsel" means Shaun Setareh and Thomas Segal of Setareh Law Group. 

"Class Counsel A ward" means such award of fees and costs and expenses as the 

Court may authorize to be paid to Class Counsel for the services they have rendered 

and will render to Named Plaintiff and the Class in the Action. The Class Counsel 

Award will not exceed Eight Hundred Thousand Dollars ($800,000.00), plus Class 

Counsel's actual costs and expenses as supported by declaration and not to exceed 

Thirty Five Thousand Dollars ($35,000.00). 

1 Case No. 3:17-cv-00152-VC 

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F. 

G. 

H. 

I. 

J. 

K. 

L. 

M . 

N. 

"Class Data" means information regarding Class Members that Defendant will in 

good faith compile from its records and provide to the Settlement Administrator. It 

shall be formatted as a Microsoft Excel spreadsheet and shall include: each Class 

Member's employee number; full name; last known address; last known home 

telephone number; Social Security number, if available, and whether they are 

subject to the Claims Period applicable for FLI front-line non-exempt employees or 

for FLI salaried/exempt positions (i.e., whether they are an FLI front-line nonexempt employee or an FLI salaried/exempt employee). 

"Class Representative" means Marcus Chism. 

"Class Representative Service Awards" means the amount that the Com1 authorizes 

to be paid to Named Plaintiff, if appointed Class Representative, that is in addition 

to his Individual Settlement Payment, in recognition of his efforts and risks in 

assisting with the prosecution of the Action and in exchange for executing a General 

Release of Defendant. 

"Complaint" means the Second Amended Complaint filed by Named Plaintiff 

Marcus Chism on July 3, 2017, in this Action. 

"Court'· means the United States District Court for the Northern District of 

California. 

"Covered Periods" mean (a) for FLI frontline non-exempt positions, the period from 

January 12, 2015 through November 7, 2016, and (b) for FLI salaried/exempt 

positions, the period from January 12, 2015 through December 15, 2016. 

"Defendant" means FLI. 

"Defendant's Counsel" means Thomas M. Mcinerney, Stephen R. Woods, Jason P. 

Brown, and James R. Silvers of Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 

"Effective Date" means: (a) the date when the Final Approval Order is signed, if 

there are no objectors, or (b) in the event there are objectors, thirty-two (32) days 

after service of notice of entry of the Final Approval Order and Judgment on the 

Parties and all objectors to the Settlement, without any appeals or request for review 

2 Case No. 3: 17-cv-00 152-VC 

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0. 

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being taken, or (c) orders affinning said Fina] Approval Order and Judgment or 

denying review after exhaustion of all appellate remedies, if appeals or requests for 

review have been taken. 

"Fina] Approval" means that the Final Approval Order and Judgment have been 

entered by the Court. 

"Final Approval Hearing" or "Final Approval/Settlement Fairness Hearing" means 

the hearing on the Motion for Final Approval of the Settlement. 

"Final Approval Order" means the Order Granting Final Approval of the Class 

Settlement, which shall be submitted with the Motion for Final Approval of the 

Settlement. 

" Individual Settlement Payment" means the amount payable from the Net 

Settlement Amount to each Settlement Class Member. 

"Maximum Settlement Amount" means the maximum amount of Two Million, Four 

Hundred Thousand Dollars ($2,400,000.00) that Defendant will pay as a result of 

this Stipulation of Settlement. 

"Named Plaintiff' means Marcus Chism. 

"Net Settlement Amount" or "NSA" means the Maximum Settlement Amount, less 

Class Counsel Award, Class Representative Service Awards, and Settlement 

Administration Costs. 

"Notice" means the Notice of Class Action Settlement in a fonn substantially 

similar to the fonn attached hereto as Exhibit 1. 

"Parties" means Named Plaintiff and Defendant, collectively and "Party" shall mean 

either Named Plaintiff or Defendant, individually. 

" Preliminary Approval Date" means the date the Court enters an order granting 

preliminary approval of the Settlement. 

"Postcard Notice" ( or "Postcard Notice of Class Action Settlement") means the 

notice to be mailed to Settlement Class members in postcard format and 

substantially similar to the form attached hereto as Exhibit 2. 

3 Case No. 3: 17-cv-00152-VC 

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Z. 

AA. 

"Released Claims" means all claims alleged in the Complaint and any known or 

unknown claims that were or could have been alleged based on the specific facts 

alleged in the Plaintiffs' Complaint ( collectively, the "Released Claims"). This 

includes claims for (I) Violation of 15 U.S.C.§§ 1681 b(b)(2)(A) (Fair Credit 

Reporting Act); (2) Violation of 15 U.S.C. §§ 1681 d(a)(l) and 1681 g( c) (Fair Credit 

Reporting Act); (3) Violation of California Civil Code§ 1786 et seq. (Investigative 

Consumer Reporting Agencies Act); (4) Violation of California Civil Code§ 1785 et 

seq. (Consumer Credit Reporting Agencies Act); (5) Violation of 15 U.S.C. 

§ 1681 b(b )( 1 )(A) (Fair Credit Reporting Act). Released Claims as defined herein 

include any claims that were or could have been alleged based on the facts and/or legal 

theories addressed in the Complaint and/or related to the current Action, including 

ones under the Fair Credit Reporting Act and any state law analogues, including but 

not limited to background check or consumer report disclosure notices and forms, the 

procurement and use of any background check or consumer reports obtained by FU, 

and adverse action notification (including but not limited to any claims under the Fair 

Credit Reporting Act, the California Consumer Credit Reporting Agencies Act, the 

California Investigative Consumer Reporting Agencies Act, California Business & 

Professions Code section 17200, or any comparable provision of federal, state or local 

law alleging or arising out of adverse employment action), whether such basis is 

known or unknown at the time the release is approved by the Court. The period of the 

Released Claims shall extend to the limits of the Covered Periods. The res judicata 

effect of the Final Order and Judgment will be the same as that of the Released 

Claims. 

"Released Parties" means Defendant and its past, present and/or future, direct and/or 

indirect, officers, directors, members, managers, employees, agents, representatives, 

attorneys, insurers, partners, investors, shareholders, administrators, parent 

companies, subsidiaries, affiliates, divisions, predecessors, successors, assigns, and 

joint venturers. 

4 Case No. 3:17-cv-001 52-VC 

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BB. "Response Deadline" means the date forty-five (45) days after the Settlement 

2 Administrator mails Postcard Notices to Settlement Class Members and the last date 

3 on which Settlement Class Members may submit requests for exclusion or 

4 objections to the Settlement. 

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CC. "Settlement" means the disposition of the Action pursuant to this Agreement. 

DD. "Settlement Administration Costs" means the fees and expenses reasonably incurred 

by the Settlement Administrator as a result of the procedures and processes 

expressly required by this Agreement, which are estimated to be approximately 

EE. 

FF. 

$ 110,000 based on a not-to-exceed quote from the Settlement Administrator. 

"Settlement Administrator" means KCC, LLC, or such other claims administrator 

that is agreed to by the Parties and approved by the Court. 

"Settlement Class Members" or "Settlement Class" means all Class Members after 

excluding any person who submits a timely and valid request for exclusion as 

provided in this Agreement. 

2. RECITALS 

A. Class Certification. The Parties stipulate to provisional class certification for purposes of 

settlement only. If the Court does not grant either preliminary or final approval of this 

settlement, this provisional class certification shall immediately be set aside and the 

Settlement Class immediately decertified (subject to further proceedings on motion of any 

party to certify or deny certification thereafter) and this Stipulation of Settlement shall not 

constitute or be used as evidence that class certification is appropriate. If the Court does 

not grant either preliminary or final approval of this settlement, the Parties shall be returned 

to their respective statuses as of the date and time immediately prior to the execution of the 

Stipulation of Settlement, and the Parties shall proceed in all respects as if this Agreement 

had not been executed, except that any costs actually incurred by the Settlement 

Administrator shall be paid by equal apportiomnent among the Parties. 

B. Procedural History. On January 12, 2017, plaintiff Marcus Chism filed a putative class 

action Complaint in the U.S. District Court for the Northern District of California alleging 

5 Case No. 3: 17-cv-00 152-VC 

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various background check-related claims. On June I, 2017, plaintiff dismissed without 

prejudice Pepsico, Inc. On June 19, 2017, the Court granted the Motion to Dismiss filed by 

First Advantage Background Corporation. On July 3, 2017, plaintiff filed his Second 

Amended Complaint. On July 19, 2017, plaintiff dismissed without prejudice defendant 

First Advantage Background Corporation. On July 31, 2017, defendant Frito-Lay, Inc. 

filed its answer to the Second Amended Complaint. 

C. The Class Representative believes he has meritorious claims based on alleged violations of 

federal and state law and that class certification is appropriate because the prerequisites for 

class certification can be satisfied in the Action. 

D. Defendant denies any liability or wrongdoing of any kind associated with the claims alleged 

in the Action, disputes the damages and penalties claimed by the Class Representative, and 

further contends that, for any purpose other than settlement, the Action is not appropriate 

for class or representative action treatment. Defendant contends, among other things, that 

at all times it complied with federal and California law regarding background checks, 

including but not limited to the claims asserted in the Second Amended Complaint. 

E. The Named Plaintiff and Class Representative is represented by Class Counsel. Class 

Counsel conducted an investigation into the facts relevant to the Action, including 

reviewing documents and information provided by Defendant pursuant to fonnal and 

informal requests for information to prepare for mediation. Defendant produced for the 

purpose of settlement negotiations certain employment data concerning the Class, which 

Class Counsel reviewed and analyzed. Based on their own independent investigation and 

evaluation, Class Counsel is of the opinion that the Settlement with Defendant is fair, 

reasonable and adequate, and in the best interest of the Class in light of all known facts and 

circumstances, including the risks of significant delay, defenses asserted by Defendant, and 

uncertainties regarding class certification. Although Defendant denies any liability, 

Defendant is agreeing to this Settlement solely to avoid the cost of further litigation. The 

Parties and their counsel have agreed to settle the claims on the terms set forth herein. 

F. The Parties participated in two day-long mediations sessions with Michael Dickstein, a 

6 Case No. 3: 17-cv-001 52-YC 

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well-respected, third-party mediator with considerable experience in mediating employment 

class actions, including those asserting background check claims. The mediations resulted 

in a signed Memorandum of Understanding ("MOU") which, per the tenns of the MOU, 

was to be followed by this long-form settlement agreement. 

The Parties believe that the Settlement is fair, reasonable and adequate. The Settlement was 

arrived at through arm's-length negotiations, taking into account all relevant factors. The 

Parties recognize the uncertainty, risk, expense and delay attendant to continuing the Action 

through trial and any appeal. Accordingly, the Parties desire to fully, finally, and forever 

settle, compromise and discharge all disputes and claims arising from or relating to the 

Action. 

A. 

B. 

3. TERMS OF AGREEMENT 

Settlement Consideration. Defendant shall pay the Maximum Settlement Amount 

which consists of the sum of the Individual Settlement Payments, the Class 

Representative Service Award, the Class Counsel Award, and the Settlement 

Administration Costs, as specified in this Agreement. The Parties agree that this is a 

non-reversionary Settlement and that no portion of the Maximum Settlement Amount 

shall revert to Defendant. In no event shall Defendant be required to pay more or 

less than the Maximum Settlement Amount. 

Release By All Settlement Class Members (including Named PlaintifO. As of the 

Effective Date, in exchange for the consideration set forth in this Agreement, Named 

Plaintiff and the Settlement Class Members release the Released Parties from the 

Released Claims for the Covered Period. Named Plaintiff and the Settlement Class 

Members may hereafter discover facts or legal arguments in addition to or different 

from those they now know or currently believe to be true with respect to the claims, 

causes of action and legal theories of recovery in this case which are the subject 

matter of the Released Claims, including but not limited to actual damages, statutory 

damages, and punitive damages, attorneys' fees, costs, expenses, interest, settlement 

administrator costs, service awards and any other monetary claims. Regardless, the 

7 Case No. 3: 17-cv-00152-VC 

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C. 

discovery of new facts or legal arguments shall in no way limit the scope or 

definition of the Released Claims, and by virtue of this Agreement, Named Plaintiff 

and the Settlement Class Members shall be deemed to have, and by operation of the 

final judgment approved by the Court, shall have, fully, finally, and forever settled 

and released all of the Released Claims as defined in this Agreement. 

General Release By Named Plaintiff Marcus Chism. As of the Effective Date, in 

consideration for the consideration set forth in this Agreement, Named Plaintiff, for 

himself and his heirs, successors and assigns, does hereby waive, release, acquit and 

forever discharge the Released Parties, from any and all claims, actions, charges, 

complaints, grievances and causes of action, of whatever nature, whether known or 

unknown, which exist or may exist on Named Plaintiff' behalf up through the 

Effective Date, and that relates in any way to Plaintiff's application or employment 

with Defendant, including but not limited to any and all tort claims, contract claims, 

wage claims, wrongful termination claims, disability claims, benefit claims, public 

policy claims, retaliation claims, statutory claims, personal injury claims, emotional 

distress claims, invasion of privacy claims, defamation claims, fraud claims, quantum 

meruit claims, and any and all claims arising under any federal , state or other 

governmental statute, law, regulation or ordinance, including, but not limited to 

claims for violation of the Fair Credit Reporting Act, the California Consumer Credit 

Reporting Agencies Act ,the California Investigative Consumer Reporting Agencies 

Act, California Business & Professions Code section 17200, the Fair Labor 

Standards Act, the California Labor Code, the Wage Orders of California's Industrial 

Welfare Commission, other state wage and hour laws, the Americans with 

Disabilities Act, the Employee Retirement Income Security Act, Title VII of the 

Civil Rights Act of 1964, the California Fair Employment and Housing Act, the 

California Family Rights Act, the Family Medical Leave Act, California 's 

Whistleblower Protection Act, and any and all claims arising under any federal, state 

or other governmental statute, law, regulation or ordinance. Named Plaintiff hereby 

8 Case No. 3: l 7-cv-001 52-VC 

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D. 

E. 

expressly waives and relinquishes any and all claims, rights or benefits that he may 

have under California Civil Code § 1542, which provides as follows: A general 

release does not extend to claims which the creditor does not know or suspect to 

exist in his or her favor at the time of executing the release which if known by him 

or her must have materially affected his or her settlement with the debtor. Named 

Plaintiff may hereafter discover claims or facts in addition to, or different from, those 

which they now know or believe to exist, but they each expressly agree to fully and 

finally settle and release any and all claims against the Released Parties, known or 

unknown, suspected or unsuspected, which exist or may exist arising from or related 

to Named Plaintiffs application or employment with Defendant. The Parties further 

acknowledge, understand and agree that this representation and commitment is 

essential to the Agreement and that this Agreement would not have been entered into 

were it not for this representation and commitment. 

Conditions Precedent: This Settlement will become final and effective only upon the 

occurrence of all of the following events: 

1. 

2. 

3. 

4. 

The Court enters an order granting preliminary approval of the Settlement; 

The Court enters an order granting final approval of the Settlement and a 

Final Judgment pursuant to the Settlement Agreement; 

The time for appeal of the Final Judgment and Order Granting Final 

Approval of Class Action Settlement expires; or, if an appeal is timely filed, 

there is a final resolution of any appeal from the Judgment and Order 

Granting Final Approval of Class Action Settlement; and 

Defendant does not invoke its right to revoke the Settlement as described in 

paragraph 3(N) herein. 

Nullification of Settlement Agreement. In the event that this Settlement Agreement 

is not preliminarily or finally approved by the Court, fails to become effective, or is 

reversed, withdrawn or modified by the Court, or in any way prevents or prohibits 

Defendant from obtaining a complete resolution of the claims as described herein: 

9 Case No. 3: l 7-cv-00152-VC 

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F. 

G. 

I. 

2. 

3. 

This Settlement Agreement shall be void ab initio and of no force or effect, 

and shall not be admissible in any judicial, administrative or arbitral 

proceeding for any purpose or with respect to any issue, substantive or 

procedural; 

The conditional class certification (obtained for any purpose) shall be void 

ab initio and of no force or effect, and shall not be admissible in any judicial, 

administrative or arbitral proceeding for any purpose or with respect to any 

issue, substantive or procedural; and 

None of the Parties to this Settlement will be deemed to have waived any 

claims, objections, defenses or arguments in the Action, including with 

respect to the issue of class certification. 

Certification of the Settlement Class. The Parties stipulate to conditional class 

certification of the Settlement Class for the Covered Periods for purposes of 

settlement only. In the event that this stipulation is not approved by the Court, fails 

to become effective, or is reversed, withdrawn or modified by the Court, or in any 

way prevents or prohibits Defendant from obtaining a complete resolution of the 

claims as described herein, the conditional class certification ( obtained for any 

purpose) shall be void ab initio and of no force or effect, and shall not be admissible 

in any judicial, administrative or arbitral proceeding for any purpose or with respect 

to any issue, substantive or procedural. 

Tax Liability. Individual Settlement Payments to members of the Settlement Class 

are not intended by the Parties to be considered wages, and will not be used to 

calculate any additional benefits under any benefit plans to which they may be 

eligible, including but not limited to, profit-sharing plans, bonus plans, 401 (k) plans, 

stock purchase plans, vacation plans, sick leave plans, PTO plans, and any other 

benefit plan. Rather, it is the Parties' intention that this Settlement Agreement will 

not affect any rights, contributions, or amounts to which any Settlement Class 

members may be entitled under any benefit plans. Notwithstanding the above, 

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H. 

I. 

Settlement Class Members understand and agree that they will be responsible for the 

payment of any taxes and penalties assessed by any taxing authority on the 

Individual Settlement Payments described herein. 

Circular 230 Disclaimer. Each Party to this Agreement (for purposes of this section, 

the " acknowledging party" and each Party to this Agreement other than the 

acknowledging party, an "other party") acknowledges and agrees that: (1) no 

provision of this Agreement, and no written communication or disclosure between or 

among the Parties or their attorneys and other advisers, is or was intended to be, nor 

shall any such communication or disclosure constitute or be construed or be relied 

upon as, tax advice within the meaning of United States Treasury Department 

circular 230 (31 CFR part 10, as amended); (2) the acknowledging party (a) has 

relied exclusively upon his, her or its own, independent legal and tax counsel for 

advice (including tax advice) in connection with this Agreement, (b) has not entered 

into this Agreement based upon the recommendation of any other Party or any 

attorney or advisor to any other Party, and (c) is not entitled to rely upon any 

communication or disclosure by any attorney or adviser to any other party to avoid 

any tax penalty that may be imposed on the acknowledging party, and (3) no attorney 

or adviser to any other Party has imposed any limitation that protects the 

confidentiality of any such attorney's or adviser's tax strategies (regardless of 

whether such limitation is legally binding) upon disclosure by the acknowledging 

party of the tax treatment or tax structure of any transaction, including any 

transaction contemplated by this Agreement. 

Preliminary Approval Motion. At the earliest practicable time, Plaintiffs shall file 

with the Court a Motion for Order Granting Preliminary Approval and supporting 

papers, which shall include this Settlement Agreement. Class Counsel shall provide a 

copy of the draft Motion for Order Granting Preliminary Approval to Defendant's 

Counsel at least seven (7) business days in advance of filing with the Court, to allow 

for Defendant's review and edits. 

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J. 

K. 

Settlement Administrator. The Settlement Administrator shall be responsible for: 

printing and mailing the Notice Packets to the Settlement Class Members as directed 

by the Court; receiving and reporting the objections and requests for exclusion; 

processing and mailing payments to the Class Representative, Class Counsel, and 

Settlement Class Members; providing declaration(s) as necessary in support of 

preliminary and/or final approval of this Settlement; and other tasks as the Parties 

mutually agree or the Court orders the Settlement Administrator to perfonn. The 

Settlement Administrator shall keep the Parties timely apprised of the performance of 

all Settlement Administrator responsibilities. The Settlement Administrator will 

contract with Class Counsel only; Defendant and Defendant's Counsel are not parties 

to any contracts or agreements with the Settlement Administrator. Accordingly, 

Class Counsel, not Defendant or Defendant's Counsel, will be responsible for any 

issues, errors, or omissions with/by the Settlement Administrator. 

Notice Procedure. 

1. 

2. 

Class Data. No later than fourteen (14) calendar days after the Preliminary 

Approval Date, Defendant shall provide the Settlement Administrator with 

the Class Data for purposes of preparing and mailing Postcard Notices to 

Class Members. The Class Data shall be confidential. The Settlement 

Administrator shall not provide the Class Data to Class Counsel or Named 

Plaintiffs or any third party, or use the Class Data or any information 

contained therein for any purpose other than to administer this Settlement. 

Notices. 

a) The Long Fonn Notice of Class Action Settlement shall be in a fonn 

substantially similar to the fonn attached hereto as Exhibit 1. The 

Postcard Notice shall be in a form substantially similar to the form 

attached hereto as Exhibit 2. The Postcard Notice of Class Action 

Settlement shall include the estimated amount of their Individual 

Settlement Payment if they do not request to be excluded from the 

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Settlement. The Postcard Notice of Class Action Settlement shall 

also infonn Settlement Class Members that in order to receive an 

Individual Settlement Payment, they do not need to do anything 

except keep the Settlement Administrator apprised of their current 

mailing addresses. The Postcard Notice will direct the Settlement 

Class Members to the settlement website for the Long Fonn Notice 

which will be posted there. The Long Fonn Notice of Class Action 

Settlement shall set forth the release to be given by all members of 

the Class who do not request to be excluded from the Settlement 

Class in exchange for an Individual Settlement Payment. 

Notice By First Class U.S. Mail. Upon receipt of the Class Data, the 

Settlement Administrator will perform a search based on the National 

Change of Address Database to update and correct any known or identifiable 

address changes. No later than fourteen (14) calendar days after receiving 

the Class Data from Defendant as provided herein, the Settlement 

Administrator shall mail a postcard notice to all Settlement Class Members 

via regular First Class U.S. Mail. The Settlement Administrator shall 

exercise its best judgment to determine the current mailing address for each 

Settlement Class Member. The address identified by the Settlement 

Administrator as the current mailing address shall be presumed to be the best 

mailing address for each Settlement Class Member. 

Undeliverable Notices. Any Postcard Notices returned to the Settlement 

Administrator as non-delivered on or before the Response Deadline shall be 

re-mailed to the forwarding address affixed thereto. If no forwarding 

address is provided, the Settlement Administrator shall promptly attempt to 

determine a correct address by lawful skip-tracing, or other search using the 

name, address and/or Social Security number of the Settlement Class 

Member involved, and shall then perfonn a re-mailing, if another mailing 

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6. 

7. 

address is identified by the Settlement Administrator. Settlement Class 

Members who received a re-mailed Postcard Notice shall have their 

Response Deadline extended fifteen (15) days from the original Response 

Deadline. 

Disputes Regarding Administration of Settlement. Any disputes not 

resolved by the Settlement Administrator concerning the administration of 

the Settlement will be resolved by the Court under the laws of the State of 

California. Prior to any such involvement of the Court, counsel for the 

Parties will confer in good faith to resolve the disputes without the necessity 

of involving the Court. 

No Claim Fonn Required. Class Members are not required to submit a 

claim fonn to receive an Individual Settlement Payment. The Postcard 

Notice of Class Action Settlement shall state that Settlement Class Members 

who wish to receive Individual Settlement Payments need not do anything 

except to keep the Settlement Administrator apprised of a current mailing 

address in order to receive an Individual Settlement Payment check 

following the Effective Date of the Settlement. 

Exclusions. The Postcard Notice shall state that Class Members who wish to 

exclude themselves from the Settlement must submit a written request for 

exclusion by the Response Deadline. The Postcard Notice will direct Class 

Members to the settlement website for specific instructions on how to 

request exclusion. Those instructions will indicate that the written request 

for exclusion must state that the Class Member wishes to exclude himself or 

herself from the Settlement and (1) must contain the name, address, 

telephone number and the last four digits of the Social Security number of 

the person requesting exclusion; (2) must be signed by the Class Member; 

(3) must be postmarked or fax stamped by the Response Deadline and 

returned to the Settlement Administrator at the specified address or fax 

14 Case No. 3: l 7-cv-001 52-VC 

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telephone number; and ( 4) contain a typewritten or handwritten notice 

stating in substance: " I have read the enclosed Notice and I wish to Opt Out 

of the class action and the Settlement of the case: Marcus Chism v. 

PEPSICO, INC., et al., U.S. District Court for the Northern District of 

California Case No. 3: l 7-cv-00152-VC." The request for exclusion will not 

be valid if it is not timely submitted, if it is not signed by the Class Member, 

or if it does not contain the name and address of the Class Member. The 

date of the postmark on the return mailing envelope on the request for 

exclusion shall be the exclusive means used to determine whether the 

request for exclusion was timely submitted. Any Class Member who 

requests to be excluded from the Settlement Class will not be entitled to any 

recovery under the Settlement and will not be bound by the terms of the 

Settlement or have any right to object, appeal or comment thereon. Class 

Members who fail to submit a valid and timely written request for exclusion 

on or before the Response Deadline shall be bound by all terms of the 

Settlement and any final judgment entered in this Action if the Settlement is 

approved by the Court. No later than fourteen (14) calendar days after the 

Response Deadline, the Settlement Administrator shall provide counsel for 

the Parties with a final list of the Class Members who have timely submitted 

written requests for exclusion. At no time shall any of the Parties or their 

counsel seek to solicit or otherwise encourage members of the Class to 

submit requests for exclusion from the Settlement. 

Objections. The Postcard Notice will inform Class Members of their right to 

object and will direct them to the settlement website for instructions on how 

to object. . The settlement website shall state that Class Members who wish 

to object to the Settlement must file with the Couti a written statement of 

objection ("Notice of Objection") by the Response Deadline. The Notice of 

Objection must be signed by the Class Member and state: (1) the full name 

15 CaseNo.3: 17-cv-00 152-VC 

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of the Class Member; (2) the dates of employment of the Class Member; (3) 

the last four digits of the Class Member's Social Security number and/or the 

Employee ID number; (4) the basis for the objection; and (5) if the Class 

Member intends to appear at the Final Approval/Settlement Fairness 

Hearing. Class Members who fail to make objections in the manner 

specified above shall be deemed to have waived any objections and shall be 

foreclosed from making any objections (whether by appeal or otherwise) to 

the Settlement although the Court will excuse defects if there is substantial 

compliance. Class Members who submit a timely Notice of Objection will 

have a right to appear at the Final Approval/Settlement Fairness Hearing in 

order to have their objections heard by the Court. No Class Member may 

appear at the Final Approval/Settlement Fairness Hearing unless he or she 

has served a timely objection that complies with the procedures provided in 

this paragraph although the Court may excuse this requirement upon a 

showing of good cause or if there is substantial compliance. At no time shall 

any of the Parties or their counsel seek to solicit or otherwise encourage 

Class Members to file or serve written objections to the Settlement or appeal 

from the Order and Final Judgment. Class Members who submit a written 

request for exclusion are not entitled to object to the Settlement. 

Funding and Allocation of the Maximum Settlement Amount. Defendant is required 

to pay the Maximum Settlement Amount, which includes the sum of the Individual 

Settlement Payments, the Class Representative Service Award, the Class Counsel 

Award, and the Settlement Administration Costs. 

I. Funding Due Date. No later than five (5) business days after the Effective 

Date, Defendant shall provide the Maximum Settlement Amount to the 

Settlement Administrator to fund the Settlement, as set fo11h in this 

Agreement. 

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2. Individual Settlement Payments. Individual Settlement Payments shall be 

paid from the Net Settlement Amount and shall be paid pursuant to the 

formula set forth herein. 

a) 

b) 

c) 

d) 

Calculation of Individual Settlement Payments. Individual 

Class Members will receive a minimum cash payment in the 

gross amount of $40.00. Irrespective of the actual payment to 

each member of the Settlement Class, in no event will the 

Maximum Settlement Amount exceed $2,400,000.00. To 

calculate the Individual Settlement Payment that each 

Individual Class Member will receive, the Settlement 

Administrator will divide the Net Settlement Amount by the 

number of non-returned (i.e., non-undeliverable) Postcard 

Notices, and then distribute the checks to each individual 

Settlement Member on whom a Postcard Notice has not been 

returned, as described in the subsection just below. 

Mailing. Individual Settlement Payments shall be mailed by regular 

First Class U.S. Mail to Settlement Class Members' last known 

mailing address no later than fourteen ( I 4) calendar days after the 

Effective Date. 

Expiration. Any checks issued to Settlement Class Members shall 

remain valid and negotiable for one hundred and twenty ( 120) days 

from the date of their issuance. In the event an Individual Settlement 

Payment check has not been negotiated within one hundred and 

twenty (120) days, the check shall be voided 

Second Distribution. Within thirty (30) days of the 120-day check 

void date, Settlement Administrator will assess whether there is any 

residue from uncashed checks. Any residue from uncashed checks 

will first be applied to satisfy any shortfall, if there is one, between 

17 Case No. 3: 17-cv-00152-VC 

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f) 

the attorney fee award and the initial payout as set forth in subsection 

(f) below. In the event that the remaining funds associated with 

voided checks equal or exceed $40,000, within twenty (20) days of 

the assessment of any residue, class members who cashed the first 

check will be mailed a second check with their pro rata share of the 

excess funds. Any checks not negotiated within one hundred and 

twenty days of mailing shall be voided. In the event that the 

remaining funds associated with voided checks are less than $40,000 

they will be transmitted to cy pres recipient United Way or another 

cy pres recipient designated by the Court. 

Any funds associated with such voided checks following Second 

Distributions plus any accrued interest that has not otherwise been 

distributed shall be transmitted to cy pres recipient United Way or 

another cy pres recipient to be designated by the Court. The 

Settlement Administrator shall prepare a report regarding the 

distribution plan, including and not limited to the unused funds as set 

forth in this Section, in accordance with the Court's orders. 

As set forth above, the Settlement requires that each Settlement Class 

Member who does not opt out receives a minimum net payment of 

$40.00. If the Settlement Administrator's pre-distribution 

calculations show that, after deduction of the Class Representative 

Service Award, the Class Counsel Award, and the Settlement 

Administration Costs, the minimum payment will be less than 

$40.00, then the initial payment of any Class Counsel Award will be 

reduced in an amount necessary to ensure that each Settlement Class 

Member receives a check for $40.00. If, as described above, there is 

a residue from uncashed, expired checks and the initial payment of 

the Class Counsel Award was reduced from the amount awarded by 

18 Case No. 3: 17-cv-00 152-YC 

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the Court, then the residue from uncashed, expired checks will be 

applied in the amount of the reduction in a subsequent attorney fee 

payment, to be paid on the same date the residue is scheduled to have 

been paid to the Settlement Class members who cashed the first 

check. If there is no residue, there will be no subsequent attorney fee 

payment. 

Class Representatives Service Awards. Defendant agrees not to oppose or 

object to any application or motion by Named Plaintiff for a Class 

Representative Service Award ofup to Five Thousand Dollars ($5,000.00) to 

the Named Plaintiff. The Settlement Administrator shall pay the Class 

Representative Service Award to Named Plaintiffs from the Maximum 

Settlement Amount no later than fourteen (14) calendar days after the 

Effective Date. Any portion of the requested Class Representative Service 

Award that is not awarded to the Class Representatives shall be part of the 

Net Settlement Amount and shall be distributed to Settlement Class 

Members as provided in this Agreement. The Settlement Administrator 

shall issue an IRS Fonn l 099 - MISC to the Named Plaintiff for his 

respective Class Representative Service Award. The Parties' intent is that 

the Service A ward shall be treated for tax withholding purposes as non-wage 

income. Notwithstanding the foregoing, Named Plaintiff shall be solely and 

legally responsible to pay any and all applicable taxes on his respective 

Class Representative Service Award). The Class Representative Service 

Award shall be in addition to Named Plaintiffs respective Individual 

Settlement Payment as a Settlement Class Member. In the event that the 

Court reduces or does not approve the requested Class Representative 

Service Award, Named Plaintiff shall not have the right to revoke the 

Settlement, and it will remain binding, subject to Named Plaintiffs right to 

appeal. 

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4. Class Counsel Award. Defendant agrees not to oppose or object to any 

application or motion by Class Counsel for attorneys' fees not to exceed 

$800,000.00, plus costs and expenses supported by declaration not to exceed 

$35,000.00, from the Maximum Settlement Amount. Any portion of the 

requested Class Counsel A ward that is not awarded to Class Counsel shall be 

part of the Net Settlement Amount and shall be distributed to Settlement 

Class Members as provided in this Agreement. The Settlement 

Administrator shall pay the Class Counsel Award to Class Counsel from the 

Maximum Settlement Amount no later than fourteen (14) calendar days after 

the Effective Date. Class Counsel shall be solely and legally responsible to 

pay all applicable taxes on the payment made pursuant to this paragraph. 

The Settlement Administrator shall issue an IRS Fonn 1099 - MISC to 

Class Counsel for the payments made pursuant to this paragraph. In the 

event that the Court reduces or does not approve the requested Class Counsel 

Award, Named Plaintiffs and Class Counsel shall not have the right to 

revoke the Settlement and the Settlement will remain binding, subject to 

Named Plaintiffs' and Class Counsel's right to appeal. 

5. Settlement Administration Costs. The Settlement Administrator shall be 

paid for the costs of administration of the Settlement from the Maximum 

Settlement Amount. Settlement Administration Costs presently are 

estimated to be no more than $ 110,000 . The Settlement Administrator 

shall be paid the Settlement Administration Costs no later than fourteen (14) 

calendar days after Defendant provides funds to the Settlement 

Administrator for disbursement under this Agreement. 

Final Approval Motion. At the earliest practicable time following the expiration of 

the Response Deadline, Named Plaintiffs shall file with the Court a Motion for an 

Order Granting Final Approval and Entering Judgment, which motion shall request 

final approval of the Settlement and the amounts payable for the Class 

20 Case No. 3:17-cv-00152-VC 

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Representatives Service Awards, the Class Counsel Award, and the Settlement 

Administration Costs. 

I. Declaration by Settlement Administrator. The Settlement Administrator 

shall submit a declaration in support of Named Plaintiffs' motion for final 

approval of this Settlement detailing the number of Postcard Notices mailed 

and re-mailed to Class Members, the number of undeliverable Postcard 

Notices, the number of timely requests for exclusion, the number of 

objections received, the amount of the average Individual Settlement 

Payment, the Settlement Administration Costs, and any other infonnation as 

the Parties mutually agree or the Court orders the Settlement Administrator 

to provide. 

Defendant's Option to Tem1inate Settlement. Defendant has the unilateral right to 

terminate the Settlement if, after the Response Deadline and before the Final 

Approval/Settlement Fairness Hearing, the number of Settlement Class Members 

who submitted timely and valid written requests for exclusion from the Settlement is 

at least ten percent (10%) of all Class Members, Defendant shall have, in its sole 

discretion, the option to tenninate this Settlement. If Defendant exercises the option 

to tenninate this Settlement, Defendant shall provide written notice to Class Counsel 

within seven (7) calendar days after the Response Deadline (provided that is at least 

five (5) calendar days after Defendant learns of this percentage of valid opt-outs); 

and the Parties shall proceed in all respects as if this Agreement had not been 

executed. 

Motions for Preliminary and Final Approval. Class Counsel will provide an 

opportunity for Counsel for Defendant to review the Motions for Preliminary and 

Final Approval prior to filing with the Court by providing drafts to FLI's counsel at 

least seven business days before it is filed. The Parties and their counsel will 

cooperate with each other and use their best efforts to effect the Court's approval of 

the Motions for Preliminary and Final Approval of the Settlement. 

21 Case No. 3:1 7-cv-00152-VC 

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Q. 

R. 

s. 

T. 

Cooperation. The Parties and their counsel will cooperate with each other and use 

their best efforts to effect the implementation of the Settlement. If the Court rejects 

the Parties' proposed Release and Settlement Agreement, the Parties agree to work in 

good faith to resolve any differences they may have regarding any revised Release 

and Settlement Agreement to be re-submitted to the Court, and if the Parties are 

unable to resolve any such differences on their own, the Parties further agree to 

engage a mediator for the purposes of helping the parties to resolve any disputes 

about the tenns and conditions of any revised Release and Settlement Agreement to 

be re-submitted to the Court. 

Interim Stay of Proceedings. The Parties agree to stay all proceedings in the Action, 

except such proceedings necessary to implement and complete the Settlement, 

pending the Final Approval/Settlement Fairness Hearing to be conducted by the 

Court. 

Amendment or Modification. This Agreement may be amended or modified only by 

a written instrument signed by counsel for all Parties or their successors-in-interest. 

Entire Agreement. This Agreement and any attached Exhibits constitute the entire 

Agreement among these Parties, and no oral or written representations, warranties or 

inducements have been made to any Party concerning this Agreement or its Exhibits 

other than the representations, warranties and covenants contained and memo1ialized 

in the Agreement and its Exhibits. 

Authorization to Enter Into Settlement Agreement. Counsel for all Parties warrant 

and represent they are expressly authorized by the Parties whom they represent to 

negotiate this Agreement and to take all appropriate actions required or permitted to 

be taken by such Parties pursuant to this Agreement to effectuate its terms, and to 

execute any other documents required to effectuate the terms of this Agreement. The 

persons signing this Agreement on behalf of Defendant represent and warrant that 

they are authorized to sign this Agreement on behalf of Defendant. Named Plaintiffs 

represent and warrant that they are authorized to sign this Agreement and that each of 

22 Case No. 3:17-cv-00152-VC 

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U. 

V. 

them has not assigned any claim, or part of a claim, covered by this Settlement to a 

third-party. 

Binding on Successors and Assigns. This Agreement shall be binding upon, and 

inure to the benefit of, the successors or assigns of the Parties hereto, as previously 

defined. 

California Law Governs. All tenns of this Agreement and the Exhibits hereto and 

any disputes arising hereunder shall be governed by and interpreted according to the 

Jaws of the State of California. 

W. Counterparts. This Agreement may be executed in one or more counterparts. All 

executed counterparts and each of them shall be deemed to be one and the same 

instrument provided that counsel for the Parties to this Agreement shall exchange 

among themselves copies or originals of the signed counterparts. 

X. 

Y. 

z. 

This Settlement Is Fair, Adequate and Reasonable. The Parties believe this 

Settlement is a fair, adequate and reasonable settlement of this Action and have 

arrived at this Settlement after extensive anns-length negotiations, taking into 

account all relevant factors, present and potential. 

J misdiction of the Court. The Parties agree that the Court shall retain jurisdiction 

with respect to the interpretation, implementation and enforcement of the tenns of 

this Agreement and all orders and judgments entered in connection therewith, and the 

Parties and their counsel hereto submit to the jurisdiction of the Court for purposes of 

interpreting, implementing and enforcing the settlement embodied in this Agreement 

and all orders and judgments entered in connection therewith. 

Invalidity of Any Provision. Before declaring any provision of this Agreement 

invalid, the Court shall first attempt to construe the provisions valid to the fullest 

extent possible consistent with applicable precedents so as to define all provisions of 

this Agreement valid and enforceable. 

AA. Publicity. Named Plaintiffs and Class Counsel agree not to disclose or publicize the 

Settlement, including the fact of the Settlement, its tenns or contents, and the 

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negotiations underlying the Settlement, in any manner or form, directly or indirectly, 

to any person or entity, except Class Members and as shall be contractually required 

to effectuate the terms of the Settlement as set forth herein. For the avoidance of 

doubt, this section means Named Plaintiffs and Class Counsel agree not to issue 

press releases or website postings, communicate with, or respond to any media or 

publication entities, publish information in manner or form, whether printed or 

electronic, on any medium or otherwise communicate, whether by print, video, 

recording or any other medium, with any person or entity concerning the Settlement, 

including the fact of the Settlement, its tenns or contents and the negotiations 

underlying the Settlement, except as shall be contractually required to effectuate the 

terms of the Settlement as set forth herein. However, for the limited purpose of 

allowing Class Counsel to prove adequacy as class counsel in other actions, Class 

Counsel may disclose the name of the Parties in this action and the venue/case 

number of this action (but not any other settlement details) for such purposes. In 

addition, in response to inquiries from third parties, the Parties and their counsel may 

respond as follows: "The parties reached an amicable resolution" and may refer the 

inquirer to the public records of this action on file with the Court. The Parties may 

also discuss the tenns of the settlement with members of the Settlement Class. The 

exceptions to the Publicity Provision outlined herein are to be strictly construed and 

do not authorize any disclosures other than those specifically identified. Except to 

the extent required for Court approval, and except that FLI may disclose such 

information to its employees, counsel, advisors, shareholders and company 

representatives who FLI believes have a need to know the specific tenns of the 

settlement, the Parties agree to maintain confidentiality as to the specific tenns of the 

settlement until such times as it is submitted to the court for approval. 

No Unalleged Claims. Class Counsel agrees that they know of no facts that could 

lead to a background check lawsuit or allegations against FLI other than the Action. 

The Parties further acknowledge, understand and agree that this representation is 

24 Case No. 3: 17-cv-00152-VC 

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essential to the Agreement and that this Agreement would not have been entered into 

were it not for this representation. 

CC. No Admissions. Named Plaintiffs have claimed and continue to claim that the 

Released Claims have merit and give rise to liability on the part of Defendant. 

Defendant claims that the Released Claims have no merit and do not give rise to 

liability. This Agreement is a compromise of disputed claims. Nothing contained in 

this Agreement and no documents refen-ed to herein and no action taken to can-y out 

this Agreement may be construed or used as an admission by or against the 

Defendant or Named Plaintiffs or Class Counsel as to the merits or lack thereof of 

the claims asserted. 

IN WITNESS WHEREOF, this Settlement Agreement is executed by and on behalf of the 

I 2 Settling Parties and their duly authorized attorneys, as of the day and year herein set forth. 

13 DATED: 

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18 DATED: 

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____ , 2018 

____ , 201 8 

SETAREH LAW GROUP 

By: Isl Shaun Setareh 

SHAUN SET AREH 

THOMAS SEGAL 

Attorneys for Plaintiff 

MARCUS CHISM 

OGLETREE, DEAKIN S, NASH, SMOAK & 

STEWART, P.C. 

By: Isl Thomas M. Mcinerney 

THOMAS M. MCINERNEY 

JASON P. BROWN 

STEPHEN R. WOODS 

JAMES R. SILVERS 

Attorneys for Defendant 

FRITO-LAY, INC. 

25 Case No. 3:17-cv-00152-VC 

STIPULATION OF SETTLEMENT OF CLASS ACTION AND RELEASE OF CLAIMS 

Case 3:17-cv-00152-VC Document 95-2 Filed 07/09/18 Page 27 of 29
II Case 3:17-cv-00152-VC Document 88-3 Filed 04/12/18 Page 28 of 29

DocuSign Envelope ID: D01 F61 E2-030C-4A93-A556-2A801DC004CO 

TE 4/ 12/ 2018 DA D: _____ ,2018 

r-DocuSigned by: 

By: ______ ..,...l_ )Jk~ei!&!l~F-449,,,...------ rece2eeae10r us ... 

2 Plaintiff: MARCUS CHISM 

3 

4 

5 DATED _____ ,2018 By: ________________ _ 

6 Authorized Signature of Frito Lay Inc. 

7 Aida Babalola 

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26 Case No. 3:17-cv-00152-VC 

STIPULATION OF SETTLEMENT OF CLASS ACTION AND RELEASE OF CLAIMS 

Case 3:17-cv-00152-VC Document 95-2 Filed 07/09/18 Page 28 of 29
Case 3:17-cv-00152-VC Document 88-3 Filed 04/12/18 Page 29 of 29

1 DATED._· _____ ,201.8 

2 

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5 DATED.A,p.-, L i 2. ., 201:8 

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Sy:-=------ ---- ---- -

Plaintiff.: .. MARCUs CHISM 

.Authorized·Signature :o't'Frito,,L~y IJ1c. 

Aioa Ba:bal<'>la 

STIPl.lLATJON .OF SETTLEMENT: OF CLASS ACTION AND·R.ELEASE OF CI.;AThfS 

Case 3:17-cv-00152-VC Document 95-2 Filed 07/09/18 Page 29 of 29