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28 United States District Court Northern District of California 

IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF CALIFORNIA 

JUAN QUINTANILLA VASQUEZ, et al., 

Plaintiffs, 

v. 

LIBRE BY NEXUS, INC., 

Defendant. 

Case No. 17-cv-00755 CW

 

ORDER GRANTING IN PART AND 

DENYING IN PART MOTION FOR AN 

ORDER HOLDING DEFENDANT IN 

CIVIL CONTEMPT AND IMPOSING 

CIVIL CONTEMPT SANCTIONS 

(Re: Dkt. No. 218) 

Now before the Court is Plaintiffs’ motion for an order holding Defendant Libre by Nexus, 

Inc. (LBN) in civil contempt and imposing civil contempt sanctions on LBN. Docket No. 218. 

For the reasons set forth below, and in light of the argument heard on September 15, 2022, the 

Court grants the motion in part and denies it in part. 

I. BACKGROUND 

On February 8, 2021, the Court granted final approval of the parties’ settlement agreement 

(Final Approval Order). See Docket No. 184. The operative version of the settlement agreement 

was filed as Exhibit 1 to the Declaration of Jason Rathod, Docket No. 143-1, and its terms were 

incorporated into the Final Approval Order. See generally Docket No. 184. In the Final Approval 

Order, the Court ordered LBN to take certain actions pursuant to the terms of the settlement 

agreement, which include the following: 

First, the Court ordered LBN to provide to the members of the settlement class and 

subclasses, which are defined in the settlement agreement and the Final Approval Order, with the 

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Settlement Amount1, which consists of consideration whose total monetary value is $3,200,000. 

Docket No. 184 at 10-13; see also Docket No. 143-1 at ECF header pages 10-11. The Settlement 

Amount is comprised of the following components: 

1. A Cash Settlement Fund of $750,000, to be distributed on a pro rata basis to the 

members of the Former and Current Program Participant Payments Subclass and 

Sponsor Payments Subclass. Docket No. 143-1 at ECF header page 11. The Court 

required LBN to make payments toward the Cash Settlement Fund based on the 

payment schedule set forth in the settlement agreement.2 Docket No. 184 at 10. 

2. An incentive award to each of the four named plaintiffs of $10,000, for a total of 

$40,000. Docket No. 143-1 at ECF header page 9. The Court required LBN to 

make payments toward the incentive awards based on the payment schedule set 

forth in the settlement agreement. Docket No. 184 at 13. 

3. $800,000 in attorneys’ fees and costs to be paid into an escrow account established 

by the settlement administrator, to be distributed to Class Counsel only after the 

members of the Former and Current Program Participant Payments Subclass and 

1

 Capitalized terms are defined in, and have the same meaning as in, the settlement 

agreement. 

2

 Under the payment schedule set forth in the settlement agreement, see Docket No. 143-1 

at ECF header pages 14-15, LBN was required to begin making payments on a weekly basis 

toward the $750,000 Cash Settlement Fund, the $40,000 in incentive awards, and the $800,000 

award of attorneys’ fees and costs on December 1, 2021, if its quarterly revenues met certain 

thresholds relative to its quarterly revenues for 2019. Id. The amount of LBN’s weekly payments 

would be determined starting on December 1, 2021, and on a quarterly basis thereafter, based on 

benchmarks comparing LBN’s current quarterly revenues with its revenues for the same quarter in 

2019. Id. To the extent that LBN’s weekly payments under this payment schedule did not satisfy, 

by January 1, 2023, the cash amounts that LBN owed (i.e., the $750,000 Cash Settlement Fund, 

the $40,000 in incentive awards, and the $800,000 award of attorneys’ fees and costs), then LBN 

would be required to pay the remainder in twelve equal monthly installments beginning on 

January 20, 2023. Id. In response to a motion to enforce the settlement agreement that Plaintiffs 

filed in 2021, the Court, in an order filed on July 30, 2021, clarified the logistics of the payment 

schedule and benchmarks set forth in the settlement agreement on the basis that doing so would 

help enforce and effectuate the settlement agreement. See Docket No. 203 at 8. In relevant part, 

the Court ordered that the quarterly revenue comparisons for determining the amounts that LBN 

must pay on a weekly basis starting on December 1, 2021, shall be made based on financial 

statements for LBN prepared by an external accountant and certified under penalty of perjury by 

counsel for LBN. See id. at 8-9. 

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Sponsor Payments Subclass receive their Cash Settlement Fund distributions. 

Docket No. 143-1 at ECF header page 26. The Court required LBN to pay these 

fees based on the payment schedule set forth in the settlement agreement. Docket 

No. 184 at 12-13. 

4. $80,000 in costs of settlement administration, to be paid in accordance with the 

terms of the settlement agreement. Docket No. 184 at 10. Under the terms of the 

settlement agreement, LBN was required to make an initial deposit of these costs 

within fourteen days of the date on which the Court granted preliminary approval 

of the settlement agreement, and thereafter was required to make periodic payments 

within thirty days of approval by Class Counsel and LBN’s counsel of an invoice 

by the settlement administrator. See Docket No. 143-1 at ECF header page 14. 

5. $1,530,000 for a Debt Relief Fund, which consists of credits that LBN must apply 

to the accounts of members of the Current Program Participant Subclass on a pro 

rata basis according to the terms of the settlement agreement. Docket No. 143-1 at 

ECF header pages 13-14. The Court ordered LBN to apply these credits pursuant 

to the terms of the settlement agreement, Docket No. 184 at 10-11, which, in turn, 

required LBN to apply the credits within twenty days of the date on which the 

Court granted final approval of the settlement agreement, Docket No. 143-1 at ECF 

header page 15. 

Second, the Court ordered LBN, pursuant to the terms of the settlement agreement, to 

provide to members of the Current Program Participant Subclass additional monetary relief in the 

form of: 

1. Discounts of up to twenty percent with respect to monthly recurring fees based on 

whether members of the Current Program Participant Subclass made consecutive 

monthly payments as set forth in the settlement agreement (Consecutive Payment 

Discount).3 See Docket No. 184 at 11; Docket No. 143-1 at ECF header pages 15-

3

 “Program Participants who make three (3) consecutive monthly payments on time and in 

full will have their monthly recurring fee reduced by ten percent (10%) [the Consecutive Payment 

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16. The Consecutive Payment Discount was to be implemented by LBN by the 

later of April 1, 2020, or within twenty days of the Final Settlement Approval Date. 

See Docket No. 143-1 at ECF header page 17. 

2. A reduction of monthly recurring program fees to $415 for each member of the 

Current Program Participant Subclass who paid more than $420 per month and 

made on-time and in-full payments according to the terms of the settlement 

agreement (Timely and In Full Payment Discount). Docket No. 184 at 11; Docket 

No. 143-1 at ECF header page 16. The Timely and In Full Payment Discount was 

to be implemented by LBN by the later of April 1, 2020, or within twenty days of 

the Final Settlement Approval Date. See Docket No. 143-1 at ECF header page 17. 

3. A total payment cap for program payments made by members of the Current 

Program Participant Subclass, excluding the initial payment and set-up fees, to an 

amount not to exceed the face amount of the bond (Total Payment Cap). Docket 

No. 184 at 11; Docket No. 143-1 at ECF header page 16. The Total Payment Cap 

was to be applied to the accounts of Current Program Participant Subclass members 

within twenty days of the date the Court granted preliminary approval of the 

settlement agreement. See Docket No. 143-1 at ECF header pages 16-17. 

Third, the Court ordered LBN, pursuant to the terms of the settlement agreement, to 

provide the settlement class members with a variety of non-monetary benefits. See Docket No. 

184 at 11-12; Docket No. 143-1 at ECF header pages 17-21. 

Pursuant to the settlement agreement’s terms, this Court retained jurisdiction over the 

action and the parties, including to enforce, interpret, and effectuate the settlement agreement and 

the Court’s Final Approval Order. Docket No. 184 at 13; Docket No. 143-1 at ECF header page 

32. 

Discount]. Program Participants who make an additional three (3) consecutive monthly payments 

on time and in full (for a total of 6 consecutive on time and in full payments) will have their 

monthly recurring fee reduced by a further ten percent (10%) from the original fee amount set for 

each program participant [the Second Consecutive Payment Discount] for a total of a twenty 

percent (20%) discount from their original recurring fee.” Docket No. 184 at 11. 

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Since it entered the Final Approval Order on February 8, 2021, the Court has issued 

several orders in response to evidence presented by Plaintiffs that LBN has failed to comply with 

the Final Approval Order and the terms of the settlement agreement incorporated therein. In those 

orders, the Court required LBN, among other things, to comply with these obligations, to provide 

Class Counsel with declarations signed under penalty of perjury and records sufficient to 

demonstrate its compliance with the same, and to respond to communications from Class Counsel 

within one business day. See Order of July 30, 2021, Docket No. 203; Order of November 12, 

2021, Docket No. 209; Order of January 12, 2022, Docket No. 216. 

II. LEGAL STANDARD 

Civil contempt “consists of a party’s disobedience to a specific and definite court order by 

failure to take all reasonable steps within the party’s power to comply.” Inst. of Cetacean Rsch. v. 

Sea Shepherd Conservation Soc’y, 774 F.3d 935, 945 (9th Cir. 2014) (citation omitted). In a civil 

contempt action, “[t]he moving party has the burden of showing by clear and convincing evidence 

that the contemnors violated a specific and definite order of the court. The burden then shifts to 

the contemnors to demonstrate why they were unable to comply.” Fed. Trade Comm’n v. 

Enforma Nat. Prod., Inc., 362 F.3d 1204, 1211 (9th Cir. 2004) (citation and internal quotation 

marks omitted). Remedies that (1) “coerce compliance with a court order” or (2) are “meant to 

compensate the complainant for actual losses” fall within the scope of civil contempt sanctions. 

See Ahearn ex rel. N.L.R.B. v. Int’l Longshore & Warehouse Union, Locals 21 & 4, 721 F.3d 

1122, 1129 (9th Cir. 2013) (“[A] sanction generally is civil if it coerces compliance with a court 

order or is a remedial sanction meant to compensate the complainant for actual losses.”) (citation 

omitted). In contrast with criminal contempt sanctions, “civil contempt sanctions, or those 

penalties designed to compel future compliance with a court order, are considered to be coercive 

and avoidable through obedience, and thus may be imposed in an ordinary civil proceeding upon 

notice and an opportunity to be heard. Neither a jury trial nor proof beyond a reasonable doubt is 

required.” Int’l Union, United Mine Workers of Am. v. Bagwell, 512 U.S. 821, 827 (1994). 

“[A]lthough the district court generally must impose the minimum sanction necessary to secure 

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compliance . . . the district court retains discretion to establish appropriate sanctions[.]” United 

States v. Bright, 596 F.3d 683, 696 (9th Cir. 2010) (internal citations omitted). 

Where a court order incorporates the terms of a settlement agreement, a district court has 

the authority to modify the court order and the settlement agreement terms incorporated therein if 

it finds that there has been a change in factual circumstances. See Kelly v. Wengler, 822 F.3d 

1085, 1097 (9th Cir. 2016). “Under well established law, substantial violation of a court order 

constitutes a significant change in factual circumstances.” Id. at 1098. 

III. DISCUSSION 

Plaintiffs move for an order holding LBN in civil contempt and imposing civil contempt 

sanctions on it. Docket No 218. Plaintiffs contend that LBN has not complied, or otherwise has 

not provided them with sufficient documentation to demonstrate its compliance, with several key 

terms of the settlement agreement, the Final Approval Order that incorporates those terms, and 

several other orders issued by the Court. Id. at 1. Plaintiffs request that the Court impose a 

variety of civil contempt sanctions on LBN, which are described in their motion and their 

proposed order, see generally Docket Nos. 218 and 218-9, on the basis that those sanctions would 

coerce LBN’s compliance or would otherwise compensate them for losses they suffered as a result 

of LBN’s noncompliance. 

In lieu of filing an opposition to Plaintiffs’ motion, LBN filed an unsworn letter signed by 

Evan Ajin. See Docket No. 219. In other filings, Ajin represented that he is a corporate secretary 

of LBN. See Docket No. 208-1. In his letter, which Ajin represents is a “[r]esponse from LBN 

management team,” Docket No. 219 at 1, Ajin states that the pandemic and “significant shifts in 

immigration policy” have resulted in a “long-term reduction in clients” for LBN that has “created 

a significant reduction in revenue,” id. Ajin also states that he remains willing to “work with 

Counsel for the Plaintiffs” to resolve any lingering disputes over LBN’s alleged noncompliance 

with the Court’s orders and the terms of the settlement agreement. Id. at 1-3. The unsworn Ajin 

letter is unaccompanied by any evidence showing the state of LBN’s financial condition or the 

steps that LBN has taken, if any, to comply with the Court’s orders and its obligations under the 

settlement agreement. 

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Below, the Court addresses each of the alleged instances of LBN’s noncompliance that 

Plaintiffs discuss in their motion, as well as Ajin’s response, if any, to each alleged instance of 

noncompliance. 

A. Payments Required by the Settlement Agreement for Cash Settlement Fund, 

Incentive Awards, and Attorneys’ Fees and Costs Award 

Plaintiffs argue that LBN has failed to make payments according to the payment schedule 

set forth in the settlement agreement to satisfy the cash amounts it owes under the settlement 

agreement, which total $1,590,000 and are comprised of $750,00 for the Cash Settlement Fund, 

$40,000 for incentive awards for the named plaintiffs, and $800,000 in attorneys’ fees and costs 

for Class Counsel. Plaintiffs contend that, under the payment schedule set forth in the settlement 

agreement, see Docket No. 143-1 at ECF header pages 14-16, LBN was required to deposit on a 

weekly basis with the settlement administrator payments that would be used to satisfy those cash 

amounts it owes beginning on December 1, 2021, and until the earlier of either: (a) all outstanding 

cash amounts being paid in full, or (b) January 1, 2023, at which time LBN would be required to 

pay the remainder of the cash amounts it owes in twelve equal monthly instalments beginning in 

January 2023. The amount that LBN would be required to deposit on a weekly basis beginning on 

December 1, 2021, depended on revenue benchmarks set forth in the settlement agreement, which 

compared the amount of LBN’s quarterly revenue for certain quarters with LBN’s quarterly 

revenue for the corresponding quarters in 2019. 

As Plaintiffs point out, the Court clarified the mechanics of the payment schedule and 

benchmarks in question in its order of July 30, 2021. In that order, the Court, among other things, 

required LBN to produce to Plaintiffs, for the purpose of determining the weekly amounts that 

LBN would be required to pay based on the revenue benchmarks set forth in the settlement 

agreement, financial statements prepared by an external accountant and certified under penalty of 

perjury by LBN counsel. See Docket No. 203 at 8-10. The Court required LBN order to provide 

these statements to Class Counsel starting on December 1, 2021, and thereafter on a quarterly 

basis. See id. In an order issued on January 12, 2022, the Court found that LBN had failed to 

produce the first of the required financial statements, which had been due on December 1, 2021, 

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and it ordered LBN to produce the financial statement to Class Counsel within fourteen days of 

that order. See Docket No. 216 at 3. 

Plaintiffs contend that, to date, LBN has not provided them with any financial statement 

that complies with the Court’s orders of July 30, 2021, and January 12, 2022 (i.e., one that was 

generated by an external accountant and was certified under penalty of perjury by counsel for 

LBN) even though LBN was required to produce these statements on a quarterly basis starting on 

December 1, 2021. See Rathod Decl. ¶ 25. Plaintiffs acknowledge that LBN filed an unsworn 

statement in December 2021 and January 2022 by Rebecca Wells, a person who purports to be a 

former external accountant for LBN but is now LBN’s Chief Financial Officer, see Docket No. 

217-4. Plaintiffs contend that Wells’ unsworn statement is insufficient to comply with the Court’s 

orders of July 30, 2021, and January 12, 2022, because it was not generated by a person who 

currently is an external accountant for LBN and is not certified under penalty of perjury by 

counsel for LBN (or even by Wells herself). Plaintiffs argue that, because LBN has not provided 

them with certified financial statements prepared by an external accountant showing how its 

quarterly revenues compare to its 2019 revenues, the Court should not permit LBN to delay its 

payments toward the cash amounts it owes under the settlement agreement, because the settlement 

agreement contemplates delayed payments by LBN only to the extent that LBN is able to 

demonstrate a revenue shortfall relative to its 2019 revenues pursuant to the benchmarks set forth 

in the agreement. 

Plaintiffs request that the Court, as a civil contempt sanction, draw an adverse inference 

against LBN and assume that, on each date on which LBN was required to produce to Class 

Counsel certified financial statements generated by an external accountant, LBN’s quarterly 

revenue was in the range of one-hundred to one-hundred-and-ten percent relative to its revenue for 

the corresponding 2019 quarter. Plaintiffs argue that, if the Court draws this adverse inference, 

then, under the payment schedule set forth in the settlement agreement, LBN would have been 

required to pay $100,000 per week starting on December 1, 2021, until the date on which LBN 

finished paying the cash amounts it owes under the settlement agreement (which total 

$1,590,000), which would have been on March 28, 2022 (approximately sixteen weeks after 

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making the first weekly payment of $100,000 on December 1, 2021). Accordingly, if the Court 

draws the adverse inference that Plaintiffs request, LBN would be required to pay immediately all 

of the cash amounts it owes under the settlement agreement. 

In his unsworn letter, Ajin provides no response to Plaintiffs’ representations that LBN has 

failed to produce the financial statements generated by an external accountant and certified under 

penalty of perjury by LBN counsel that the Court ordered LBN to produce in multiple orders. See 

generally Docket No. 219. Ajin states only that “LBN is unable to make the payments that 

Plaintiff’s counsel would like to accelerate” and that Ajin “remains willing to work with Counsel 

for the Plaintiffs” to resolve this issue. Id. at 2. Ajin also states that LBN’s revenues have 

decreased as a result of the pandemic. Id. 

The Court finds that Plaintiffs have met their burden to show that LBN violated the Court’s 

orders of July 30, 2021, and January 12, 2022, by failing to provide Class Counsel with financial 

statements prepared by an external accountant and certified under penalty of perjury by LBN’s 

counsel on December 1, 2021, and on a quarterly basis thereafter. See Rathod Decl. ¶ 25. LBN 

has neither pointed to any evidence showing that it took all reasonable steps within its power to 

comply with these orders, nor has it explained why it has failed, to date, to produce the certified 

financial statements in question. See generally Docket No. 219. Ajin’s unsworn and unsupported 

statements regarding LBN’s purported reduction in revenues are insufficient to comply with the 

July 30, 2021, and January 12, 2022, orders, or to reliably establish that LBN’s revenues fell 

below the thresholds and benchmarks set forth in the settlement agreement. Likewise, the 

statement signed by LBN’s former external accountant and current CFO, Rebecca Wells, which 

LBN filed on the docket in December 2021 and January 2022, also is insufficient to comply with 

the Court’s orders of July 30, 2021, and January 12, 2022, because that statement was not 

prepared by a person who currently is an external accountant for LBN, nor was it certified by 

counsel for LBN under penalty of perjury.4 See Docket No. 217-4. 

4

 The statement in question is signed by “Rebecca Wells, CPA,” who purports to be a 

former external accountant of LBN who was “brought in-house as Libre’s Chief Financial 

Officer.” Docket No. 217-4. Above the signature line, the phrase “I certify that this statement is 

true and accurate” appears. See Docket No. 217-4. The statement does not contain any indication 

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The Court also finds that Plaintiffs have met their burden to show that LBN is in violation 

of the Final Approval Order and the terms of the settlement agreement incorporated therein, which 

required LBN to begin to make payments towards the cash amounts it owes under the settlement 

agreement beginning on December 1, 2021. Plaintiffs have represented, and LBN has not 

disputed, that LBN has made no payments toward the cash amounts it owes under the settlement 

agreement to date. 

Accordingly, the Court finds that LBN is in civil contempt and that civil contempt 

sanctions against it are warranted. See Kelly, 822 F.3d at 1096 (“A contemnor in violation of a 

court order may avoid a finding of civil contempt only by showing it took all reasonable steps to 

comply with the order.”). 

The Court finds that the adverse inference that Plaintiffs request is an appropriate civil 

contempt sanction, as it would serve to coerce LBN’s compliance with the terms of the settlement 

agreement that require it to pay the cash amounts totaling $1,590,000, and begin to compensate 

Plaintiffs for its consistent failure to do so. Therefore, the Court will infer that, had LBN 

produced the certified financial statements by an external accountant that the Court ordered, such 

statements would have revealed that LBN’s revenues were such that it would have been required, 

under the benchmarks and payment schedule set forth in the settlement agreement, to pay the 

maximum weekly amount of $100,000 toward the cash amounts it owes under the settlement 

agreement. Such weekly payments would have begun on December 1, 2021, and ended the week 

of March 28, 2022, when the entire cash amount LBN owes ($1,590,000) would have been 

satisfied. Because it is undisputed that LBN has failed to pay any amount toward the $1,590,000 

it owes, and that this amount should have been paid in full by the week of March 28, 2022 (under 

the adverse inference that the Court has drawn), the Court hereby orders LBN to pay the entire 

cash amount it owes ($1,590,000) within ten business days of the date this order is filed. For each 

day that LBN fails to pay this amount by the date specified in this order, LBN shall pay a fine of 

that it was reviewed by counsel for LBN. It also lacks any statement by Wells or anyone else 

attesting under penalty of perjury that the revenues discussed in the statement are true and correct. 

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$1,000 per day of continued noncompliance, which LBN shall pay to the settlement administrator 

for the benefit of, and eventual distribution to5, members of the Former and Current Program 

Participant Payments Subclass and Sponsor Payments Subclass.6 The Court finds that these civil 

contempt sanctions are necessary to coerce LBN’s compliance with the Court’s orders. 

B. Costs of Settlement Administration 

Plaintiffs argue that, in its order of July 30, 2021, Docket No. 203 at 4, the Court ordered 

LBN to pay, within fourteen days of that order (or by August 14, 2021), the $80,000 that LBN 

owes in administration costs pursuant to the settlement agreement and the Final Approval Order.7 

Plaintiffs represent that, despite their continued requests that LBN pay the $80,000 it owes, LBN 

has failed to comply with the Court’s July 30, 2021, order because, to date, LBN has paid only 

$8,000 of the $80,000 it owes for the costs of settlement administration. See Rathod Decl. ¶ 20. 

Plaintiffs request that the Court order LBN to pay immediately the $72,000 that it still owes to the 

settlement administrator, with interest. 

In the unsworn letter that Ajin filed, he states that “LBN is aware of the requirement and 

the outstanding balance owed” but that LBN’s revenues have decreased as a result of the 

pandemic. Docket No. 219 at 2. Ajin further represents that LBN will “repay the remaining fees 

before 90 days.” Id. 

5

 The distribution of any fines collected by the settlement administrator for the benefit of 

members of the Former and Current Program Participant Payments Subclass and Sponsor 

Payments Subclasses pursuant to this order shall be effectuated pursuant to the distribution plan 

set forth in the settlement agreement for the Cash Settlement Fund. 

6

 Any fine of $1,000 per day that LBN incurs for noncompliance, as set forth in this order, 

shall be cumulative (i.e., each $1,000 per-day fine shall be per each instance of noncompliance 

with respect to each of the subject matters regarding which the Court has separately ordered LBN 

to take certain actions, as described above) and shall be in addition to (1) any other judgment, fine, 

or fee imposed against LBN in this action, and (2) any amounts that LBN is obligated to pay 

pursuant to the terms of the settlement agreement, the Final Approval Order, and any other order 

previously issued by the Court. 

7

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not dispute, that the parties had agreed that LBN would pay the $80,000 in administration costs by 

March 11, 2021, which was thirty days after the Court issued the Final Approval Order. 

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The Court finds that Plaintiffs have met their burden to show that LBN violated the Court’s 

order of July 30, 2021, as it is undisputed that LBN has not yet paid all of the $80,000 that LBN 

owes under the terms of the settlement agreement for the costs of settlement administration. LBN 

has failed to point to any evidence showing that it took all reasonable steps within its power to 

comply with the Court’s July 30, 2021, order, which required it to pay the entire $80,000 within 

fourteen days of that order. Ajin’s unsworn and unsupported statements regarding LBN’s 

purported reduction in revenues are insufficient to establish that LBN’s financial condition 

prevented LBN from complying with the Court’s July 30, 2021, order. As discussed above, the 

Court has required LBN on multiple occasions to produce to Class Counsel financial statements 

generated by an external accountant and certified by LBN counsel under penalty of perjury to 

reliably demonstrate the state of its revenues, but LBN has repeatedly failed to produce them. 

Without reliable evidence as to LBN’s financial condition, the Court cannot reasonably infer that 

LBN’s financial condition has prevented LBN from complying with its obligation to pay the 

$80,000 in costs of settlement administration pursuant to the Court’s July 30, 2021, order. 

Accordingly, the Court finds LBN in civil contempt of the Court’s orders, and that 

imposing civil contempt sanctions against LBN is warranted. The Court orders LBN to pay, 

within ten business days of the date of this order, the remainder of the $80,000 it owes for the 

costs of settlement administration ($72,000), with interest to be calculated from August 14, 2021, 

to the present.8 The Court finds that these civil contempt sanctions are necessary to coerce LBN’s 

compliance with the Court’s orders and to compensate the settlement administrator for losses it 

suffered as a result of LBN’s noncompliance. 

Additionally, for each day that LBN fails to pay this amount by the date specified in this 

order, LBN shall pay a fine of $1,000 per day of continued noncompliance, which LBN shall pay 

to the settlement administrator for the benefit of, and eventual distribution to, members of the 

8

 Interest, for the purpose of complying with this order, shall be calculated “at a rate equal 

to the weekly average 1-year constant maturity Treasury yield, as published by the Board of 

Governors of the Federal Reserve System, for the calendar week preceding the date of the 

judgment.” 28 U.S.C. § 1961(a). Interest shall be computed daily and shall be compounded 

annually. 28 U.S.C. § 1961(b). 

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Former and Current Program Participant Payments Subclass and Sponsor Payments Subclass. The 

Court finds that these civil contempt sanctions are necessary to coerce LBN’s compliance with the 

Court’s orders. 

C. Attorneys’ Fees for Enforcement Motion Filed in 2021 

Plaintiffs point out that, in its order of July 30, 2021, Docket No. 203 at 4, the Court 

ordered LBN to pay $34,142.60 for the attorneys’ fees and costs that Class Counsel incurred in 

bringing a motion to enforce the settlement agreement in 2021. Plaintiffs also point out that the 

Court again ordered LBN to pay the $34,142.60 in question in its orders of November 12, 2021, 

Docket No. 209, and January 12, 2022, Docket No. 216. Plaintiffs represent that LBN has failed 

to comply with the Court’s orders because LBN, to date, has not paid any of the $34,142.60 that 

the Court required it to pay. Plaintiffs request that the Court order LBN to pay immediately into a 

trust account held by the settlement administrator the $34,142.60 at issue, with interest. 

In the unsworn letter that Ajin filed, he provides no response to Plaintiffs’ representations 

that LBN has failed to pay the $34,142.60 in question. See generally Docket No. 219. 

The Court finds that Plaintiffs have met their burden to show that LBN violated several 

court orders by failing to pay the $34,142.60 at issue. In its order of July 30, 2021, the Court 

ordered LBN to pay the $34,142.60 at issue into a trust account held by the settlement 

administrator. See Docket No. 203 at 4. On November 12, 2021, the Court issued another order 

requiring LBN, within seven days of the order, to file a declaration under penalty of perjury signed 

by a LBN principal and supporting documentation showing that LBN “has paid the $34,142.60 in 

attorneys’ fees and costs into the trust account controlled by the settlement administrator.” Docket 

No. 209 at 3. On January 12, 2022, the Court issued yet another order requiring LBN, within 

seven days of that order, to pay the $34,142.60 at issue to the extent that it had not done so, and to 

file a declaration confirming that it had paid that amount. Docket No. 216 at 3. LBN points to no 

evidence showing that it complied with any of these orders or that it took all reasonable steps in its 

power to comply with these orders. Ajin’s unsworn and unsupported statements in his letter 

regarding LBN’s purported reduction in revenues are insufficient to establish that LBN’s financial 

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condition prevented LBN from complying with the Court’s orders of July 30, 2021, November 12, 

2021, and January 12, 2022, for the reasons discussed above. 

Accordingly, the Court finds that LBN is in civil contempt and that imposing civil 

contempt sanctions against LBN is warranted. The Court orders LBN to pay, within ten business 

days of the date of this order, the $34,142.60 it owes for Class Counsel’s attorneys’ fees and costs 

in connection with their 2021 enforcement motion, with interest to be calculated from July 30, 

2021, to the present. These amounts shall be paid into a trust held by the settlement administrator 

and shall not be distributed to Class Counsel until cash distributions pursuant to the settlement 

agreement and the Court’s orders are first made to members of the Former and Current Program 

Participant Payments Subclass and Sponsor Payments Subclass. The Court finds that these civil 

contempt sanctions are necessary to coerce LBN’s compliance with the Court’s orders and to 

compensate the Class Counsel for losses they suffered as a result of LBN’s noncompliance. 

Additionally, for each day that LBN fails to pay the $34,142.60 amount plus interest as 

indicated herein, LBN shall pay a fine of $1,000 per day of continued noncompliance, which LBN 

shall pay to the settlement administrator for the benefit of, and eventual distribution to, members 

of the Former and Current Program Participant Payments Subclass and Sponsor Payments 

Subclass. The Court finds that these civil contempt sanctions are necessary to coerce LBN’s 

compliance with the Court’s orders. 

D. Implementation of Timely and In Full Payment Discount and Consecutive 

Payment Discount 

Plaintiffs contend that LBN has violated several Court orders and the terms of the 

settlement agreement incorporated therein by failing to demonstrate that it has implemented the 

Timely and In Full Payment Discount and the Consecutive Payment Discount required by the 

settlement agreement. Plaintiffs contend that LBN should have applied those discounts to the 

accounts of members of the Current Program Participant Subclass no later than March 31, 2021. 

In its order of July 30, 2021, the Court required LBN, within seven days of that order, to file 

declarations under penalty of perjury and supporting documents demonstrating its compliance 

with the terms of the settlement agreement, including those requiring the implementation of the 

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Timely and In Full Payment Discount and the Consecutive Payment Discount. See Docket No. 

203 at 5-7. The Court again ordered LBN in an order dated January 12, 2022, to provide Class 

Counsel with sufficient documentation to show that LBN had implemented the discounts at issue. 

See Docket No. 216 at 3-4. 

Plaintiffs argue that, to date, LBN has failed to provide them with documentation sufficient 

to show that they have implemented the Timely and In Full Payment Discount and the 

Consecutive Payment Discount. Plaintiffs further contend that materials that LBN has provided 

them to date indicate that LBN has not applied the discounts in question according to the terms of 

the settlement agreement. Plaintiffs contend that, instead of implementing the discounts at issue 

as required in the agreement, LBN appears to have simply applied an across-the-board discount so 

that Current Program Participant Subclass members’ monthly fees are capped at $400. Plaintiffs 

argue that LBN’s application of a flat, across-the-board cap of $400 does not excuse or negate its 

failure to provide members of the Current Program Participant Subclass with the discounts 

required under the settlement agreement. According to Plaintiffs, the discounts set forth in the 

settlement agreement can result in monthly payments that are less than $400 and are, therefore, 

more favorable to members of the Current Program Participant Subclass than the flat, across-theboard cap that LBN has purportedly applied. 

Plaintiffs request that the Court order LBN to provide immediate refunds to members of 

the Current Program Participant Subclass to the extent that it failed to apply the discounts in 

question according to the terms of the settlement agreement as of March 31, 2021, and to pay 

interest on those refunds calculated from March 31, 2021, to the present. Plaintiffs further request 

that the Court order LBN to reduce “the payment amounts” of settlement class members by twenty 

percent “across the board” and that the Court order LBN to implement a new accounting system to 

ensure that the discounts at issue are actually implemented by LBN and that members of the 

Current Program Participant Subclass are not charged fees or other amounts in excess of what they 

are supposed to pay under the terms of the settlement agreement. Docket No. 218 at 12-13. 

In the letter filed in response to the present motion, Ajin states conclusorily that Plaintiffs 

have failed to show that LBN has failed to comply with its obligation to implement the discounts 

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in question. Docket No. 219 at 2. Ajin also contends, without pointing to any evidence, that LBN 

has “complied to best of its capabilities and in the terms requested,” and that he remains willing to 

work with Class Counsel to resolve any lingering disputes. Id. Ajin otherwise does not respond to 

Plaintiffs’ arguments. 

The Court finds that Plaintiffs have met their burden to show that LBN violated several 

court orders, including those issued on July 30, 2021, and January 12, 2022, by failing to provide 

Class Counsel with documentation sufficient to show that it has implemented the Timely and In 

Full Payment Discount and the Consecutive Payment Discount as set forth in the settlement 

agreement. Plaintiffs have shown that, after receiving documents that LBN provided to them that 

purportedly demonstrated LBN’s implementation of the discounts at issue, Class Counsel emailed 

LBN’s principals and counsel on April 8, 2022, to notify them that the documents that LBN had 

provided to them appeared to indicate that the discounts had not, in fact, been implemented 

according to the terms of the settlement agreement. See Docket No. 218-5. Plaintiffs represent, 

see Rathod Decl. ¶ 11, and LBN does not dispute, that LBN failed to respond to Plaintiffs’ email. 

Ajin’s conclusory and unsupported assertions in his letter that LBN has “complied to the best of 

its capabilities and in the terms requested” are insufficient to demonstrate that LBN provided 

Class Counsel with documentation sufficient to show that LBN has implemented the Timely and 

In Full Payment Discount and the Consecutive Payment Discount according to the terms of the 

settlement agreement.9 

Accordingly, the Court finds that LBN is in civil contempt and that the following relief is 

warranted. The Court orders LBN to provide proof that it has implemented the In Full Payment 

Discount and the Consecutive Payment Discount pursuant to the terms of the settlement agreement 

to the accounts of a sample of eligible members of the Current Program Participant Subclass, as 

follows. No later than five business days from the date this order is filed, Class Counsel shall 

9

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Payment Discount exactly as described in the settlement agreement. A failure to implement the 

discounts in question exactly as described in the settlement agreement would constitute a violation 

of the terms of the settlement agreement and the orders incorporating such terms and requiring 

compliance with the terms of the settlement agreement. 

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provide LBN with the names of fifty members of the Current Program Participant Subclass who 

are eligible to receive, and should have received by March 31, 2021, at the latest, the Timely and 

In Full Payment Discount and the Consecutive Payment Discount pursuant to the terms of the 

settlement agreement. Within five business days of receiving these names, LBN shall provide to 

Class Counsel billing records and other documents sufficient to show that it has implemented the 

Timely and In Full Payment Discount and the Consecutive Payment Discount with respect to the 

fifty people selected by Class Counsel, as well as billing records and other documents sufficient to 

show the date on which LBN implemented the discounts in question. The billing records and 

documents that LBN shall produce to Class Counsel shall be accompanied by a declaration signed 

under penalty of perjury by LBN’s principals that authenticates the records and documents and 

attests to the truthfulness and accuracy of their contents. 

If, upon their receipt and review of the billing records and documents for the fifty people 

selected by Class Counsel, Class Counsel believe in good faith that LBN has failed to apply the 

Timely and In Full Payment Discount and the Consecutive Payment Discount as required under 

the terms of the settlement agreement, then Class Counsel may file a supplemental motion for civil 

contempt sanctions. LBN may file a response to Plaintiffs’ supplemental motion for civil 

contempt sanctions within fourteen days of the date that it is filed, and Plaintiffs may file a reply 

within seven days thereafter. Once the briefing is completed, the Court may rule on the 

supplemental motion on the papers or may refer the matter to a magistrate judge for resolution. 

Until LBN has demonstrated its compliance with the terms of the settlement agreement 

requiring it to implement the Timely and In Full Payment Discount and the Consecutive Payment 

Discount, as described in this order, LBN shall not refer to a third-party collections agency any 

alleged debt owed by a member of the Current Program Participant Subclass who was eligible to 

receive the Timely and In Full Payment Discount or the Consecutive Payment Discount under the 

terms of the settlement agreement. The Court will lift this prohibition once LBN establishes that it 

is in compliance with the terms of the settlement agreement requiring it to implement the Timely 

and In Full Payment Discount and the Consecutive Payment Discount, as described in this order. 

While the prohibition is in effect, LBN shall be subject to a fine of $1,000 per day of 

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noncompliance with the prohibition, which LBN shall pay to the settlement administrator for the 

benefit of, and eventual distribution to, members of the Former and Current Program Participant 

Payments Subclass and Sponsor Payments Subclass. The Court finds that the prohibition on 

referring debts to third-party collection agencies and the monetary fine for noncompliance with 

that prohibition are necessary to coerce LBN’s compliance with the Court’s orders and the terms 

of the settlement agreement incorporated therein. 

The Court declines at this time to require LBN, as Plaintiffs request, to apply an acrossthe-board discount of twenty percent to the accounts of members of the Current Program 

Participant Subclass, or to impose any other sanctions on LBN, as a remedy for LBN’s undisputed 

failure to demonstrate its implementation of the discounts at issue. 

E. Implementation of Total Payment Cap 

Plaintiffs argue that, under the terms of the settlement agreement, LBN was required, by no 

later than August 20, 2020, which was twenty days after the date on which the Court granted 

preliminary approval of the settlement agreement, to implement the Total Payment Cap to the 

accounts of members of the Current Program Participant Subclass so that their program payments, 

excluding the initial payment and set-up fees, did not exceed the face amount of the bond. 

Plaintiffs contend that LBN has not demonstrated that it has implemented the Total Payment Cap 

despite multiple Court orders requiring it to do so. 

As Plaintiffs point out, on July 30, 2021, the Court found that Plaintiffs had shown that 

LBN had not yet implemented the Total Payment Cap and it ordered LBN to file, within seven 

days of that order, declarations under penalty of perjury and supporting documents demonstrating 

its compliance with the terms of the settlement agreement, including those requiring the 

implementation of the Total Payment Cap. See Docket No. 203 at 5-7. Plaintiffs also point out 

that, on November 12, 2022, the Court again found that LBN had failed to demonstrate that it had 

implemented the Total Payment Cap, see Docket No. 209 at 2, and it ordered LBN to file within 

seven days another declaration under penalty of perjury signed by an LBN principal, and 

supporting documentation, showing that LBN had implemented the Total Payment Cap and that 

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the program payments of members of the Current Program Participant Subclass had not exceeded 

at all relevant times the face amount of the bond, see id. at 3. 

Plaintiffs contend that thereafter they made a showing that LBN had produced to Class 

Counsel a spreadsheet in PDF format that showed more than one thousand instances in which 

LBN program participants’ payments had exceeded the face value of the bond. The Court then 

ordered LBN on January 12, 2022, to produce to Class Counsel in native format and within 

fourteen days of that order the same spreadsheet that it had previously produced in PDF format, as 

well as “individual analysis and documentation sufficient to explain any instances where a Class 

Member’s total monthly payments exceeded his or her bond amount,” see Docket No. 216 at 3. 

Plaintiffs contend that, since the Court’s order of January 12, 2022, LBN produced to them the 

spreadsheet in native format, as well as explanations for apparent violations of the Total Payment 

Cap, but only as to twenty participants that LBN selected. Plaintiffs contend that they are unable 

to determine based on the twenty participants that LBN selected whether LBN has implemented 

the Total Payment Cap for all members of the Current Program Participant Subclass who are 

eligible under the terms of the settlement agreement to have their payments capped to the face 

value of their bond. Plaintiffs represent that they asked LBN by email on April 8, 2022, to provide 

explanations for apparent violations of the Total Payment Cap for twenty additional participants to 

be selected by Class Counsel, see Docket No. 218-5 and Rathod Decl. ¶¶ 7-11, but LBN never 

responded to that email. 

Plaintiffs request that the Court order LBN to immediately provide proof of compliance 

with the Total Payment Cap by providing individual analysis and documentation for an additional 

twenty participants, to be selected by Class Counsel, whose program payments appear to exceed 

the face value of their bond in violation of the Total Payment Cap. 

In his unsworn letter, Ajin argues conclusorily that Plaintiffs have failed to show that LBN 

has failed to comply with its obligation to implement the Total Payment Cap. Docket No. 219 at 

2. He also contends that he remains willing to work with Class Counsel to resolve any lingering 

disputes. Id. Ajin otherwise does not respond to Plaintiffs’ arguments. 

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The Court finds that Plaintiffs have met their burden to show that LBN violated the Court’s 

order of January 12, 2022, by failing to provide Class Counsel with “individual analysis and 

documentation sufficient to explain any instances where a Class Member’s total monthly 

payments exceeded his or her bond amount,” see Docket No. 216 at 3; see also Docket No. 218-5 

and Rathod Decl. ¶¶ 7-11. LBN has not pointed to any evidence showing that it took all 

reasonable steps to comply with its obligation under the Court’s January 12, 2022, order to 

provide the individual analysis and documentation at issue. 

Accordingly, the Court finds that that the following relief is warranted. The Court orders 

LBN to provide proof that it has implemented the Total Payment Cap pursuant to the terms of the 

settlement agreement to the accounts of a sample of eligible members of the Current Program 

Participant Subclass, as follows. No later than five business days from the date this order is filed, 

Class Counsel shall provide LBN with the names of fifty members of the Current Program 

Participant Subclass who are eligible to receive, and should have received, the Total Payment Cap 

pursuant to the terms of the settlement agreement. Within five business days of receiving these 

names, LBN shall provide to Class Counsel billing records and other documents sufficient to show 

that it has implemented the Total Payment Cap with respect to the fifty people selected by Class 

Counsel, as well as billing records and other documents sufficient to show the date on which LBN 

implemented the discounts in question. The billing records and documents that LBN shall 

produce to Class Counsel shall be accompanied by a declaration signed under penalty of perjury 

by LBN’s principals that authenticates the records and documents and attests to the truthfulness 

and accuracy of their contents. 

If, upon their receipt and review of the billing records and documents for the fifty people 

selected by Class Counsel, Class Counsel believe in good faith that LBN has failed to apply the 

Total Payment Cap as required under the terms of the settlement agreement, then Class Counsel 

may file a supplemental motion for civil contempt sanctions. LBN may file a response to 

Plaintiffs’ supplemental motion for civil contempt sanctions within fourteen days of the date that it 

is filed, and Plaintiffs may file a reply within seven days thereafter. Once the briefing is 

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completed, the Court may rule on the supplemental motion on the papers or may refer the matter 

to a magistrate judge for resolution. 

Until LBN has demonstrated its compliance with the terms of the settlement agreement 

requiring it to implement the Total Payment Cap, as described in this order, LBN shall not refer to 

a third-party collections agency any alleged debt owed by a member of the Current Program 

Participant Subclass who was eligible to receive the Total Payment Cap under the terms of the 

settlement agreement. The Court will lift this prohibition once LBN establishes that it is in 

compliance with the terms of the settlement agreement requiring it to implement the Total 

Payment Cap, as described in this order. While the prohibition is in effect, LBN shall be subject 

to a fine of $1,000 per day of noncompliance with the prohibition, which LBN shall pay to the 

settlement administrator for the benefit of, and eventual distribution to, members of the Former 

and Current Program Participant Payments Subclass and Sponsor Payments Subclass. The Court 

finds that the prohibition on referring debts to third-party collection agencies and the monetary 

fine for noncompliance with that prohibition are necessary to coerce LBN’s compliance with the 

Court’s orders and the terms of the settlement agreement incorporated therein. 

F. Implementation of Debt Relief Fund 

Plaintiffs argue that LBN was required to implement the $1,530,000 Debt Relief Fund by 

twenty days after the Court granted final approval of the settlement agreement. To implement the 

Debt Relief Fund, LBN was required to apply credits that totaled $1,530,000 on a pro rata basis to 

the accounts of members of the Current Program Participant Subclass. Plaintiffs point out that, 

after they made a showing that LBN had failed to implement the Debt Relief Fund independently 

from other credits that LBN may have applied to the accounts of participants pursuant to LBN’s 

obligations in other actions, the Court ordered LBN on July 30, 2021, to provide proof of its 

implementation of the Debt Relief Fund within seven days. See Docket No. 203 at 5. 

Specifically, the Court ordered LBN to file declarations under penalty of perjury signed by its 

principals, as well as business records, client billing records, and other documents sufficient to 

show “LBN’s timely implementation of the $1.53 million debt relief” required under the 

settlement agreement “independent of debt relief that LBN may have provided in other actions[.]” 

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See id. The Court further ordered LBN on July 30, 2021, to provide refunds with interest to the 

accounts of affected settlement class members to the extent that it had failed to comply with the 

terms of the settlement agreement with financial implication to the members of the settlement 

class, including the provisions for debt relief. Id. at 10. The Court again ordered LBN on January 

12, 2022, to implement the Debt Relief Fund and to provide Class Counsel with “sufficient 

records to show compliance[.]” See Docket No. 216 at 3. Plaintiffs represent that LBN has failed 

to provide them with sufficient records to demonstrate that it has implemented the Debt Relief 

Fund. Plaintiffs contend that they requested by email on April 8, 2022, that LNB provide them 

with the billing records of fifty members of the Current Program Participant Subclass to be 

selected by Class Counsel showing that LBN had applied the credits at issue to their accounts, see

Docket No. 218-5, but LBN has not responded to their email to date. 

Plaintiffs request that the Court order LBN to immediately provide proof of its 

implementation of the Debt Relief Fund by producing to Class Counsel the billing records of fifty 

members of the Current Program Participant Subclass who are entitled to receive the credits at 

issue under the terms of the settlement agreement. The fifty members are to be selected by Class 

Counsel. 

In his unsworn letter, Ajin states that “LBN has applied $1.53 million in credits” and that 

LBN “at its own expense rais[ed] the total to over $2 in an attempt to demonstrate good faith to 

the Court.” Docket No. 219 at 1. Ajin also states that LBN has not “refused” to provide the 

“sampling” that Class Counsel requested and that he remains willing to work with Class Counsel 

“to resolve this issue.” Id. 

The Court finds that Plaintiffs have met their burden to show that LBN violated the Court’s 

order of January 12, 2022, see Docket No. 216 at 3, by failing to provide Class Counsel with 

“sufficient records to show compliance” with the terms of the settlement agreement requiring that 

LBN implement the Debt Relief Fund. See Docket No. 218-5 and Rathod Decl. ¶¶ 2-3. LBN has 

not pointed to any evidence showing that it took all reasonable steps to comply with its obligation 

under the Court’s January 12, 2022, order to provide Class Counsel the records at issue. 

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Accordingly, the Court finds that LBN is in civil contempt and that the following relief is 

warranted. The Court orders LBN to provide proof that it has implemented the Debt Relief Fund 

pursuant to the terms of the settlement agreement to the accounts of a sample of eligible members 

of the Current Program Participant Subclass, as follows. No later than five business days from the 

date this order is filed, Class Counsel shall provide LBN with the names of fifty members of the 

Current Program Participant Subclass who are eligible to receive, and should have received, the 

Debt Relief Fund credits pursuant to the terms of the settlement agreement. Within five business 

days of receiving these names, LBN shall provide to Class Counsel billing records and other 

documents sufficient to show that it has implemented the Debt Relief Fund credits with respect to 

the fifty people selected by Class Counsel, as well as billing records and other documents 

sufficient to show the date on which LBN implemented the credits in question. The billing 

records and documents that LBN shall produce to Class Counsel shall be accompanied by a 

declaration signed under penalty of perjury by LBN’s principals that authenticates the records and 

documents and attests to the truthfulness and accuracy of their contents. 

If, upon their receipt and review of the billing records and documents for the fifty people 

selected by Class Counsel, Class Counsel believe in good faith that LBN has failed to apply the 

Debt Relief Fund credits as required under the terms of the settlement agreement, then Class 

Counsel may file a supplemental motion for civil contempt sanctions. LBN may file a response to 

Plaintiffs’ supplemental motion for civil contempt sanctions within fourteen days of the date that it 

is filed, and Plaintiffs may file a reply within seven days thereafter. Once the briefing is 

completed, the Court may rule on the supplemental motion on the papers or may refer the matter 

to a magistrate judge for resolution. 

Until LBN has demonstrated its compliance with the terms of the settlement agreement 

requiring it to implement the Debt Relief Fund, as described in this order, LBN shall not refer to a 

third-party collections agency any alleged debt owed by a member of the Current Program 

Participant Subclass who was eligible to receive the Debt Relief Fund credits under the terms of 

the settlement agreement. The Court will lift this prohibition once LBN establishes that it is in 

compliance with the terms of the settlement agreement requiring it to implement the Debt Relief 

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Fund, as described in this order. While the prohibition is in effect, LBN shall be subject to a fine 

of $1,000 per day of noncompliance with the prohibition, which LBN shall pay to the settlement 

administrator for the benefit of, and eventual distribution to, members of the Former and Current 

Program Participant Payments Subclass and Sponsor Payments Subclass. The Court finds that the 

prohibition on referring debts to third-party collection agencies and the monetary fine for 

noncompliance with that prohibition are necessary to coerce LBN’s compliance with the Court’s 

orders and the terms of the settlement agreement incorporated therein.

G. Attorneys’ Fees in Connection with Present Motion 

Plaintiffs request that the Court order LBN to pay for the $53,021.60 in attorneys’ fees 

they incurred in connection with the present motion. Plaintiffs contend that the settlement 

agreement provides for an award of attorneys’ fees and costs for any party who prevails in 

enforcing the settlement agreement. Plaintiffs also argue that the Court has discretion to award 

them the attorneys’ fees they incurred in bringing the present motion as a remedial measure for 

LBN’s civil contempt. 

In his unsworn letter, Ajin does not specifically address Plaintiffs’ entitlement to, or the 

reasonableness of their request for, an award of attorneys’ fees. See Docket No. 219 at 3. Ajin 

states only that “the goal of class counsel seems to be to run up extreme legal fees[.]” Id. 

A district court has discretion to award attorneys’ fees and costs as a remedial measure in a 

proceeding for civil contempt. See Perry v. O'Donnell, 759 F.2d 702, 705 (9th Cir. 1985) (holding 

that a district court has discretion “to analyze each contempt case individually and decide whether 

an award of fees and expenses is appropriate as a remedial measure” and that a finding of “willful” 

disobedience with a court order is not required for a district court to award fees and costs as a 

remedial measure in civil contempt proceedings). The Court finds that an award to Class Counsel 

of the attorneys’ fees they incurred in connection with the present motion is warranted, as 

Plaintiffs have demonstrated that LBN has failed to comply with several court orders and the 

terms of the settlement agreement incorporated therein, as discussed above. 

The Court finds that the lodestar that Plaintiffs have requested, namely $53,021.60, is fair 

and reasonable in light of the results that Class Counsel obtained in the context of the present 

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motion, the quality of the representation, the contingent nature of their compensation, and the fact 

that Class Counsel’s payment will be delayed until members of the settlement classes receive their 

compensation under the terms of the settlement agreement. The amount requested is the product10

of 69.4 hours billed at a rate of $764, which is a reasonable rate when considering the rates billed 

by counsel with similar experience for similar legal services.11 See Rathod Decl. ¶ 27 & Docket 

No. 218-8. The 69.4 hours claimed were reasonably expended on tasks that were necessary to 

bring the present motion, including investigating LBN’s compliance (or lack thereof) with the 

Court’s orders and the terms of the settlement agreement incorporated therein, communicating 

with LBN regarding the same, and researching and drafting the present motion. See id. LBN did 

not challenge the reasonableness of Class Counsel’s requested hours or hourly rates in the Ajin 

letter that LBN filed in opposition to the present motion, and it has, therefore, waived any 

objections to the same. See Perry, 759 F.2d at 706 (finding that party held in civil contempt 

waived objections to reasonableness of requested attorneys’ fees and costs because it “failed to 

challenge the reasonableness of the amount of the fee award requested before the district court”). 

Accordingly, the Court orders LBN to pay, within ten business days of the date that this 

order is filed, $53,021.60 for the attorneys’ fees that Class Counsel incurred in connection with the 

present motion. LBN shall pay this amount into a trust held by the settlement administrator and 

the amount shall not be distributed to Class Counsel until cash distributions pursuant to the 

settlement agreement and the Court’s orders are made first to members of the Former and Current 

Program Participant Payments Subclass and Sponsor Payments Subclass. 

10 Plaintiffs refer to a different amount in their motion, namely $53,022.6. That appears to 

be a typing error, as the product of $764 and 69.4 is $53,021.60. 

11 Class Counsel, Jesse Newmark and Jason Rathod, represent that they have more than 

eleven years of experience and argue that the requested hourly rate of $764 for their work is 

reasonable in light of the Laffey Matrix, which sets $764 as the reasonable hourly rate for 

attorneys with eleven to nineteen years of experience. See Rathod Decl. ¶ 27. The Laffey Matrix 

is “a widely recognized compilation of attorney and paralegal rates based on various levels of 

experience” upon which courts, including those in this district, routinely rely to determine the 

reasonableness of attorney hourly rates. See Theme Promotions, Inc. v. News Am. Mktg. FSI, Inc, 

731 F. Supp. 2d 937, 948 (N.D. Cal. 2010). The Court finds that the requested hourly rate of $764 

is reasonable in light of the Laffey Matrix and the fact that LBN did not object to the requested 

hourly rate. 

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IV. CONCLUSION

For the reasons set forth above, the Court GRANTS IN PART and DENIES IN PART

Plaintiffs’ motion for an order holding LBN in civil contempt and imposing civil contempt 

sanctions against LBN. The Court will issue a separate order delineating the civil contempt 

sanctions that the Court imposes on LBN. 

IT IS SO ORDERED. 

Dated: October 3, 2022

CLAUDIA WILKEN 

United States District Judge 

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