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LEAD ATTORNEYS IN CHARGE FOR

PLAINTIFF AND CLASS MEMBERS

James X. Bormes (pro hac vice)

Catherine P. Sons (pro hac vice)

LAW OFFICE OF JAMES X. BORMES, P.C.

Illinois State Bar No. 620268

8 South Michigan Avenue

Suite 2600

Chicago, Illinois 60603

(312) 201-0575

jxbormes@bormeslaw.com 

cpsons@bormeslaw.com

Thomas M. Ryan (Admitted pro hac vice)

LAW OFFICE OF THOMAS M. RYAN, P.C.

Illinois State Bar No. 6273422

35 East Wacker Drive

Suite 650

Chicago, Illinois 60601

(312) 726-3400

tom@tomryanlaw.com 

Attorney for Plaintiff

LOCAL COUNSEL:

Michelle R. Matheson #019568

MATHESON & MATHESON, P.L.C.

15300 North 90th Street

Suite 550

Scottsdale, Arizona 85260

(480) 889-8951

mmatheson@mathesonlegal.com 

Attorney for Plaintiff

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

TERRI HAYFORD, individually and

on behalf of all others similarly situated,

Plaintiff,

v.

MAGELLAN HEALTH, INC. 

Defendant.

Case No.: 15 cv 2643 JTT

[UNOPPOSED] MOTION FOR ORDER 

GRANTING APPROVAL OF 

COLLECTIVE ACTION SETTLEMENT, 

CONDITIONAL CERTIFICATION FOR 

SETTLEMENT PURPOSES, APPROVAL 

OF COLLECTIVE ACTION NOTICE

AND FORMS, AND MEMORANDUM OF 

POINTS AND AUTHORITIES IN 

SUPPORT THEREOF 

Case 2:15-cv-02643-JJT Document 74 Filed 05/19/17 Page 1 of 21
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TABLE OF CONTENTS

Page

I. INTRODUCTION.................................................................................................................. 3

II. BACKGROUND.................................................................................................................... 4

A. Magellan Health, Inc............................................................................................... 4

B. Terri Hayford .......................................................................................................... 4

C. “Off the Clock” Allegations.................................................................................... 4

D. “Rounding” Allegations.......................................................................................... 5

III. PROCEDURAL POSTURE .................................................................................................. 5

IV. SUMMARY OF PROPOSED SETTLEMENT TERMS....................................................... 6

A. Gross Settlement Amount....................................................................................... 6

B. Net Settlement Fund ............................................................................................... 6

C. Formula for Distribution to Participating Collective Members.............................. 7

D. Released Claims...................................................................................................... 7

E. Settlement Administration ...................................................................................... 7

V. THE PROPOSED COLLECTIVE ACTION SHOULD BE CONDITIONALLY 

CERTIFIED TO FACILITATE NOTICE TO PUTATIVE MEMBERS........................... 9

VI. THE COURT SHOULD PRELIMINARILY APPROVE THE COLLECTIVE 

ACTION SETTLEMENT................................................................................................. 11

A. Strength, Risk, Expense, Complexity, and Duration of Further Litigation .......... 11

B. The Extent of Discovery and Stage of the Proceedings Support Settlement........ 12

C. The Experience and Views of Counsel Supports Settlement Now....................... 13

D. The Proposed Settlement Is a Reasonable Compromise of Claims...................... 13

E. The Proposed Settlement Agreement Does Not Grant Preferential 

Treatment .............................................................................................................. 14

1. Award of Attorneys’ Fees and Expenses, and Service Award for 

Plaintiff ..................................................................................................... 14

VII. CONCLUSION.................................................................................................................... 15

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TABLE OF AUTHORITIES

Page(s)

Cases

Boyd v. Bechtel Corp.,

485 F. Supp. 610 (N.D. Cal. 1979)..........................................................................................12

Class Plaintiffs v. City of Seattle,

955 F.2d 1268 (9th Cir. 1992) .................................................................................................11

Does I thru XXIII v. Advanced Textile Corp., 

214 F.3d 1058 (9th Cir. 2000) ...................................................................................................9

Edwards v. City of Long Beach,

467 F.Supp.2d 986 (C.D. Cal. 2006) .......................................................................................10

Ellis v. Naval Air Rework Facility,

87 F.R.D. 15 (N.D. Cal. 1980), affd. 661 F.2d 939 (9th Cir. 1981) ........................................13

Gillings v. Time Warner Cable LLC,

No. CV 10–5565–AG, 2012 WL 1656937 (C.D. Cal. Mar. 26, 2012)....................................14

Hanlon v. Chrysler Corp.,

150 F.3d 1011 (9th Cir. 1988) .................................................................................................11

Hill v. R & L Carriers, Inc.,

690 F.Supp.2d 1001 (N.D. Cal. 2010).......................................................................................9

Hipp v. National Life Ins. Co.,

252 F 3d 1208 (11th Cir. 2001) ...............................................................................................10

Hoffman-La Roche, Inc. v. Sperling,

493 U.S. 165 (1989)...................................................................................................................9

Jacobs v. California State Auto. Ass’n Inter–Ins. Bureau,

No. C 07–0362 MHP, 2009 WL 3562871 (N.D. Cal. Oct. 27, 2009) .....................................15

Jones v. Agilysys, Inc.,

No. C 12-03516 SBA, 2014 WL 108420 (N.D. Cal. Jan. 10, 2014) .......................................15

Khanna v. Inter–Con Sec. Sys., Inc.,

No. CIV S–09–2214 KJM GGH, 2012 WL 4465558 (E.D. Cal. Sept. 25, 

2012) ........................................................................................................................................11

Linney v. Cellular Alaska Partnership,

151 F. 3d 1234 (9th Cir. 1998) ................................................................................................14

Lynn’s Food Stores, Inc. v. United States,

679 F. 2d 1350 (11th Cir. 1982) ..............................................................................................11

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McElmurry v. U.S. Bank Nat. Ass’n,

495 F.3d 1136 (9th Cir. 2007) ...................................................................................................9

In re Mego Fin. Corp. Sec. Litig.,

213 F. 3d 454 (9th Cir. 2000) ..................................................................................................14

Officers for Justice v. Civil Serv. Comm’n,

688 F.2d 615 (9th Cir. 1982) ...................................................................................................14

In re Omnivision Technologies, Inc.,

559 F. Supp. 2d 1036 (N.D. Cal. 2007)...................................................................................13

Rodriguez v. West Publishing Corp.,

563 F.3d 948 (9th Cir. 2009) ...................................................................................................15

Sanchez v. Sephora USA, Inc.,

No. C 11–3396 SBA, 2012 WL 2945753 (N.D. Cal. Jul. 18, 2012) .......................................10

Shea v. Ryla Teleservices,

2012 WL 4210291 (E.D. Cal. 2012) .......................................................................................10

Stanfield v. First NLC Fin. Servs., LLC,

No. C 06–3892 SBA, 2006 WL 3190527 (N.D. Cal., Nov. 1, 2006)......................................10

Staton v. Boeing Co.,

327 F.3d 938 (9th Cir. 2003) ...................................................................................................15

Tarlecki v. Bebe Stores, Inc.,

No. C 05–1777 MHP, 2009 WL 3720872 (N.D. Cal. Nov. 3, 2009) ......................................15

Van Bronkhorst v. Safeco Corp.,

529 F.2d 943 (9th Cir. 1976) ...................................................................................................11

Vasquez v. Coast Valley Roofing, Inc.,

670 F. Supp. 2d 1114 (E.D. Cal. 2009)......................................................................................9

Statutes

29 U.S.C. § 216(b)...........................................................................................................................9

Fair Labor Standards Act, 29 U.S.C. § 201 et seq................................................................. passim

Other:

Newberg on Class Actions (4th 2002) § 14:6 ......................................................14-15

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MOTION

TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD:

Plaintiff Terri Hayford (“Plaintiff”) submits this Motion on the grounds that Plaintiff and 

Defendant Magellan Solutions, Inc. (“Defendant”) desire to completely resolve all issues, claims, 

and disputes related to this lawsuit. As further explained in the following Memorandum of Points 

and Authorities, the Parties successfully mediated the claims in this lawsuit and entered into a 

written settlement agreement. Plaintiff accordingly moves this Court for an order granting: 

(1) Approval of a proposed settlement agreement on behalf of Plaintiff and a collective 

consisting of all persons who worked for Defendant as telephone-dedicated employees (Customer 

Services Representatives, or “CSR”, however titled) who were compensated, in part or in full, on 

an hourly basis, for the time period of September 23, 2013 through December 7, 2016, and who 

are identified by Employee ID number on Exhibit A to the Settlement Agreement1 (“Collective 

Action Settlement”);

(2) Certification of a collective action under 216(b) of the Fair Labor Standards Act for 

settlement purposes only; 

(3) Approval of the Notice of Collective Action Settlement and Claim Form;

(4) Appointment of Plaintiff’s attorneys as Collective Action Counsel;

(5) Appointment of Plaintiff as the Collective Representative; and

(6) Appointment of Dahl Administration, LLC to administer notice to putative 

Collective Action Settlement members as the Third-Party Administrator, which will inform them 

of the proposed Collective Action Settlement, and their rights to opt-in or object to the proposed 

terms.

 

1 The Settlement Agreement is being submitted for in camera review pending the Court’s ruling 

on the Parties’ motion for leave to file the agreement under seal.

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DATED this 19th day of May 2017.

/s/ James X. Bormes

James X. Bormes (pro hac vice)

Catherine P. Sons (pro hac vice)

LAW OFFICE OF JAMES X. BORMES, P.C.

Illinois State Bar No. 620268

8 South Michigan Avenue, Suite 2600

Chicago, Illinois 60603

(312) 201-0575

jxbormes@bormeslaw.com 

cpsons@bormeslaw.com

Thomas M. Ryan (pro hac vice)

LAW OFFICE OF THOMAS M. RYAN, P.C.

Illinois State Bar No. 6273422

35 East Wacker Drive

Suite 650

Chicago, Illinois 60601

(312) 726-3400

tom@tomryanlaw.com 

LOCAL COUNSEL:

Michelle R. Matheson #019568

MATHESON & MATHESON, P.L.C.

15300 North 90th Street

Suite 550

Scottsdale, Arizona 85260

(480) 889-8951

mmatheson@mathesonlegal.com 

Attorneys for Plaintiff

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MEMORANDUM OF POINTS AND AUTHORITIES

I. INTRODUCTION 

After discovery including document production and depositions as well as arm’s-length 

negotiations and a mediation, the Parties reached agreement to resolve all issues, claims, and 

disputes related to this lawsuit. Plaintiff therefore seeks approval of a proposed settlement on 

behalf of Plaintiff and a collective consisting of all persons who worked for Defendant at call 

centers located in Tempe, Arizona and St. Louis, Missouri in approximately 21 states2 as 

telephone-dedicated employees (Customer Services Representatives, or “CSR”, however titled) 

for the time period of September 23, 2013 through December 7, 2016 (“Collective Action 

Settlement”). Based upon the payroll data of Defendant, there are a total of 931 putative collective 

action members who worked at least one workweek of 40 hours or more during the relevant period, 

who collectively worked a total of 27,426 overtime workweeks, and who may potentially be 

entitled to some recovery under this Settlement (hereinafter referred to as “Members”).

Subject to Court approval, the Parties have settled the claims in this lawsuit for the gross 

settlement amount of up to $725,000.00, which includes payments for service awards, attorneys’ 

fees and costs, interest, liquidated and/or multiple damages, all costs of litigation and settlement 

administration, and any other costs, damages, or payments of any kind. For purposes of settlement 

only, Plaintiff seeks certification of a collective action under Section 216(b) of the Fair Labor 

Standards Act (“FLSA”), the appointment of Plaintiff’s attorneys as Collective Action Counsel, 

the appointment of Plaintiff as the Collective Representative, and the appointment of Dahl 

Administration, LLC as Third-Party Administrator to administer notice to putative Collective 

Action Settlement Members, which will inform them of the proposed Collection Action 

Settlement, and their rights to opt-in to the proposed terms. 

 

2 Many of Defendant’s employees worked from home. Defendant’s data indicates that the putative 

collective members who worked for Defendant’s Arizona and Missouri call centers performed 

their work in 21 different states.

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II. BACKGROUND

A. Magellan Health, Inc.

Magellan provides customer call centers to companies who desire to outsource the task of 

providing customer service representative to handle phone calls from a company’s customer. 

Magellan operates a call center on Washington Road in Tempe, Arizona, and a call center in St. 

Louis, Missouri and employs telephone-dedicated customer service representatives in over 21

different states who handle phone calls regarding various medical authorization and insurance 

inquiries, among other things. 

B. Terri Hayford

Plaintiff is a resident of Arizona. Defendant hired Plaintiff to work as an hourly, nonexempt customer services representative at Defendant’s Tempe, Arizona call center from 

approximately June 2014 to November 2014. Her job duties included answering incoming 

customer service telephone calls and operating a computer. 

C. “Off the Clock” Allegations

This lawsuit arises under the FLSA alleging that Defendant failed to pay Plaintiff and other 

similarly situated persons overtime pay for all time worked in excess of 40 hours per week. 

Plaintiff alleges that Defendant has a practice of requiring and/or permitting telephone-based 

hourly employees to work before the start of their scheduled shift time; and that Defendant 

knowingly required and/or permitted Plaintiff and other similarly situated employees to perform 

unpaid work before and after the start and end times of their shifts. Plaintiff alleges that Defendant 

was aware that Plaintiff and those similarly situated to her also performed work for Defendant on 

their break periods, for which they were not paid. 

Defendant denies any liability or wrongdoing of any kind whatsoever associated with the 

claims alleged in Named Plaintiff’s Complaint. Specifically, Defendant denies that its pay 

practices failed to comply with the FLSA, or any other federal or state law. Defendant further 

denies that the settlement shall constitute an admission, finding, or evidence that any requirement 

for representative litigation or class certification has been satisfied in this action, or that this action 

would be manageable or otherwise appropriate to be litigated as a class or collective action. Should 

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the Court not approve Settlement Agreement, Defendant expressly reserves its right to oppose 

certification of the Action as a collective action. 

D. “Rounding” Allegations

Plaintiff alleges that the telephone-dedicated customer service representatives record time 

worked by entering it into electronic timesheets using an onsite timekeeping system. Plaintiff 

alleges that the timekeeping system is configured to round each time entry to the nearest quarter 

hour. Plaintiff alleges that the rounding policy or practice has denied Plaintiff overtime 

compensation purportedly due. Defendant denies that its timekeeping system or pay practices 

failed to comply with the FLSA, or any other federal or state law. 

III. PROCEDURAL POSTURE

On December 29, 2015, Plaintiff filed a Collective Action Complaint against Defendant in 

the United States District Court for the District of Arizona. (ECF No. 1.) The complaint alleges 

that Defendant knowingly required or permitted Plaintiff “and other similarly situated telephonededicated employees to perform unpaid work before and after the start and end times of their shifts, 

including but not limited to booting up computers, initializing several computer software 

programs, reading company issued emails and instructions, and completing customer service 

calls.” (ECF No. 1, ¶ 3.) The Complaint alleges violations of the FLSA for failure to pay 

statutorily-mandated overtime, and requests certification of and notice to a group of “[a]ll persons 

who worked for Defendant as telephone dedicated employees, however titled, who were 

compensated, in part or in full, on an hourly basis at Magellan call centers at any time between 

December 28, 2012 and the present who did not receive the full amount of overtime wages earned 

and owed to them.” (Id. ¶ 65.)

On February 26, 2016, Defendant filed its Answer and Affirmative Defenses to Plaintiff’s 

Complaint. (ECF No. 35.) On April 20, 2016, Plaintiff filed her Amended Collective Action 

Complaint correcting the name of Magellan entity named as the Defendant. (ECF No. 25.) On May 

9, 2016, Defendant filed its Answer and Affirmative Defenses to Plaintiff’s Amended Complaint. 

(ECF No. 26.)

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On April 11, 2016, the Court ordered that discovery be completed by September 2, 2016, 

and Plaintiff’s motion for conditional certification would be due by October 7, 2016. (ECF No. 

19.) The Parties subsequently exchanged disclosures, Defendant responded to written discovery 

and produced timekeeping, payroll, and login data for Plaintiff, and two witnesses were deposed. 

On September 21, 2016, the Parties stipulated to a stay of proceedings to allow the Parties to 

engage in private mediation. (ECF No. 51.) Additional depositions were deferred, and the Parties 

agreed to toll the statute of limitations for potential collective Members until after the Parties’ 

mediation. 

On February 21, 2017, the Parties filed a Notice of Settlement. (ECF No. 57.) On April 

28, 2017, in recognition that the outcome of this lawsuit is uncertain and that achieving a final 

result through litigation would require substantial additional risk, fact discovery, expert discovery, 

time, and expense, the Parties reached a final agreement to resolve all claims pertaining to, arising 

from, or associated with this lawsuit. (See Exhibit 1, Settlement and Release Agreement 

(“Settlement Agreement”).) 

IV. SUMMARY OF PROPOSED SETTLEMENT TERMS

A. Gross Settlement Amount

The Parties have agreed – subject to the approval of this Court – to fully and finally resolve 

the claims in this action for a maximum gross settlement amount (“GSA”) of $725,000. This 

amount comprises all payments to individuals contemplated by the Settlement Agreement, 

including payments for service awards, attorneys’ fees and costs, interest, liquidated and/or 

multiple damages, all costs of litigation and settlement administration, and any other costs, 

damages, or payments of any kind. (Ex. 1, ¶ 1.2.)

B. Net Settlement Fund

After all Court-approved deductions to the GSA, including a reasonable service award, 

attorneys’ fees, costs of litigation, and settlement administration, the remaining net settlement 

funds (“NSF”) will be distributed to each individual consenting to join the Collective Action 

Settlement who timely submits his/her Claim Form (“Opt-In Plaintiff”). The Parties agree that 

50% of the payment to each Opt-In Plaintiff shall constitute wages from which the employer’s and 

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employee’s applicable payroll taxes shall be withheld, and 50% of the settlement payment to each 

Opt-In Plaintiff shall constitute liquidated damages. (Ex. 1, ¶ 1.8.)

C. Formula for Distribution to Participating Collective Members

Each Opt-In Plaintiff who worked two or more workweeks of 40 hours or more per 

workweek, by formula, will be allocated a pro rata share of the remaining NSF in proportion to 

the number of overtime workweeks each Opt-In Plaintiff worked as against the total number of 

overtime workweeks worked by all Members of the Collective Action Settlement. (Ex. 1, ¶ 1.7.) 

For example, if a settlement member worked 10 workweeks of 40 hours or more, that individual 

would receive $162.42. If a settlement member worked 50 workweeks of 40 hours or more, that 

individual would receive $812.00. 

D. Released Claims

Plaintiff and Opt-In Plaintiffs will release all wage and hour claims made against 

Defendant, its affiliates and related companies, including any of these entities’ predecessors and 

successors and, in their capacities as such, all of their present, past, and future directors, officers, 

employees, representatives, attorneys, insurers, reinsurers, agents, and assigns, as well as all of 

these entities’ affiliates, parent or controlling corporations, partners, divisions, and subsidiaries 

(collectively “Released Entities”), alleged in this Lawsuit, including, but not limited to, any and 

all wage and hour claims under the FLSA; any and all wage and hour claims arising out of any 

state wage, minimum wage, or overtime laws; and any claims relating to unpaid wages, minimum 

wage, and overtime compensation against the Released Entities, relative to all such claims that 

arose prior to December 7, 2016. (Ex. 1, ¶¶ 3.1, 3.2.)

E. Settlement Administration

The Parties agree by mutual agreement that Dahl Administration, LLC will handle the 

administration of the Collective Action Settlement (including notice, receipt of claims, and 

processing and mailing of settlement payments to Opt-In Plaintiffs) as Third-Party Administrator. 

Defendant will provide the name and last known mailing address of each potential Opt-In Plaintiff. 

The Third-Party Administrator will thereafter update the address through the National Change of 

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Address Update database and then mail to each individual identified a Notice of Collective Action 

Settlement, a Claim Form, and a pre-printed, postage-paid return envelope. (Ex. 1, ¶¶ 2.2, 2.3.)3

The Claim Form requires of potential Opt-In Plaintiffs only a modest showing of eligibility 

to make a valid claim for participation in the Collective Action. By signing the Claim Form, the 

potential Opt-In Plaintiff attests that she/he meets the definition of the Collective Action 

Settlement; namely, that she/he was a telephone-dedicated employee (Customer Services 

Representative, or “CSR”, however titled), employed by Defendant during the time period from 

December 29, 2012 through December 7, 2016. This modest showing not only increases 

efficiencies in administering the Collective Action Settlement without further burdensome 

validation of each claim, but allows the potential Opt-In Plaintiff to make a knowing determination 

of whether she/he meets the definition of the Collective Action Settlement, or to contact Plaintiff’s 

counsel or the Claims Administrator if the potential Opt-In Plaintiff has questions. Timely return 

of the completed and signed Claim Form is the only step required for opting-in to the Collective 

Action Settlement and receiving the applicable distribution pursuant to the Settlement Agreement. 

Within fourteen (14) days after Court’s approval of the Settlement and conditional 

certification of the collective action for settlement, the Third-Party Administrator shall mail to 

each Member of the Collective Action the Class Notice attached hereto as Exhibit 2 and the Claim 

Form attached hereto as Exhibit 3. The Third-Party Administrator will report the names of all 

timely Opt-In Plaintiffs to Collective Action Counsel and Counsel for Defendant. The opt-in 

period shall be forty-five (45) days form the day of mailing.

Within fourteen (14) days after the close of the Opt-In Period, the Third-Party 

Administrator will: (1) mail each Opt-In Plaintiff his/her respective distribution check to their last 

known address as provided by the Opt-In Plaintiff in his/her completed Claim Form; (2) mail the 

approved service award to Collective Action Counsel; and (3) pay approved attorneys’ fees, 

litigation expenses and costs to Collective Action Counsel via wire transfer. Following allocation 

 

3 The proposed Notice of Collective Action Settlement and Claim Form are attached hereto as 

Exhibits 2 and 3, respectively.

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for Defendant’s contribution to Plaintiff’s and Opt-In Plaintiffs’ payroll taxes, any remaining 

portion of the NSF for which a claim is not timely returned by an Opt-In Plaintiff or the expenses 

set forth above are paid shall remain the property of Defendant. (Ex. 1, ¶ 2.4.8.)

If any payments are returned by the postal service as undeliverable, the Third-Party 

Administrator will notify all Counsel of checks that are returned by the U.S. Postal Service, and 

will make a second and final attempt through skip-tracing to mail the returned check to the last 

known or updated address of the Opt-In Plaintiff. Checks that remain uncashed for a period of six 

months shall escheat to the state of the last known address where the Opt-In Plaintiff resides. (Ex. 

1, ¶ 2.4.9.)

V. THE PROPOSED COLLECTIVE ACTION SHOULD BE CONDITIONALLY 

CERTIFIED TO FACILITATE NOTICE TO PUTATIVE COLLECTIVE 

MEMBERS

The FLSA authorizes an employee to bring a collective action “on behalf of similarly 

situated employees, but requires that each employee opt-in to the suit by filing a consent to sue 

with the district court.” Does I thru XXIII v. Advanced Textile Corp., 214 F.3d 1058, 1064 (9th 

Cir. 2000) (citing 29 U.S.C. § 216(b)). Only those who affirmatively opt in by providing a written 

consent are bound by the results of the action. McElmurry v. U.S. Bank Nat. Ass’n, 495 F.3d 1136, 

1139 (9th Cir. 2007). The Court may conditionally certify an FLSA suit as a collective action so 

that similarly-situated employees receive notice of the action and the proposed settlement, and are 

provided with an opportunity to opt-in to the settlement. See generally, Hoffman-La Roche, Inc. 

v. Sperling, 493 U.S. 165 (1989) (noting that the FLSA requires courts to provide potential 

plaintiffs “accurate and timely notice concerning the pendency of the collective action, so that they 

can make informed decisions about whether to participate.”); see also Vasquez v. Coast Valley 

Roofing, Inc., 670 F. Supp. 2d 1114, 1124 (E.D. Cal. 2009) (“Subject to final approval at a later 

date, conditional certification of a settlement class under the FLSA is appropriate.”).

Although the FLSA does not define “similarly situated,” most federal courts in this Circuit 

have adopted a two-tiered approach to make that determination on a case-by-case basis. Hill v. R 

& L Carriers, Inc., 690 F.Supp.2d 1001, 1009 (N.D. Cal. 2010). The first step is the conditional 

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certification or notice stage, at which time the Court assesses whether potential members should 

be notified of the opportunity to opt-in to the action. Sanchez v. Sephora USA, Inc., No. C 11–

3396 SBA, 2012 WL 2945753, at *2 (N.D. Cal. Jul. 18, 2012). The second step is the final 

certification stage, which typically occurs following the completion of discovery, and, barring a 

settlement, is initiated by a motion for decertification by the defendant. See Hipp v. National Life 

Ins. Co., 252 F 3d 1208, 1218 (11th Cir. 2001). The showing to conditionally certify a FLSA 

collective action has been described as “modest” and usually “requires little more than substantial 

allegations, supported by declarations or discovery, that the putative class members were together 

the victims of a single decision, policy, or plan.” Stanfield v. First NLC Fin. Servs., LLC, No. C 

06–3892 SBA, 2006 WL 3190527, at *2 (N.D. Cal., Nov. 1, 2006) (internal quotations and 

citations omitted). “Plaintiff need not show that [her] position is or was identical to the putative 

class members’ positions; a class may be certified under the FLSA if the named plaintiff can show 

that [her] position was or is similar to those of the absent class members.” Edwards v. City of Long 

Beach, 467 F.Supp.2d 986, 990 (C.D. Cal. 2006). 

Here, the policies and practices were common among Plaintiff and all potential Opt-In 

Plaintiffs and they were all treated the same (i.e., classified as non-exempt, paid per hour, and were 

telephone dedicated employees (Customer Services Representatives, or “CSR”, however titled)). 

As such, the Parties, for purposes of the proposed Collective Action Settlement, have stipulated 

that this matter is appropriate for conditional certification under the FLSA, and accordingly request 

the Court to conditionally certify the Collective Action Settlement so that notice can be given to 

potential claimants. Courts in this Circuit have granted conditional certification of FLSA 

collective actions for purposes of settlement where Plaintiff and putative collective members are 

similarly situated. See, e.g., Shea v. Ryla Teleservices, 2012 WL 4210291, *3 (E.D. Cal. 2012) 

(“[F]or settlement purposes the Parties have stipulated that this matter is appropriate for 

conditional certification under the FLSA. The Court agrees that the named plaintiffs and putative 

plaintiffs are similarly situated.”).

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VI. THE COURT SHOULD APPROVE THE COLLECTIVE ACTION 

SETTLEMENT 

A settlement of private collective action claims under the FLSA requires court approval 

and will be approved only after the Court determines that the settlement is a “fair and reasonable 

resolution of a bona filed dispute.” Lynn’s Food Stores, Inc. v. United States, 679 F. 2d 1350, 1353 

(11th Cir. 1982). “Among the factors relevant to this determination are the course of the 

negotiations, the existence of any factual or legal questions that place the outcome of the litigation 

in doubt, the benefits of immediate recovery balanced against litigation, and the parties’ belief the 

settlement is fair.” Khanna v. Inter–Con Sec. Sys., Inc., No. CIV S–09–2214 KJM GGH, 2012 WL 

4465558, at * 11 (E.D. Cal. Sept. 25, 2012). The Court also may consider whether the settlement 

includes an incentive award to Plaintiff and the amount of fees to be paid to counsel. Id.

Courts must give “proper deference” to settlement agreements, because “the court’s 

intrusion upon what is otherwise a private consensual agreement negotiated between the parties to 

a lawsuit must be limited to the extent necessary to reach a reasoned judgment that the agreement 

is not the product of fraud or overreaching by, or collusion between the negotiating parties, and 

the settlement, taken as a whole, is fair, reasonable and adequate to all concerned.” Hanlon v. 

Chrysler Corp., 150 F.3d 1011, 1027 (9th Cir. 1988) (quotations omitted). Further, the law favors 

settlement, particularly in collective actions and other complex cases where substantial resources 

can be conserved by avoiding the time, cost, and rigors of formal litigation. See Class Plaintiffs v. 

City of Seattle, 955 F.2d 1268, 1275 (9th Cir. 1992); Van Bronkhorst v. Safeco Corp., 529 F.2d 

943, 950 (9th Cir. 1976). Approval is thus appropriate, and the Court should allow the Notice of 

Collective Action Settlement and the Claim Form to be disseminated.

A. Strength, Risk, Expense, Complexity, and Duration of Further Litigation

The Settlement Agreement was reached as a result of intensive arms-length negotiations 

between the Parties, and facilitated by an experienced, nationally recognized mediator, Hunter R. 

Hughes. While Plaintiff believes in the merits of her case, she also recognizes the inherent risks 

and uncertainty of litigation and understands the benefit of a settlement sum now as opposed to 

risking denial of collective action certification; and/or an unfavorable result on the merits on 

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summary judgment or at trial and/or on an appeal – a process which can take several more years 

to litigate.

Although Defendant has strong defenses against liability and damages, and believes

Plaintiff will face several steep hurdles going forward should this matter not resolve, it is also

mindful that there are risks and significant expenses associated with proceeding further in the case. 

The Parties have agreed to settle this lawsuit on the terms and conditions set forth in the Settlement 

Agreement in recognition that the outcome is uncertain, and that achieving a final result through 

litigation would require substantial additional risk, discovery, time, and expense.

B. The Extent of Discovery and Stage of the Proceedings Support Settlement

Although discovery is not complete, settlement at this time is appropriate to avoid 

unnecessary drawn out costs of foreseeable, complicated discovery; particularly data and expert 

discovery. To date, the Parties exchanged disclosures, Defendant responded to written discovery 

and produced payroll data and call center information for Plaintiff and phone-based customer 

service representatives who worked in approximately 21 states, and two local witnesses were 

deposed. Should the case move forward, and litigation resume, the Parties will resume extensive 

discovery comprised of additional depositions, the retaining of wage and hour testifying experts, 

and complicated data analyses for the entire population identified for purposes of settlement. It is 

anticipated that discovery will be followed by conditional certification proceedings and 

decertification proceedings including dispositive motion practice. 

Plaintiff asserts that settlement of this action now will bestow substantial economic benefits 

to the Collective Action members, especially in light of the uncertainty regarding recovery and the 

costs of continued litigation. The proposed Collective Action Settlement before this Court comes 

only after this matter has been fully investigated by Counsel, as the Parties have thoroughly 

investigated and evaluated the strengths and weaknesses of their respective cases, and have 

engaged in sufficient discovery. This litigation has reached the stage where the Parties certainly 

have a clear view of the strengths and weaknesses of their cases sufficient to support the approval 

of the Settlement Agreement. Boyd v. Bechtel Corp., 485 F. Supp. 610, 622 (N.D. Cal. 1979).

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C. The Experience and Views of Counsel Supports Settlement Now

The proposed Settlement was reached through a fair compromise of disputed claims arrived 

at through substantial exchange of information and data analysis followed by a full day of arm’slength negotiations before a respected and nationally-recognized mediator with expertise in the 

relevant field, Hunter R. Hughes. Furthermore, James X. Bormes of the Law Office of James X. 

Bormes, P.C., Thomas M. Ryan of the Law Office of Thomas M. Ryan, P.C., and Michelle R. 

Matheson of Matheson & Matheson, P.L.C. (together, “Collective Action Counsel”) each have 

significant experience in litigating overtime and other wage and hour class and collective cases, 

and have obtained certification in these types of cases. Likewise, Defendant’s counsel, Mark 

Ogden and Cory G. Walker of Littler Mendelson, P.C. also are particularly experienced in complex 

wage and hour employment law matters and class and collective actions. 

Experienced counsel, operating at arms-length, have weighed the strengths of the case and 

examined all of the issues and risks of litigation and endorse the proposed Collective Action 

Settlement. Counsel for all Parties believe, in view of the costs, risks, and delay of continued 

litigation, balanced against the benefits of settlement, that settlement at this time represents a fair, 

reasonable, and adequate resolution. Views of counsel conducting litigation “are “entitled to 

significant weight” in deciding whether to approve a settlement. Ellis v. Naval Air Rework Facility, 

87 F.R.D. 15, 18 (N.D. Cal. 1980), affd. 661 F.2d 939 (9th Cir. 1981). Accordingly, “[t]he 

recommendations of plaintiffs’ counsel should be given a presumption of reasonableness.” In re 

Omnivision Technologies, Inc., 559 F. Supp. 2d 1036, 1043 (N.D. Cal. 2007).

D. The Proposed Settlement Is a Reasonable Compromise of Claims

Based upon information exchanged, liability is contested on the basis that the Parties 

disagree that Plaintiff is similarly situated to the population of allegedly disadvantaged employees 

she seeks to represent. The overall assessment of claim viability, even assuming certification, 

presents several significant difficulties, including substantial costs – both in legal expenses and 

business interruption – of defending a statistical wage and hour claim involving both digitally 

stored data and the research of data archived in manual records. While Plaintiff is firmly convinced 

that work was permitted and performed off-the-clock and/or hours worked were improperly 

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rounded, this is not a given. Courts in this Circuit follow the federal rule and allow employers to 

round as long as the rounding policy is facially neutral and evenhandedly applied. Gillings v. Time 

Warner Cable LLC, No. CV 10–5565–AG, 2012 WL 1656937, at *5 (C.D. Cal. Mar. 26, 2012) 

(neutral rounding practices permissible since “net effect does not withhold wages”).

In the face of these uncertainties, the Parties agree to a compromise of a claims made 

settlement of up to $725,000.00. A settlement is not judged solely against what might have been 

recovered had Plaintiff prevailed at trial, nor does the settlement have to provide 100% of the 

damages sought to be fair and reasonable. In re Mego Fin. Corp. Sec. Litig., 213 F. 3d 454, 459 

(9th Cir. 2000). The adequacy of the amount recovered must be judged as “a yielding of absolutes 

. . . [n]aturally, the agreement reached normally embodies a compromise; in exchange for the 

saving of cost and elimination of risk, the parties each give up something they might have won 

had they proceeded with litigation.” Officers for Justice v. Civil Serv. Comm’n, 688 F.2d 615, 624 

(9th Cir. 1982) (citation omitted). “It is well-settled law that a cash settlement amounting to only 

a fraction of the potential recovery does not . . . render the settlement inadequate or unfair.” Id. at 

628. Accordingly, the proposed settlement value is not to be judged against a speculative measure 

of what might have been achieved and is well within the range of reasonableness; and should be 

granted approval. Linney v. Cellular Alaska Partnership, 151 F. 3d 1234, 1242 (9th Cir. 1998). 

E. The Proposed Settlement Agreement Does Not Grant Preferential Treatment

No member of the Collective Action Settlement will be discriminated against under the 

terms of the proposed Settlement Agreement. The proposed Settlement Agreement provides, 

subject to the Court’s approval, a service award to Plaintiff in connection with the prosecution of 

this action, and allows that Collective Action Counsel be paid a fee of 33.33% of the gross amount 

of $725,000 plus costs of $20,000. The proposed Settlement Agreement does not condition the 

Collective Action Settlement on the Court’s issuance of any such awards.

1. Award of Attorneys’ Fees and Expenses, and Service Award for Plaintiff

Collective Action Counsel are requesting reimbursement of their litigation expenses and 

an award of fees – not to exceed 33.33% of the GSA, or an amount approved by the Court, and 

expenses not to exceed $20,000. (Ex. 1, ¶ 1.6; see also, Ex. 4, ¶ 21; Newberg on Class Actions 

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(4th 2002) § 14:6 (“fee awards in class actions average around one-third of the recovery”)). Courts 

have discretion to award incentive fees to named representatives. Rodriguez v. West Publishing 

Corp., 563 F.3d 948, 958 (9th Cir. 2009). These fees “are intended to compensate [collective] 

representatives for work done on behalf of the class, to make up for financial or reputational risk 

undertaken in bringing the action, and, sometimes, to recognize their willingness to act as a private 

attorney general.” Id. at 958-59; see also Staton v. Boeing Co., 327 F.3d 938, 977 (9th Cir. 2003) 

(in assessing the propriety of an incentive award, courts consider “the actions the plaintiff has 

taken to protect the interests of the class, the degree to which the class has benefitted from those 

actions, . . . [and] the amount of time the plaintiff expended in pursuing the litigation.”); Tarlecki 

v. Bebe Stores, Inc., No. C 05–1777 MHP, 2009 WL 3720872, at *5 (N.D. Cal. Nov. 3, 2009).

Here, the proposed service award is fair and reasonable. Collective Action Counsel may 

request on behalf of Plaintiff $7,500 for her time, effort, and risks undertaken for the payment of 

costs in the event this action had been unsuccessful. (Ex. 1, ¶1.5; Ex. 4, ¶ 20.). See, e.g., Jones v. 

Agilysys, Inc., No. C 12-03516 SBA, 2014 WL 108420, at *3 (N.D. Cal. Jan. 10, 2014) 

(preliminarily finding an award of $5,000 as incentive payment for each of the six named plaintiffs 

presumptively reasonable); Jacobs v. California State Auto. Ass’n Inter–Ins. Bureau, No. C 07–

0362 MHP, 2009 WL 3562871, at *5 (N.D. Cal. Oct. 27, 2009) (noting that “a $5,000 [incentive] 

payment is presumptively reasonable”).

VII. CONCLUSION

For the foregoing reasons, Plaintiff respectfully requests that the Court approve the 

Collective Action Settlement for settlement purposes only, approve the Proposed Notice of 

Collective Action Settlement and Claim Form, appoint Plaintiff’s attorneys as Collective Counsel, 

appoint Plaintiff as the Collective Representative, appoint Dahl Administration, LLC to administer 

notice to putative Collective Action Settlement members, and enter the proposed Approval Order 

attached hereto as Exhibit 5. This Motion is unopposed by Defendant.

DATED this 19th day of May 2017.

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/s/ James X. Bormes

James X. Bormes (pro hac vice)

Catherine P. Sons (pro hac vice)

LAW OFFICE OF JAMES X. BORMES, P.C.

Illinois State Bar No. 620268

8 South Michigan Avenue, Suite 2600

Chicago, Illinois 60603

(312) 201-0575

jxbormes@bormeslaw.com 

cpsons@bormeslaw.com

Thomas M. Ryan (pro hac vice)

LAW OFFICE OF THOMAS M. RYAN, P.C.

Illinois State Bar No. 6273422

35 East Wacker Drive

Suite 650

Chicago, Illinois 60601

(312) 726-3400

tom@tomryanlaw.com 

LOCAL COUNSEL:

Michelle R. Matheson #019568

MATHESON & MATHESON, P.L.C.

15300 North 90th Street

Suite 550

Scottsdale, Arizona 85260

(480) 889-8951

mmatheson@mathesonlegal.com 

Attorneys for Plaintiff

 

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CERTIFICATE OF SERVICE

I hereby certify that on May 19, 2017, I electronically transmitted the foregoing document 

to all counsel of record via the Court’s CM/ECF system, which will send notification of such filing 

to the following at their e-mail addresses on file with the Court: 

Mark Ogden

Cory G. Walker

Littler Mendelson, P.C.

2425 E. Camelback Road, Suite 900

Phoenix, AZ

85016-2907

mogden@littler.com

cgwalker@littler.com

/s/ James X. Bormes

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