AFROUZ NIKMANESH, ELVIS - Good Jobs FirstNOTICE OF MOTION AND MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT OF THE TRAINING COURSE CLAIMS Eric M. Epstein, SBN 64055 Mark

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NOTICE OF MOTION AND MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT OF THE TRAINING COURSE CLAIMS

Eric M. Epstein, SBN 64055 Mark R. Thierman, SBN 72913 Eric M. Epstein, APC Joshua D. Buck, SBN 258324 1901 Avenue of the Stars, #1100 Thierman Buck LLP Los Angeles, CA 90067-6002 7287 Lakeside Drive 310/552-5366 Reno, NV 89511 [email protected] 775/284-1500 [email protected] Dayton B. Parcells, III, SBN 127495 [email protected] Parcells Law Firm 1901 Avenue of the Stars, #1100 Los Angeles, CA 90067 310/201-9882 [email protected] Attorneys for Plaintiffs

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA – SOUTHERN DIVISION

AFROUZ NIKMANESH, ELVIS ATENCIO, ANNA NGUYEN, AND EFFIE SPENTZOS, on behalf of themselves, the general public, and all others similarly situated, Plaintiffs, vs. WAL-MART STORES, INC., a Delaware corporation, and WAL-MART ASSOCIATES, INC., a Delaware corporation, and DOES 1 through 10, inclusive, Defendants.

Case No.: 8:15-cv-00202 AG-JCG NOTICE OF MOTION AND MOTION FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT OF THE TRAINING COURSE CLAIMS; MEMORANDUM OF POINTS AND AUTHORITIES; DECLARATION OF ERIC M. EPSTEIN; [PROPOSED] ORDER

Judge: Hon. Andrew J. Guilford Date: October 17, 2016 Time: 10:00 a.m. Ctrm: 10D

Trial: March 7, 2017

Case 8:15-cv-00202-AG-JCG Document 125 Filed 09/02/16 Page 1 of 32 Page ID #:4604

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1 NOTICE OF MOTION AND MOTION FOR PRELIMINARY APPROVAL

OF CLASS ACTION SETTLEMENT OF THE TRAINING COURSE CLAIMS

TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD:

PLEASE TAKE NOTICE that on September 26, 2016, at 10:00 a.m. in

Courtroom 10D of the above entitled Court, Plaintiffs, Afrouz Nikmanesh

(“Nikmanesh”), Effie Spentzos (“Spentzos”), Anna Nguyen (“Nguyen”) and Elvis

Atencio (“Atencio”), on behalf of themselves individually (collectively “Plaintiffs”),

and on behalf of all others similarly situated, hereby move the Court for preliminary

approval of the Parties’ settlement and for entry of an Order:

1. Granting preliminary approval of the class action settlement reached

between the Parties as set forth in the Parties’ Settlement Agreement (the “Settlement

Agreement”), which is attached as Exhibit A to the Declaration of Eric M. Epstein,

filed concurrently herewith in support of Plaintiffs’ Motion for Preliminary Approval

of Class Action Settlement (“Epstein Dec.”);

2. Conditionally certifying the Settlement Class;

3. Approving the Notice of Settlement of Class Action Litigation (in the

form set forth in Exhibit 3 to the Settlement Agreement);

4. Approving the Claim Form (in the form set forth in Exhibit 1 to the

Settlement Agreement);

5. Approving Nikmanesh, Spentzos, Nguyen and Atencio as Class

Representatives;

6. Approving Eric M. Epstein, APC, Thierman Buck, LLP, and the Parcells

Law Firm as Class Counsel;

7. Approving Simpluris, Inc. as the Claims Administrator;

8. Approving the establishment of a Qualified Settlement Fund pursuant to

Treas. Reg. §1.468B-1;

9. Scheduling the date for the final approval hearing; and ///


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10. Entering the [Proposed] Order Preliminarily Approving Class Action

Settlement Agreement filed herewith.

This Motion is made on the grounds that the proposed settlement reached by

the Parties is fair and reasonable and the product of informed, non-collusive

negotiations by the Parties who were represented by experienced counsel with the

assistance of a well-respected mediator. The Motion is based on this Notice, the

accompanying Memorandum of Points and Authorities, the Declaration of Eric M.

Epstein, the exhibits attached thereto including the Settlement Agreement, the

proposed Notice of Settlement of Class Action Litigation, the proposed Claim Form,

the Court’s record of this action, all matters of which the Court may take notice, and

such further evidence as the Court may receive.

DATED: September 2, 2016 Respectfully submitted, THIERMAN BUCK LLP PARCELLS LAW FIRM ERIC M. EPSTEIN, APC By: s/ Eric M. Epstein______________

ERIC M. EPSTEIN Attorneys for Plaintiffs


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i NOTICE OF MOTION AND MOTION FOR PRELIMINARY APPROVAL


TABLE OF CONTENTS

MEMORANDUM OF POINTS AND AUTHORITIES ...................................... 3

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

II. PROCEDURAL HISTORY OF THE CASE ............................................. 4

PRELIMINARY FACTS ........................................................................................ 6

THE TRAINING COURSE CLAIMS ................................................................... 6

REST BREAK CLAIMS ......................................................................................... 7

NIKMANESH INDIVIDUAL CLAIMS ............................................................... 7

III. SUMMARY OF PLAINTIFFS’ TRAINING COURSE CLAIMS ......... 7

A. The Training Course Was Not Voluntary ........................................ 8

B. The Training Course Is Directly Related To The Pharmacists’

Job ......................................................................................................... 8

WAL-MART DEFENSES....................................................................................... 8

C. Waiting Time Penalties ..................................................................... 10

IV. DESCRIPTION OF SETTLEMENT ....................................................... 10

A. Class Settlement Amount ................................................................. 10

B. The Settlement Class ......................................................................... 11

C. Net Settlement Amount .................................................................... 11

D. Calculation of Settlement Class Member Payments ...................... 12

E. Timing and Manner of Payment ..................................................... 12

F. Tolerance of Opt-Outs ...................................................................... 12

G. Release by the Settlement Class ....................................................... 13


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ii NOTICE OF MOTION AND MOTION FOR PRELIMINARY APPROVAL


H. General Release by Plaintiffs Nikmanesh, Spentzos, Nguyen

and Atencio ........................................................................................ 13

I. No Publicity........................................................................................ 13

J. Confidentiality ................................................................................... 13

K. Class Counsel ..................................................................................... 13

L. Attorneys’ Fees and Costs ................................................................ 15

M. Class Representatives ....................................................................... 15

N. Class Administration ........................................................................ 17

O. Qualified Settlement Fund ............................................................... 17

P. CAFA and Labor Code Notice ......................................................... 18

Q. Final Approval Order ....................................................................... 18

V. THE SETTLEMENT MEETS THE CRITERIA FOR

PRELIMINARY APPROVAL ................................................................... 19

A. The Settlement Class Should be Certified for Settlement

Purposes ............................................................................................. 20

B. The Proposed Settlement is Fair, Reasonable and Adequate ....... 20

1. The Settlement is Fair .................................................................. 21

2. The Settlement is Reasonable ..................................................... 23

3. The Settlement is Adequate ......................................................... 25

C. The Notice Adequately Informs Class members of the

Settlement ........................................................................................... 26

VII. CONCLUSION ............................................................................................ 27


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iii NOTICE OF MOTION AND MOTION FOR PRELIMINARY APPROVAL


TABLE OF AUTHORITIES

FEDERAL STATUTES AND REGULATIONS

29 CFR 785.27 ............................................................................................................... 9

Fair Labor Standards Act (“FLSA”) .............................................................................. 4

Treas. Reg. §1.468B-1 ............................................................................................. 1, 17

Treasury Regulation §1.468B-1(c), C.F.R. §1.468B-1(c), .......................................... 18

FEDERAL CASES

Acosta v. Equifax Info. Servs. LLC, 243 F.R.D. 377,386 (C.D. Cal. 2007) .............. 20

Alberto v. GMRI, Inc., 252 F.R.D. 652, 658 (E.D. Cal. 2008) (citing Class Plaintiffs v. City of Seattle, 955 F.2d 1268, 1276 (9th Cir. 1992)). ........................................ 19

City of Detroit v. Grinnell Corp., 495 F .2d 448, 463 (2d Cir. 1974) ......................... 26

In re Activision Securities Litigation, 723 F.Supp. 1373, 1378 (N.D. Cal. 1989) ...... 22

Jimenez v. JPMorgan Chase & Co., Case No. 08cv0152 W (WMc), 2008 U.S. Dist. LEXIS 72605, *2 (S.D. Cal. Sept. 23, 2008) ........................................................... 19

League of Martin v. City of Milwaukee, 588 F. Supp. 1004 (E.D. Wis. 1984) .......... 23

Linney v. Cellular Alaska P’ship, 151 F .3d 1234, 1242 (9th Cir. 1998) ................... 26

Local Joint Executive Bd., 244 F.3d at 1163............................................................... 25

Lynn’s Food Stores, Inc. v. United States, 679 F.2d 1350, 1352-53 (11th Cir. 1982). .................................................................................................................................. 19

Molski v. Gleich, 318 F.3d 937,944 (9th Cir. 2003) .................................................. 21

Officers for Justice, 688 F.2d at 634 ........................................................................... 26

Vincent v. Hughes Air West, Inc., 557 F.2d 759, 769 (9th Cir. 1977) ....................... 22

STATE STATUTES AND REGULATIONS

California Business and Professions Code .................................................................... 4

California Labor Code ............................................................................................. 4, 18

Private Attorneys General Act (“PAGA”) .................................................................... 4


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iv NOTICE OF MOTION AND MOTION FOR PRELIMINARY APPROVAL


STATE CASES

Koehl v. Verio, 142 Cal. App. 4th 1313, 1328 (2006) ................................................ 23

OTHER AUTHORITIES Manual for Complex Litigation (Fourth)......................................................... 19, 21, 26

Newberg on Class Action § 14:6 (4th ed. 2008); ........................................................ 22


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MEMORANDUM OF POINTS AND AUTHORITIES Plaintiffs, Afrouz Nikmanesh (“Nikmanesh”), Effie Spentzos (“Spentzos”),

Anna Nguyen (“Nguyen”) and Elvis Atencio (“Atencio”), on behalf of themselves,

(collectively “Plaintiffs”), and on behalf of all others similarly situated, hereby submit

this Memorandum of Points and Authorities in support of their Motion for Preliminary

Approval of Class Action Settlement (the “Motion”).

I. INTRODUCTION

The Parties have reached a full and final settlement of all issues in this case

related to Plaintiffs’ claims that Wal-Mart did not properly compensate Plaintiffs and

the class members for time spent on the home study and test portions of the Wal-Mart

Sponsored APhA Immunization Certification and Training Course (“the Training

Course Claims”).

The Parties’ settlement will resolve all the claims for the allegations raised in the

litigation, except the rest break claims, the Unfair Competition and PAGA causes of

action predicated on the rest break claims, and the individual claims of Nikmanesh.

The complete terms of the settlement are stated in the Settlement Agreement

(“Settlement Agreement”) a copy of which is attached as Exhibit A to the Declaration

of Eric M. Epstein (“Epstein Dec.”) filed concurrently with this Motion. Therefore,

Plaintiffs file this Motion asking that the Court grant preliminary approval of the

settlement and approval of the Notice of Settlement of Class Action Litigation attached

as Exhibit 3 to the Settlement Agreement (the “Notice”) that will be mailed to the

Settlement Class Members advising them of the critical settlement terms. Plaintiffs

also request preliminary approval of the Claim Form attached as Exhibit 1 to the

Settlement Agreement (the “Claim Form”). Plaintiffs also ask that the Court approve

Simpluris, Inc. as the Claims Administrator; approve Eric M. Epstein, APC, Thierman

Buck, LLP, and the Parcells Law Firm as Class Counsel, and Nikmanesh, Spentzos,

Nguyen, and Atencio as Class Representatives. Finally, Plaintiff requests entry of the

[Proposed] Order Preliminarily Approving Class Action Settlement, which is also filed


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herewith.

II. PROCEDURAL HISTORY OF THE CASE

On December 8, 2014, Plaintiff, Afrouz Nikmanesh filed a Complaint against

Wal-Mart Stores, Inc. and Wal-Mart Associates, Inc. in the Superior Court of

California for the County of Orange, Case No. 30-2014-00760054-CU-OE-CXC.

Afrouz Nikmanesh then filed a First Amended Complaint before the case was

removed to the United States District Court for the Central District of California,

Southern Division. Thereafter, the Plaintiffs filed a Second Amended Complaint,

which is the operative pleading in the Litigation.

The Second Amended Complaint asserts 12 causes of action. Those causes of

action include the Nikmanesh Individual Claims (as defined in the Settlement

Agreement, ¶2.21), as well as ten class claims, including claims under the Fair Labor

Standards Act (“FLSA”), various wage and hour claims under the California Labor

Code, the Private Attorneys General Act (“PAGA”) and the Unfair Competition

provisions of the California Business and Professions Code, and a claim for breach of

contract. [Doc. 25.]

On June 15, 2015, Plaintiffs filed a Motion for Conditional Certification of an

FLSA Collective Action based upon Wal-Mart’s alleged failure to pay overtime

wages relating to the home-study and test portions of the Wal-Mart sponsored APhA

Immunization Certification Training Course (the “Training Course”). [Doc. 52.]

On June 29, 2015, Wal-Mart filed an Answer to the Second Amended

Complaint, denying all of the allegations contained therein and asserting numerous

Affirmative Defenses. [Doc. 57.]

On July 20, 2015, Wal-Mart filed its Opposition to Plaintiffs’ Motion for

Conditional Certification related to the Training Course Class. [Doc. 59.]

On August 3, 2015, Plaintiffs filed their Reply in support of their Motion to

conditionally certify the Training Course Class. [Doc. 63.]

///


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On August 18, 2015, the Court granted Plaintiffs’ Motion for Conditional

Certification of the Training Course Class, and appointed Eric M. Epstein, APC,

Thierman Buck, LLP, and the Parcells Law Firm as Class Counsel. The Training

Course Class conditionally certified by the Court was defined as follows:

“All current and former non-exempt employees, employed by

Defendants as pharmacists in the United States, who took the Wal-Mart

sponsored APhA Immunization Certification Training Course (the

“Training Course”) during their employment within 3 years of the filing

of the original Complaint until the day of the judgment, and were not

paid any wages for the home-study and test portion of the Training

Course (the “Training Course Class”). [Doc. No. 71.]

On or about September 24, 2015, Notice was circulated to eligible collective

action members of the Training Course Class. A total of 416 individuals who received

Notice of Conditional Certification, not including the Plaintiffs, filed Consent to Join

forms. (See Declaration of Eric M. Epstein filed concurrently herewith, “Epstein

Dec.”, ¶25.)

After receipt of the aforesaid 416 Opt-Ins, the Parties conducted further

investigation with respect to said Opt-Ins. Said investigation indicated that 163 of said

Opt-Ins were not eligible Training Course Class members. Accordingly, on August 19,

2016, the Parties ultimately stipulated to remove 163 Opt-Ins from the FLSA Training

Course Class and to dismiss their FLSA Claims. [Doc. 115.] On August 25, 2016 the

Court entered an Order removing said Opt-Ins and dismissing their FLSA claims

without prejudice. [Doc. 116.]

On May 13, 2016, the Parties attended a Mediation before Michael Loeb, a

highly respected and experienced Mediator of class action matters. Although the

Parties did not settle the matter at the Mediation, the Parties were able to narrow their

differences with respect to the Training Course Class and agreed to continue to

negotiate. (Epstein Dec., ¶37.)


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On June 1, 2016, Plaintiffs filed a Motion for Class Certification pursuant to

Rule 23 of the Federal Rules of Civil Procedure, requesting that the Court certify a

California-only Rest Break Class, and a California Overtime Class for failure to pay

overtime for the home-study and test portions of the Training Course. The hearing on

said Motion is scheduled for September 26, 2016.1 [Doc. 103.]

On or about June 21, 2016, with the continued assistance of the Mediator, the

Parties reached a settlement in principle of all the claims related to the Training Course

Class. (Epstein Dec., ¶38.)

PRELIMINARY FACTS

This lawsuit includes class-action wage and hour claims brought on behalf of a

putative class of Pharmacists who work at Wal-Mart both in California, as well as the

United States. It also includes individual wrongful termination and retaliation claims

brought by Nikmanesh. The case consists of three (3) distinct categories of claims as

follows [Doc. 25]:

THE TRAINING COURSE CLAIMS

Plaintiffs’ claims are based on allegations that Wal-Mart failed to pay Plaintiffs

and putative Class Members for time spent on the home-study and test portions of the

Training Course. Plaintiffs allege that the Training Course was not voluntary, it was

directly related to their job as Pharmacists, and Wal-Mart was required by law to pay

for the entire Training Course, including the home-study and test portions. There are

approximately 253 eligible FLSA collective Class Members who have opted-in to the

Class, plus the Plaintiffs. There are approximately 494 additional California putative

Training Course Class Members.2 (Epstein Dec., ¶27.) Based on the Declarations

1 In accordance with the Court’s order dated August 29, 2016, Wal-Mart’s opposition to Plaintiffs’ Rule 23 Motion for Class Certification due on September 2, 2016 need not address the Training Course allegations (that is, that it only address the remaining rest break allegations). [Doc. 122.] 2 These do not include approximately 100 California Pharmacists who opted into the FLSA Collective Action.


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filed in support of Plaintiffs’ Motion for Rule 23 Class Certification (Docs. 103 and

103-7), it is Plaintiff’s contention that the home-study and test portions of the

Training Course took an average of approximately 12 hours to complete. This is the

unpaid overtime for which Plaintiffs are seeking compensation. Wal-Mart denies

Plaintiff’s allegations.

REST BREAK CLAIMS

The putative Rest Break Class consists of approximately 1250 non-exempt

hourly Pharmacists employed by Wal-Mart in California during the applicable time

period. The crux of the claim is that as a result of several Wal-Mart policies,

Plaintiffs allege that the Pharmacists were prevented or discouraged from taking their

legally mandated rest periods uninterrupted by work. Plaintiffs further allege that as a

result of Wal-Mart’s policies each Pharmacist missed at least one (1) rest break

virtually every day that they worked. Wal-Mart denies Plaintiffs’ allegations.

NIKMANESH INDIVIDUAL CLAIMS

Nikmanesh has individual claims for wrongful termination and retaliation based

on both discrimination and being a “whistle blower”. Wal-Mart denies all her claims.

III. SUMMARY OF PLAINTIFFS’ TRAINING COURSE CLAIMS3

Plaintiffs’ Training Course claims are based on allegations that Wal-Mart

required Plaintiffs and Putative Class Members to attend and complete a Wal-Mart

sponsored APhA Immunization Certification Training Course (the “Training Course”)

so that Wal-Mart could provide immunization services to its customers, keep up with

the competition and increase its revenues and profits. In 2013 Wal-Mart rolled out a campaign to ensure Pharmacists became

immunization certified with the goal that all stores would provide immunization services by September 2014. Only a Pharmacist can a administer immunizations. Pharmacists must be certified in order to be able to lawfully provide immunizations.

3 The following are Plaintiffs’ allegations, which Wal-Mart denies.


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In order to be certified they must first attend and complete an approved certification course. Wal-Mart arranged for current Pharmacist employees to attend the Training Course which was the only one approved by Wal-Mart for Pharmacists to attend. In order to successfully complete the Training Course and become certified, the Pharmacists were required to complete a self-study and test portion prior to attending the classroom portion of the Training Course. While Wal-Mart paid for the cost of the Training Course itself and paid wages to Pharmacists for their time taking the live classroom portion of the Training Course, Wal-Mart did not pay wages for the time it took Pharmacists to complete the required home-study and test portions of the Training Course. (Epstein Dec., ¶¶28 and 29.)

A. The Training Course Was Not Voluntary Even prior to Wal-Mart’s decision to make immunization certification a

“minimum” job qualification, Wal-Mart made clear to its Pharmacists, in a variety of ways, that the Training Course was required. [Doc. 103-7.] Indeed, it is Plaintiff’s position that Wal-Mart’s decision to make immunization certification a preferred qualification in 2014 and then a minimum qualification in 2015 confirms that Wal-Mart always intended to have Pharmacists be certified to administer immunizations to Wal-Mart customers. (Epstein Dec., ¶30.) B. The Training Course Is Directly Related To The Pharmacists’ Job

Plaintiff contends that the Training Course at issue here was not for the benefit of the employee. Instead, it was for the benefit of Wal-Mart to offer additional pharmacy services to its customers, compete with other national chains such as CVS and Walgreens, and increase its revenues. Wal-Mart incorporated into the general job duties of its Pharmacist employees the duty of providing immunization shots to Wal-Mart customers and provided standard operating procedures for the administration of immunizations. [Epstein Dec., ¶31; Docs. 103 and 103-7.]

WAL-MART’S DEFENSES

Wal-Mart denies Plaintiffs’ allegations and asserts that the Training Course was

voluntary and not directly related to the Pharmacists’ jobs as Wal-Mart Pharmacists.


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Specifically, among other things, Wal-Mart contends that no Pharmacist was forced to

take the Training Course and no adverse consequences resulted to any Pharmacists

who did not take the Course. Wal-Mart further contends that an exception to the

payment of time spent in Training Courses, as set forth in 29 CFR 785.27 applies to

this case. That exception provides that if the Course if voluntary and not directly

related to the employee’s job, it is not compensable.

Wal-Mart further contends that it does not have to pay for the home-study and

test portions of the Training Course, pursuant to the special circumstance exception set

forth in 29 CFR 785.31, which states as follows:

“Special Situations. There are some special situations where the time

spent in attending lectures, training sessions and course of instruction is

not regarded as hours worked. For example, an employer may establish

for the benefit of its employees a program of instruction which

corresponds to courses offered by independent bona fide institutions of

learning. Voluntary attendance by an employee at such courses outside

of working hours are not the hours worked, even if it directly related to

his job, or paid for by the employer.”

Wal-Mart claims because employees could receive continuing education credits

for their Pharmacy Certification, the Training Course qualifies under that special

circumstances exception.

Wal-Mart also contends the Training Course allegations are not properly subject

to class certification. Among other things, highly individualized issues exist as to

whether the Training Course was voluntary, particularly given that no written or

uniform policy as to the Training Course exists, and Plaintiffs’ theory relies on

thousands of unique communications among Divisional Directors, Regional Directors,

Market Directors, Pharmacy Managers, and Pharmacists.

In any event, as set forth above, the issues of whether or not the Training Course

was voluntary, whether it was directly related to the Pharmacists’ job as Wal-Mart


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Pharmacists, and whether or not the special situation exception applies, are hotly

contested issues. (Epstein Dec., ¶¶32-35.) C. Waiting Time Penalties

The Settlement also includes a release of waiting time penalties. There are approximately 106 putative Class Members who were employed in California and whose employment was terminated. Plaintiffs allege they would be entitled to waiting time penalties if Plaintiffs prevailed on their overtime claims for Wal-Mart’s failure to pay for the home-study and test portions of the Training Course. Wal-Mart, on the other hand, contends that, even if Plaintiffs prevail, waiting time penalties would not be awarded. Among other things, such penalties are discretionary with the Court, and Wal-Mart contends that it did not willfully fail to make such payments at the time of termination but reasonably believed that the putative Class Members were not entitled to any compensation for the home-study and test portions of the Training Course. (Epstein Dec., ¶36.) Accordingly, the failure to pay for the home-study and test portions of the Training Course, even if found to be compensable, would not necessarily lead to waiting time penalties for putative Class Members who are no longer employed by Wal-Mart, unless Plaintiffs could establish that such failure to pay was willful and the Court exercised its discretion and awarded such penalties. This is also a hotly disputed issue.

IV. DESCRIPTION OF THE SETTLEMENT

A. Class Settlement Amount

Under the terms of the Settlement Agreement, Wal-Mart has agreed to pay, on a

claims made basis but with no reversion, a maximum of Eight Hundred Thousand

Dollars ($800,000.00) defined as the “Class Settlement Amount”. (See Settlement

Agreement attached to the Epstein Dec. ¶2, Exhibit 1, §2.10). Payments by Wal-Mart

pursuant to the Settlement Agreement will resolve all “Settled Matters” as defined in

§2.32 of the Settlement Agreement. Subject to Court approval, the Class Settlement

Amount will include Class Member payments, all attorneys’ fees and costs, claims


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administration fees, Incentive Payments to the Plaintiffs and payment to the LWDA.

In addition to that amount, Wal-Mart will also pay the employer’s share of taxes

(Settlement Agreement ¶¶5.1.1.2, 5.1.1.3, 5.1.2.1, 5.1.3.1, 5.1.4.1, and 5.1.5.1).

B. The Settlement Class

The Settlement Class consists of: (1) all current and former hourly pharmacists

who, during the Settlement Class Period, worked as an hourly pharmacist at Wal-Mart

in the State of California and took the APhA Training Course while working as an

hourly pharmacist in the State of California; and (2) all persons who opted into the

Litigation by way of a consent-to-join form and who the Parties have not stipulated to

dismiss. (Settlement Agreement at ¶¶ 2.26, 2.31, and 2.34.)

Pursuant to the terms of the Settlement Agreement, Plaintiffs seek preliminary

approval of this class action settlement and asks the Court to certify the Settlement

Class for purposes of this settlement only.4 Of course, if the settlement is not granted

final approval, then the certification for settlement will be null and void and the fact

that the case was certified for settlement will have no impact on future proceedings.

(Settlement Agreement at ¶¶ 4.1, 4.2, 17.1.)

C. Net Settlement Amount

The Net Settlement Amount (“NSA”) is defined as the amount remaining from

the Class Settlement Amount after deducting Court approved Class Counsel’s

attorneys’ fees and costs, all Class Representative Incentive awards, the Claims

Administrator’s fees, and payment to the LWDA. (Settlement Agreement ¶ 2.20.)

Subject to the Court’s approval, the Parties anticipate the NSA will be roughly Four

Hundred Twenty-Five Thousand and 00/100 Dollars ($425,000.00) which will be

available for distribution to the Class Members who submit valid Claim Forms. Each

Settlement Class Member who submits a timely Claim Form will be entitled to a

proportional share of the Net Settlement Amount (“NSA”). (Settlement Agreement,

4 The FLSA class has already been conditionally certified by the Court [Doc. 71].


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¶¶5.1.1.2 and 5.1.1.2.1.) Any funds remaining from the NSA that are not claimed will

be paid to the Class Members who submit valid Claim Forms up to a maximum of 2.1x

the amount that had been calculated prior to such increase. (Settlement Agreement,

¶5.1.1.2.2.) Any remaining balance will be distributed to the LWDA in addition to the

LWDA amount. (Settlement Agreement, ¶5.1.1.2.2.)

D. Calculation of Settlement Class Member Payments

Each Settlement Class Member who returns a valid, timely, and properly

executed Claim Form will be entitled, to a proportional share of the NSA. (Settlement

Agreement at ¶5.1.1.2.1). The proposed Claim Form is attached as Exhibit 1 to the

Settlement Agreement.

All payment checks that remain uncashed one hundred eighty (180) days after

such checks are mailed by the Claims Administrator shall be paid to any Settlement

Class Member who submitted a late claim based proportionately in accordance with the

distribution to the other Settlement Class Members and if there are no such recipients,

or if any funds remain after such distribution, such remaining funds shall be distributed

to the LWDA. (Settlement Agreement, ¶5.1.1.2.6)

E. Timing and Manner of Payment

Within ten (10) business days after the “Settlement Effective Date” (as defined

in the Settlement Agreement, ¶¶2.4.1 and 2.4.25), Wal-Mart will fund the Settlement

and within ten (10) business days after receipt of such funds the Claims Administrator

will pay all claims to Settlement Class Members, attorneys’ fees and costs awarded to

Class Counsel, all Incentive Payments to the Class Representatives, and the payment to

the LWDA. (Settlement Agreement, ¶¶10.1.2 and 10.1.3.)

F. Tolerance of Opt-Outs

5 The Settlement Effective date is triggered by the final order approving the settlement with no further rights of appeal. Given that all claims are not resolved by this Settlement, the Parties will request that the Court issue an Order which constitutes a final determination and Final Order of the Settled Matters for purposes of appeal or any further judicial proceedings. See also Section (IV(Q), infra.


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Notwithstanding any other provision of this Agreement, Defendant retains the

right, in the exercise of its sole discretion, to revoke and nullify this settlement within

five (5) business days of being informed by the Claims Administrator that 7.5% or

more of the Settlement Class Members have opted out of this settlement. (Settlement

Agreement at ¶8.4.)

G. Release by the Settlement Class

This settlement resolves all Settled Matters. Upon Final Approval of this

Settlement Agreement, each member of the Settlement Class who does not exclude

themselves from the Settlement, regardless of whether that Settlement Class Member

submitted a timely claim, to the extent permitted by law, releases Wal-Mart (as defined

in ¶2.43 of the Settlement Agreement) from any and all claims, rights, causes of action,

penalties, demands, damages, debts, accounts, duties, costs and expenses (other than

those costs and expenses required to be paid pursuant to this Agreement), liens,

charges, complaints, causes of action, obligations, or liability of any and every kind

that were asserted in the Litigation (as defined in the Settlement Agreement ¶2.17) or

that could have been asserted but were not asserted in the Litigation, or in any other

court or forum, whether known or unknown, based upon, arising out of, or related to, in

whole or in part, any or all of the facts that were alleged in the Litigation, whether such

allegations were or could have been based on common law or equity, or on any statute,

rule, regulation, order, or law, whether federal, state, or local, including without

limitation, claims for damages, interest and penalties of any nature, all of which

constitute the Settled Matters, provided however that the Settled Matters and this

release do not include: (a) the rest-break claims as alleged in the Second Amended

Complaint; (b) the PAGA and Unfair Competition Causes of Action based upon or

relating to the rest break claims; (c) the Named Plaintiffs’ right to seek Incentive

Payments based upon the rest break claims; (d) the Named Plaintiffs right to seek any

applicable attorneys’ fees based upon the rest break claims, or based upon the PAGA

or Unfair Competition Claims predicated on the rest break claims; (e) the Nikmanesh


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Individual Claims; and (f) any obligations created by this Agreement. The release by

the Settlement Class Members also includes a release of all claims for Attorneys’ Fees

and Costs incurred by Releasing Settlement Class Members or by Class Counsel or any

other attorney in connection with the Settled Matters, as well as a 1542 waiver related

to the Settled Matters. These released claims are defined as the Settlement Class

Member Released Claims (Settlement Agreement, ¶¶2.32, 2.36, 12.1, 12.2, 12.3, 12.4)

H. General Release by Plaintiffs Nikmanesh, Spentzos, Nguyen and

Atencio

In consideration for the Incentive Payments and other promises set forth in the

Settlement Agreement, the named Plaintiffs are executing a full and complete general

release and 1542 Waiver, (except for the rest break claims in the Litigation,

Nikmanesh’s Individual Claims (as defined in the Settlement Agreement ¶2.21), the

PAGA and Unfair Competition claims predicated upon the rest break claims, Nguyen’s

current employee benefits, the Plaintiffs’ right to seek Incentive Payments, and

Plaintiffs’ right to seek attorneys fees and applicable costs on the aforesaid claims, and

any rights created by the Settlement Agreement. (Settlement Agreement, ¶2.42 and

12.5.)

I. No Publicity

The Class Representatives and Class Counsel agree not to make any statements

to the media, except, if asked by the media, they can respond that the matter has been

resolved and they are satisfied with the settlement. (Settlement Agreement, ¶22.)

J. Confidentiality

Plaintiffs and Class Counsel agree to keep the negotiations related to the

settlement strictly confidential with the exception of disclosure to other Settlement

Class Members and a limited number of specified individuals. (Settlement Agreement,

¶21.)

K. Class Counsel

Plaintiffs request that Eric M. Epstein, APC, Thierman Buck, LLP, and the


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Parcells Law Firm be appointed as Class Counsel for the Settlement Class (“Class

Counsel”). The Court has already approved Eric M. Epstein, APC, Thierman Buck,

LLP and the Parcells Law Firm, as Class Counsel for the conditionally certified FLSA

Class. [Doc. 71.] As evidenced by the Declaration of Eric M. Epstein filed in support

of Plaintiffs’ Motion for Conditional Certification of FLSA class [Doc. 52.1, ¶¶ 2-18],

Class Counsel are very experienced in wage and hour class actions and are qualified to

adequately represent the Settlement Class Members. (See also Epstein Dec., ¶¶3-23.)

L. Attorneys’ Fees and Costs

Prior to final approval, Class Counsel will petition the Court for an award of

attorney fees not to exceed Two Hundred and Sixty Six Thousand Six Hundred Sixty

Six and 00/100 Dollars ($266,666.00) representing thirty-three and one-third percent

(33 and 1/3%) of the Class Settlement Amount, for their professional services rendered

in this case. (Settlement Agreement at §5.1.2.1; Epstein Dec. at ¶43). In addition,

Class Counsel will petition the Court for litigation costs and expenses incurred in

prosecuting the Litigation in the sum of approximately $65,000. (Settlement

Agreement, ¶5.1.2.1).

Although Class Counsel will not actually move the Court for approval regarding

payment of attorneys’ fees and costs until the final approval hearing - and after the

Class has been notified of the terms of the Parties’ settlement - Class Counsel submits

that preliminarily, the attorneys’ fees (and litigation costs and expenses) are fair and

reasonable in light of the time incurred (approximately 1,500 hours to date,

approximately half of which are attributable to the Training Course Claims), the

difficulty, complexity and novelty of issues faced in this case, the contingency risks

undertaken by Class Counsels and the results achieved. (Epstein Dec. at ¶44). Class

Counsel’s efforts to date have been without compensation of any kind, and the fee has

been wholly contingent upon the result achieved (Id.). Furthermore, it is anticipated

that the Lodestar analysis which will be presented to the Court will result in a negative

Lodestar ratio of approximately .60. (Epstein Dec. ¶45.)


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M. Class Representatives

The Parties request that Plaintiffs Nikmanesh, Spentzos, Nguyen and Atencio be

appointed as Class Representatives and subject to Court approval, request that the

Class Representatives be awarded Incentive Payments not to exceed an aggregate of

$25,000 allocated as follows:

Afrouz Nikmanesh- $8,000

Effie Spentzos- $8,000

Elvis Atencio- $4,500

Anna Nguyen- $4,500

(Settlement Agreement ¶5.1.3.1).

Plaintiffs respectfully submit that these incentive awards reflect appropriate

compensation for their services and in producing a favorable result on behalf of the

Class. Each of the Class Representatives took a substantial risk in agreeing to be

named Plaintiffs in this class action litigation. Moreover, each of the Plaintiffs has

devoted substantial time in the prosecution of the Training Course Claims, including,

explaining Wal-Mart’s compensation policies related to the Training Course, the

manner in which the requirement to take the Training Course was communicated, how

it was directly related to their jobs, providing the names of other Pharmacists who

provided supporting evidence, providing numerous documents to Class Counsel,

responding to Interrogatories and Request for Production of Documents, attending full-

day depositions, communicating with Class Counsel by both email and telephone on

numerous occasions, meeting in person with Class Counsel, and attending a full day

Mediation session.6 The reason for the allocation of the Incentive Payments is that

Nikmanesh and Spentzos have spent substantially more time than Nguyen and Atencio,

especially, in communicating with Class Counsel, providing documents, and also

assisting in locating other witnesses and evidence. Prior to Final Approval, Plaintiffs

6 Nguyen did not personally attend the Mediation session but was available by phone.


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will submit Declarations setting forth in detail the services rendered by each of the

named Plaintiffs, and the time they have devoted to the prosecution of this case.

Plaintiffs submit that these Incentive Payments are fair and reasonable. (Epstein Dec.,

¶46-47).

N. Class Administration

The Parties have agreed to use Simpluris, Inc. (“Simpluris”) as the Claim

Administrator (“Claims Administrator”). (Settlement Agreement at ¶2.9.) The cost of

the Claims Administrator will be paid from the Class Settlement Amount up to

$13,200. (Settlement Agreement ¶5.1.5.1.) The Claims Administrator shall be

responsible for sending the Class Notice, processing Claims, Exclusions and

Objections, making all payments to any person or entity from the settlement amounts,

for all required tax reporting and withholding, and for communicating the information

regarding status of the payments to the Parties’ counsel. (Settlement Agreement,

¶¶11.4 and 11.5.)

O. Qualified Settlement Fund

Under the Settlement Agreement, Wal-Mart has agreed to transfer the required

portions of the Class Settlement Amount into a Qualified Settlement Fund as described

in Treasury Regulation §1.468B-1, 26 C.F.R. §1.468B-1, in full settlement and

discharge of the claims of the Settlement Class Members against Wal-Mart that are

included under the Settlement Agreement. (Settlement Agreement ¶11.1.) The Parties

determined that establishing a Qualified Settlement Fund to receive and hold the

settlement funds, and to distribute the funds according to the terms of the Settlement

Agreement and under the administration of the Claims Administrator, meets the criteria

under the regulations and also would serve the best interests of the Parties, and on this

basis request the Court approve the establishment of a Qualified Settlement Fund.

The Qualified Settlement Fund will be administered by the Claims

Administrator, who, along with the Qualified Settlement Fund, will remain subject to

the continuing jurisdiction of this Court. The Qualified Settlement Fund will be a


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segregated bank account opened at a financial institution mutually agreed by the

Parties. The Qualified Settlement Fund account will receive the Class Settlement

Amount from Wal-Mart and will hold that sum, and the earnings thereon, until the

Administrator has completed all administration of such funds and income thereon, as

well as disbursements to Settlement Class Members and Class Counsel, and payment

of taxes and administrative costs, as more fully set forth in Section 11 of the Settlement

Agreement and subject to further approvals of this Court, if required.

Approval by the Court of the establishment of the Qualified Settlement Fund

best serves the interests of the Settlement Class Members by assuring that the Class

Settlement Amount is transferred by Wal-Mart following approval of this Motion.

Approval by the Court of the establishment of the Qualified Settlement Fund best

serves the interests of Wal-Mart by assuring finality to the claims against Wal-Mart in

this litigation that are the subject of the Settlement Agreement.

With the Court’s approval, therefore, establishment of a Qualified Settlement

Fund will satisfy the requirements of Treasury Regulation §1.468B-1(c), C.F.R.

§1.468B-1(c), by (a) being established pursuant to the approval of this Court, (b)

resolving and satisfying claims against Wal-Mart for alleged violations of law, and (c)

constituting a segregated account, all as required by those regulations.

P. CAFA And Labor Code Notice

Wal-Mart will provide notice to the appropriate government authorities in

accordance with CAFA and California Labor Code, Section 2699.

Q. Final Approval Order

The Parties have agreed to a form of Final Order and Dismissal, a copy of which

is attached to the Settlement Agreement at Exhibit 2. In the event the Court grants

Final Approval of the Settlement, the Parties will request that the Order be immediately

appealable. If no appeals are filed regarding the Settlement, but Wal-Mart nevertheless

contends that such Final Order is not immediately appealable, Plaintiffs may revoke the

Settlement Agreement, although they shall not be obligated to do so. (Settlement


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Agreement, ¶¶15.1 and 17.3.)

V. THE SETTLEMENT MEETS THE CRITERIA FOR PRELIMINARY

APPROVAL

FRCP 23(e) provides that settlement of the claims of a certified class is subject

to the court’s approval. In general, settlement of class actions is favored as a matter

of “strong judicial policy.” Alberto v. GMRI, Inc., 252 F.R.D. 652, 658 (E.D. Cal.

2008) (citing Class Plaintiffs v. City of Seattle, 955 F.2d 1268, 1276 (9th Cir. 1992)).

Likewise, FLSA class action claims may be settled under the supervision of the

Department of Labor or by court approval. Lynn’s Food Stores, Inc. v. United

States, 679 F.2d 1350, 1352-53 (11th Cir. 1982).

Procedurally, the reviewing court’s evaluation is conducted in two stages.

Alberto, 252 F.R.D. at 658. At the first stage the court conditionally certifies a class

for settlement purposes, preliminarily approves the settlement pending the “fairness

hearing,” and authorizes notice of the proposed class settlement to be given to the

class. Id. (citations omitted); see also Manual for Complex Litigation (Fourth) §

21.632 (2004) (“Manual for Complex Litigation”) (summarizing “preliminary

fairness review”). Stage two is the fairness hearing, set for a time after notice has

been provided to the class and Class Members have had an opportunity to submit

claims or objections to the proposed settlement or to opt out of it, and the court

reaches a final determination about whether the proposed settlement should be

approved as a fair, adequate, and reasonable resolution of the dispute. Alberto, 252

F.R.D. at 659 (citations omitted).

Under the FLSA, when reviewing the fairness of the settlement, “a court must

determine whether the settlement is a fair and reasonable resolution of a bona fide

dispute.” Jimenez v. JPMorgan Chase & Co., Case No. 08cv0152 W (WMc), 2008

U.S. Dist. LEXIS 72605, *2 (S.D. Cal. Sept. 23, 2008); Lynn’s Food Stores, Inc.,

679 F.2d 1350 at 1354 (“If a settlement in an employee FLSA suit does reflect a

reasonable compromise over issues, such as FLSA coverage or computation of back


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wages, that are actually in dispute; we allow the district court to approve the

settlement in order to promote the policy of encouraging a settlement of litigation.”).

Because this is the first stage of the Court’s evaluation of the Settlement, the

(A) the Class should be certified for settlement purposes, (B) the Settlement should

be preliminary deemed fair, reasonable, and adequate, and (C) notice should be sent

out in accordance with the Notice Plan. (Settlement Agreement, ¶¶2.25 and 6.) As to

the timing for sending notice, Plaintiff contends that notice should be sent within 20

business days after the granting of the Motion for Preliminary Approval. Wal-Mart

contends that sending of notice should be deferred until after the Court has decided

the Plaintiffs’ separate motion for class certification on the rest break claims (which

is scheduled to be heard on September 26, 2016).

A. The Settlement Class Should Be Certified for Settlement Purposes.

To facilitate the proposed settlement, Plaintiffs respectfully request that the

Court conditionally certify the Settlement Class as described above for purposes of

this settlement only. Of course, if the settlement is not granted final approval, then

the conditional certification will be null and void and the fact that the case was

conditionally certified will have no impact on future proceedings. (Settlement

Agreement at ¶¶4.1, 4.2 and 17.1.)

B. The Proposed Settlement Is Fair, Reasonable, and Adequate.

At the preliminary approval stage, courts do not make a final

determination of fairness, reasonableness, and adequacy. Instead, the key question at

this point is only whether the settlement is “potentially fair, as the Court will make a

final determination of [the settlement’s] adequacy at the hearing on Final Approval,

after such time as any party has had a chance to object and/or opt out.” Acosta v.

Equifax Info. Servs. LLC, 243 F.R.D. 377,386 (C.D. Cal. 2007). Thus, the inquiry

should focus on whether the proposed settlement falls within the “range of possible

approval” and appears to be sufficiently fair, reasonable, and adequate to warrant

distributing notice to Class Members informing them about the proposed settlement


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and their options for responding and participating. Molski v. Gleich, 318 F.3d

937,944 (9th Cir. 2003); see also Manual for Complex Litigation § 21.632. “Once the

judge is satisfied as to the ... results of the initial inquiry into the [1] fairness, [2]

reasonableness and [3] adequacy of the settlement,” the court should direct notice to

issue and schedule a final approval hearing. Id., § 21.633 at 321. Here, all three are

preliminarily met.

1. The Settlement Is Fair.

Fairness of distribution among Class Members. The proposed settlement is

fair in that Class Members are being paid the same amount. No Class Member is

being paid any more than any other Class Member for unpaid overtime for the home-

study and test portions of the Training Course. As a preliminary matter, Plaintiffs’

evidence indicated that the Class Members spent an average of approximately 12

hours on the home-study and test portions of the Training Course. Their average

overtime rate was approximately $96 per hour. There are approximately 747

Putative Class Members. Even if every putative Class Member submits a Claim

Form, each Class Member will receive approximately $569 which is approximately

50% of the overtime wages to which they would be entitled. Depending on the

number of claims submitted, Settlement Class Members who submit timely, valid

claim forms could receive substantially more than $569, up to a maximum of $1,192,

since there is no reversion to Wal-Mart of any unclaimed amounts. In light of Wal-

Mart’s defenses, and the uncertainty, cost and delay of further litigation, this is a fair

and reasonable settlement by any means. (Epstein Dec., ¶41.)

Fairness of proposed attorneys’ fees. The allocation of total settlement

funds between Class Members and the attorneys is also fair, in that the settlement

agreement provides for Plaintiffs’ counsel to seek $266,666 for attorneys’ fees,

which is 33 1/3% of the Class Settlement Amount.

The requested fees are fair compensation for undertaking complex, risky,

expensive, and time-consuming litigation solely on a contingency basis. (See Section


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IV(L), supra.) Further, the requests are in line with other attorneys’ fees awards for

wage and hour class actions, particularly where all Class Members who submit a

valid Claim Form will be receiving a substantial payment of hundreds of dollars.

Indeed, courts have recognized that an appropriate method for awarding

attorneys’ fees in class action is to award a percentage of the “common fund” created

as a result of the settlement. Vincent v. Hughes Air West, Inc., 557 F.2d 759, 769

(9th Cir. 1977). The purpose of the common fund/percentage approach is to “spread

litigation costs proportionally among all the beneficiaries so that the active

beneficiary does not bear the entire burden alone.” Id.

Class counsels’ application for 33 1/3% of the Gross Settlement Fund is within

the range of reasonableness. Historically, courts have awarded percentage fees in the

range of 20% to 50% of the common fund, depending on the circumstances of the

case. Newberg on Class Action § 14:6 (4th ed. 2008); see also In re Activision

Securities Litigation, 723 F.Supp. 1373, 1378 (N.D. Cal. 1989). According to

Newberg: “No general rule can be articulated on what is a reasonable percentage of a

common fund. Usually 50% of the fund is the upper limit on a reasonable fee award

from a common fund in order to assure that the fees do not consume a

disproportionate part of the recovery obtained for the class, although somewhat

larger percentages are not unprecedented.” Newberg, § 14:6.

Notwithstanding the above, Class counsel has devoted approximately 1,500

hours to this case, approximately one half of which is attributable to the Training

Course Claims, and will provide the Court with a detailed summary of such time

prior to Final Approval. Class Counsel anticipates that the Lodestar analysis to be

presented to the Court will result in a negative Lodestar ratio of approximately .60.

(Epstein Dec., ¶44 and 45)

Accordingly, the attorneys’ fees sought in this case are fair and reasonable.

Fairness of Proposed Incentive Payments for the Named Plaintiffs. The

principle of fairness is also well served by the $25,000 aggregate Incentive Payments


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proposed for the named Plaintiffs. (See Section IV(M), supra.) Further, Plaintiffs

incurred personal risk in bringing this lawsuit on behalf of the other persons in the

class. See, e.g., Koehl v. Verio, 142 Cal. App. 4th 1313, 1328 (2006) (in wage and

hour action where defendant prevailed at trial, named plaintiffs were held liable,

jointly and severally, for defendant’s attorneys’ fees). Plaintiffs could have been

held liable for Defendant’s costs if they were ultimately unsuccessful in resolving the

case and Plaintiffs could face adverse publicity.

Such service payments are recognized as serving an important function in

promoting class action settlements. In League of Martin v. City of Milwaukee, 588 F.

Supp. 1004 (E.D. Wis. 1984), the court held that the proposed settlement properly

granted the named plaintiff additional relief, explaining that it is “not uncommon for

class ... members to receive special treatment in settlement” when they have been

instrumental in prosecuting the lawsuit. Id. at 1024. Accordingly, the enhancement

is fair.

2. The Settlement Is Reasonable.

At $800,000 overall, the proposed non-reversionary settlement is clearly

substantial. This is not a settlement where the aggregate figure is large simply

because the size of the class is in the tens or hundreds of thousands. Instead, here the

class size is relatively small but Class Members are eligible for a significant financial

benefit. In fact, the total alleged unpaid overtime for the Class, on average, is

calculated at approximately $860,544. (12 hours of overtime x $96 per hour x 747

Class Members = $860,544.) The Class Settlement Amount of $800,000 is 93% of

the approximate unpaid overtime. (Epstein Dec. ¶49.) These considerations indicate

that the proposed settlement falls within the range of reasonableness, warranting

preliminary approval.

Prior to reaching a settlement, Class Counsel conducted substantial discovery

and investigation, including, propounding approximately 10 sets of Requests for

Production of Documents, propounding several sets of Special Interrogatories, taking


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9 depositions of Wal-Mart managers and supervisors, reviewing thousands of pages

of documents, obtaining essential information from the named plaintiffs, conducting

well over 100 interviews of Opt-Ins, conducting legal research on the pertinent

issues, obtaining class-wide data on the average compensation for the Pharmacists, as

well as the approximate number of Pharmacists who were terminated after taking the

Training Course. In addition, the named Plaintiffs responded to written discovery,

the Parties participated in Rule 26 disclosures, Defendants took approximately 30

depositions, and approximately 25 Opt-Ins responded to written discovery

propounded by Wal-Mart.7 As a result of Class Counsel’s investigation and

discovery, Class Counsel had sufficient facts and data in order to make an informed

decision with respect to the Settlement. (Epstein Dec., ¶50).

The conclusion that the proposed settlement falls within the range of

reasonableness, warranting preliminary approval, is reinforced by considering such

factors as the risk that a Rule 23 class might not be certified, or the FLSA

Conditional Certification might be de-certified, or might be significantly smaller than

proposed due to Opt-Ins not participating in discovery, and the time, expense, and

complexity of the litigation, including the possibility of appellate proceedings. Of

particular relevance to the reasonableness of the proposed settlement is the fact that

Wal-Mart has vigorously asserted defenses to the Training Course Claims and there

are questions as to whether Defendant was liable to the terminated Class Members

for so-called waiting time penalties since “willfulness” is very much disputed by

Wal-Mart and such penalties are up to the discretion of the Court.8

7 Following Plaintiffs’ motion for a protective order regarding written discovery propounded by Wal-Mart, Plaintiffs were ordered to produce 75 sets of discovery responses by the Opt-Ins (with Wal-Mart entitled to petition for further discovery). (Doc. 94.) Plaintiffs partially complied with that order but contend that they were not able to secure all 75 responses. While Wal-Mart reserves all rights if this settlement is not finally approved, the issue of those remaining responses was mooted by the parties reaching this settlement. 8 In addition, the penalty for inaccurate Wage Statements (also alleged in the Litigation) would be relatively minimal because it would only apply to the pay period


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Furthermore, while Class Counsel believe that Plaintiffs’ claims are

meritorious, they are experienced class action litigators, and understand that the

outcome of class certification, trial, and any attendant appeals were inherently

uncertain, as well as likely to consume many more months, even years. Having

reviewed relevant evidence, compensation data and employment information, as set

forth above, counsel for the Parties—all experienced class action litigators well

versed in wage and hour law—arrived at a reasonable resolution through a protracted

and arm’s-length negotiation process, assisted by the efforts of a well respected class

action Mediator.

In sum, the resulting settlement is, in light of all applicable factors, reasonable,

and warrants notification of its terms to members of the potential class for their

consideration and response.

3. The Settlement Is Adequate.

In a similar class action in which it was estimated that under the most

optimistic scenario maximum each Class Member would recover about $1,330, the

Court aptly observed that it would have been irrational for most, and probably all,

Class Members to pursue their claims on an individual basis “because of the disparity

between their litigation costs and what they hope to recover.” Local Joint Executive

Bd., 244 F.3d at 1163. In this case, the amount of overtime Plaintiff allege that a

Class Member could receive, based on an average of 12 hours to take the home-study

and test portions of the Training Course, at an average overtime rate of $96 per hour,

would be about $1,152.00. That is hardly enough to justify the cost and expense that

would be incurred to litigate an individual claim against Wal-Mart.

The recovery provided through the settlement is substantial, especially as its

adequacy must be judged as “a yielding of absolutes and an abandoning of highest

for which the overtime was not paid. Also, such penalties would only be applicable if there was an “injury” and any penalty, would be discretionary with the Court.


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hopes.... Naturally, 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, 688 F.2d at 634 (citation omitted). Accordingly, the settlement is not to be

judged against a speculative measure of what might have been achieved. Linney v.

Cellular Alaska P’ship, 151 F .3d 1234, 1242 (9th Cir. 1998). An additional

consideration is that the settlement provides for payment to the class now, rather than

a payment many years down the road, if ever. See City of Detroit v. Grinnell Corp.,

495 F .2d 448, 463 (2d Cir. 1974).

Thus, considering the present value of the settlement sum, the probability of

lengthy litigation in the absence of a settlement, and the risks that the class might not

have prevailed at trial, it is no exaggeration to predict that without using the class

action process, the relief that members of the class were likely to achieve ranged

from negligible to zero. Consequently, the $800,000 settlement satisfies the criterion

of adequacy. See Manual for Complex Litigation § 21.62 (“Adequacy of the

settlement involves a comparison of the relief granted relative to what Class

Members might have obtained without using the class action process.”).

C. The Notice Adequately Informs Class Members Of The Settlement

The settlement provides for individualized Notice to each Class Member. The

proposed Notice will be sent via First Class Mail and advises Class Members about

the lawsuit and settlement. (¶6.2 of the Settlement Agreement).

The settlement provides for address verification members that will help Class

Members receive the Notice even if the information provided to the Settlement

Administrator is not current. (¶6.2 of the Settlement Agreement). The proposed

Notice will inform each Class Member of the estimated amount each Class Member

will receive, and how it was calculated, so that Class Members will have complete

information about the settlement, the estimated amount that they will receive, and can


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respond accordingly. (See Section VII(B) of Notice attached to Settlement

Agreement as Exhibit 3.)

The Notice explains the process; how to participate in (submit a valid Claim

Form), request to be excluded, or object to the Settlement; and the consequences of

the action the Class Member takes (submitting a Claim Form, doing nothing, opting

out, or objecting), in terms of both financial benefit and release of claims. The Notice

advises Class Members about the final approval hearing, their rights with respect to

that hearing, and how to get more information. (See Notice attached to Settlement

Agreement as Exhibit 3.) The 45-day time frame for submitting a valid Claim Form

or requesting exclusion is reasonable, allowing Class Members to digest the

information in the notice and obtain answers to questions before deciding on the

action they want to take. Accordingly, in addition to approving the Settlement

Agreement as a whole, Plaintiffs respectfully ask that the Court approve the Notice

(Exhibit 3 to the Settlement Agreement) and Claim Form (Exhibit 2 to the Settlement

Agreement) in substantially the format presented with the Settlement.

VII. CONCLUSION

For the foregoing reasons, the proposed settlement enjoys a presumption of

fairness, and falls within the range of possible approval. Accordingly, the Court should

grant preliminary approval of the Settlement Agreement and enter the accompanying

[Proposed] Order Granting Plaintiff’s Motion for Preliminary Approval of Class

Action Settlement.

DATED: September 2, 2016 THIERMAN BUCK LLP PARCELLS LAW FIRM ERIC M. EPSTEIN, APC By: s/ Eric M. Epstein____________

ERIC M. EPSTEIN ATTORNEYS FOR PLAINTIFFS


This lawsuit includes class-action wage and hour claims brought on behalf of a putative class of Pharmacists who work at Wal-Mart both in California, as well as the United States. It also includes individual wrongful termination and retaliation claim...THE TRAINING COURSE CLAIMSREST BREAK CLAIMSThe putative Rest Break Class consists of approximately 1250 non-exempt hourly Pharmacists employed by Wal-Mart in California during the applicable time period. The crux of the claim is that as a result of several Wal-Mart policies, Plaintiffs allege...A. The Training Course Was Not VoluntaryB. The Training Course Is Directly Related To The Pharmacists’ JobAfrouz Nikmanesh- $8,000