180 Litigating CA Wage & Hour Class and PAGA Actions (23rd Edition) Seyfarth Shaw LLP | www.seyfarth.com opinion on the merits for those of the settling parties: the merits of the underlying class claims are not a basis for upsetting the settlement of a class action; the operative word is “settlement.” Instead the inquiry is on whether the parties conducted sufficient discovery to evaluate the claims themselves—something even the plaintiffs in the 7Eleven case agreed the defendants had done. In such circumstances, the court should not disapprove a settlement based on a hypothetical or speculative measure of what might have been achieved by the negotiators.892 Furthermore, where relatively few class members object, that factor weighs against sustaining the objection.893 Objectors have better success in their objections when they identify procedural defects in the settlement process. For example, objections have been sustained when the class notice was excessively vague and confusing, or when class counsel failed to undertake sufficient discovery to properly evaluate the case.894 In short, the odds of a successful objection are low if the parties conduct an adequate investigation, make the notice documents clear, set forth some rational basis for the settlement amount, and take adequate steps that class members are informed in their choices.895 F. Individual Settlements with Putative Class Members Class actions differ from individual actions in that most of the parties on whose behalf the action allegedly is advanced have no involvement in the case (and may be totally unaware of the case) until a court orders certification and notice. This aspect of class litigation has raised the question of whether employers and their counsel should be entitled to communicate with putative class members before certification or whether they should be treated in the same manner as the named plaintiff, in which case the right to communicate with the putative class members would be severely restricted.896 Putative class members are not treated the same as parties and there is no attorney-client relationship between a plaintiff’s attorney and putative class members before a court certifies a class.897 Despite this fact, an employer 892 Id. at 1149-50; but see Kullar v. Foot Locker Retail, Inc., 168 Cal. App. 4th 116, 129 (2008) (parties are not excused from explaining what the claims potentially were worth and why less money was accepted: “While an agreement reached under these circumstances presumably will be fair to all concerned, particularly when few of the affected class members express objections, in the final analysis it is the court that bears the responsibility to ensure that the recovery represents a reasonable compromise, given the magnitude and apparent merit of the claims being released, discounted by the risks and expenses of attempting to establish and collect on those claims by pursuing the litigation.”). 893 Id. at 1152-53 (out of a class of 5454 people, only 9 objected and only 80 opted out). 894 Cho v. Seagate Tech. Holdings, Inc., 177 Cal. App. 4th 734, 747-48 (2009) (settlement disapproved without prejudice to issuance of new class notice where original notice was confusing as to who qualified as a class member); Kullar, 168 Cal. App. 4th at 132-33 (case remanded for parties to better explain what information the parties considered in reaching settlement, and to allow objector limited discovery relevant to valuation of case). 895 Another source of objections to settlements is the amount that plaintiffs’ counsel will recover from the settlement. The California Supreme Court, in Lafitte v. Robert Half International, Inc., 1 Cal. 5th 480 (2016), held that attorneys’ fees are recoverable as a percentage from a common fund, and that there is no requirement for the court to cross check the amount against a lodestar-multiplier method of fee recovery, so long as there is some other means of evaluating the reasonableness of the award. 896 See generally Cal. Rule of Professional Conduct 2-100. 897 Atari v. Superior Court, 166 Cal. App. 3d 867 (1985); see also Ochoa-Hernandez v. Cjaders Foods, Inc., 2010 WL 1340777 (N.D. Cal. April 2, 2010) (denying plaintiff’s motion for a protective order seeking to prohibit defense attorneys
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