Ana Miranda Mendoza et al vs Rich & Famous Inc et al

Case Number

20CV04009

Case Type

Hearing Date / Time

Fri, 01/09/2026 - 10:00

Nature of Proceedings

Motion: Approval

Tentative Ruling

For the reasons set forth herein, the motion for order granting preliminary approval of class action settlement is denied without prejudice.

Background:

This action was commenced on December 3, 2020, by Ana Miranda Mendoza filing a complaint alleging nine causes of action primarily based on the Labor Code. The original complaint was answered by Rich & Famous, Inc., dba Big Green Cleaning Company, Inc. (“BGC”) on January 19, 2021. On February 18, 2021, the parties stipulated to the filing of plaintiff’s first amended complaint. The first amended complaint was filed on March 17, 2021, adding a cause of action for penalties pursuant to the California Private Attorneys General Act of 2004 (“PAGA”), and other provisions of the Labor Code. On September 26, 2022, the parties stipulated to the filing of a second amended complaint adding Maria Garcia as an additional class representative. On October 26, 2021, Allen Paul Williams was added as a defendant in place of Doe 1.

By way of a second amended answer, BGC asserted a general denial and 21 affirmative defenses.

Following both informal and formal discovery, as well as two separate private mediation sessions, on December 16, 2025, the parties executed a settlement agreement on December 16, 2025. (Melmed Decl., ¶¶ 10-27 & Exh. A.)

Plaintiffs now seek preliminary approval of the settlement, preliminary certification of the Class for purposes of settlement, preliminary appointment of plaintiffs as Class Representatives for purposes of settlement, preliminary appointment of plaintiffs’ attorneys as Class Counsel for purposes of settlement, preliminary approval of Class Counsel’s request for up to one-third of the gross settlement amount as attorneys’ fees, preliminary approval of actual litigation costs up to $50,000.00, preliminary approval of enhancement awards to the Class Representatives of $10,000.00, preliminary approval of enhancement awards to 47 additional “unnamed plaintiffs” of $1,000.00 each, preliminary approval of a PAGA allocation of $150,000.00 with 75 percent payable to the Labor and Workforce Development Agency (“LWDA”) and 25 percent payable to the PAGA settlement class, approval of the Notice of Proposed Class Action Settlement, appointing ILYM Group, Inc. (“ILYM”) as the third-party settlement administrator, and approval of $100,000.00 to be deducted from the gross settlement amount for the costs of settlement administration.

There is no opposition to the motion.

Analysis:

            Initial Concerns

The memorandum of points and authorities is nearly double the allowable pages. California Rules of Court, rule 3.1113(d) mandates that, except for motions for summary judgment or summary adjudication, no opening memorandum may exceed 15 pages. Excluding the caption, notice, table of contents, and table of authorities, plaintiffs’ memorandum is 29 pages long. Plaintiffs did not seek leave of court to file a memorandum which exceeds the 15 page limit. While the court appreciates that the memorandum is well organized and contains all information necessary for ruling on the motion, it is quite repetitive, and all the information could easily have been presented in 15 pages or less.

Further, including exhibits, the declaration of plaintiff’s counsel is 100 pages long and the exhibits are not properly bookmarked as required by California Rules of Court, rule 3.1110(f)(4) and Santa Barbara County, Local Rules, rule 1012 (c)(1). “Compliance with all of the formatting requirements for electronic documents is extremely important for the court’s timely consideration of e-filed documents. In cases of noncompliance, the court may, in its discretion, order any, or all, of the following in addition to any other sanction permitted by law: (i) the noncomplying document to be stricken as improperly filed; (ii) the continuance of the hearing to which the noncomplying document pertains; or, (iii) the imposition of monetary sanctions for violation of the California Rules of Court or these Local Rules, following adequate notice and an opportunity to be heard.” (Super. Ct. Santa Barbara County, Local Rules, rule 1012 (c)(2).)

Counsel is reminded of the obligation to comply with the California Rules of Court, the Santa Barbara County Local Rules, and all other relevant legal authority for any future filings, and bear in mind the potential consequences of ignoring these obligations.

            Preliminary Approval

The purpose of the preliminary approval hearing is to determine whether the settlement is within the range of reasonableness for preliminary approval and to approve or deny certification of a provisional settlement class. A full inquiry into the fairness of the proposed settlement occurs at the final approval hearing. (Rules of Court, rule 3.769, subd. (g).)

“‘The court has a fiduciary responsibility as guardians of the rights of the absentee class members when deciding whether to approve a settlement agreement.’” (Kullar v. Foot Locker Retail, Inc. (2008) 168 Cal.App.4th 116, 129.) The court has broad discretion to determine whether the settlement is fair. (Dunk v. Ford Motor Co.) (1996) 48 Cal.App.4th 1794, 1801.) “The well-recognized factors that the trial court should consider in evaluating the reasonableness of a class action settlement agreement include ‘the strength of plaintiffs’ case, the risk, expense, complexity and likely duration of further litigation, the risk of maintaining class action status through trial, the amount offered in settlement, the extent of discovery completed and stage of the proceedings, the experience and views of counsel, the presence of a governmental participant, and the reaction of the class members to the proposed settlement.’ [Citations.] This list ‘is not exhaustive and should be tailored to each case.’ [Citation.]” (Kullar v. Foot Locker Retail, Inc., supra, 168 Cal.App.4th at p. 128.)

A PAGA action is a type of qui tam action, in which a private party is authorized to bring an action to recover a penalty on behalf of the government and receive part of the recovery as compensation. (Huff v. Securitas Sec. Servs. USA, Inc. (2018) 23 Cal.App.5th 745, 753.) In doing so, the employee acts as proxy for the state labor law enforcement agency; the proceeding is designed to protect the public, not to benefit private parties. (Amalgamated Transit Union, Local 1756, AFL-CIO v. Superior Court (2009) 46 Cal.4th 993, 1003.) The dispute is between the employer and the state. (Kim v. Reins International California, Inc. (2020) 9 Cal.5th 73, 81.) The purpose of PAGA is not to recover damages, restitution, or redress the employees’ injuries, but to recover civil penalties to remediate present violations and deter future ones. (Id. at p. 86.) While a PAGA case is representative in nature, it is not a class action and may be brought without the procedural requirements involved in class actions.

Labor Code section 2699(k) mandates that PAGA civil penalties be allocated 75% to the LWDA, for enforcement of labor laws and education of employers and employees about their rights and responsibilities under the code, and 25% to the aggrieved employees. Section 2699(l)(2) requires that the superior court review and approve any penalties sought as part of a proposed settlement agreement, pursuant to that part of the code.

As noted above, on December 16, 2025, the parties executed a settlement agreement and release that resulted in a settlement in principle of the class action and PAGA claims. Pursuant to the agreement, which is attached as Exhibit C to the Melmed declaration, the parties agreed:

The settlement class consists of all individuals who are or were employed by defendants as non-exempt employees in California during the Class Period. (Agreement, ¶ 1.40.) The settlement class consists of approximately 2,240 class members that worked a total of approximately 218,184 workweeks during the class period. (Ibid.) The class period is December 3, 2016, through February 5, 2025. (Id. at ¶ 1.11.)

The non-revisionary gross settlement amount is $3,670,933.04 and is inclusive of administrative expenses, employee’s taxes and required withholdings, the class attorney fees and expenses, incentive awards, and PAGA payment. (Agreement, ¶ 1.22.) Defendants shall separately pay its share of the employer’s taxes in addition to the gross settlement amount on the portion of each individual settlement amount allocated as wages. (Ibid.) Twenty percent of each settlement amount shall constitute payment in the form of wages and eighty percent of each individual settlement amount shall constitute penalties and interest. (Id. at ¶ 5.5.)

Proposed Class Counsel, Jonathan Melmed and Laura M. Supanich, of Melmed Law Group P.C., request attorneys’ fees in an amount not to exceed one third of the gross settlement amount, or $1,223,644.35, plus costs not to exceed $50,000.00. (Agreement, ¶ 5.7.) In the event the court awards class counsel less than this requested amount, the difference shall become part of the net settlement amount and shall be distributed to participating class members as part of their individual settlement awards. (Ibid.)

For settlement purposes only, the parties agree to the designation of plaintiffs as the class representatives and request a class representative service award not to exceed $10,000.00 for each of the named plaintiffs. (Agreement, ¶ 5.2.) Plaintiffs further request that the court approve incentive awards for 47 additional individuals, of $1,000.00 each, whom the settlement agreement refers to as “additional plaintiffs.” (Ibid.)

The parties agree that defendant shall reimburse the settlement administration costs, not to exceed $100,000.00, to be paid from the gross settlement amount. (Agreement, ¶ 6.1.)

The parties agree that defendant will pay a total of $150,000.00 to resolve the PAGA claims, with 75 percent, or $112,500.00, to be paid to the LWDA and the remaining 25 percent, or $37,500.00 to be distributed to the PAGA eligible employees based on their proportionate share of the compensable pay periods worked during the PAGA period. (Agreement, ¶ 5.4.)

The parties agree that the settlement administrator shall be ILYM. (Agreement, ¶ 1.39 & Melmed Decl., ¶ 88.)

The Court has carefully analyzed the terms of the settlement, including the nature and scope of the release it requires of absent class members and the representative plaintiffs. The Court finds, generally, that it is within the range of acceptable settlements.

Substantial investigation and discovery were conducted, giving rise to an informed settlement considering the risks of further litigating the action through trial. The case involves experienced class counsel, who believe the settlement is fair, reasonable, and in the best interests of the class members. The settlement was achieved through extensive arms’-length negotiations and was not collusive.

The motion asks the Court for an order provisionally certifying the settlement class. The class is ascertainable from defendant’s records and is so numerous that joinder of all members is impracticable. There are questions of law or fact common to the proposed class, and there is a well-defined community of interest among its members with respect to the subject matter of the litigation.

It appears to the Court that the claims of the class representatives are typical of the claims of the members of the proposed class, and that they are positioned to fairly and adequately protect the interests of the class members. It also appears to the Court that proposed class counsel is experienced and qualified in wage and hour class litigation and will properly and adequately represent the interests of the absent class.

The court further finds that the PAGA claim class is appropriate and the terms of the PAGA settlement are, generally, fair and reasonable.

The motion further seeks approval of the proposed Notice of Proposed Class Action Settlement to be provided to the absent class members. The Notice is attached as Exhibit 1 to the agreement that is attached to the Melmed declaration. Under Trotsky v. Los Angeles Fed. Sav. & Loan Assn. (1975) 48 Cal.App.3d 134, 151-152, the notice provided to a class must fairly apprise the class members of the terms of the proposed compromise and of the options open to dissenting class members. The court has analyzed the contents of the Notice and finds that it meets the standard for approval in clearly outlining what the recipient must do in order to object to the settlement, or to opt out of the settlement, and the time within which each must be accomplished.

Having so determined, there are issues with the proposed settlement and order that must be addressed.

            Issues with the Proposed Settlement and Order

“Incentive awards to class representatives are intended to compensate class representatives for the work and risk undertaken on behalf of the class, to reimburse expenses incurred in the class litigation, and sometimes to recognize the willingness of class representatives to act as a private attorney general. [Citation.] An incentive award may be appropriate to induce someone to serve as a class representative. In determining whether to make an incentive award, the court may consider (1) the risk, both financial and otherwise, the class representative faced in bringing the suit; (2) the notoriety and personal difficulties encountered by the class representative; (3) the amount of time and effort spent by the class representative; (4) the duration of the litigation; and (5) the personal benefit received by the class representative as a result of the litigation. [Citation.]” (Golba v. Dick’s Sporting Goods, Inc. (2015) 238 Cal.App.4th 1251, 1272.)

“ ‘[N]amed plaintiffs, as opposed to designated class members who are not named plaintiffs, are eligible for reasonable incentive payments.’ [Citation.]” (Alberto v. GMRI, Inc. (E.D. Cal. 2008) 252 F.R.D. 652, 669.)

There is no authority for awarding incentive payments to non-named “plaintiffs.” The court will not grant preliminary approval of a settlement that suggests awarding $47,000.00 to individuals that are not named plaintiffs in this action. They are not plaintiffs and should be removed from the settlement agreement as well as the proposed order.

Further, as noted above, plaintiffs are requesting that ILYM be approved for $100,000.00 from the gross settlement amount for settlement administration. (Notice of Motion, p. 3, ll. 3-5.) [Note: The proposed order does not include any amount to be paid to ILYM for settlement administration.] However, the bid from ILYM, attached as Exhibit C to the Melmed declaration, provides a total estimate of $17,950.00. While the court understands that it is only an estimate, there should at least be some attempt to explain such a large discrepancy between the estimate and the amount requested by way of the preliminary approval. Although not strictly required, the court finds it helpful to have a declaration from a representative of the settlement administration entity explaining its process and anticipated fees.

Also, paragraph No. 13 of the proposed order is improper. It states: “To facilitate administration of the Settlement pending final approval, the Court hereby enjoins Plaintiffs and all Class Members from filing or prosecuting any claims, suits, or administrative proceedings (including filing claims with the Division of Labor Standards Enforcement of the California Department of Industrial Relations) regarding claims released by the Settlement, unless and until such Class Members have filed valid Requests for Exclusion with the Settlement Administrator and the time for filing claims with the Settlement Administrator has elapsed.” The court is unable, and unwilling, to enter an order that would potentially infringe on a person’s Constitutional right of petition. The court cannot issue a preliminary injunction prior to a determination of the merits of the action and certification of the class. (see People v. Sangiacomo (1982) 129 Cal.App.3d 364, 366-367.)

While the court does find the overall terms of the proposed settlement acceptable, both for the class action and the PAGA action, the above issues necessitate the denial of the motion without prejudice.