Opinion
No. 2:15-cv-01063-KJM-CKD
02-07-2018
JIMMY GREER, individually, and on behalf of others similarly situated, Plaintiff, v. DICK'S SPORTING GOODS, INC., a Delaware corporation; and DOES 1 through 100, inclusive, Defendants.
ORDER
Before the court is plaintiff Jimmy Greer's motion for approval of proposed class notice and notice plan. Defendant Dick's Sporting Goods opposes the motion and alternately provides its own proposed notice. For reasons explained below, plaintiff's motion is GRANTED in part and DENIED in part and the parties are ORDERED to jointly file a revised notice within fourteen days of this order.
I. BACKGROUND
Plaintiff Jimmy Greer ("plaintiff") filed a class action complaint on March 19, 2015, in Sacramento County Superior Court, alleging defendant Dick's Sporting Goods ("DSG") violated several provisions of the California Labor Code and California Business and Professions Code § 17200, et seq. Removal Not. Ex. A, Compl., ECF No. 1-1. DSG removed the action to this court, ECF No. 1, and plaintiff subsequently filed the operative first amended complaint, First Am. Comp. ("FAC"), ECF No. 14.
On April 13, 2017, the court granted plaintiff's motion to certify two subclasses under Federal Rule of Civil Procedure 23(b)(3). See generally Class Cert. Order, ECF No. 45. The first certified class is defined as:
All non-exempt or hourly paid employees who worked for Defendant in its DSG retail stores within California at any time from March 18, 2011 until January 31, 2015 (the "Security Check Class").Id. at 3. The second certified class is defined as:
All non-exempt or hourly paid employees who worked for Defendant in its DSG retail stores within California at any time from March 18, 2011 until [April 13, 2017] (the "Business Reimbursement Class").Id. at 4.
On January 10, 2018, the court denied without prejudice DSG's motion to stay this action pending the California Supreme Court's decisions on two questions certified by the Ninth Circuit. ECF No. 64. After DSG filed its motion to stay, but before the court issued its order denying the motion, plaintiff moved for approval of its proposed class notice and notice plan. Mot., ECF No. 55. DSG opposes the motion, contending (1) the court should stay this action and defer ruling on class notice until the stay is lifted, or, alternatively, (2) the court should approve DSG's proposed notice. Opp'n, ECF No. 56 at 4. The court took the matter under submission after oral argument, Jan. 12, 2017 Hr'g Mins., ECF No. 65, and resolves the motion here.
All references to the parties' briefing and exhibits correspond to ECF page numbers, not the briefing and exhibits' internal pagination.
II. LEGAL STANDARD
For classes certified under Rule 23(b)(3), "the court must direct to class members the best notice that is practicable under the circumstances, including individual notice to all members who can be identified through reasonable effort." Fed. R. Civ. P. 23(c)(2)(B); see Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 175 (1974). The notice must be "reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections." Mullane v. Cent. Hanover Bank & Tr. Co., 339 U.S. 306, 314 (1950). Thus, "[t]he notice should describe the action and the plaintiffs' rights in it." Id. Under Rule 23(c)(2)(B),
The notice must clearly and concisely state in plain, easily understood language:Fed. R. Civ. P. 23(c)(2)(B).
(i) the nature of the action;
(ii) the definition of the class certified;
(iii) the class claims, issues, or defenses;
(iv) that a class member may enter an appearance through an attorney if the member so desires;
(v) that the court will exclude from the class any member who requests exclusion;
(vi) the time and manner for requesting exclusion; and
(vii) the binding effect of a class judgment on members under Rule 23(c)(3).
Furthermore, "due process requires at a minimum that an absent plaintiff be provided with an opportunity to remove himself from the class by executing and returning an 'opt out' or 'request for exclusion' form to the court." Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 812 (1985).
III. DISCUSSION
As noted, the parties submit dueling proposed notices. See Pl.'s Ex. 1, ECF No. 55-1 at 6-9; DSG Ex. 2, ECF No. 56-1 at 11-16. At hearing, the parties explained that although plaintiff's proposed notice incorporates certain DSG edits, plaintiff filed his motion for approval of class notice before the parties completed meet and confer efforts. Accordingly, DSG's opposition includes extensive suggested revisions to plaintiff's proposed notice. See DSG Ex. 2. Plaintiff's reply did not address DSG's proposed revisions. At hearing, plaintiff's counsel explained that plaintiff is chiefly concerned with DSG's proposed electronic opt-out methods, and his concerns with DSG's other proposed language, if any, are minor. Given the record before it, the court evaluates the dueling notices and ensures Rule 23(c)(2)(B)'s requirements are met. See Fed. R. Civ. P. 23(c)(2)(B).
A. The Parties' Proposed Notice Language
The following charts identify the parties' main points of disagreement. Plaintiff's proposed language is provided in plain text. DSG's objections are noted as strike-outs of plaintiff's language; DSG's proposed alternative language, if any, is indicated in italics. All the text in bold or underlined is also in bold or underlined in both parties' proposed notices, unless otherwise indicated.
1. Body of Notice
DSG proposes changes to discrete sections of the body of the notice, as reflected in the following chart:
| Section of Notice | Proposed Language |
| Caption | NOTICE OF RIGHT TO PARTICIPATE IN OR OPT OUT OFCLASS ACTION |
|---|---|
| Section entitled, "WHYSHOULD I READ THISNOTICE?" | The purpose of this Notice is to inform you that your rights may beaffected by the proceedings in a class action lawsuit pending beforeJudge Kimberly J. Mueller of the United States District Court forthe Eastern District of California (the "Court"). The Court hasordered that this Notice be sent to you so that you can |
| Section entitled, "WHATIS THE LITIGATIONABOUT?" | Dick's denies Plaintiff's claims. It maintains that it correctly paidSecurity Check Class members for all time worked and that it is notrequired under California law to reimburse BusinessReimbursement Class members for the cost of |
| Section entitled, "WHOREPRESENTS THECLASS?" | As a member of the class, you also have the option to enter anappearance through an attorney of your choice. |
| Section entitled, "WHATFEES AND COSTSARE INVOLVED?" | Because Class Counsel are representing the class on a contingencyfee basis, |
The court accepts DSG's proposed change to the caption. The certification notice should provide class members with sufficient information about the case to make an informed decision about their participation. See Manual For Complex Litigation (Fourth) ("MCL") § 21.311 (2004). DSG's caption accurately reflects that purpose.
The court rejects as unnecessary DSG's changes to the "WHY SHOULD I READ THIS NOTICE?" section; however, plaintiff's proposed language should be broken into discrete paragraphs, reading:
The purpose of this Notice is to inform you that your rights may be affected by the proceedings in a class action lawsuit pending before Judge Kimberly J. Mueller of the United States District Court for the Eastern District of California (the "Court").The balance of this section proposed by plaintiff should remain unchanged.
The Court has ordered that this Notice be sent to you so that you can be fully informed about the lawsuit and your rights and options in connection with it.
The court accepts DSG's proposed changes to the "WHAT IS THE LITIGATION ABOUT?" section, as DSG's language more accurately represents DSG's position.
The court rejects DSG's proposed edit to section "WHO REPRESENTS THE CLASS?" because the proposed edit would strike important clarifying language. While the notice should include plaintiff's language, "for" should be inserted between "responsible" and "retaining."
The court rejects DSG's proposed change to the first sentence in the "WHAT FEES AND COSTS ARE INVOLVED?" section. It accepts DSG's proposed deletion in the second sentence of (1) "That means that" and (2) replacement of "they" with "Plaintiff," but requires the addition to read, "Plaintiff, on behalf of the class, prevails. . . ."
2. "Rights and Options" Chart
DSG also proposes several significant changes to a chart entitled, "WHAT ARE MY RIGHTS AND OPTIONS IN THIS MATTER?" In addition to the changes noted in the table below, DSG proposes moving the chart to immediately follow the section, "WHAT IS THE LITIGATION ABOUT?", and to precede other sections answering the following questions: "WHAT IS A CLASS ACTION?," "WHAT RECOVERY DOES THE ACTION SEEK?," and "WHO REPRESENTS THE CLASS?" The table below reflects plaintiff's proposed language and defendant's proposed changes, using the same convention adopted above.
DSG proposes deleting all of plaintiff's proposed underlining in this section. Pl.'s Ex. 1 at 9; DSG Ex. 2 at 12. --------
For the sake of clarity, the court accepts DSG's suggestion "lawsuit" replace "matter" in the header.
The court rejects DSG's proposed deletion of the "Option 1," "Option 2" and "Option 3" cells. As to Option 1, the court accepts DSG's proposed "Do Nothing" to replace "Remain in the Class AND . . . ." Also as to option 1, the court rejects and accepts in part DSG's proposed changes to Option 1's substantive text and requires the text to read:
If you wish to remain in the case, you do not need to do anything right now. You will be automatically included as a member of the certified class and you will receive further notices as the case progresses.
If the Class obtains a favorable judgment or a settlement is reached, you may receive a portion of any monetary recovery. Whether the judgment is favorable or unfavorable to the Class, you will be bound by the result, and you will give up the right to separately sue Dick's for legal claims that are the same or related to those alleged in this lawsuit. You may also be called to testify at trial by either Plaintiff or Dick's, and/or to provide sworn deposition testimony in this matter.
The court rejects DSG's proposed deletion of all text as part of Option 2, which notifies a class member that he or she "may enter an appearance through an attorney if the member so desires[.]" See Fed. R. Civ. P. 23(c)(2)(B)(iv). However, the court modifies plaintiff's proposed language as follows: "If you wish to remain in the Class but want to hire yourown attorney, you and your attorney must notify Class Counsel and the Court that you have hired an attorney." The balance of the Option 2 language should remain as proposed by plaintiff.
In addition, the court rejects all of DSG's proposed changes to the Option 3 language.
The court agrees with DSG's placement of the "Options" chart to immediately follow the "WHAT IS THE LITIGATION ABOUT" section rather than at the end of the notice. See MCL § 21.31 ("Counsel should logically order the information that will assist the class member in making important decisions, such as whether to opt out of the class, object to a settlement, or file a claim."). /////
3. DSG's Proposed Additions
DSG also proposes two additional sections be added as the final two sections of the notice, immediately preceding the text reading, "PLEASE DO NOT CONTACT THE COURT REGARDING THIS MATTER":
| 8. HOW DO I STAY IN THE CLASS?You do not have to do anything at this time to stay in the Class. |
|---|
| 9. HOW DO I ASK TO BE EXCLUDED FROM THE CLASS?If you do not want to stay in the Class, you must submit a Request for Exclusion no later than[45 days from mailing]. You may submit a Request for Exclusion in any of the following ways:• By email to [insert email address];• By text message to [insert phone number],• Online at [insert web address of online Request for Exclusion form here];• By telephone call to [insert phone number]; or• By U.S. Mail using the enclosed Request for Exclusion form.If you choose to request exclusion online, by email, or by text message, your request must besent no later than [45 days from mailing] and must include the following information:• Your first and last name;• The following ID number: [insert ID number]• The following PIN number: [insert PIN number]If you choose to request exclusion by telephone call, you must do so no later than [45 days frommailing]. You will be asked to enter your ID and PIN numbers at the prompts.If you choose to request exclusion by U.S. Mail, the enclosed Request for Exclusion form mustbe postmarked by no later than [45 days from mailing]. |
The court rejects DSG's proposed "HOW DO I STAY IN THE CLASS" section as duplicative of the earlier described options. The court accepts DSG's proposed "HOW DO I ASK TO BE EXCLUDED FROM THE CLASS" section with the following modifications: First, the section shall immediately succeed the section entitled "WHAT ARE MY RIGHTS AND OPTIONS IN THIS LAWSUIT? and immediately precede the section "WHAT IS A CLASS ACTION?" In addition, the notice must be revised to refer only to mail and email opt-out methods, as discussed below. ///// /////
4. Changes Required by the Court
Although not requested by the parties, the court requires the following changes. In the section, "WHAT IS A CLASS ACTION?" the court strikes the parties' proposed language, as it is unnecessarily legalistic and potentially confusing. See Pl.'s Ex. 1 at 7; see also DSG Ex. 2 at 13. Instead, the following language shall be provided:
In a class action lawsuit, one or more people called "Class Representatives" (in this case Jimmy Greer) sue on behalf of other people with similar claims. The people with similar claims are "Class Members." In a class action lawsuit, one court resolves the issues for everyone in the Class—except for those people who choose to exclude themselves from the Class.
In addition, as the first sentence in the section "WHY SHOULD I READ THIS NOTICE?," the parties shall add: "Dick's Sporting Goods' records show that you currently work, or previously worked, for Dick's." See Pl.'s Ex. 1 at 6; DSG Ex. 2 at 11.
B. Opt-Out Form
The court accepts plaintiff's proposed opt-out form, Pl.'s Ex. 2, which will be included with the notice mailed to class members, with the following adjustments to the second sentence: (1) the word "back" should be deleted and (2) the claims administrator's mailing address should be provided at the end of the sentence. Accordingly, the latter half of the second sentence should read, "you must complete and sign this form and mail it to the Claims Administrator at [address] before [date]."
The court rejects DSG's proposal, which could be interpreted to suggest a class member is merely requesting to opt-out, rather than affirmatively opting-out by sending the notice. See DSG Ex. 4.
C. Third Party Administrator and Estimated Costs
Plaintiff proposes CPT Group, Inc. ("CPT") as its third-party administrator. Mot. at 7. After reviewing the declaration of CPT's senior vice president of operations, Green Decl., ECF No. 55-2, and accompanying material on CPT's experience, Ex. A, Green Decl., the court is satisfied that CPT is an experienced administrator. See, e.g., Sequeira Ruiz v. JCP Logistics, Inc., No. SACV131908JLSANX, 2016 WL 6156211, at *7 (C.D. Cal. Mar. 10, 2016) (collecting cases and finding CPT Group qualified to administer class notice and claim administration procedure in settlement).
CPT Group estimates $12,000 in estimated mailing costs, excluding a $2,500 interactive website charge to which plaintiff objects; it estimates an additional $3,105.56 in other costs, including skip traces, remailing, live call center support and tracking of opt-outs. Ex. B, Green Decl. Plaintiff will pay the $12,605 in notice costs. Mot. at 7; see Eisen, 417 U.S. at 177 (plaintiff typically bears cost of notice).
Although the court finds CPT is a qualified administrator, neither the briefing nor CPT's materials sufficiently explain CPT's processes for confirming class members' mailing addresses and processing mail returned as undeliverable. The court is not satisfied by the mere inclusion of skip tracing and remailing costs in CPT's estimate. Plaintiff is ORDERED to provide the court with a supplemental explanation of up to five pages correcting this omission within fourteen days of this order.
D. Opt-Out Procedures
"[D]ue process requires at a minimum that an absent plaintiff be provided with an opportunity to remove himself from the class by executing and returning an 'opt out' or 'request for exclusion' form to the court." Phillips Petroleum, Co., 472 U.S. at 812. "The opt-out procedure should be simple and should afford class members a reasonable time in which to exercise their option." MCL § 21.321.
The parties dispute the opt-out procedures to be made available to class members. DSG argues opt-out methods should reflect "the way that people communicate in this century," and proposes members be permitted to opt-out through a website, email, text message and mail. Opp'n at 10. Plaintiff argues this "muti-prong opt-out procedure . . . is simply unnecessary and unwarranted," and complains of "complications and significant costs" and potential "issues verifying the identity of the message's source and whether [a] message constitutes a legally binding request for exclusion from the class." Mot. at 9; see also Green Decl. ¶ 9 ("In CPT's experience, Exclusion Requests have not been permitted via text message."). Plaintiff argues the ///// opt-out form it proposes to send along with the notice, which class members may fill out and return by U.S. Mail, satisfies due process requirements. Mot. at 8-9.
The court is not persuaded by DSG's argument that allowing class members to opt-out through U.S. Mail "is essentially to allow no effective opt out at all." See Opp'n at 10. U.S. Mail offers a simple opt-out procedure that, despite DSG's contentions, remains a means of communication even "in this century." See id.; see also MCL § 21.321 (noting opt-out method should be "simple"). Although other opt-out procedures may be made available to the extent practicable, DSG has not shown permitting class members to opt-out only through U.S. Mail violates due process considerations or inadequately serves the purpose of "insur[ing] that the judgment, whether favorable or not, would bind all class members who did not request exclusion from the suit . . . ." See Eisen, 417 U.S. at 177. Accordingly, the court finds notice by U.S. Mail is sufficient and rejects DSG's contention the court must order plaintiff to provide electronic opt-out methods.
Nonetheless, DSG obtained a $300 estimate from CPT to provide an email opt-out method, and DSG offers to pay the $300 cost. See DSG Green Decl., ECF No. 56-2; Opp'n at 13 n.6. At hearing, plaintiff's counsel confirmed plaintiff does not object to including an email opt-out option if DSG pays the associated costs, and DSG reaffirmed its willingness to pay CPT's$300 fee. While the email opt-out method is not required, the court finds no reason to refuse such a method when the parties agree in this way.
Accordingly, in addition to submitting a signed opt-out form by U.S. Mail, class members may opt out through a secure email allowing verification that the person opting out is the potential class member associated with the email. The class notice should reflect these options and remove reference to all other opt-out methods not approved by the court.
IV. MEET AND CONFER ORDER
The parties are ORDERED to meet and confer to implement changes required in this order and jointly file an updated class notice and opt-out form incorporating the court's required changes within fourteen days of this order. In addition, the filing may include each ///// party's objections, if any, to the court's revisions. Any such objections should be explained concisely and should not be filed as a formal brief.
After receiving and reviewing the parties' joint filing, the court will issue an order noting additional changes, if any, approving the notice and issuing a notice plan. As discussed at hearing, DSG should be prepared to provide class information within ten days of the court's order approving the notice and issuing a notice plan.
IT IS SO ORDERED. DATED: February 7, 2018.
/s/_________
UNITED STATES DISTRICT JUDGE