The Court has approved the Notice to inform you of the Settlement of the class action lawsuit entitled Moore et al. v. Department of State Hospitals, Los Angeles Superior Court, Case No. 19STCV16858, and to advise you of your rights under the Settlement. If you received a Notice, it is because DSH’s records indicate that you are a member of the Class. The Class is composed of all civil detainees who worked at any of the Hospitals managed by the DSH, in the DSH’s vocational program or sheltered workshops, between March 29, 2018 and June 27, 2019 and were paid a rate less than the applicable California minimum wage.
WHAT IS THIS ALL ABOUT?
Plaintiffs Venus Moore, Deanna Winton, Thomas Hall, Robert Lefort, Joseph Bennett, Joshua Chiaromonte, Shan Shaw, Shane Potter, and Joseph Badiali filed this class action lawsuit against DSH. The lawsuit’s primary claim is that DSH improperly failed to pay Plaintiffs and other patient-workers the applicable California state minimum wage for the hours they spent working in DSH’s vocational rehabilitation program. DSH disagrees and believes that its practices during the Class Period complied with California law.
On June 27, 2019, Senate Bill 78 (“SB 78”) was enacted into law. The new law continues to authorize DSH to establish sheltered workshops at state hospitals “to provide patients with remunerative work.” (Welf. & Inst. Code §§ 4316; 4317.5.) The law, however, specifies that patient-workers who participate in sheltered workshops or other vocational-rehabilitation program are not employees for purposes of state civil service, minimum wage, and employment contracts. (Id.) The Welfare and Institutions Code states, in relevant part, that notwithstanding any payment schedule, participating patients “are not employees” subject to the minimum wage. (Welf. & Inst. Code §§ 4316(b); 4317.5.) The Court has not ruled on the merits of any of the claims asserted in the Lawsuit. DSH continues to deny that it has done anything wrong or that it is liable for any of the claims made in the Lawsuit. The Settlement is not an admission that DSH did anything wrong. Plaintiffs and DSH agreed to this Settlement to avoid the uncertainty of continuing with the case—including uncertainty related to the outcome of various possible motions, a trial, and any appeal—and the ongoing distraction, inconvenience, and expense of litigation. The Settlement provides the opportunity for patient-workers to receive payments in exchange for ending the Lawsuit and releasing the claims against DSH.
The class action attorneys approved by the Court as counsel for the patient-workers (“Class Counsel”) believe that the Settlement is fair and reasonable. One reason that Class Counsel believe this Settlement is fair and reasonable is that the Court recently decided that patient-workers can only bring claims for unpaid wages for one year before the filing of their government claim form. So, although Plaintiffs filed their case seeking three years of unpaid wages, the Court held that recovery in this case would be limited to the one year period before the filing of their government claim form—from March 29, 2018, until the enactment of Senate Bill 78 on June 27, 2019. There are also other risks in moving forward, including the risk that the Court would not certify the case as a class action, or that Plaintiffs would not prevail on the merits of their claims.
The Court has reviewed the Settlement Agreement and has preliminarily approved it as fair and reasonable and therefore has ordered the mailing of the Notice to the proposed class of patient-workers. On July 15, 2021, the Court will review the Settlement Agreement again and will make a final determination of the fairness and reasonableness of the Settlement before deciding whether to finally approve it.
HOW MUCH IS THE SETTLEMENT; HOW IS IT CALCULATED; AND HOW MUCH IS MY SHARE?
DSH has agreed to pay $2 million to settle the disputed claims in this Lawsuit. Some of that amount will pay for administration costs of the Settlement (not to exceed $20,000); attorneys’ fees (in an amount to be approved by the Court but not to exceed 33% of the Gross Settlement Amount, or $660,000); reasonable out-of-pocket costs of the Lawsuit (not to exceed $50,000); costs for a Guardian ad Litem for any incompetent class members (not to exceed $4,000); and service payments to the Plaintiffs (not to exceed $5,000 each). Everything that is left after those expenses (the “Net Settlement Amount”) will be paid to the Class Members.
The amount that each Class Member receives will be determined by a formula. DSH will provide the Settlement Administrator with two pieces of information for each Class Member: (1) the number of hours the Class Member worked in during the Class Period and (2) the hourly rate of pay the Class Member was paid for each week the Class Member worked. The Settlement Administrator will then calculate an average hourly rate of pay for each Class Member by averaging all of the hourly rates of pay for each of the weeks that the person worked. To determine the average hourly amount that the person was paid less than minimum wage, the Settlement Administrator will then subtract the average hourly rate of pay from $11.40 (the weighted average of the California state minimum wage during the Settlement Period). The Settlement Administrator will then multiply each Class Member’s number of hours worked by the average hourly amount that the person was paid less than minimum wage. The result is the Class Member’s “Product.” The Administrator will then divide the Class Member’s Product by the sum of such Products for all Participating Class Members. The result will be the Class Member’s “Payment Ratio.” In other words, the Class Member’s Payment Ratio is a fraction, with the Class Member’s own individual Product as the numerator, and the sum of the Products of all Class Members as the denominator. The Settlement Administrator will then multiply the Class Member’s Payment Ratio by the Net Settlement Amount. The result of this calculation will be the Participating Class Member’s Individual Settlement Payment.
If you are a Class Member, your estimated share of the Settlement is stated on the second page of your Notice. This amount is an approximate minimum payment because it is based on the assumption that all Class Members will participate.
Settlement Class Members who are no longer detained in a DSH Hospital at the time the Settlement payments are made will be issued a check, which can be cashed for 365 days. Any checks not cashed after 365 days will be paid to the State of California General Fund.
Settlement Class Members who are detained in a DSH Hospital at the time payments are made will have their Settlement payments directly deposited into their patient account.
WHAT ARE MY OPTIONS?
As a Class Member, you have the following options regarding your participation in the Lawsuit:
Option 1 (Participate/Do Nothing): If you want to receive your monetary share of the Settlement fund, you do not need to take any action. You will receive money and will give up certain claims as described in the release. If your address changes, be sure to let either Class Counsel or the Settlement Administrator know your updated contact information so that you may receive your settlement share.
Option 2 (Exclude Yourself/Opt-out): If you do not wish to receive a Settlement payment and do not want to release your claims against DSH in this case, you must ask to be excluded from the Settlement (“Opt-Out”) by postmarking a request for exclusion by August 16, 2021.
Option 3 (Object): If you want to object to the Settlement, you must write to the Settlement Administrator or Class Counsel by August 16, 2021 to express your objection, following the procedures described in Section 9 of the Notice. If the Settlement is approved despite your objection, you will remain a Class Member, receive a settlement payment, and will release your claims against DSH in this case.
WHAT IF I THINK MY SETTLEMENT SHARE WAS CALCULATED INCORRECTLY?
The number of hours worked and the average pay rate used to calculate your settlement share are pre-printed on your Notice. That information was taken from DSH’s records. If you dispute either or both of these numbers pre-printed on your Notice, you must write what you believe is the correct number of hours worked and/or the correct average pay rate and, if possible, attach documents that verify the information you believe to be correct. Please be advised that DSH’s personnel records are presumed to be accurate unless you prove otherwise. Note that you must postmark a written, signed dispute along with supporting documents to the Settlement Administrator at the address provided on this Notice by August 16, 2021. Once your dispute is received, the Settlement Administrator shall report it to Class Counsel and Defendant’s Counsel and shall be granted reasonable access to DSH’s records related to the dispute. After consulting with both counsel and reviewing the dispute and DSH’s records, the Settlement Administrator will make a final and non-appealable decision regarding the dispute.
IS MY SETTLEMENT PAYMENT TAXED?
An IRS Form 1099 will be distributed to patient-workers who participate in the Settlement, reflecting the payments they receive under the Settlement. No tax withholdings will be made. If you have any questions about the tax consequences of the payments you may receive under the Settlement, you should consult with a tax advisor.
HOW DO I EXCLUDE MYSELF FROM THE LAWSUIT AND SETTLEMENT IF I WISH TO DO SO?
If you are a member of the Class but do not want to remain in the Class, you may exclude yourself (“opt out”). If you exclude yourself from the Class, you will lose any right to participate in the Settlement—including any right to receive a settlement payment. If you decide on this option, you may keep any rights you have, if any, against DSH and you may file your own suit against DSH based upon the same legal claims that are asserted in the Lawsuit, but you will need to find your own attorney at your own cost to represent you in that suit. If you are considering this option, you should consult an attorney immediately to determine the extent of your rights.
IMPORTANT: You will be bound by the terms of the Settlement unless you submit a timely and signed written request to be excluded from the Settlement. To exclude yourself from the Settlement, you must mail a request for exclusion, postmarked no later than August 16, 2021, to:
Moore v DSH Settlement
c/o Atticus Administration
PO Box 64053
Saint Paul, MN 55164
This signed and dated statement must contain the following information: your full name; your current address; the last four digits of your social security number/ITIN; and a statement that you do not wish to participate in the Settlement in Moore et al. v. Department of State Hospitals, Los Angeles Superior Court, Case Nos. 19STCV16858. If you do not comply with these procedures and the deadline for exclusions, you will lose any opportunity to exclude yourself from the Class, and your rights will be determined in this lawsuit by the Settlement Agreement if it is approved by the Court.
WHAT CLAIMS AM I RELEASING?
By participating in the Settlement, you will be releasing the claims that were pled or asserted or that could have been pled based on the factual allegations set forth in the most recent complaint in the Action for the Class Period, including, any claims for unpaid wages or waiting time penalties. This release includes claims that you know to exist, and those that you do not know or suspect to exist.
THIS IS A SUMMARY DESCRIPTION ONLY. THE FULL RELEASE OF CLAIMS IS CONTAINED IN THE SETTLEMENT AGREEMENT, WHICH CAN BE VIEWED HERE OR SENT TO YOU UPON REQUEST TO THE SETTLEMENT ADMINISTRATOR OR CLASS COUNSEL. IF YOU HAVE QUESTIONS ABOUT THE RELEASE OF CLAIMS, YOU MAY CONTACT CLASS COUNSEL.
HOW DO I OBJECT TO THE SETTLEMENT, ATTORNEYS' FEES AND COSTS, OR ENHANCEMENT PAYMENTS?
You may object to the terms of the Settlement before Final Approval. Objections may only be submitted by persons who have not excluded themselves from the Settlement. However, the only way to avoid being bound by the terms of the Settlement is to timely postmark a signed request for exclusion as described above. You can ask the Court to deny approval by filing an objection. You can’t ask the Court to order a larger settlement; the Court can only approve or deny the Settlement. If the Court denies approval, no settlement payments will be sent out and the lawsuit will continue. If that is what you want to happen, you must object in writing, as described below. You may also appear at the Final Approval Hearing, either in person or through your attorney, but you do not need to appear at the hearing to have your objection considered by the Court.
All written objections and supporting papers must (a) clearly identify the case name and number (Moore et al. v. Department of State Hospitals, Los Angeles County Superior Court, Case No. 19STCV16858), (b) be submitted to either Class Counsel (Contact Information in Section 10) or the Settlement Administrator (Contact Information in Section 7), and (c) be postmarked on or before August 16, 2021. You must not submit your objections directly to the Court. If you do not comply with these procedures and the deadline for objections, you may lose any opportunity to have your objection considered at the Final Approval Hearing or otherwise to contest the approval of the Settlement or to appeal from any orders or judgments entered by the Court in connection with the proposed Settlement. You will still be eligible to receive a settlement payment if the Settlement becomes final even if you object to the Settlement.
The Court has scheduled a Final Approval Hearing on September 23, 2021 to listen to and consider any concerns or objections from patient-workers regarding the fairness, adequacy, and reasonableness of the terms of the Settlement Agreement. That hearing will take place on September 23, 2021 at 1:30 p.m., before the Honorable Elihu Berle, Los Angeles Superior Court, 312 North Spring Street, Los Angeles, California, 90012. Due to COVID-19, this hearing will likely take place remotely. Please visit https://my.lacourt.org/laccwelcome or contact Class Counsel for information about how to attend virtually if you would like to be present.
If you have an objection to Class Counsel’s motion for an award of attorneys’ fees and out-of-pocket costs, and/or their request for a “service award” to the Plaintiffs, you must submit to the Settlement Administrator or Class Counsel a written statement of the grounds of your objection, signed by you or your attorney, along with any supporting papers that you wish the Court to consider. The written objection must be postmarked by August 16, 2021. Should you wish to review the motion, it will be filed by May 17, 2021 and will be available to view on this website. You may also contact the Settlement Administrator or Class Counsel if you do not have internet access and would like to request a copy of the motion.
WHO ARE THE ATTORNEYS FOR THE CLASS MEMBERS?
If you participate in the Settlement, you will be represented by Class Counsel for purposes of the Settlement. If you prefer to be represented by your own lawyer, you may hire one at your own expense.
The Court has appointed the following attorneys as Class Counsel: Jessica Riggin and Valerie Brender of Rukin Hyland & Riggin LLP and Gay Grunfeld and Michael Freedman of Rosen Bien Galvan & Grunfeld LLP. Class Counsel can be reached as follows:
RUKIN HYLAND & RIGGIN LLP
1939 Harrison St., Suite 290
Oakland, CA 94612
Tel: (415) 421-1800
Fax: (415) 421-1700
ROSEN BIEN GALVAN & GRUNFELD LLP
101 Mission Street, Sixth Floor
San Francisco, CA 94105
Tel: (415) 433-6830
Fax: (415) 433-7104
HOW MUCH WILL CLASS COUNSEL BE PAID IN ATTORNEYS' FEES?
Class Counsel have been litigating this case since March 2019, including filing Plaintiffs’ government claims forms, two complaints, preparing and responding to discovery, litigating a motion for summary adjudication, and attending two full-day mediations. Class Counsel will ask the Court to award them attorneys’ fees of up to thirty percent (33%) of the Settlement Amount—that is, up to $660,000—which will be paid out of the Settlement Fund. You will not have to separately pay any portion of these fees yourself. As noted above, Class Counsel’s request for attorneys’ fees and costs (which must be approved by the Court) will be filed on May 17, 2021 and will be available to view on this Settlement website, or can be requested from the Settlement Administrator or Class Counsel.
WHAT ABOUT EXPENSES?
Subject to the Court’s approval, Class Counsel shall be reimbursed out of the Settlement Fund for the out-of-pocket costs that they have incurred throughout the Lawsuit in an amount not to exceed $50,000. The costs of claims administration and a Guardian ad Litem will also be deducted from the Settlement Fund, but it is estimated that this amount should not exceed $24,000.
WILL THE NAMED PLAINTIFFS GET ANY ADDITIONAL MONEY?
Class Counsel will ask the Court to award the Named Plaintiffs a service award of $5,000 each for the time that they spent, and the risk that they undertook, in bringing the Lawsuit and in providing relevant information to Class Counsel. This amount is also subject to Court approval. Whatever amount the Court approves, if any, will be deducted and paid from the Settlement Fund prior to distribution of the balance of the Settlement Fund to Class Members participating in the Settlement.
WHAT PROTECTIONS DO I HAVE AGAINST RETALIATION FOR PARTICIPATING IN THIS SETTLEMENT?
The law protects you from any retaliatory action based upon your participation in this Settlement. You will not be retaliated against by DSH for choosing to participate (or not participate) in the Settlement.
WHERE CAN I GET FURTHER INFORMATION?
If you have questions about this Notice or the Settlement, or if you did not receive this Notice in the mail and you believe that you are or may be a member of the Class, you should contact the Settlement Administrator (contact information listed in Section 7), for more information or to request that a copy of this Notice be sent to you in the mail. You may also view the Notice on the Settlement website on the Settlement Documents page, or you can request a copy of the Settlement Agreement or any of the papers filed in this matter from the Settlement Administrator or Class Counsel. If you wish to communicate directly with Class Counsel, you may contact them (contact information noted above in Section 10). You may also seek advice and guidance from your own private attorney at your own expense, if you wish to do so.
This Notice is only a summary of the Lawsuit and the Settlement Agreement. The entire Settlement Agreement and other related documents are available for viewing at the Settlement Documents page. If you have questions about the proposed Settlement, or wish to receive a copy of the Settlement Agreement but do not have access to the Internet to download a copy online, you may contact the Settlement Administrator or Class Counsel.
The Court cannot respond to any questions regarding this Notice, the Lawsuit, or the proposed Settlement. Please do not contact the Court or its Clerk.