Brandon Wilder, et al. v. The Kroger Co.

Summary

The United States District Court for the Southern District of Ohio approves a settlement class and settlement in consolidated wage-and-hour litigation arising from alleged underpayments caused by Kroger's MyTime payroll system. The Court finds the settlement fair, reasonable, and adequate under Federal Rule of Civil Procedure 23, but concludes that the requested attorneys' fees and costs are unreasonable and should be reduced. The consolidated cases involve employees from multiple states and claims under the Fair Labor Standards Act and related state wage laws.

Holdings

1. The proposed two-subclass settlement class satisfied Rule 23(a) and Rule 23(b)(3), including numerosity, commonality, typicality, adequacy, predominance, and superiority, and was finally certified for settlement purposes.
2. The proposed settlement was fair, reasonable, and adequate under Rule 23(e)(2) and was approved.
3. Kroger's approximately $10.55 million in voluntary payments made before settlement could not be included in the common fund for calculating attorneys' fees.
4. The court retained authority and an obligation to review the reasonableness of attorneys' fees in the class settlement even though the parties negotiated fees separately from class-member compensation.
5. The requested $4,878,376.85 fee and expense award was unreasonable because it represented approximately 47% of the properly calculated settlement fund; the court awarded $3,445,256, approximately one-third of the settlement fund, plus $48,845.38 in litigation expenses.
6. The court approved $48,845.38 in litigation expenses, up to $175,000 in settlement-administration costs, and $5,000 enhancement payments to each named plaintiff.

Questions Presented

1. Whether the proposed settlement classes satisfied the numerosity, commonality, typicality, adequacy, predominance, and superiority requirements of Federal Rule of Civil Procedure 23.
2. Whether the proposed class action settlement was fair, reasonable, and adequate under Federal Rule of Civil Procedure 23(e)(2).
3. Whether Kroger's pre-settlement voluntary payments to class members could be included in the common fund for calculating attorneys' fees.
4. Whether the court had authority and an obligation to review the reasonableness of attorneys' fees negotiated separately from class-member compensation in a class action settlement.
5. Whether the requested attorneys' fees and costs were reasonable under the percentage-of-the-fund method and lodestar cross-check.
6. Whether the proposed claims-administration costs and named-plaintiff enhancement payments should be approved.

Disposition

other