Litigating California Wage & Hour and Labor Code Class Actions

precertification discovery. 467 The court distinguished CashCall, noting that in that case, “the
only conceivable class members were debtors who were unaware of the secret monitoring,”
and therefore unaware that they had potential claims. 468 “However, in contrast, Starbucks’
job applicants who had marijuana convictions know about their own previous convictions
and about the fact that they had applied for a job at Starbucks,” and therefore had a fair
opportunity to file suit if they so desired. 469 Thus, the court held that the Parris balancing
test required the requested precertification discovery to be denied because the potential
abuse of the class action procedure in this instance outweighed the rights of the class
members. 470
To the extent that any rule derives from all of these cases, it appears to be that the trial
court has broad discretion to deny discovery for the plaintiff to locate a new class
representative when the plaintiff is inadequate, but more narrow discretion in the absence
of a showing that the plaintiff never was a proper putative class member or never
experienced an injury in fact. Trial courts appear to lack any discretion to deny discovery
where the plaintiff is rendered inadequate by conduct of the defendant or as a result of
some other characteristic independent of the merits of the plaintiff’s claims.
XVI. Class Action Settlement
A. Generally
The vast majority of class actions result in a settlement. Unlike an individual settlement of
employment law claims, a court must approve a class settlement to ensure that it is fair and
reasonable, is not the product of collusion, and does not subordinate the interests of the
broader class to those of the named plaintiffs. 471
Typically, the plaintiffs and the defendant enter into a stipulation of settlement, which a
court analyzes to determine if the agreement looks reasonable on its face. If so, the court
will grant preliminary approval (sometimes called “conditional certification”) and then notice
of the settlement will be sent to the class. Most commonly, class members will be given a
choice of (1) returning a claim form to receive money under the agreement; (2) returning a
request for exclusion (“opt out”) form that excludes them from the settlement and preserves
their individual right to sue; or (3) doing nothing, in which case the class members receive
467
468
469
470
471
Id. at 725.
Id. at 726.
Id.
Id. at 726 (also noting that “the excessive penalties sought by class counsel bear little relationship to any true public
interest for what, at most, appears to be a technical violation of Labor Code 432.8 by Starbucks”).
See generally Dunk v. Ford Motor Co., 48 Cal. App. 4th 1794, 1800-01 (1996).
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