The opinion
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
Jessica Robinson, et al., on
behalf of herself and all others
Civil Action No. 19-9066
similarly situated,
(MEF)(JRA)
Plaintiffs,
OPINION
v.
Jackson Hewitt, Inc., et al.,
Defendants.
* * *
For the purposes of this brief Opinion, the Court assumes full
familiarity with the facts and procedural history of this case.
* * *
The Plaintiffs moved for preliminary approval of a proposed
settlement and preliminary certification of a settlement class.
See Motion (April 5, 2024) (“Motion”).
Soon after the motion was made, the Court posed certain
questions, at a status conference. See Text Order (May 6, 2024)
(setting conference).
Following the status conference, the Plaintiffs submitted
revised materials. See Brief (May 29, 2024) (“Brief”). These
address the Court’s main questions in a satisfactory manner.
The motion is therefore likely to be granted, pending the
Plaintiffs addressing a loose end.
* * *
The Court’s first question related to the Plaintiffs’ obligation
to support the factual assertions they aim to rely on with
appropriate evidentiary materials. See generally Hacker v.
Elec. Last Mile Sols. Inc., 2024 WL 1231257, at *4 (D.N.J. Mar.
21, 2024).
But that is no longer an issue. The Plaintiffs have now filed
ample sworn materials. See e.g., Joint Declaration of Richard
M. Paul III, Jason Hartley, and Joseph Saveri in Support of
Plaintiffs’ Supplemental Memorandum in Support of Unopposed
Motion for Preliminary Approval of Settlement and Certification
of Settlement Class (May 29, 2024) (“Joint Declaration”).
* * *
The second set of questions related to the dollar value of the
proposed settlement. What percentage of the Plaintiffs’ total
damages does the proposed settlement cover? Must the settlement
account for the possibility of treble damages? And how does the
proposed settlement compare to settlements in comparable class
actions?
Each of these questions has been answered.
The settlement represents 54% of the total damages that are
potentially in play here, at least as those total damages have
been calculated by the Plaintiffs’ expert. See id. at 22.
The settlement need not account for the possibility of treble
damages. See Brief at 29 (citing In re Am. Family Enters., 256
B.R. 377, 425 (D.N.J. 2000); City of Detroit v. Grinnell Corp.,
495 F.2d 448, 458-59 (2d Cir. 1974), abrogated on other grounds
by Goldberger v. Integrated Res., 209 F.3d 43 (2d Cir. 2000)).
And a 54% settlement compares favorably to settlements in
comparable class actions. See Brief at 22 (referring to
settlements of less than 5%, 25%, and 16.7%).
The Court has itself independently scrutinized these answers and
concludes that they make sense.
* * *
The Court’s third question related to the various factors that
must be assessed before a district court in the Third Circuit
may finally approve a settlement, under Girsh v. Jepson, 521
F.2d 153, 157 (3d Cir. 1975), and its progeny.
The Plaintiffs’ newly built-out analysis of these factors is
persuasive. See Brief at 24-32. Among other things, the
Plaintiffs’ likelihood of success here is not 100%. Even
putting wholly to one side the arguable novelty of some of the
key legal theories, see id. at 26-27, there would be factual
questions here that could break in any number of different ways.
As to liability, for example, a number of franchise owners have
sworn that they were unaware of any “no-poach agreements” ---
and would prove it, in part, by showing that they had in fact
hired employees that would have been off-limits under such no-
poach agreements. See Joint Declaration ¶ 47; Brief at 30-31
(citing Exhibit R (Declarations JH-095707; JH-095701; JH-095690;
JH-05713; JH-095710); Defendant’s Class Certification Opposition
Exhibits 13-17).
As to damages, those are proposed to be calculated here based on
battling experts. These experts offer complex (and competing)
judgments as to how to estimate any declines in wages --- and it
is not crystal clear which expert’s views might prevail, and to
what extent.
Especially in light of these risks, a settlement that amounts to
54% of the Plaintiffs’ expert’s total damage calculation is, in
the Court’s judgment, a sufficient one. And all the more so by
comparison with the markedly lower settlements (5% to 25%) that
have been obtained in reasonably comparable cases.
* * *
The Court’s fourth question related to whether the Plaintiffs’
lawyers were properly incentivized not only to negotiate a
robust settlement --- but also to ensure that settlement money
actually makes its way into the pockets of individual class
members. See generally Hacker, 2024 WL 1231257 at *18-*20
(discussing this concern).
The Plaintiffs have adequately addressed this issue. They have
explained that they “have sufficient information for each of the
class members” for the claims administrator to make automatic
payments to them. See Brief at 13. This information includes
names, addresses, and email addresses, see Declaration of Carla
Peak ¶ 10, and this should allow for class members to be readily
located and promptly paid.
Moreover, the Plaintiffs’ lawyers have proposed that the Court
hold back 10% of their fee award until the process of
distributing all settlement funds to the class members is
completed. See Brief at 13 n.4. This creates a useful
incentive, that will help to encourage the Plaintiffs’ lawyers
to use their best efforts to make sure that class members
actually receive the payments to which any final settlement
would entitle them.
k tk *
Fifth and finaliy, the Court asked about whether objections to
the proposed settlement might be made by email, as opposed to by
traditional paper-and-stamp letters. This is, in part, to
ensure that there are low barriers to entry for anyone who might
wish to object to the proposed settlement. See Hacker 2024 WL
1231257 at *17. The Plaintiffs’ papers suggest that they will
allow for email notice. See Joint Declaration § 42. But the
proposed notice materials they have submitted to the Court do
not reference the possibility of email objections being made.
See Motion Exhibit 6 at 2, 8.
* * *
The motion at Docket Entry 309 is likely to be granted, upon
submission of revised notice materials that address the
referenced email issue.
DATE: June 24, 2024 Michael E. Farbiarz, U.S.D.J.