Anderson v. VITAC Corporation

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Chief Judge Philip A. Brimmer
Civil Action No. 25-cv-00329-PAB-NRN
KATELYN ANDERSON, on behalf of herself and similarly situated employees,
Plaintiff,
v.
VITAC CORPORATION,
Defendant.
ORDER
This matter is before the Court on the Joint Motion for Preliminary Approval of
Class Action Settlement [Docket No. 74]. The Court has subject matter jurisdiction
pursuant to 28 U.S.C. § 1331.
I. BACKGROUND
On January 31, 2025, plaintiff Katelyn Anderson filed her complaint on behalf of
herself and all others similarly situated against defendant Vitac Corporation. Docket No.
1. Ms. Anderson was employed by defendant from October 2017 to November 2024 to
create closed captions for defendant’s media clients. Id. at 3, ¶ 15. Defendant hired
employees who are paid hourly. Id., ¶ 16. The complaint alleges that defendant
required its employees to perform “prep time,” id., where they were required to clock-in
and perform “preparation tasks,” such as connecting to customers’ facilities, conducting
research, and conducting quality assurance, before the scheduled start of their shifts.
Id. at 3, 4, ¶¶ 17, 21. The complaint alleges that Ms. Anderson and similarly situated
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employees recorded their prep time, but were not paid for that time. Id. at 3-4, ¶¶ 19,
24.
Ms. Anderson seeks to represent a collective pursuant to the Fair Labor
Standards Act (the “FLSA”), 29 U.S.C. § 216(b), and a class pursuant to Fed. R. Civ. P.
23. See id. at 4-7. On behalf of the collective, Ms. Anderson asserts a claim for
violation of the FLSA for unpaid wages. See id. at 7-8. On behalf of the class, Ms.
Anderson asserts claims for violation of the Colorado Wage Act and for unjust
enrichment. See id. at 8-9.
II. HYBRID CLASS ACTIONS
Ms. Anderson seeks to certify a hybrid class action. See Docket No. 1 at 2-3,
¶¶ 9-10. Hybrid class actions involve both a Rule 23 class action and FLSA collective
actions. Pliego v. Los Arcos Mexican Restaurants, Inc., 313 F.R.D. 117, 123 (D. Colo.
2016). “Hybrid actions have troubled district courts across the country because of the
inherent conflict between the opt-in requirement of FLSA collective actions and the opt-
out provisions of Rule 23(b)(3) class actions.” Id. In a Rule 23 class action, class
members are bound by class judgment unless they affirmatively opt-out. See id. On
the other hand, in an FLSA collective action, collective members must affirmatively opt-
in to be bound by a judgment on behalf of the collective. See id. at 124. “Employees
who do not opt-in are not similarly bound by the results of the litigation, including any
settlement.” Id.
In their Joint Motion, the parties ask the Court to approve the settlement of both
the FLSA collective claim and the CWA class claim. Docket No. 74 at 1. “Although the
opt-in requirement of FLSA collective actions conflicts with the opt-out provisions of
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Rule 23(b)(3) class actions, courts have permitted parties to enter into hybrid
settlements to resolve both FLSA and state law claims.” German v. Holtzman Enters.,
Inc., No. 19-cv-03540-PAB-STV, 2023 WL 3585212, at *2 (D. Colo. May 22, 2023).
Accordingly, courts have found it appropriate in hybrid actions to bind class members –
who do not opt-out pursuant to Rule 23 – to the ultimate judgment, which includes the
release of FLSA claims. See id. at *10 (“The result of the application of res judicata is
that individuals who do not opt out of the Rule 23 class, but do not opt in to the release
of FLSA claims, are nevertheless bound by the settlement unless they show grounds for
collateral attack on the judgment.”); Pliego, 313 F.R.D. at 132 (“This court is in
agreement with courts which have found that normal res judicata principles apply in
hybrid FLSA/Rule 23 collective/class actions, thus binding non opt-out Rule 23 Class
Members who do not specifically opt-in to the release of FLSA claims to the ultimate
judgment, unless such a claimant shows grounds for collateral attack on the
judgment.”).
“Where parties seek settlement of a hybrid action, the settlement is evaluated on
a combination of the factors required for preliminary approval of an FLSA action and
those required for approval of a Rule 23 class settlement.” German, 2023 WL 3585212,
at *2. Accordingly, the Court will determine, pursuant to Rule 23 and the FLSA, whether
conditional certification of the proposed class is appropriate and whether the settlement
agreement is fair and reasonable.
III. PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT
Approval of a class action settlement under Federal Rule of Civil Procedure 23
occurs in two stages. In the first stage, the court preliminarily certifies a settlement
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class, preliminarily approves the settlement agreement, and authorizes that notice be
given to the class so that interested class members may object to the settlement’s
fairness. In the second stage, after notice is given to the putative class, the court holds
a fairness hearing at which it will address (1) any timely objections to the treatment of
this litigation as a class action and (2) any objections to the fairness, reasonableness, or
adequacy of the settlement terms. Fed. R. Civ. P. 23(e)(2); see, e.g., McReynolds v.
Richards-Cantave, 588 F.3d 790, 803 (2d Cir. 2009).
“Preliminary approval of a class action settlement, in contrast to final approval, is
at most a determination that there is . . . ‘probable cause’ to submit the proposal to class
members and hold a full-scale hearing as to its fairness.” In re Crocs, Inc. Sec. Litig.,
No. 07-cv-02351-PAB-KLM, 2013 WL 4547404, at *3 (D. Colo. Aug. 28, 2013) (quoting
Davis v. J.P. Morgan Chase & Co., 775 F. Supp. 2d 601, 607 (W.D.N.Y. 2011)). A
proposed settlement of a class action should therefore be preliminarily approved where
it “appears to be the product of serious, informed, non-collusive negotiations, has no
obvious deficiencies, and does not improperly grant preferential treatment to class
representatives.” See In re Motor Fuel Temperature Sales Practices Litig., 286 F.R.D.
488, 492 (D. Kan. 2012) (internal quotation marks omitted). Although the standards for
preliminary approval of a class action settlement are not as stringent as they are in the
second stage, id., the standards used in the second stage inform the court’s preliminary
inquiry. Therefore, it is appropriate to review those standards.
District courts have broad discretion when deciding whether to certify a putative
class. See Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 350 (2011); Shook v. Bd. of
Cnty. Comm’rs of the Cnty. of El Paso, 386 F.3d 963, 967 (10th Cir. 2004). A district
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court may only certify a settlement class if it is “satisfied, after a rigorous analysis,” that
the requirements of Rule 23 are met, and frequently, a district court’s “‘rigorous analysis’
will entail some overlap with the merits of the plaintiff’s underlying claim.” Dukes, 564
U.S. at 350–51; see also In re Initial Pub. Offerings Sec. Litig., 471 F.3d 24, 41 (2d Cir.
2006) (holding that “the obligation to make [Rule 23] determinations is not lessened by
overlap between a Rule 23 requirement and a merits issue, even a merits issue that is
identical with a Rule 23 requirement”).
A district court may certify a class action if the proposed class satisfies the
prerequisites of Fed. R. Civ. P. 23(a) as well as the requirements of one of the three
types of classes identified in Rule 23(b). The plaintiff bears the burden of proving that
Rule 23’s requirements are satisfied. DG ex rel. Stricklin v. Devaughn, 594 F.3d 1188,
1194 (10th Cir. 2010) (citing Shook, 386 F.3d at 968). Rule 23(a) requires that (1) the
class be so numerous that joinder is impracticable; (2) there are questions of law or fact
common to the class; (3) the claims of the representative parties are typical of those of
the class; and (4) the representative parties will fairly and adequately protect the
interests of the class. Fed. R. Civ. P. 23(a); In re Literary Works in Elec. Databases
Copyright Litig., 654 F.3d 242, 249 (2d. Cir. 2011).
The parties ask the Court to certify a settlement class under Rule 23(b)(3).
Docket No. 74 at 14. Under that provision, plaintiffs must show that “questions of law or
fact common to class members predominate over any questions affecting only individual
members” and that a class action “is superior to other available methods for fairly and
efficiently adjudicating the controversy.” Fed. R. Civ. P. 23(b)(3). In determining
predominance and superiority under Rule 23(b)(3), the court considers the following
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factors: (A) the class members’ interests in individually controlling the prosecution or
defense of separate actions; (B) the extent and nature of any litigation concerning the
controversy already begun by or against class members; (C) the desirability or
undesirability of concentrating the litigation of the claims in the particular forum; and (D)
the likely difficulties in managing a class action. Fed. R. Civ. P. 23(b)(3)(A)–(D). To
certify a settlement class, the court need not inquire whether the case, if tried, would
present difficult management problems under Rule 23(b)(3)(D). Amchem Prods., Inc. v.
Windsor, 521 U.S. 591, 620 (1997). However, all other Rule 23 requirements apply and
demand heightened attention in the settlement context because the court generally
lacks an opportunity to adjust the class as the case unfolds. Id. If the proposed
settlement class satisfies the requirements of Rules 23(a) and (b), then the court must
separately evaluate whether the settlement agreement is “fair, reasonable, and
adequate” under Rule 23(e). 1 Fed. R. Civ. P. 23(e)(2); In re Am. Int’l Grp., Inc. Sec.
Litig., 689 F.3d 229, 238 (2d Cir. 2012).
If plaintiffs meet the requirements for preliminary approval, the court will direct
notice to all class members who would be bound by the proposed settlement agreement
and hold a fairness hearing to determine if the proposal
is fair, reasonable, and adequate after considering whether: (A) the class
representatives and class counsel have adequately represented the class; (B)
the proposal was negotiated at arm’s length; (C) the relief provided for the class
is adequate, taking into account: (i) the costs, risks, and delay of trial and appeal;
(ii) the effectiveness of any proposed method of distributing relief to the class,
including the method of processing class-member claims; (iii) the terms of any
proposed award of attorney’s fees, including timing of payment; and (iv) any
1 The Supreme Court in Amchem cautioned that the fairness inquiry under Rule
23(e) does not supplant the Rule 23(a) and (b) requirements, but instead “function[s] as
an additional requirement.” 521 U.S. at 621.
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agreement required to be identified under Rule 23(e)(3); and (D) the proposal
treats class members equitably relative to each other.
Fed. R. Civ. P. 23(e)(2).
As noted above, although the standards for preliminary approval are not as
stringent as those for final approval, the final approval standards inform the court’s
preliminary inquiry. The court’s review for final approval is to “focus[] on whether ‘(1)
the settlement was fairly and honestly negotiated, (2) serious legal and factual
questions placed the litigation’s outcome in doubt, (3) the immediate recovery was more
valuable than the mere possibility of a more favorable outcome after further litigation,
and (4) [the parties] believed the settlement was fair and reasonable.’” Elna Sefcovic,
LLC v. TEP Rocky Mountain, LLC, 807 F. App’x 752, 757 (10th Cir. 2020) (unpublished)
(quoting Tennille v. W. Union Co., 785 F.3d 422, 434 (10th Cir. 2015)).
IV. PRELIMINARY APPROVAL OF FLSA COLLECTIVE SETTLEMENT
To preliminarily approve an FLSA collective settlement, the court must (1)
conditionally certify an FLSA collective; and (2) preliminarily approve the FLSA
settlement. See Stanley v. Panorama Orthopedics & Spine Ctr., P.C., No. 22-cv-01176-
RM-SBP, 2024 WL 1743497, at *11 (D. Colo. Apr. 23, 2024). Title 29 U.S.C. § 216(b)
of the FLSA provides in pertinent part:
Any employer who violates the provisions of . . . section 207 of this title shall be
liable to the employee or employees affected in the amount of . . . their unpaid
overtime compensation, . . . and in an additional equal amount as liquidated
damages. . . . An action to recover the liability prescribed in [section 207] may be
maintained against any employer . . . in any Federal . . . court of competent
jurisdiction by any one or more employees for and in behalf of himself or
themselves and other employees similarly situated.
29 U.S.C. § 216(b) (emphasis added). There is a two-step approach for determining
whether plaintiffs are “similarly situated” for purposes of FLSA collective action
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certification. Thiessen v. GE Capital Corp., 267 F.3d 1095, 1105 (10th Cir. 2001). 1 The
court’s initial certification comes at the notice stage, where the court determines
whether the plaintiff is similarly situated for purposes of sending notice to putative
collective members. Id. at 1102. Plaintiff is required to provide “nothing more than
substantial allegations that the putative class members were together the victims of a
single decision, policy or plan.” Id.; see also Stransky v. HealthONE of Denver, Inc.,
No. 11-cv-02888-WJM-MJW, 2012 WL 6548108, at *4 (D. Colo. Dec. 14, 2012). This is
a “lenient” standard, Baldozier v. Am. Family Mut. Ins. Co., 375 F. Supp. 2d 1089, 1092
(D. Colo. 2005), “which typically results in conditional certification of a representative
class.” Renfro v. Spartan Computer Servs., Inc., 243 F.R.D. 431, 432 (D. Kan. 2007).
The second stage, which comes at the conclusion of discovery, applies a stricter
standard of “similarly situated,” including application of at least four factors, to determine
whether the case can proceed as a collective action. Thiessen, 267 F.3d at 1102-03.
In an FLSA action, the parties must present any proposed settlement to the
district court for review and a determination of whether the settlement agreement is fair
and reasonable. See Lynn’s Food Stores, Inc. v. United States, 679 F.2d 1350, 1353
(11th Cir.1982); Baker v. Vail Resorts Mgmt. Co., No. 13-cv-01649-PAB-CBS, 2014 WL
700096, at *1 (D. Colo. Feb. 24, 2014). Requiring court approval of FLSA settlements
effectuates the purpose of the statute, which is to “protect certain groups of the
1Thiessen involved a collective action under the Age Discrimination in
Employment Act (“ADEA”), 29 U.S.C. § 621 et seq. Because the ADEA adopts the
collective action mechanism set forth in FLSA § 216(b), courts apply Thiessen to FLSA
collective actions. See Kaiser v. At The Beach, Inc., 2010 WL 5114729, at *4 n.9 (N.D.
Okla. Dec. 9, 2010); see also Brown v. Money Tree Mortg., Inc., 222 F.R.D. 676, 679
(D. Kan. 2004).
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population from substandard wages and excessive hours . . . due to the unequal
bargaining power as between employer and employee.” Brooklyn Sav. Bank v. O’Neil,
324 U.S. 697, 706 (1945). To approve the settlement agreement, the court must find
that (1) the litigation involves a bona fide dispute, (2) the proposed settlement is fair and
equitable to all parties concerned, and (3) any award of attorney’s fees in the proposed
settlement be reasonable. Baker, 2014 WL 700096, at *1.
V. ANALYSIS OF PROPOSED SETTLEMENT AGREEMENT
A. The Settlement Agreement
The parties’ motion for preliminary approval of the class settlement seeks
certification of a class of “[a]ll current and former closed captioners in Colorado who
worked for Defendant from January 31, 2022 through the date of final settlement
approval.” Docket No. 74 at 3. The settlement agreement states that defendant will pay
a Maximum Settlement Amount of $500,000. Docket No. 74-1 at 3. The Maximum
Settlement Amount includes a $5,000 service award to Ms. Anderson, $200,000 for
class counsel’s attorney’s fees, settlement payments to class members, and settlement
payments to Out of State Captioners, who are “out-of-state captioners who signed
consent forms to participate in this litigation.” Id. at 3, 10. The only cost not included in
the Maximum Settlement Fund is the cost of the Settlement Administrator. Id. at 3.
Defendant will pay the cost of the Settlement Administrator. Id. at 11. Within 21 days
after the Date of Finality, 2 defendant shall transfer the Maximum Settlement Amount to
2 The Settlement Agreement defines the Date of Finality as:
the later of the following: (1) the date the Final Order is signed if no
objections are made to the Settlement or if objections are made and
withdrawn; (2) five (5) days after the deadline to appeal the Final Order
has expired without a timely appeal or request for review being filed if
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the Settlement Administrator. Id. at 10. After attorney’s fees and the service award are
paid from the Maximum Settlement Fund, class members and Out of State Captioners
will be paid. Id. at 11. Ms. Anderson, class members, and Out of State Captioners shall
release their claims 3 against defendant, effective on the date that defendant transfers
the Maximum Settlement Amount to the Settlement Administrator. Id. at 14-15.
B. Numerosity
Rule 23(a)(1) requires that the class membership be sufficiently large to warrant
a class action because the alternative of joinder is impracticable. Fed. R. Civ. P.
23(a)(1). Some courts have held that numerosity may be presumed after a certain
number of class members are met; however, the Tenth Circuit has never adopted a
presumption of numerosity. Trevizo v. Adams, 455 F.3d 1155, 1162 (10th Cir. 2006)
(upholding district court ruling that a group of eighty-four class members was insufficient
to warrant class certification).
objections are filed and overruled; (3) ten (10) days after any appeal is
withdrawn or after an appellate decision affirming the Final Order without
material modification becomes final if objections are filed and overruled
and an appeal is taken of the Final Order; or (4) the date that the Action is
dismissed with prejudice.
Docket No. 74-1 at 2.
3 Claims shall include:
The claims released shall include, without limitation, known and unknown
claims relating to any alleged: underpayment of wages; failure to pay
minimum wages; failure to pay or correctly calculate regular, overtime,
paid sick leave, or meal or rest break premium pay; failure to provide meal
or rest periods; failure to maintain accurate payroll records; failure to
timely pay wages when due; failure to pay pre-shift or post-shift activities;
failure to pay reporting time; failure to reimburse business expenses; and
any statutory and/or civil penalty claims including but not limited to claims
for inaccurate wage statements, untimely or late pay, and underpayment
of wages due at termination.
Id. at 14.
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Here, the parties state that the settlement class contains 88 putative members.
Docket No. 74 at 11. Given Trevizo, the sheer number of class members does not
create a presumption of numerosity; however, given that the Tenth Circuit has found
fewer potential claimants can satisfy numerosity, see, e.g., Rex v. Owens ex rel St. of
Okla., 585 F.2d 432, 436 (10th Cir. 1978) (“Class actions have been deemed viable in
instances where as few as 17 to 20 persons are identified as the class.”), the Court
agrees that the joinder of 88 people would be impracticable and that the numerosity
requirement is met.
C. Commonality
Rule 23(a) requires a district court to ensure that “there are questions of law or
fact common to the class.” Fed. R. Civ. P. 23(a)(2). Factual differences in the claims of
the individual class members should not result in the denial of class certification where
common questions of law exist. Devaughn, 594 F.3d at 1195. Commonality requires
that plaintiffs demonstrate that the class members have “suffered the same injury” such
that the claims of the class are based on a common contention and that the
determination of the truth or falsity of this contention “will resolve an issue that is central
to the validity of each one of the claims in one stroke.” Dukes, 564 U.S. at 350. In other
words, plaintiffs must have a common question of fact or law that will connect many
individual claims to the relief sought by the class. Ellis v. Costco Wholesale Corp., 657
F.3d 970, 981 (9th Cir. 2011).
The parties contend that members of the proposed class have questions of law
and fact in common that include whether defendant paid them on a piece rate basis,
whether defendant failed to compensate them for prep time, whether proposed class
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members are owed minimum wage or overtime compensation, and whether owed prep
time (if any) should be paid despite the piece rate agreement. Docket No. 74 at 12.
Because a “finding of commonality requires only a single question of law or fact
common to the entire class,” see Devaughn, 594 F.3d at 1195, the Court finds that the
commonality requirement is satisfied. See Stanley, 2024 WL 1743497, at *4 (agreeing
with the parties that “commonality is met here because the proposed class features two
basic questions of law and fact that are common to every member of the class: Whether
each worked hours off-the-clock and whether non-payment of wages for those hours
violated state and federal wage law”) (internal quotation, alteration, and citation
omitted); Shahlai v. Comcast Cable Commc’ns Mgmt., LLC, No. 16-cv-2556-WJM-NRN,
2018 WL 3870129, at *4 (D. Colo. Aug. 15, 2018) (holding that the commonality
requirement was satisfied where the parties asserted that “the Settlement Class
Members are joined by the common questions of law and fact that arise from
[defendant’s] alleged failure to pay minimum wages”) (citation omitted).
Accordingly, the Court finds that the commonality requirement is satisfied.
D. Typicality
Rule 23(a)(3) requires that the “claims or defenses of the representative parties
are typical of the claims or defenses of the class.” Fed. R. Civ. P. 23(a)(3). The
typicality requirement ensures that the absent class members are adequately
represented by the lead plaintiffs such that the interests of the class will be fairly and
adequately protected in their absence. Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147,
157 n.13 (1982). Typicality “is satisfied when each class member’s claim arises from
the same course of events, and each class member makes similar legal arguments to
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prove the defendant’s liability.” Marisol A. v. Giuliani, 126 F.3d 372, 376 (2d Cir. 1997).
The interests and claims of the lead plaintiff and the class members need not be
identical to satisfy typicality and, provided the claims of the lead plaintiff and class
members are based on the same legal or remedial theory, differing fact situations of the
class members do not defeat typicality. Devaughn, 594 F.3d at 1198–99.
Nevertheless, “it is well-established that a proposed class representative is not ‘typical’
under Rule 23(a)(3) if the representative is subject to a unique defense that is likely to
become a major focus of the litigation.” Marcus v. BMW of N. Am., LLC, 687 F.3d 583,
599 (3d Cir. 2012) (citation and quotation omitted).
The parties contend that Ms. Anderson’s claims are typical of the class claims
because Ms. Anderson and class members were employed as voice captioners for
defendant, paid on a piece rate basis, compensated through a common payroll system,
and subject to defendant’s policies for voice captioners, including policies concerning
prep time. See Docket No. 74 at 12-13. The Court agrees that Ms. Anderson’s claims
are typical claims of the proposed class. Accordingly, the Court finds that the typicality
requirement is satisfied. See Stanley, 2024 WL 1743497, at *4 (holding that the
typicality requirement was satisfied because “[t]he Named Plaintiffs, like all members of
the putative class, allege that they were not paid for the off-the-clock hours they worked
and that this non-payment violated the same state and federal laws as to each of
them”).
E. Adequacy of the Representation
Rule 23(a)(4) requires that the class representatives “fairly and adequately
protect the interests of the class.” Fed. R. Civ. P. 23(a)(4). As the Supreme Court has
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noted, the “adequacy-of-representation requirement tends to merge with the
commonality and typicality criteria of Rule 23(a), which serve as guideposts for
determining whether maintenance of a class action is economical and whether the
named plaintiff’s claim and the class claims are so interrelated that the interests of the
class members will be fairly and adequately protected in their absence.” Amchem, 521
U.S. at 626 n.20 (internal quotations omitted). As such, the “inquiry under Rule 23(a)(4)
serves to uncover conflicts of interest between named parties and the class they seek to
represent.” Id. at 625. To be an adequate class representative, the “representative
must be part of the class and possess the same interest and suffer the same injury as
the class members.” Id. at 625-26.
The Tenth Circuit has identified two questions relevant to the adequacy of
representation inquiry: “(1) do the named plaintiffs and their counsel have any conflicts
of interest with other class members and (2) will the named plaintiffs and their counsel
prosecute the action vigorously on behalf of the class?” Rutter & Wilbanks Corp. v.
Shell Oil Co., 314 F.3d 1180, 1187–88 (10th Cir. 2002) (citation omitted). “Adequate
representation depends on, among other factors, an absence of antagonism between
representatives and absentees, and a sharing of interest between representatives and
absentees.” Ellis, 657 F.3d at 985.
The Court finds that the interests of the class are fairly and adequately protected
by Ms. Anderson and her counsel. With regard to the first adequacy factor, Ms.
Anderson’s interests are aligned with those of the proposed settlement class because
she seeks relief for injuries arising out of the same conduct by defendant that resulted in
unpaid wages. Further, there is nothing in the record to show any conflict of interest
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between Ms. Anderson or counsel and the rest of the class; any class members who
disagree will be able to challenge this issue at the fairness hearing if they believe
otherwise.
With regard to the second adequacy factor, the proposed class counsel, Sara A.
Green of Hardin Thompson PC, “has diligently litigated this case since its inception and
has significant experience litigating FLSA and CWCA claims, including the resolution of
class actions and complex cases through settlement.” See Docket No. 74 at 13. There
are no questions regarding the competency of the proposed class counsel or her ability
to prosecute this action, and, to the extent any such questions do arise, they will be
considered at the fairness hearing. Accordingly, at this preliminary stage, because Ms.
Anderson and proposed class counsel do not have a conflict of interest with the rest of
the class and have shown that they can vigorously litigate on behalf of the class, the
Court finds that the adequacy requirement is satisfied. See Rutter, 314 F.3d at 1188.
F. Rule 23(b)(3)
To qualify for certification under Rule 23(b)(3), class questions must
“predominate over any questions affecting only individual members,” and class
resolution must be “superior to other available methods for the fair and efficient
adjudication of the controversy.” Amchem, 521 U.S. at 615. Rule 23(b)(3) states that
courts should consider the following factors when certifying a class: (A) the interest of
members of the class in individually controlling the prosecution or defense of separate
actions; (B) the extent and nature of any litigation concerning the controversy already
commenced by or against members of the class; (C) the desirability of concentrating the
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litigation of the claims in the particular forum; and (D) the difficulties likely to be
encountered in the management of a class action. See Fed. R. Civ. P. 23(b)(3)(A)-(D).
Parallel with Rule 23(a)(2)’s commonality element, Rule 23(b)(3)’s predominance
requirement imposes an obligation upon district courts to ensure that issues common to
the class predominate over those affecting only individual class members. Sullivan v.
DB Investments, Inc., 667 F.3d 273, 297 (3d Cir. 2011). However, the predominance
criterion is “far more demanding” than Rule 23(a)(2)’s commonality requirement.
Amchem, 521 U.S. at 624. Rule 23(b)(3)’s purpose is to “ensure[ ] that the class will be
certified only when it would achieve economies of time, effort, and expense, and
promote . . . uniformity of decision as to persons similarly situated, without sacrificing
procedural fairness or bringing about other undesirable results.” Cordes & Co. Fin.
Servs., Inc. v. A.G. Edwards & Sons, Inc., 502 F.3d 91, 104 (2d Cir. 2007) (quotation
omitted). Thus, Rule 23(b)(3)’s predominance inquiry tests whether the proposed class
is sufficiently cohesive to warrant adjudication by representation based on “questions
that preexist any settlement.” Amchem, 521 U.S. at 623.
The Court agrees that common questions predominate over questions only
affecting individual members. See Docket No. 74 at 14. Evidence of unpaid wages is a
common question that goes to the alleged injury. See Stanley, 2024 WL 1743497, at *6
(finding that common questions predominate in a case regarding unpaid wages
because the court found that there was a dominant injury, even if the “amount of
damages will vary among the class members”). Although the damages may vary for
individuals in the class, the question of what wages should have been paid will be
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common to the class and is enough at this stage to show a common question on the
measure of damages.
Second, the Court finds that a class action settlement is a superior method for
resolving this dispute fairly and effectively. Settlement avoids duplicative litigation,
saving both class members and defendant significant time and legal costs to adjudicate
common legal and factual issues. Additionally, the parties state that “absent Class
Members to date have shown no interest in controlling the litigation of separate actions
because no other litigation regarding this controversy has been commenced.” Docket
No. 74 at 14. Thus, given that the class members’ claims arise from the same series of
events, the Court finds that conducting the class action settlement in this forum would
achieve economies of time, effort, and expense and promote uniformity of decision to
similarly situated persons. 	See Fed. R. Civ. P. 23(b)(3); Cordes, 502 F.3d at 104.
Because class members will receive the same type of relief and have claims that
present common questions of fact and law, the Court finds that class certification is
appropriate because the class questions predominate over individual questions and the
settlement class is a superior method of resolving this litigation. See Amchem, 521 U.S.
at 623.
G. Rule 23(e) Factors
Rule 23(e) provides that a proposed settlement may only be approved after a
“finding that it is fair, reasonable, and adequate.” Fed. R. Civ. P. 23(e)(2). In making
this determination, “trial judges bear the important responsibility of protecting absent
class members” and must be “assur[ed] that the settlement represents adequate
compensation for the release of the class claims.” In re Pet Food Prods. Liab. Litig.,
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629 F.3d 333, 349 (3d Cir. 2010); see also Amchem, 521 U.S. at 623 (noting that the
Rule 23(e) inquiry “protects unnamed class members from unjust or unfair settlements
affecting their rights when the representatives become fainthearted before the action is
adjudicated or are able to secure satisfaction of their individual claims by a compromise”
(citations omitted)).
To determine whether a proposed settlement is fair, reasonable, and adequate,
courts consider the following factors: (1) whether the proposed settlement was fairly and
honestly negotiated; (2) whether serious questions of law and fact exist, placing the
ultimate outcome of the litigation in doubt; (3) whether the value of an immediate
recovery outweighs the mere possibility of future relief after protracted and expensive
litigation; and (4) the judgment of the parties that the settlement is fair and reasonable.
Rutter, 314 F.3d at 1188. If the settling parties can establish these factors, courts
usually presume that the proposed settlement is fair and reasonable. In re Warfarin
Sodium Antitrust Litig., 391 F.3d 516, 535 (3d Cir. 2004) (applying an “initial
presumption of fairness” to a proposed settlement where: (1) it is the result of arm’s
length negotiations; (2) it is based on sufficient discovery; (3) the proponents of the
settlement are experienced in similar litigation; and (4) only a small fraction of the class
objected).
Based on the information available to the Court, the Court notes the following,
which weigh in favor of preliminary approval: (1) the proposed settlement agreement is
the product of “extensive arms-length negotiations and a settlement conference with
Magistrate Judge N. Reid Neureiter,” see Docket No. 74 at 2-3; (2) the Settlement
Agreement was negotiated by “experienced counsel” and “Class Counsel has
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negotiated settlements of FLSA and CWCA claims on both an individual and a class-
wide basis and is experienced in addressing the issues that arise in complex litigation
and settlements,” see id. at 9-10; and (3) there is no evidence that the settlement
agreement was the result of a collusive agreement between the parties. See id. at 10.
The Court therefore finds that the negotiations were conducted fairly and honestly.
Furthermore, the parties represent that “Defendant denies any fault, liability, or
wrongdoing of any kind and disputes that the evidence developed in any way supports
the claims asserted in the litigation” and “that the named Plaintiff or any Settlement
Class Members were harmed or suffered any loss as a result of any of the conduct
alleged in the litigation.” See id. at 3. As a result, the Court finds that the serious
questions factor weighs in favor of the proposed settlement agreement. 4
The settlement agreement provides that “Class Counsel shall move for an award
of attorneys’ fees of no more than Two Hundred Thousand Dollars and Zero Cents
($200,000) from the Maximum Settlement Amount, and Defendant shall not oppose the
request for attorneys’ fees for that amount.” Docket No. 74-1 at 10. Local Rule 54.3(b)
requires that a motion for attorney’s fees shall include the following for each person for
whom fees are claimed: (1) a summary of the relevant qualifications and experience;
and (2) a detailed description of the services rendered, the amount of time spent, the
hourly rate charged, and the total amount claimed. D.C.COLO.LCivR 54.3(b). To
determine the reasonableness of a fee request, a court must begin by calculating the
4 At the fairness hearing, the Court will be interested in what percentage of each
class member’s estimated unpaid prep time and off-the-clock work will be compensated
through the Settlement Amount and what percentage would be compensated if
attorney’s fees awarded were 30% of the Settlement Amount rather than 40%.
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“lodestar amount.” Robinson v. City of Edmond, 160 F.3d 1275, 1281 (10th Cir. 1998).
The lodestar amount is the “number of hours reasonably expended on the litigation
multiplied by a reasonable hourly rate.” See Hensley v. Eckerhart, 461 U.S. 424, 433
(1983). A “reasonable rate” is defined as the prevailing market rate in the relevant
community for an attorney of similar experience. Guides, Ltd. v. Yarmouth Group Prop.
Mgmt., Inc., 295 F.3d 1065, 1078 (10th Cir. 2002). A party seeking an award of
attorney’s fees must establish the reasonableness of each dollar and each hour for
which the party seeks an award. Jane L. v. Bangerter, 61 F.3d 1505, 1510 (10th Cir.
1995).
Because class counsel has not yet moved for attorney’s fees pursuant to Local
Rule 54.3(b), the Court will not determine the precise amount of attorney’s fees that
class counsel is entitled to. Rather, the Court will determine whether the maximum
amount of attorney’s fees provided for in the settlement agreement is fair and
reasonable. The proposed, maximum attorney’s fee award of $200,000 is 40% of the
settlement fund. See Docket No. 74-1 at 10. This amount is within the customary
range for contingent fee awards in common fund settlement cases. See Johnston v.
Camino Nat. Res., LLC, No. 19-cv-02742-CMA-SKC, 2021 WL 2550165, at *2 (D. Colo.
June 22, 2021) (finding that an attorney’s fee award that is 40% of the settlement fund is
“within the normal range for a contingent fee award”); Whittington v. Taco Bell of Am.,
Inc., No. 10-cv-01884-KMT-MEH, 2013 WL 6022972, at *6 (D. Colo. Nov. 13, 2013)
(“Together the fees and costs amount to approximately 39% of the fund as a whole.
This is within the normal range for a contingent fee award.”); Vaszlavik v. Storage Corp.,
No. 95-cv-02525, 2000 WL 1268824, at *4 (D. Colo. Mar. 9, 2000) (“A 30% common
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fund fee award is in the middle of the ordinary 20%-50% range and is presumptively
reasonable.”). Provided that class counsel’s motion for attorney’s fees sufficiently
supports the amount requested, and depending on the information discussed in footnote
four above, the Court finds that the attorney’s fee provision of the settlement agreement
is reasonable.
Regarding the $5,000 service award for Ms. Anderson, the Court finds that this
amount is reasonable. “When determining whether a service award is reasonable,
courts consider the actions the plaintiff has taken to protect the interests of the class,
the degree to which the class benefited from those actions, the time and effort required
to pursue the litigation, and any reasonable fears of workplace retaliation.” Stanley,
2024 WL 1743497, at *13. The parties state that “Ms. Anderson met with Class
Counsel Sara Green on several occasions to discuss her employment with Defendant,
Defendant’s pay practices, and her time records in order to assist with the Complaint”
and “assisted counsel in preparing for settlement negotiations.” Docket No. 74 at 7.
These are “consequential tasks” and the service award “appear[s] to be in line with . . .
awards . . . that have been approved in class settlements in this District.” See Stanley,
2024 WL 1743497, at *14.
Next, the Court must determine whether the value of immediate recovery
outweighs the mere possibility of future relief. This factor weighs in favor of the
proposed settlement. Given the prospect of shortening what could be prolonged
litigation and providing partial guaranteed relief, the Court finds that immediate recovery
outweighs the possibility of future relief. Accordingly, the Court finds this factor weighs
in favor of granting preliminary approval. With regard to the fourth factor, the parties’
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counsel has extensive experience in wage and hour class action litigation and
represents that the settlement agreement is fair and reasonable. See Docket No. 74 at
9-10.
Certifying the class will allow the Court to determine whether there are members
of the class who challenge the fairness of the parties’ proposed settlement agreement.
Should any class member find the terms of the settlement agreement unfair, he or she
may choose not to join the settlement and to litigate independently or to remain in the
case and file objections to the settlement agreement detailing why it is unfair under the
Rule 23 factors. Cf. Grilli v. Metro. Life Ins. Co., Inc., 78 F.3d 1533, 1536-38 (11th Cir.
1996) (district court did not abuse discretion in denying motion to intervene, based on
the court’s conclusion that proposed intervenors could protect their interest either by
opting out of the class and litigating separately, or by remaining in the case and, if they
thought the proposed settlement was unfair, objecting to it); In re Crocs, Inc. Sec. Litig.,
2013 WL 4547404, at *12 (explaining that party opposing settlement agreement could
opt-out or file objections). The Court finds that the presumption of fairness, see In re
Warfarin Sodium, 391 F.3d at 535, is sufficient to preliminarily approve the terms of the
proposed settlement agreement.
H. FLSA Factors
For the same reasons that the Court will preliminarily certify a Rule 23 class, the
Court finds that preliminary certification is appropriate under the FLSA. See Stanley,
2024 WL 1743497, at *10 (“And in light of the overlap between the requirements for
preliminarily certifying a Rule 23 class and an FLSA collective action, ‘[f]or essentially
the same reasons explained above, as to Rule 23, and given the parties’ stipulation and
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joint motion, the Court also finds that preliminary certification of the proposed FLSA
class is warranted under the comparatively lenient standard for preliminary certification
and notice of an FLSA collective action.’”) (quoting Shahlai, 2018 WL 3870129, at *6).
The Court finds that the complaint provides substantial allegations that the putative
collective members are similarly situated. See Thiessen, 267 F.3d at 1102-03.
Turning to whether there is a bona fide dispute, the parties state that this case
alleges defendant violated the FLSA and Colorado Wage Act by “failing to pay
Captioners for mandatory pre-shift ‘prep time’ and related off-the-clock work performed
by Plaintiff and all similarly situated employees.” Docket No. 74 at 2. The parties
engaged in “extensive investigation and discovery” with defendant producing “over
13,800 pages of documents consisting of employees’ pay records and Defendant’s pay
policies and practices.” Id. Defendant denies any fault, liability, or wrongdoing and
denies that class members were harmed by defendant’s alleged practices. See id. at 3.
Accordingly, the Court finds that a bona fide dispute exists.
To be fair and reasonable, an FLSA settlement must provide adequate
compensation to the employees and must not frustrate the FLSA’s policy rationales.
See Ostrander v. Customer Eng’g Servs., LLC, No. 15-cv-01476-PAB-MEH, 2019 WL
764570, at *1 (D. Colo. Feb. 21, 2019). Courts considering both individual and
collective settlements under the FLSA turn to the factors for evaluating the fairness of a
class action settlement. Id. Courts then determine “whether the settlement undermines
the purposes of the FLSA.” See Stanley, 2024 WL 1743497, at *11 (citation omitted).
For the reasons described supra § V.G, the Court finds that the proposed
settlement agreement is fair and reasonable. As for whether the settlement agreement
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undermines the purpose of the FLSA, the FLSA’s purpose is to protect employees’
rights from employers who generally wield superior bargaining power. See Baker, 2014
WL 700096, at *2. To determine whether a settlement agreement complies with the
FLSA, courts look at the following factors: (1) the presence of other similarly situated
employees; (2) a likelihood that plaintiff’s circumstances will recur; and (3) whether
defendant has a history of non-compliance with the FLSA. Id.
The Court agrees that the employees in this case are similarly situated. See
Docket No. 74 at 3-5. There is no evidence that defendant’s alleged failure to comply
with the FLSA represents a continuing violation and the Court discerns “no reason to
anticipate anything other than Defendants’ compliance with the FLSA going forward.”
See Stanley, 2024 WL 1743497, at *12. As discussed supra § V.G., the Court finds that
the attorney’s fee award contemplated by the settlement agreement, provided that
plaintiff’s counsel sufficiently supports her fee award request in her motion for attorney’s
fees and depending on the information discussed in footnote four, is reasonable.
Plaintiff’s counsel reviewed over 13,800 pages of discovery and engaged in extensive
arms-length negotiations and a settlement conference. See Docket No. 74 at 2.
Furthermore, this case involves “hybrid classes and so is more complex than either a
standalone FLSA collective action or Rule 23 class action would have been." See
Stanley, 2024 WL 1743497, at *13.
Accordingly, the Court finds that the settlement agreement is fair and reasonable
under the FLSA.
VI. NOTICE TO THE SETTLEMENT CLASS
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Under Rule 23(e)(1), a district court approving a class action settlement “must
direct notice in a reasonable manner to all class members who would be bound by the
proposal.” Fed. R. Civ. P. 23(e)(1). Rule 23(c)(2)(B) provides, in relevant part, that for
“any class 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).
In addition to the requirements of Rule 23, the Due Process Clause also guarantees
unnamed class members the right to notice of a settlement. DeJulius v. New England
Health Care Emps. Pension Fund, 429 F.3d 935, 943-44 (10th Cir. 2005). However,
due process does not require that each class member receive actual notice to be bound
by the adjudication of a representative action. Id. Instead, the procedural rights of
absent class members are satisfied so long as “the best notice practicable [is given]
under the circumstances including individual notice to all members who can be
identified through reasonable effort.” In re Integra Realty Resources, Inc., 262 F.3d at
1110 (citation omitted). Thus, the legal standards for satisfying Rule 23(c)(2)(B) and the
constitutional guarantee of procedural due process are “coextensive and substantially
similar.” DeJulius, 429 F.3d at 944.
Plaintiff, in conjunction with the Settlement Administrator, proposes a plan to
provide members of the settlement class with direct notice of the settlement in this case.
See Docket No. 74-1 at 6-7. The Settlement Administrator – within fifteen days of
receiving a list of class members’ and Out of State Captioners’ last known home or
mailing address, Social Security number or, as applicable, other
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taxpayer identification number, and the number of Qualifying Workweeks worked during
the period (the “Class List”), see id. at 2 – will send the Notice by first-class mail to the
applicable mailing address. See id. at 6. The Settlement Administrator will check the
Class List against the National Change of Address Database before mailing. See id. If
Notice is returned as undeliverable, the Settlement Administrator shall perform a skip
trace to identify another address. See id. The parties have identified 88 class members
from defendant’s records. See Docket No. 74 at 11.
The Court is satisfied that the procedures detailed in the Settlement Agreement
are reasonably calculated to apprise the absent class members of the action. See In re
Integra, 262 F.3d at 1111. The proposed notice plan will be approved. See Rhodes v.
Olson Assocs., P.C., 308 F.R.D. 664, 668 (D. Colo. 2015) (approving the parties’ plan to
directly mail notice using a third-party claims administrator where there was “no
indication that any of the class members cannot be identified through reasonable
efforts” and defendant’s records already identified class members).
The notice must “clearly and concisely state in plain, easily understood
language:”
(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).
Fed. R. Civ. P. 23(c)(2)(B). The Notice indicates that class members can request
exclusion by mailing, sending a fax, or emailing the Opt-Out Form to:
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Optime Administration, LLC
PO Box 3206
Brockton, MA 02304
Fax: (781) 287-0381
Docket No. 74-2 at 3. Although the Notice indicates that putative class members can
opt-out via email, this contact information does not include an email address. The
parties shall provide an email address for class members seeking exclusion.
Regarding the binding effect of a class judgment, the Notice states:
Upon approval of the Settlement by the Court, and that approval becoming final,
you will receive a settlement payment and will be deemed to have released
VITAC Corp. from all claims of every kind related to payment for any alleged
unpaid wages related to pre-shift “prep time” and related off-the-clock work.
Specifically, you will release and fully discharge VITAC Corp. and their present
and former officers, directors, shareholders, agents employees, representatives,
attorneys, parent companies, subsidiaries, divisions, affiliates, related
companies, successors and assigns (the “Releasees”) from any and all wage
and hour claims, debts, complaints, damages, penalties, costs, demands, suits,
actions, and causes of action under Colorado law that were brought or could
have been brought in this Action based on the facts alleged in the operative
complaint. The facts alleged involved the failure to pay all time worked for “prep
time.” If you participate in this settlement, you agree not to make claims against
the Releasees for those things.
Id. (emphasis added). The Notice appears to represent to class members that they are
only releasing their claims under Colorado law. However, the Settlement Agreement
indicates that class members will release all claims:
Effective the date that the Maximum Settlement Amount is deposited into the
QSF, Class Representatives and all Participating Class Members release the
Released Parties from any and all federal, state, and local wage-and-hour
claims, rights, demands, liabilities, and/or causes of action of every nature and
description, whether known or unknown, including, without limitation, statutory,
constitutional, contractual, and/or common law claims for wages, gratuities,
reimbursements, damages, unpaid costs, penalties, liquidated damages, punitive
damages, interest, attorneys’ fees, litigation costs, restitution, or equitable relief,
which were or could have been asserted in the Action based upon the alleged
claims under any federal, state, or local statutes, Wage Orders, codes, or
ordinances, to the extent permitted by applicable law, for the duration of the
Class Period. The claims released shall include, without limitation, known and
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unknown claims relating to any alleged: underpayment of wages; failure to pay
minimum wages; failure to pay or correctly calculate regular, overtime, paid sick
leave, or meal or rest break premium pay; failure to provide meal or rest periods;
failure to maintain accurate payroll records; failure to timely pay wages when
due; failure to pay pre-shift or post-shift activities; failure to pay reporting time;
failure to reimburse business expenses; and any statutory and/or civil penalty
claims including but not limited to claims for inaccurate wage statements,
untimely or late pay, and underpayment of wages due at termination (“Released
Claims”).
Docket No. 74-1 at 14; see also Docket No. 74 at 5. Accordingly, the parties shall
revise the Notice to indicate that class members shall release their claims under federal,
state, and local laws if they choose to not opt-out. Furthermore, the Court will require
the parties to revise the Notice to explicitly state that class members will release their
FLSA claims by failing to opt-out. See German, 2023 WL 3585212, at *12 (approving
notice in a hybrid action where the “proposed notice conspicuously informs potential
class members that failing to opt out of the Rule 23 class will result in the
extinguishment of the potential class member's FLSA claims”).
Subject to the revisions discussed, the Court will approve the Notice.
VII. CLASS COUNSEL
When certifying a class, a court “must appoint class counsel.” Fed. R. Civ. P.
23(g)(1). In appointing class counsel, the Court must consider:
(A)(i) the work counsel has done in identifying or investigating potential claims in
the action; (ii) counsel’s experience in handling class actions, other complex
litigation, and the types of claims asserted in the action; (iii) counsel’s knowledge
of the applicable law; and (iv) the resources that counsel will commit to
representing the class; [and] (B) may consider any other matter pertinent to
counsel’s ability to fairly and adequately represent the interests of the class[.]
Fed. R. Civ. P. 23(g)(1). The settlement agreement lists Sara A. Green of Hardin
Thompson, P.C. as class counsel, and the parties request that Ms. Green be appointed
as class counsel. Docket No. 74-1 at 1-2; Docket No. 71 at 1. The Court finds that Ms.
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Green has sufficient experience in wage collective and class actions, and her
knowledge of the applicable law, as exhibited in the case up to this point, weighs in
favor of her appointment. Therefore, the Court finds that it is appropriate to appoint Ms.
Green as class counsel.
VIII. CONCLUSION
For the foregoing reasons, it is
ORDERED that the Joint Motion for Preliminary Approval of Class Action
Settlement [Docket No. 74] is GRANTED. It is further
ORDERED that the class, defined as follows, shall be preliminarily certified
pursuant to Fed. R. Civ. P. 23:
All current and former closed captioners in Colorado who worked for Defendant
from January 31, 2022 through the date of final settlement approval.
It is further
ORDERED that Katelyn Anderson is appointed as Class Representative. It is
further
ORDERED that Sara A. Green is appointed as Class Counsel. It is further
ORDERED that the proposed Notice and notice schedule, Docket Nos. 74-1, 74-
2, are approved subject to the parties making the revisions discussed herein. It is
further
ORDERED that the parties shall contact the Court to schedule a final fairness
hearing within seven days of the date of this order. It is further
ORDERED that Plaintiffs’ Motion for Conditional Certification of Fair Labor
Standards Act, 29 U.S.C. § 216(b) Collective Action and For Class Certification Under
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Fed. R. Civ. P. 23 (Colorado Wage Act) [Docket No. 49] is DENIED without prejudice
as moot. 5 It is further
ORDERED that Plaintiffs’ Motion for Conditional Certification of Fair Labor
Standards Act, 29 U.S.C. § 216(b) Collective Action and For Class Certification Under
Fed. R. Civ. P. 23 (Colorado Wage Act) [Docket No. 48] is DENIED as moot. 6 It is
further
ORDERED that Defendant’s Opposed Motion for Leave to File Response to
Plaintiff’s Motion for Conditional Certification of Fair Labor Standards Act, 29 U.S.C.
§ 216(b) Collective Action and for Class Certification Under Fed. R. Civ. P. 23 (Colorado
Wage Act) Out of Time [Docket No. 58] is DENIED without prejudice as moot.
DATED January 22, 2026.
BY THE COURT:
___________________________
PHILIP A. BRIMMER
Chief United States District Judge
5 Because the parties have reached a settlement and now move jointly for
conditional certification, the Court finds that the parties’ competing motions concerning
conditional certification, filed prior to the settlement conference, are moot.
6 The motion filed by plaintiff at Docket No. 48 is identical to the motion filed at
Docket No. 49, except that Docket No. 49 attaches an additional exhibit. See Docket
No. 49-3 at 1. Therefore, the Court will deny Docket No. 48 as moot in light of the
amended motion.
____	__	__	___	___	____	__	__	___________	__	____________	_____	________	_____	_____	__	________________________________________________________________	_______________________________
PHILIP A BRIMMER
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