Jerammy Sanchez v. UAG Cerritos I, LLC, et al.

Case Number: 24STCV09094 Hearing: August 24, 2026

CONTINUE preliminary approval for the parties to address the issues listed in the accompanying checklist.

BACKGROUND

This is a wage and hour class action. On April 10, 2024, Plaintiff Jerammy Sanchez ("Plaintiff" or "Sanchez"), individually and on behalf of all others similarly situated, filed this putative class action against Defendants UAG Cerritos I, LLC d.b.a. Penske Chevrolet of Cerritos; UAG Cerritos, LLC d.b.a. Penske Buick GMC of Cerritos; and Does 1 through 100 (collectively, "Defendants") asserting causes of action for: (1) minimum wage violations (Labor Code Sec.Sec. 1182.12, 1194, 1194.2, 1197); (2) failure to pay all overtime wages (Labor Code Sec.Sec.204, 510, 558, 1194, and 1198); (3) meal period violations (Labor Code Sec.Sec.226.7, 512, and 558); (4) rest period violations (Labor Code Sec.Sec.226.7, 516, and 558); (5) wage statement violations (Labor Code Sec.226 et seq.); (6) waiting time penalties (Labor Code Sec.Sec.201-203); (7) failure to indemnify for all necessary business expenditures (Labor Code Sec.Sec.2802 and 2804); and (8) unfair competition (Business and Professions Code Sec.17200 et seq.).

Plaintiff alleges that Defendants operate a group of car dealerships throughout Los Angeles County. Plaintiff worked for Defendants as a non-exempt "Internet Salesman" or "Sales Representative" from approximately September 2019 to May 2023.

On April 10, 2024, Plaintiff sent written notice to the Labor and Workforce Development Agency ("LWDA") and Defendants pursuant to Labor Code section 2699.3, subdivision (a). (Declaration of Sean M. Blakely ("Blakely Decl."), P.9, Ex. B.)

On June 17, 2024, Plaintiff filed the operative First Amended Class and Representative Action Complaint ("FAC") adding a cause of action for civil penalties under the Private Attorneys General Act ("PAGA") (Labor Code Sec.2698 et seq.).

On January 16, 2025, the parties participated in a full-day mediation with Steven G. Mehta, Esq., and at the end of the mediation, the parties reached a settlement based on the mediator's proposal. (Blakely Decl., P.11.) A copy of the fully executed Stipulation of Settlement ("Stipulation") is attached to counsel Blakely's declaration as Exhibit A. (Ibid., Ex. A.)

Now before the Court is the Motion for Preliminary Approval of Class Action Settlement ("MPA"), filed on February 11, 2026.

SETTLEMENT

CLASS DEFINITION

· "Settlement Class" means all current and former non-exempt employees who worked for Defendants UAG Cerritos I, LLC d.b.a. Penske Chevrolet of Cerritos and UAG Cerritos, LLC d.b.a. Penske Buick GMC of Cerritos ("Defendants") in California from April 10, 2023, through September 2, 2025 ("Class Period"). (Stipulation, P.1)

o "Class Period" means April 10, 2023, through September 2, 2025. (Ibid.)

· " Aggrieved Employees" means all Settlement Class Members (regardless of whether they opt-out) who worked for Defendants at any time from April 10, 2023 through September 2, 2025 (the "PAGA Period")." (P.2.B)

o "PAGA Period" means April 10, 2023, through September 2, 2025. (Ibid.)

· For the purposes of this Settlement Agreement only, Plaintiff and Defendants stipulate to the certification of the Settlement Class. (P.1)

TERMS OF SETTLEMENT AGREEMENT

The essential terms are as follows:

· The Gross Settlement Amount ("GSA") is $355,733.00, non-reversionary. (P.3)

o Escalator Clause. Defendants represent that there are approximately 13,845 total collective workweeks worked during the Class Period. Should the actual number of workweeks during the Class Period exceed this extrapolation estimate by more than 10% (i.e., if there are 15,230 or more workweeks), Defendants shall increase the Gross Settlement Amount on a proportional basis above the 10% threshold (i.e., if there was a 12% increase in the number of workweeks above the estimated 13,845 workweeks, Defendants shall increase the Gross Settlement Amount by 2%). (P.3.D)

· The Net Settlement Amount ("NSA") ($168,095.33) is the GSA minus the following:

o Up to $118,577.67 (1/3) for attorney fees (P.P.3.C.4, 5)

o Up to $30,000 for litigation costs (Ibid.)

o Up to $10,000 for an Enhancement Award to the Class Representative (P.3.C.3); Sec. The Class Representative payment should not exceed $7,500, absent substantial justification. Provide justification for a payment of $10,000.

o Up to $8,250 for settlement administration costs (P.3.C.2); and

o Payment of $20,000 PAGA Penalty (75% of $15,000 to the LWDA) (P.3.C.5).

· Defendants' share of payroll taxes shall be paid by Defendants separately from, and in addition to, the Gross Settlement Amount. (P.3.E)

· Funding of GSA: The Gross Settlement Amount shall be deposited with the Settlement Administrator within thirty (30) calendar days of the Effective Date (which, for this purpose, shall be defined as the later of (1) date on which the Court enters an Order granting Final Approval of the Settlement Agreement or, (2) solely in the event that there are any objections to the Settlement Agreement (the filing of an objection being a prerequisite to the filing of an appeal), the later of: (i) the last date on which any appeal might be filed or (ii) the successful resolution of any appeal(s) - including expiration of any time to seek reconsideration or further review. (P.3.B)

· Payments from the GSA: Within ten (10) calendar days following Defendants' deposit of the Gross Settlement Amount with the Settlement Administrator, the Settlement Administrator will calculate Individual Settlement Payments amounts and provide the same to the Parties' counsel for review and approval. Within seven (7) calendar days of approval by the Parties' counsel, the Settlement Administrator will prepare and mail Individual Settlement Payments, less applicable taxes and withholdings, to participating Settlement Class members. The Settlement Administrator shall simultaneously pay the withholdings to the applicable authorities with the necessary reports, submitting copies to Defendants' counsel. (P.4.D)

o What about Individual PAGA Payments’

o Ensure that payment of the Class Representative Enhancement Award and Attorney Fees and Costs does not precede distribution of payments to Class Members and Aggrieved Employees.

· There is no claim form requirement. (P.4)

· Individual Settlement Payment Calculation: The Net Settlement Amount shall be allocated among Settlement Class members (except those who submit a timely and valid Request for Exclusion) based on each participating Settlement Class member's proportionate workweeks worked during the Class Period, which will be calculated by multiplying the Net Settlement Amount by a fraction, the numerator of which is the participating Settlement Class member's number of workweeks worked during the Class Period, and the denominator of which is the total workweeks worked by all participating Settlement Class members during the Class Period. (P.4.B.i)

o Tax Allocation: 20% wages; 40% penalties; and 40% interest. (P.4.D)

· Individual PAGA Payment Calculation: Each Settlement Class member who was employed by Defendants at any time during the PAGA Period (including those who submit a valid and timely Request for Exclusion from the class action settlement), shall receive a portion of the PAGA Amount proportionate to the number of workweeks worked during the PAGA Period, and which will be calculated by multiplying the PAGA Amount by a fraction, the numerator of which is the Settlement Class member's gross number of workweeks worked during the PAGA Period, and the denominator of which is the total number of workweeks worked by all participating Settlement Class members (including those who submit a valid and timely Request for Exclusion from the class action settlement) during the PAGA Period. (P.4.B.ii)

o Tax Allocation: 100% penalties. (P.4.D)

· " Response Deadline " means sixty (60) calendar days of the date of the initial mailing of the Notice Packets. (P.9.C) The Response Deadline is the deadline by which Class Members may mail a Request for Exclusion, Workweek Dispute, or written Objection to the Settlement Administrator. (P.P.9.C-9.E) Settlement Class members to whom Notice Packets are re-mailed after having been returned as undeliverable to the Settlement Administrator shall have fourteen (14) calendar days from the date of re-mailing, or until the Response Deadline has expired, whichever is later, to submit a Request for Exclusion, Objection, or dispute. (P.9.F)

· Uncashed Settlement Checks: Each member of the Settlement Class who receives an Individual Settlement Payment must cash that check within 180 days from the date the Settlement Administrator mails it. Any funds payable to Settlement Class members whose checks are not cashed within 180 days after mailing shall be distributed to Working Wardrobes, as the cy pres recipient. (P.4.E)

o Detail the steps that will be taken to ensure compliance with Code of Civil Procedure section 384, which requires that the Court re-open judgments following the final distribution of funds to include the cy pres in the judgment and to include the unclaimed amount, plus an unspecified amount of interest. Such information should be actively contemplated/provided for within the current terms of the settlement.

o Explain how uncashed Individual PAGA Payment checks will be treated. Generally, the Administrator should transmit the funds represented by such check to the California Controller's Unclaimed Property Fund in the name of the Aggrieved Employee thereby leaving no "unpaid residue" subject to the requirements of Code of Civil Procedure section 384, subdivision (b).

o Explain why the cy pres distribution fulfills the purposes of the lawsuit or is otherwise appropriate.

o Provide declarations by all parties and counsel disclosing any interest or involvement (or lack thereof) in the governance or work of the cy pres recipient.

· The settlement administrator will be Phoenix Settlement Administrators. (P.3.A; see Declaration of Jodey Lawrence.)

· Counsel submitted the proposed settlement agreement to the LWDA on February 11, 2026. (2-11-26 Proof of Service to LWDA.)

· The named Plaintiff and class members will release certain claims against Defendants. (See further discussion below).

ANALYSIS OF SETTLEMENT AGREEMENT

· Does a presumption of fairness exist?

1. Was the settlement reached through arm's-length bargaining? Yes. On January 16, 2025, the parties participated in a full-day mediation with Steven G. Mehta, Esq., and at the end of the mediation, the parties reached a settlement based on the mediator's proposal. (Blakely Decl., P.11.) A copy of the fully executed Stipulation of Settlement ("Stipulation") is attached to counsel Blakely's declaration as Exhibit A. (Ibid., Ex. A.)

2. Were investigation and discovery sufficient to allow counsel and the court to act intelligently? Yes. Counsel represents that in connection with mediation, Defendants provided Plaintiff with a 20% sampling of timekeeping and payroll records for putative class members employed during a one-year Class and PAGA Period. Defendants also produced relevant policy documents, including their written meal and rest period policies, timekeeping policies, commission-based pay plans, and overtime policies, and also provided Plaintiff with the number of current and former employees employed during the Class Period, and the corresponding number of pay periods worked by each employee and rate of pay.

Plaintiff conducted a comprehensive analysis and extrapolation of the data produced by Defendants to calculate classwide damages for each of Plaintiff's claims. This discovery allowed the Parties to assess the merits and value of Plaintiff's claims, the chances of certification of Plaintiff's claims, and Defendants' potential defenses. (Blakely Decl., P.10.) Demonstrate that the sample is statistically reliable.

3. Is counsel experienced in similar litigation? Yes. Class Counsel are experienced in class action litigation, including wage and hour class action cases. (Blakely Decl., P.P.2-6; Declaration of Paul K. Haines, P.P.2-8; Declaration of Joel M. Gordon, P.P.2-4.)

4. What percentage of the class has objected? This cannot be determined until the fairness hearing. See Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 2014) P. 14:139.18, ("Should the court receive objections to the proposed settlement, it will consider and either sustain or overrule them at the fairness hearing.")

CONCLUSION: The settlement is entitled to a presumption of fairness.

· Is the settlement fair, adequate, and reasonable?

1. Strength of Plaintiffs' case. "The most important factor is the strength of the case for plaintiffs on the merits, balanced against the amount offered in settlement." (Kullar v. Foot Locker Retail, Inc. (2008) 168 Cal.App.4th 116, 130.) Counsel has provided the following exposure analysis: Violation | Maximum Exposure | Realistic Exposure | Unpaid Wage Claim | $407,874 | $35,689 | Meal Period Claim (before 5 th hour) | $679,799 | $84,975 | Meal Period Claim (over 10-hour shift) | $231,124 | $17,334 | Rest Period Claim | $1,349,032 | $84,315 | Reimbursement Claim | $79,875 | $11,981 | Wage Statement Penalties | $680,200 | $68,020 | Waiting Time Penalties | $424,260 | $26,516 | PAGA Claim | $692,300 | $43,269 | Total | $4,544,464 | $372,099 | (Blakely Decl., P.P.15-23.)

2. Risk, expense, complexity and likely duration of further litigation. Given the nature of the class claims, the case is likely to be expensive and lengthy to try. Procedural hurdles (e.g., motion practice and appeals) are also likely to prolong the litigation as well as any recovery by the class members.

3. Risk of maintaining class action status through trial. Even if a class is certified, there is always a risk of decertification. (See Weinstat v. Dentsply Intern., Inc. (2010) 180 Cal.App.4th 1213, 1226 (" Our Supreme Court has recognized that trial courts should retain some flexibility in conducting class actions, which means, under suitable circumstances, entertaining successive motions on certification if the court subsequently discovers that the propriety of a class action is not appropriate.").)

4. Amount offered in settlement. Plaintiff's counsel obtained a $355,733 non-reversionary settlement. This is approximately 7.8% to 95.6% of the estimated recovery which, given the uncertain outcomes, is within the "ballpark" of reasonableness. The $355,733 settlement amount, after reduction by the requested deductions (assuming they are taken in full), leaves approximately $168,095.33 to be divided among the participating class members, for an average payment of $697.96. ($168,095.33 / 242= $697.96)

5. Extent of discovery completed and stage of the proceedings. As indicated above, at the time of the settlement, Class Counsel conducted sufficient discovery.

6. Experience and views of counsel. The settlement was negotiated and endorsed by Class Counsel who, as indicated above, are experienced in class action litigation, including wage and hour class actions.

7. Presence of a governmental participant. This factor is not applicable here.

8. Reaction of the class members to the proposed settlement. The class members' reactions will not be known until they receive notice and are afforded an opportunity to object and or opt-out. This factor becomes relevant during the fairness hearing.

CONCLUSION: The settlement can be preliminarily deemed "fair, adequate, and reasonable."

Scope of the release

· Every member of the Settlement Class (except those who opt out and except as to the PAGA claims specified below) will fully release and discharge Defendants, and all of their past and present officers, directors, shareholders, employees, agents, principals, representatives, accountants, auditors, consultants, and their respective successors and predecessors in interest, subsidiaries, affiliates, parents and attorneys, (collectively the "Released Parties"), as follows: (P.2)

o Upon the Effective Date and the complete funding of the Gross Settlement Amount, Settlement Class members will release all claims, demands, rights, liabilities and causes of action that were pled in the operative First Amended Class and Representative Action Complaint ("FAC") that arose during the Class Period, including claims for: (a) failure to pay all minimum wages; (b) failure to pay all overtime wages; (c) failure to provide meal periods as required by law; (d) failure to authorize rest periods as required by law; (e) failure to provide accurate, itemized wage statements; (f) failure to reimburse for all necessary business expenditures; and (g) all claims for unfair business practices that could have been premised on the facts, claims, causes of action or legal theories described above (the "Class Released Claims"). The period of the Class Released Claims shall extend to the limits of the Class Period. (P.2.A)

o Release of PAGA Claims. In addition, all Settlement Class members (regardless of whether they opt out) who worked for Defendants at any time from April 10, 2023 through September 2, 2025 (the "PAGA Period") are "Aggrieved Employees" and shall release the Released Parties from all claims for civil penalties under PAGA arising during the PAGA Period as disclosed in Plaintiff's Notification Letter to the Labor and Workforce Development Agency ("LWDA") ("the PAGA Released Claims"). (P.2.B) Sec. Settlement Class members who were employed by Defendants at any time during the PAGA Period and submit a valid and timely Request for Exclusion shall still be entitled to their portion of the PAGA Amount described above, and will release all PAGA Released Claims, whether they submit a valid and timely Request for Exclusion or not. (P.9.C.i)

· Plaintiff will also provide a general and CC Sec.1542 release as to Defendants. (P.2.C)

· May conditional class certification be granted?

1. Standards A detailed analysis of the elements required for class certification is not required, but it is advisable to review each element when a class is being conditionally certified (Amchem Products, Inc. v. Winsor (1997) 521 U.S. 620, 622-627.) The trial court can appropriately utilize a different standard to determine the propriety of a settlement class as opposed to a litigation class certification. Specifically, a lesser standard of scrutiny is used for settlement cases. (Dunk at 1807, fn. 19.) Finally, the Court is under no "ironclad requirement" to conduct an evidentiary hearing to consider whether the prerequisites for class certification have been satisfied. (Wershba at 240.)

2. Analysis

a. Numerosity. There are approximately 242 Class Members. (Blakely Decl., P.13.) This element is met.

b. Ascertainability. The proposed class is defined above. The class definition is "precise, objective and presently ascertainable." (Sevidal v. Target Corp. (2010) 189 Cal.App.4th 905, 919.) Class members are identifiable from Defendants' records. (MPA at 20:8-9.)

c. Community of interest. "The community of interest requirement involves three factors: '(1) predominant common questions of law or fact; (2) class representatives with claims or defenses typical of the class; and (3) class representatives who can adequately represent the class.'" (Linder v. Thrifty Oil Co. (2000) 23 Cal.4th 429, 435.) As to commonality, counsel contends that Plaintiff's claims are predicated primarily on Defendants' alleged unlawful timekeeping policies/practices and unlawful meal and rest period policies/practices. (MPA at 20:17-20.)

As to typicality, counsel contends that Plaintiff's claims are typical of the Settlement Class because (1) Plaintiff worked in California for Defendants as a non-exempt employee during the Class Period and was subject to Defendants' wage and hour policies/practices at issue in this case and (2) Plaintiff was injured by the same challenged policies/practices that allegedly injured the Settlement Class as a whole. (MPA at 20:24-21:6.) As to adequacy, Plaintiff does not have any conflicts of interest with other Class Members, understands his duties as Class Representative, has been active in litigation of the case, and is represented by adequate counsel. (MPA at 21:10-17; see Declaration of Jerammy Sanchez.)

d. Adequacy of class counsel. As indicated above, Class Counsel have shown experience in class action litigation, including wage and hour class actions.

e. Superiority. Given the relatively small size of the individual claims, a class action appears to be superior to separate actions by the class members.

CONCLUSION: The class may be conditionally certified since the prerequisites of class certification have been satisfied.

· Is the notice proper?

1. Content of class notice. The proposed notice is attached as Exhibit 1 to the Settlement Agreement. The Notice's content appears to be acceptable. It includes information such as: a summary of the litigation; the nature of the settlement; the terms of the settlement agreement; the proposed deductions from the gross settlement amount (attorney fees and costs, enhancement awards, and claims administration costs); the procedures and deadlines for participating in, opting out of, or objecting to, the settlement; the consequences of participating in, opting out of, or objecting to, the settlement; and the date, time, and place of the final approval hearing.

The Notice Packet consists of the Class Notice (Exhibit A) and Notice of Estimated Settlement Payment (Exhibit B). (P. 8.F) The Class Notice will be distributed in English and Spanish. (Notice, p. 1.) Correct P. 8.F of the Stipulation to indicate that the Class Notice is attached as Exhibit 1 and the Notice of Estimated Settlement Payment is attached as Exhibit 2.

2. Method of class notice. Class Data: Within ten (10) business days after entry of an order preliminarily approving this Settlement, Defendant will provide the Settlement Administrator with the Class Data in an electronic format satisfactory to the Settlement Administrator. (P. 9.A) Notice via direct mail: Within ten (10) business days from receipt of this information, the Settlement Administrator shall (i) run the names of all Settlement Class members through the National Change of Address ("NCOA") database to determine any updated addresses for Settlement Class members; (ii) update the address of any Settlement Class member for whom an updated address was found through the NCOA search; (iii) calculate the estimated Individual Settlement Payment for each Settlement Class member; and (iv) mail a Notice Packet to each Settlement Class member at his or her last known address or at the updated address found through the NCOA search, and retain proof of mailing. (P. 9.B) Any Notice Packets returned to the Settlement Administrator as non-delivered on or before the Response Deadline shall be re-mailed to the forwarding address affixed thereto.

If no forwarding address is provided, the Settlement Administrator shall make reasonable efforts, including utilizing a "skip trace," to obtain an updated mailing address within five (5) business days of receiving the returned Notice Packet. If an updated mailing address is identified, the Settlement Administrator shall resend the Notice Packet to the Settlement Class member immediately, and in any event within three (3) business days of obtaining the updated address. The address identified by the Settlement Administrator as the current mailing address shall be presumed to be the best mailing address for each Settlement Class member.

It will be conclusively presumed that, if an envelope so mailed has not been returned within thirty (30) days of the mailing, the Settlement Class member received the Notice Packet. Settlement Class members to whom Notice Packets are re-mailed after having been returned as undeliverable to the Settlement Administrator shall have fourteen (14) calendar days from the date of re-mailing, or until the Response Deadline has expired, whichever is later, to submit a Request for Exclusion, Objection, or dispute.

Notice Packets that are re-mailed shall inform the recipient of this adjusted deadline. If a Settlement Class member's Notice Packet is returned to the Settlement Administrator more than once as non-deliverable, then an additional Notice Packet shall not be mailed. Nothing else shall be required of, or done by, the Parties, Class Counsel, or Defendants' Counsel to provide notice of the proposed settlement. Remove the conclusive presumption that notice has been received if not returned within 30 days of mailing.

Efforts to locate updated addresses for returned notices should continue throughout the 60-day notice period. Notice of Final Judgment will be posted on the Settlement Administrator's website. (P.7) Explain how notice of any change of the date or location of the hearing will be given.

3. Cost of class notice. As indicated above, settlement administration costs are estimated to equal up to $8,250. Prior to the time of the final fairness hearing, the claims administrator must submit a declaration attesting to the total costs incurred and anticipated to be incurred to finalize the settlement for approval by the Court.

· Attorney fees and costs

CRC rule 3.769(b) states: "Any agreement, express or implied, that has been entered into with respect to the payment of attorney fees or the submission of an application for the approval of attorney fees must be set forth in full in any application for approval of the dismissal or settlement of an action that has been certified as a class action." Ultimately, the award of attorney fees is made by the court at the fairness hearing, using the lodestar method with a multiplier, if appropriate. (PLCM Group, Inc. v.

Drexler (2000) 22 Cal.4th 1084, 1095-1096; Ramos v. Countrywide Home Loans, Inc. (2000) 82 Cal.App.4th 615, 625-626; Ketchum III v. Moses (2000) 24 Cal.4th 1122, 1132-1136.) In common fund cases, the Court may utilize the percentage method, cross-checked by the lodestar. (Laffitte v. Robert Half Int'l, Inc. (2016) 1 Cal.5th 480, 503.) Despite any agreement by the parties to the contrary, "the court ha[s] an independent right and responsibility to review the attorney fee provision of the settlement agreement and award only so much as it determined reasonable." (Garabedian v.

Los Angeles Cellular Telephone Company (2004) 118 Cal.App.4th 123, 128.) The question of whether Class Counsel is entitled to $118,577.67 (1/3 of GSA) in attorney fees will be addressed at the fairness hearing when class counsel brings a noticed motion for attorney fees. Class counsel must provide the court with billing information so that it can properly apply the lodestar method and must indicate what multiplier (if applicable) is being sought as to each counsel. Class Counsel should also be prepared to justify the costs (capped at $30,000) sought by detailing how they were incurred.

· Incentive Awards to Class Representatives

The Settlement Agreement provides for a Class Representative Enhancement Award of up to $10,000 to the named Plaintiff. In connection with the final fairness hearing, the named Plaintiff must submit a declaration attesting to why he or she should be entitled to an enhancement award in the proposed amount. The named Plaintiff must explain why he or she "should be compensated for the expense or risk she has incurred in conferring a benefit on other members of the class." (Clark v. American Residential Services LLC (2009) 175 Cal.App.4th 785, 806.)

Trial courts should not sanction enhancement awards of thousands of dollars with "nothing more than pro forma claims as to 'countless' hours expended, 'potential stigma' and 'potential risk.' Significantly more specificity, in the form of quantification of time and effort expended on the litigation, and in the form of reasoned explanation of financial or other risks incurred by the named plaintiff, is required in order for the trial court to conclude that an enhancement was 'necessary to induce [the named plaintiff] to participate in the suit . . . .'" (Id. at 806-807, italics and ellipsis in original.)

The Court will decide the issue of the enhancement awards at the time of final approval. ... . LOS ANGELES SUPERIOR COURT, COMPLEX CIVIL DEPARTMENT CHECKLIST FOR PRELIMINARY APPROVAL OF CLASS ACTION SETTLEMENT Department: