Insurance Inspectors Strike $2.4M Deal To End Wage Suit

Posted August 8th, 2018.

As It Appeared On
Law360

By Vin Gurrieri

Law360 (August 8, 2018, 8:50 PM EDT) — Overland Solutions Inc. struck a $2.4 million deal Wednesday with a proposed class of insurance inspectors who claim they were misclassified as independent contractors and denied proper wages, sending the deal to a California state judge for approval.

Overland, which provides insurance underwriting support services, reached the agreement with plaintiff Martin Fletscher, who is representing a class of insurance inspectors alleging they were shorted on pay and expense reimbursements in violation of the California Labor Code by being classified as independent contractors and not employees.

The settlement said the plaintiffs will soon ask the court for preliminary approval of the deal. A statement issued by the workers’ attorneys announcing the deal indicated that the proposed class includes about 250 individuals. As part of the agreement, Overland denied any wrongdoing associated with the claims in the class members’ complaint.

“After extensive discovery, analysis, and deliberation, the settling parties are of the opinion that the settlement described in this settlement agreement is fair, reasonable and adequate,” the settlement said.

The proposed class action was initially filed in March 2017 by Fletscher under the California Private Attorneys General Act alleging that Overland failed to properly pay him and other insurance inspectors minimum wages, didn’t give them itemized wage statements and failed to reimburse them for business expenses, among other claims.

The parties began engaging in mediation in April 2017 and, after exchanging certain documents and data, struck a deal in principle in March.

For purposes of the agreement, the parties asked that the court certify the proposed class, which includes individuals that Overland classified as independent contractors who performed insurance inspections or surveys in California as part of the company survey division up to four years before the suit was filed.

Of the $2.4 million settlement amount, $50,000 will go toward resolving the PAGA claim, an $18,000 service award will go to Fletscher for pursuing the suit, and a maximum of $800,000 will be allocated for attorneys’ fees, with the exact amount to be determined by the court.

Should the court determine that the amount in attorneys’ fees Fletscher’s counsel receives should be lower than the $800,000 that was set aside, the remainder will revert into the general settlement fund, according to the agreement.

Additionally, if more than 10 percent of the class members submit valid forms opting out of the class, Overland will have the right to back out of the deal, the agreement said.

“We are thrilled to have reached this resolution for Mr. Fletscher and the class,” class counsel Michael Palmer of Sanford Heisler Sharp LLP said. “It is an excellent settlement which is in the best interests of all the parties.”

An attorney for Overland was not immediately available for comment Wednesday.

The class members are represented by Michael Palmer and Danielle Fuschetti of Sanford Heisler Sharp LLP, and Xinying Valerian of Valerian Law.

Overland is represented by JoAnna L. Brooks, Damon M. Ott, Mel M.C. Cole and Paul E. Goatley of Littler Mendelson PC.

The case is Martin Fletscher et al. v. Overland Solutions Inc. et al., case number RG17852058, in the Superior Court of the State of California, County of Alameda.

–Editing by Breda Lund.

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