If you received a notice by email, you may have received residential landline telephone service from Defendant and been assessed one or more LPCs imposed by Defendant for such service from December 1, 2008, up through February 21, 2018. This notice explains that the Court has allowed, or “certified,” a class action lawsuit that may affect you and that there is a settlement pending in the case. You have legal rights and options that you may exercise. Judge Curtis E.A. Karnow of the Superior Court of California, County of San Francisco, is overseeing this class action. The lawsuit is known as Gastelum v. Frontier California, Inc., Case No. CGC-11-511467.Top
The lawsuit claims that Defendant violated California consumer protection laws and other state laws by imposing Late Payment Charges (LPCs). The suit seeks to recover monetary damages, restitution, and injunctive and other relief.Top
In a class action lawsuit, one or more people called “Class Representatives” sue on behalf of other people who have similar claims. The people together are a “Class” or “Class Members.” One court resolves the issues for everyone in the Class – except for those people who choose to exclude themselves from the Class. The company sued in this case, Frontier California Inc. (formerly known as Verizon California Inc.), is called the Defendant.Top
The Class Representatives for the Settlement Class are Deanna Gastelum and Heather Bryden.Top
The Court decided that this lawsuit and the settlement, if approved, can be a class action on behalf of the Settlement Class because it meets the requirements of California Code of Civil Procedure § 382 and California Civil Code § 1781, which govern class actions in California state courts.
More information about why the Court is allowing this lawsuit to be a class action is in the Court’s Order Granting Preliminary Approval of Settlement, issued February 21, 2018, which is available here.Top
In this lawsuit, the Plaintiff alleges, on behalf of the Settlement Class, that Defendant’s LPCs are unlawful contractual penalties under California Civil Code § 1671(d), and that in charging and collecting them, Defendant violated the California Consumers Legal Remedies Act (Civil Code §§ 1750 et seq.), the California Unfair Competition Law (Bus. & Prof. Code §§ 17200 et seq.), among other provisions of law. You can read the Plaintiffs’ Third Amended Complaint here.Top
Defendant denies all wrongdoing and denies the Plaintiffs’ allegations. It contends that all of its actions have been legal and proper. Defendant has also asserted a cross-claim against the Plaintiffs seeking to recover its actual damages. You can read Defendant’s Answer and Second Amended Cross-Complaint here.Top
The Court has not decided who is correct – Plaintiffs or Defendant. By issuing this notice, the Court is not suggesting that the Settlement Class would have won or lost this case or that Defendant committed any wrongdoing. The Notice is to inform you about the settlement.Top
The settlement provides for the following relief:
(a) Defendant will create a settlement fund of $10.6 million (“Settlement Fund”). After deductions for the costs of notice to the class and administration of the settlement (other than internal costs of Defendant which will be borne by Defendant), Class Representatives’ incentive awards (if authorized by the Court), and reimbursement of attorney’s costs and expenses (if authorized by the Court), the remainder of this money will be distributed to (i) Settlement Class Members who were landline telephone customers of Defendant at some point during the Settlement Class Period but, as of June 21, 2018, are no longer (“Former Customers”), and who submit a valid and timely claim form; and (ii) Settlement Class Members who, as of June 21, 2018, are current landline telephone customers of Defendant (“Current Customers”). Distributions to Former Customers will be in the form of checks or, at the option of the Claimant, credits to his or her Paypal or Zelle account. Due to the expense of issuing and sending checks, no check will be issued for less than $1.00. However, credits for recoveries of less than $1.00 will be issued to Paypal or Zelle accounts. Distributions to Current Customers will be in the form of credits on future bills from Defendant; provided, however, that the Court may, by further order, adjust the manner in which payment is made to certain Settlement Class Members to better facilitate the delivery of settlement funds to those who are entitled to receive them.
(b) Defendant will submit to an injunction restricting it from charging residential Late Payment Charges exceeding the greater of $1.30 or 1.5% of outstanding balance (the “Injunction”) for two years. Furthermore, the injunction will provide that Defendant shall, as soon as reasonably possible, credit the bills of all Settlement Class Members on whom it assessed an erroneous late payment charge of the greater of $9.00 or 1.5% by the difference between the amount so assessed and the LPC applicable to that Settlement Class Member at a rate of the greater of $2.50 or 1.5%, and to send either checks or prepaid debit cards for such amount to the last known addresses of such persons whose accounts are no longer active as of the time such credits are distributed. Such credits and checks are separate from, and in addition to, the Settlement Fund established in 9(a) above
(c) Defendant will contribute up to $3.9 million in cash, separate and apart from the Settlement Fund, to pay Class Counsel’s attorney’s fees attributable to the Injunction, if and to the extent awarded by the Court.
The benefits conferred by the Settlement are explained in greater detail in the Settlement Agreement, which is available here. All capitalized terms contained in this webpage have the same meaning as contained in the Settlement Agreement.Top
The net proceeds of the Settlement Fund (“Claimant’s Fund”) will be allocated and distributed pursuant to Plan of Allocation which is Article X of the Second Amended Stipulation of Settlement, available here.
Under the Plan of Allocation, we will calculate Current and Former Customers’ share of the settlement this way: we will take the amount you paid in Late Payment Charges between December 1, 2008 and February 21, 2018 and divide that by the total amount of Late Payment Charges all claimants paid for that period.
Current Customers will automatically receive their money as a credit to their bill with Defendant.
If you are a Former Customer, we will send that sum to you unless (A) it's less than a $1.00 and (B) you asked for the money to be mailed to you. If you asked for an electronic payment by PayPal or Zelle, we'll send you the money even it is under a $1.00.
There will be no distribution to Former Customers who fail to submit a valid and timely claim form. The Settlement Administrator’s determination of the amounts to be paid to each Authorized Claimant shall be final and conclusive.
The Plan of Allocation also provides that unpaid residual amounts remaining in the Settlement Fund after all Court-authorized payments have been made, including without limitation the amounts representing checks uncashed by their payee Settlement Class Members, may be redistributed to Authorized Claimants. In the event Class Counsel and the Court determine that such redistribution is not administratively feasible, the remainder may be paid, pursuant to California Code of Civil Procedure § 384, to the following recipients:
During the process of final approval of the Settlement, the Court may approve a different cy pres beneficiary than those identified above.Top
No money or benefits are available now because the Court has not yet decided whether to approve the settlement. If the settlement is approved, Settlement Class Members who are Former Customers may become eligible to share in the Settlement Fund by submitting a valid and timely Claim Form, which is available here. Settlement Class Members who are Current Customers do not need to submit a proof of claim form to be eligible to share in the Settlement Fund.Top
You are a Settlement Class Member if Defendant assessed you a Late Payment Charge or an Erroneous Late Payment Charge that was paid from December 1, 2008, through February 21, 2018.
“Late Payment Charge” means the late payment charge that Defendant assessed its residential telephone customers (excluding customers receiving either voice-over-internet- protocol telephone service or “FiOS” telephone service) in California in the amount of the greater of $2.50 or 1.5% of past due balances of $20 or greater.
“Erroneous Late Payment Charge” means the late payment charge that Defendant imposed on its California residential telephone customers (excluding customers receiving either voice- over-internet-protocol telephone service or “FiOS” telephone service) at the rate of the greater of $9.00 or 1.5% of past due balances of $20 or greater, beginning on July 10, 2017, and continuing for approximately five weeks thereafter.Top
The Court will determine whether to approve the settlement at a fairness hearing to be held on July 20, 2018 at 9:00 a.m. at the San Francisco County Superior Court, Department 304, 400 McAllister St., San Francisco, CA 94102 (the “Fairness Hearing”).Top
At the Fairness Hearing, the Court will also decide whether to approve the Class Representatives’ incentive awards of not more than $10,000 each and Class Counsel’s application for an award of attorney’s fees and litigation expenses. Class Counsel will ask the Court to approve an award of attorney’s fees and litigation expenses to them, if the Settlement is approved, consisting of (a) not more than $3.9 million for attorney’s fees, separate and apart from the Settlement Fund paid by Defendant and, in addition, (b) not more than $400,000.00 in litigation costs and expenses to be paid from the Settlement Fund. Members will not be required to pay any portion of Class Counsel’s attorney’s fees or expenses out of their own pockets.Top
If you do nothing, you will remain a member of the Settlement Class. If you are a member of the Settlement Class and you are a Current Customer, you will automatically be eligible to receive a share of the Settlement Fund, net of any costs of notice and administration, incentive awards, and reimbursement of litigation expenses deducted from the Settlement Fund. If you are a member of the Settlement Class and you are a Former Customer, you must submit a valid and timely proof of claim form, on or before June 21, 2018 to potentially share in the net Settlement Fund.
Keep in mind that if you do nothing now and the Settlement is approved, you will not be able to sue or continue to sue Defendant, as part of any other lawsuit, about the same legal claims that are the subject of the claims asserted in this lawsuit on behalf of the Settlement Class. You will also be legally bound by all of the orders or judgments the Court may issue in this case.Top
If you are a member of the Settlement Class and you already have your own lawsuit against Defendant regarding LPCs and want to continue with it, you need to ask to be excluded from the Settlement Class. If you exclude yourself from the Settlement Class – which also means to remove yourself from the Settlement Class, and is sometimes called “opting-out” of the Settlement Class – you won’t get any money or benefits from the Settlement. However, you may then be able to sue or continue to sue Defendant over LPCs. If you exclude yourself, you will not be legally bound by the Court’s orders or judgments regarding the Settlement Class’s claims in this lawsuit.Top
To ask to be excluded from the Settlement Class, you must send a letter, postmarked by June 21, 2018, to Gastelum v. Frontier California Inc., P.O. Box 404041, Louisville KY 40233-4041, stating that you want to be excluded from the Settlement Class in the Gastelum v. Frontier California, Inc. Be sure to include your name, address and telephone number, and sign the letter.Top
If you are a member of the Settlement Class and you do not exclude yourself from it as described in this Notice, you may object to the Second Amended Stipulation of Settlement, to Class Counsel’s application(s) for attorney’s fees, costs, expenses and/or incentive awards, or to the entry of the proposed Final Approval Order.
For such an objection to be considered by the Court you must send a letter, postmarked by June 21, 2018, to
Gastelum v. Frontier California Inc., P.O. Box 404041, Louisville KY 40233-4041, containing your written statement of the specific objections, and evidence (phone number and name associated with account) identifying yourself as a Settlement Class Member.
It will be sufficient to provide the phone number and last name of your account with Defendant to verify your status as a Settlement Class Member. Please provide your contact information to allow the Class Representatives to serve any response to objections, or to provide notice of scheduling changes.
Only Settlement Class Members who make this a submission shall be entitled to be heard at the Final Approval Hearing.
L. Timothy Fisher
Bursor & Fisher, P.A.
1990 North California Blvd., Suite 940
Walnut Creek, CA 94596
Telephone: (925) 300-4455
Munger, Tolles & Olson LLP
350 South Grand Avenue Thirty-Fifth Floor
Los Angeles, CA 90071-1560
Telephone: (213) 683-9100
The Court appointed the law firms of Bramson, Plutzik, Mahler & Birkhaeuser, LLP, and Bursor & Fisher, P.A., of Walnut Creek, California, and the Law Offices of Reich Radcliffe & Hoover LLP, of Newport Beach, California, to represent the Plaintiffs and all Settlement Class Members in this case. Together the law firms are called “Class Counsel.” More information about these law firms, their practices, and their lawyers’ experience is available at www.bramsonplutzik.com, www.bursor.com, and www.reichradcliffe.com.Top
If you choose to remain in the Settlement Class, you do not need to hire your own lawyer because Class Counsel is working on your behalf. But, if you want your own lawyer, you will be responsible for paying that lawyer. For example, you can ask him or her to appear in Court for you if you want someone other than Class Counsel to speak for you.Top
Defendant is represented by Munger, Tolles & Olson LLP, 350 South Grand Avenue, 50th Floor, Los Angeles, CA 90071.Top
For more information, visit this website, www.lpcsettlement.com, where you will find the contact information for Class Counsel, the Third Amended Complaint, Defendant’s Answer and Cross-Claim, the Second Amended Settlement Agreement, and all papers and all orders filed in connection with all preliminary approval motions. Moreover, all papers filed in connection with final approval of the settlement, and fee and expense application(s) will also be posted promptly to the website. You may also contact Class Counsel by writing to: Gastelum v. Frontier California, Inc., P.O. Box 404041, Louisville KY 40233-4041. Please do not contact the Court or Defendant regarding this Notice or the lawsuit itself.Top