NOTICE OF CLASS ACTION SETTLEMENT
IF HARBOR FREIGHT TOOLS USA, INC. (“HARBOR FREIGHT TOOLS”) OBTAINED YOUR CONSUMER REPORT (“BACKGROUND CHECK”) FROM A-CHECK AMERICA, INC. BETWEEN
AUGUST 27, 2011 AND SEPTEMBER 8, 2014, YOU COULD RECEIVE A CHECK IN THE GROSS AMOUNT OF $80.00 (expected to equal approximately $44.40 after reductions for each Class Member’s share
of attorneys’ fees, costs, administration expenses, and Class Representative Service Award) OR A HARBOR FREIGHT TOOLS GIFT CARD IN THE GROSS AMOUNT OF $100.00 (expected to equal approximately $58.31 after reductions for each Class Member’s share of attorneys’ fees, costs, administration expenses, and
Class Representative Service Award) FROM A CLASS ACTION SETTLEMENT (“SETTLEMENT”). YOUR LEGAL RIGHTS WILL BE AFFECTED BY THE SETTLEMENT. PLEASE READ THIS NOTICE
CAREFULLY. IT EXPLAINS THE LAWSUIT, THE SETTLEMENT, AND YOUR LEGAL RIGHTS.
YOUR LEGAL RIGHTS AND OPTIONS IN THIS SETTLEMENT
IF YOU DO NOTHING If the Court approves the Settlement and you do nothing, you will release your claims against Harbor Freight Tools regarding its use of your background check and you will receive a cash payment (by check) in a gross amount of $80.00 (expected to equal approximately $44.40 after reductions for each Class Member’s share of attorneys’ fees, costs, administration expenses, and Class Representative Service Award).
A copy of the agreement setting forth all of the terms of the Settlement is available at the Settlement website, http://www.SmithvHFT.com.
IF YOU SUBMIT A CLAIM If the Court approves the Settlement and you return the Gift Card Claim Form FOR A GIFT CARD provided with this notice as directed, you will receive a Harbor Freight Tools Gift Card in a gross amount of $100.00 (expected to equal approximately $58.31 after reductions for each Class Member’s share of attorneys’ fees, costs, administration expenses, and Class Representative Service Award) instead of a cash payment. You will still release your claims against Harbor Freight Tools regarding its use of your background check. Your request for a gift card must be postmarked or submitted online no later than January 5, 2015.
A copy of the agreement setting forth all of the terms of the Settlement is available at the Settlement website, http://www.SmithvHFT.com.
IF YOU EXCLUDE YOURSELF You have the right to exclude yourself from the settlement (“opt out”). You FROM THE SETTLEMENT can opt out by following the instructions at the Settlement website
http://www.SmithvHFT.com. You will not receive any monetary payment or Gift Card from the Settlement. You will not have any right to object, but you will not be bound by the terms of the Settlement and will retain your right to file your own lawsuit. Your request for exclusion must be postmarked no later than January 5, 2015.
If you do not opt out, you may object to the settlement by filing written objections to the Settlement. The Court will consider the objections when deciding if it should approve the Settlement. Instructions for mailing an objection to the Settlement can be found at the Settlement Website: http://www.SmithvHFT.com. If the Settlement is approved, you will not be able to sue Harbor Freight Tools for claims related to its use of your background check provided by A-Check America, Inc.
There is also the possibility that Class Members may receive slightly more than gross amounts of $80.00 (expected to equal approximately $44.40 after reductions for each Class Member’s share of attorneys’ fees, costs, administration expenses, and Class Representative Service Award), as there may be additional funds remaining if some Class Members do not cash their Settlement checks. If there are such leftover funds, they will be redistributed by check to those who cashed their earlier checks once certain deadlines pass.
What is this lawsuit about?
This lawsuit was filed on August 27, 2013, in the United States District Court for the Central District of California. Gary L. Smith (the “Plaintiff”), sued Harbor Freight Tools in this class action case (Smith v. Harbor Freight Tools USA,
Inc., 2:13-cv-06262-JFW-VBK) alleging it willfully violated the Fair Credit Reporting Act (the “FCRA”), 15 U.S.C. § 1681b(b)(2) and similar state laws.
Plaintiff alleged the authorization form Harbor Freight Tools used to obtain background checks from A-Check America, Inc. included a “release” of claims, and therefore was not a disclosure in a stand-alone document as required by the FCRA and similar state laws. The Plaintiff also alleged that Harbor Freight Tools did not give him proper notice under the FCRA and similar state laws before taking an adverse employment action against him based in whole, or in part, on the background check provided by A-Check America, Inc. Harbor Freight Tools contends its procedures did not violate, nor did it willfully violate, the FCRA and similar state laws.
On March 11, 2014, Plaintiff and Harbor Freight Tools engaged in mediation regarding this case. The mediation was successful, resulting in the Settlement, which covers a class of individuals who were the subject of background checks performed by A-Check America, Inc. (the “Class”). You are receiving this notice because you are in the Class.
Who are the Attorneys representing the Class and how will they be paid?
The Court has appointed lawyers to represent the Class (“Plaintiff’s Counsel”), but, if you want, you may enter an appearance in the case through an attorney. If you do so, you will have to pay for your own attorney.
The attorneys who have been appointed by the Court to represent the Class are:
Michael A. Caddell Devin H. Fok Leonard A. Bennett
Cynthia B. Chapman THE LAW OFFICES OF DEVIN H. FOK Matthew J. Erausquin
Craig C. Marchiando P.O. Box 7165 CONSUMER LITIGATION
CADDELL & CHAPMAN Alhambra, CA 91802-7165 ASSOCIATES, P.C.
1331 Lamar, Suite 1070 Telephone: (310) 430-9933 763 J. Clyde Morris Blvd., Suite 1A Houston, TX 77010 Facsimile: (323) 563-3445 Newport News, VA 23606
Telephone: (713) 751-0400 devin@devinfoklaw.com Telephone: (757) 930-3660
Facsimile: (713) 751-0906 Facsimile: (757) 930-3662
Subject to the Court’s approval, Harbor Freight Tools will pay from the Global Settlement Fund, which is the total amount it pays to settle this case, all reasonable attorneys’ fees, costs, and expenses, in an amount to be determined by the Court. Plaintiff’s Counsel will ask the Court to award them 30% of the Global Settlement Fund for its attorneys’ fees and costs incurred in litigating this case. The total amount of the Global Settlement Fund will range from approximately $1,040,000.00 to $1,300,000.00, depending on how many people in the Class choose a Gift Card. That means Plaintiff’s Counsel will ask the Court to award it between $312,000.00 and $390,000.00 for its attorneys’ fees and costs, and Harbor Freight Tools has agreed not to oppose that amount. The Class will also ask the Court to approve (1) a payment to Gary Smith, the individual who initiated the lawsuit, for a service award up to $2,500.00 to compensate him for his service to the Class, and (2) the costs to administer the Settlement, which are currently estimated to be $140,000.00. The approved attorneys’ fees, costs, settlement administration costs, and service award payments will reduce the amount of each Class member’s payments. We do not yet know the exact amount you will be eligible to receive because we do not yet know how many members of the Class will choose to receive a Gift Card. To the extent there are funds remaining in the Global
Settlement Fund after the Settlement checks and Gift Cards are distributed and the time to cash the checks has expired, any unclaimed funds will either be used to (1) pay for the unpaid administration of the settlement with the balance redistributed to members of the class who cashed their Settlement checks, or (2) donated to a charity. Plaintiff’s Counsel will file its request for an award of fees and costs, the service award to Gary Smith, and the costs of administration on or before December 19, 2014.
What rights am I giving up in this Settlement?
Unless you exclude yourself from the Settlement, you will be considered a member of the Class, which means you give up your right to sue, or file a lawsuit against, Harbor Freight Tools regarding the legal issues that were raised, or could have been raised, in this lawsuit. Giving up your legal claims is called a release. The released parties collectively include Harbor Freight Tools, and its parents, subsidiaries, corporate siblings, predecessors, successors, affiliates, related entities, officers, directors, shareholders, managers, employees, representatives, consultants, insurers, and their insurers’ claim managers. You will be releasing these parties from all claims relating to Harbor Freight Tool’s background checks performed by A-Check America, Inc.
Can I object to the Settlement?
You can object to the Settlement. You can give reasons why you think the Court should not approve it. The Court will consider your views. To object, you must send a letter stating you object. Be sure to include the name of the case (Smith
v. Harbor Freight Tools USA, Inc., 2:13-cv-06262-JFW-VBK), your name, address, telephone number, your signature, the reasons you object to the Settlement, and, if applicable, a statement that you or your attorney intend to appear at the Fairness Hearing. Mail the objection to all of the following three places so it is received no later than January 5, 2015:
Court Plaintiff’s Counsel Defense Counsel
Clerk of Court Michael A. Caddell Evan R. Moses
United States Courthouse CADDELL & CHAPMAN OGLETREE, DEAKINS, NASH, 312 North Spring Street 1331 Lamar, Suite 1070 SMOAK & STEWART, P.C. Los Angeles, CA 90012-4701 Houston, TX 77010 400 S. Hope St., Suite 1200
Los Angeles, CA 90071
If you object, you will still remain a part of the Class. Additional detail required for an objection to the Settlement to be valid is available at http://www.SmithvHFT.com.
If I choose to do so, how do I exclude myself from the Settlement?
If you wish to be excluded, and therefore not bound, by this Settlement, you must mail a written request for exclusion to the Settlement Administrator at: Smith v. Harbor Freight Tools USA, Inc., Settlement Administrator, P.O. Box 1367, Blue Bell, PA 19422.
Your request for exclusion must be postmarked no later than January 5, 2015. The request must specifically state: “I do not want to be part of the Class in Smith v. Harbor Freight Tools USA, Inc., 2:13-cv-06262-JFW-VBK” or words to that effect. The request should be signed, with your name, address, last four digits of your Social Security Number, and telephone number printed below your signature. So that you may be properly identified, the address you provide should be the address to which this notice was mailed. However, if you have a new address, and so you can receive any subsequent mailings about the Settlement, please provide your new address.
When and where will the Court decide whether to approve the settlement?
The Court will hold a Fairness Hearing on January 26, 2015, at 1:30 p.m. The hearing will be held in Courtroom 16 of the U.S. Courthouse, 312 North Spring St., Los Angeles, California, 90012-4701. At the Fairness Hearing, the Court will consider if the Settlement is fair, reasonable, and adequate. The Court will also hear any objections to the Settlement. We do not know how long the Court will take to decide if the Settlement should be finally approved. In addition, the hearing may be continued at any time by the Court without further notice to you.
Where can I get additional information?
This notice is only a summary of the Settlement. Any additional documents regarding the Settlement may be reviewed or copied by visiting the Clerk of Court at the address noted above or by visiting the Settlement website at http://www.SmithvHFT.com.
HARBOR FREIGHT TOOLS GIFT CARD CLAIM FORM
COMPLETE THIS FORM TO OBTAIN A HARBOR FREIGHT TOOLS GIFT CARD
IN THE GROSS AMOUNT OF $100.00 (expected to equal approximately $58.31 after reductions for each Class Member’s share of attorneys’ fees, costs, administration expenses, and Class Representative Service Award) INSTEAD OF A CASH PAYMENT IN THE GROSS AMOUNT OF $80.00 (expected to equal approximately $44.40 after reductions for each Class Member’s share of attorneys’ fees, costs, administration expenses, and Class Representative Service Award) AS DESCRIBED IN THE CLASS NOTICE. IF YOU DO NOT COMPLETE THIS GIFT CARD CLAIM FORM, YOU WILL AUTOMATICALLY RECEIVE A CHECK IN THE GROSS AMOUNT OF $80.00 (expected to equal approximately $44.40 after reductions for each Class Member’s share of attorneys’ fees, costs, administration expenses, and Class Representative Service Award). INSTRUCTIONS:
1. UPDATE YOUR NAME AND ADDRESS INFORMATION, AS NEEDED. 2. ADD YOUR E-MAIL ADDRESS, IF ANY.
3. SIGN BELOW CONFIRMING YOU HAVE ELECTED TO RECEIVE A HARBOR FREIGHT TOOLS GIFT CARD IN THE GROSS AMOUNT OF $100.00 (expected to equal approximately $58.31 after reductions for each Class Member’s share of attorneys’ fees, costs, administration expenses, and Class Representative Service Award) INSTEAD OF A CASH PAYMENT IN THE GROSS AMOUNT OF $80.00 (expected to equal approximately $44.40 after reductions for each Class Member’s share of attorneys’ fees, costs, administration expenses, and Class Representative Service Award) REGARDING THE SETTLEMENT.
4. RETURN A COMPLETED COPY OF THIS GIFT CARD CLAIM FORM TO THE SETTLEMENT ADMINISTRATOR BY MAIL TO SMITH V. HARBOR FREIGHT TOOLS USA, INC., SETTLEMENT ADMINISTRATOR, P.O. BOX 1367, BLUE BELL, PA 19422, OR COMPLETE AND SUBMIT THE GIFT CARD CLAIM FORM THROUGH THE WEBSITE ONLINE AT HTTP://WWW.SMITHVHFT.COM.
Section I: Updated Personal Information
If the preprinted information at the top of this form is not correct, make any changes here. (STOP! Do not complete this section if the preprinted information above is correct) First Name, MI, Last Name: _________________________________________________________ Mailing Address: __________________________________________________________________ City, State, Zip Code: ______________________________________________________________
Section II: Additional Information
Email Address (if you have one): _____________________________________________________ Telephone Number: ________________________________________________________________
Section III: Signature
Name: __________________________________________________________________________ Print: ___________________________________________________________________________ Date: ___________________________________________________________________________
Your Gift Card Claim Form must be postmarked or submitted online on or before January 5, 2015.
Blue Bell, PA 19422
