A New Day In The Life Of A PAGA Action: What Do PAGA Settlements Look Like? What Will We Find When Analyzing The Information Gathered From PAGA Filings? – Corporate and Company Law
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In our first installment, we discussed the general changes to the Private Attorneys General Act (PAGA) that took effect in June 2024.
United States
Corporate/Commercial Law
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Recap From Last Time
In our first installment, we discussed the
general changes to the Private Attorneys General Act (PAGA) that
took effect in June 2024. We noted that these changes lowered
penalties and allowed companies a longer horizon to remediate. In
addition to a spike in filings before June 2024, the overall trend
appears to show a continued increase in PAGA filings. This
installment will focus on the cost for companies that do not
remediate issues when receiving a PAGA notice. We explore the
settlement costs that we have aggregated in a PAGA database
prepared by Ankura.1
Data Gathering and Methods of Processing2
This analysis relies on the same document database that was
gathered for our first article on PAGA.3 However, this
data was constructed from settlement and judgment filings that the
state of California gathers when a PAGA action is finalized. We
deployed similar tools that were trained to recognize and extract
key text from settlement and judgment documents.4 To
capture the amounts of settlements and judgments, we deployed a
specialized large language model (LLM) to read the documents and
extract key pieces of information that are contained within the
documents. We gathered this data into a database and explored
judgments and settlements.
Summary Analysis
This data provides a basis to calculate various summary
statistics and to trend the data over time. There has been a
decrease in the median class sizes and settlement amounts. The
average value has increased due to some cases with larger class
sizes settling after June 2024. This is an interesting trend that
can be analyzed further as more judgments/settlements are finalized
over time. We show the average and the median values. The average
is an unbiased estimator of a series of continuous data points, but
averages are susceptible to outliers. The median shows the 50th
percentile, or the mid-point of the distribution, and it is
resistant to outliers.5 The table is based on 335 cases
with judgments that show the gross settlement value and the number
of class members.
Footnotes
1. PAGA database covers PAGA filings, settlements, and
judgments from 2019 to the present. We have developed this data by
gathering publicly available legal documents. We have ingested
those documents and scraped them for their content (e.g.,
settlement amounts, number of class members, etc…).
2.
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5. 50% of the values in the distribution are above the
median, and 50% are below. \
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