A settlement has been reached with the City of Los Angeles in a class action lawsuit claiming, among other things, that the City overcharged certain customers of L.A. Sanitation for residential property sewer services. If you received notice, you were identified as a potential Settlement Class Member. A Court authorized the notice you received because you have a right to know about the proposed settlement of this class action lawsuit and about all of your options before the Court decides whether to grant final approval to the Settlement.

The Plaintiffs allege that the City improperly determined the annual Dry Winter Compensation Factor, which is used in calculating sewage service charges for single-family properties and multi-family properties of four or fewer units that lack separate indoor (tributary) and outdoor (non-tributary) water meters, thereby overcharging such customers, with the settlement class period running from May 4, 2016, through June 30, 2022, inclusive. The Plaintiffs further allege that the City improperly failed to timely return to the Sewer Construction and Maintenance Fund certain related costs overpayments made in connection with the annual budgeting process for City Departments that performed various services for the sewer system. According to Plaintiffs, the City’s failure to timely return the money to the Sewer Construction and Maintenance Fund was a violation of California Constitution Article XIII D, § 6.

If you received a notice, you were identified as a potential Settlement Class Member. The Settlement includes all Account Holders who paid Sewer Service Charges to the City of Los Angeles calculated using the Dry Winter Compensation Factor (i.e., Residential Property (four or fewer units, non-“Multiple Dwelling”) customers of L.A. Sanitation who lack separate indoor (tributary) and outdoor (non-tributary) water meters), at any time from May 4, 2016, through June 30, 2022, inclusive (the “Settlement Class Period”).

The City has agreed to create a $57.5 million Settlement Fund. The Settlement provides that the Settlement Fund, after deduction of any Court-approved attorneys’ fees and expenses, Service Awards, notice and administration costs, and taxes, is to be divided among all Settlement Class Members who are validated by the City as having paid the sewer service charges at issue, in exchange for the settlement of this case and the Release by Settlement Class Members of claims related to this case. In addition, there are non-monetary relief components to the Settlement which are further detailed in paragraph 8 of the Settlement Notice.

The exact payment amount to settlement class members is unknown at this time. Your payment amount will be based on the amount of overcharges paid during the Settlement Class Period. The Net Settlement Fund will be distributed to Authorized Claimants on a pro rata basis relative to the amount of overcharges you paid versus the total of overcharges paid by all Authorized Claimants. If any Authorized Claimant’s Distribution Amount calculates to less than $10.00, it will not be included in the calculation and no distribution will be made to such Authorized Claimant. Any Distribution Amounts of less than $10.00 will be included in the pool distributed to those Settlement Class Members whose Distribution Amounts are $10.00 or greater.

What you have to do to get a payment depends on whether you have an active account for sewer services with the City.

Current Customer Class Members: If you are a Settlement Class Member who has an active account for sewer services with the City, you do not have to do anything to qualify for a payment. The City has your payment history and has provided the information necessary for the Claims Administrator to send a check to your current address. You will only be eligible to receive money if your Distribution Amount calculates to over $10.00.

Former Customer Class Members: If you are a Settlement Class Member who no longer has an active account for sewer services with the City, you must submit a Claim Form to receive a cash payment from this Settlement. You may submit a claim online or print the Claim Form by navigating to the pages above, or a Claim can be mailed to you upon request to the Claims Administrator at 1-877-390-3368.

If you are uncertain whether you need to file a Claim, you may visit the “Submit a Claim Online” or “Print Claim Form” pages of the Settlement Website where you can enter Notice ID (found above the mailing block of your postcard notice or at the top of your email notice) to determine the status of your account and whether it is necessary to submit a Claim.

Claim Forms must be postmarked or submitted electronically by October 31, 2023, to the Claims Administrator. You will only be eligible to receive money if your Distribution Amount calculates to over $10.00.

The Court will hold a hearing on December 20, 2023, to decide whether to grant final approval of the Settlement. Even if the Court approves the Settlement, there may be appeals. It is always uncertain whether appeals will be filed and, if so, how long it will take to resolve them. Settlement payments will be distributed as soon as possible, only if, and when, the Court grants final approval to the Settlement and after any appeals are resolved.

If you want to keep the right to sue, or continue to sue, the City or the other Defendant’s Releasees about the legal claims in this case, and you do not want to receive a cash payment from this Settlement, you must take steps to get out of the Settlement Class. This is called excluding yourself from or opting out of the Settlement. Details on how to exclude yourself from the Settlement are found in paragraph 16 of the Settlement Notice.

You can tell the Court if you don’t agree with the Settlement or any part of it. If you are a Settlement Class Member, you can object to the Settlement if you do not like it or a portion of it, including Plaintiffs’ Counsel’s Fee and Expense Application. Details on how to object to the Settlement are found in paragraph 19 of the Settlement Notice.

The Court will hold a hearing to decide whether to approve the Settlement. You may attend and you may ask to speak, but you do not have to do so to receive a payment from the Settlement. The Settlement Hearing will be held on December 20, 2023, at 10:30 a.m., before the Honorable Stuart M. Rice at the Los Angeles Superior Court, Courtroom 1, 312 N. Spring Street, Los Angeles, California 90012.

If you are Current Customer Class Member and you do nothing, you will be eligible to receive a payment and will give up the rights explained in paragraph 13 of the Settlement Notice, including your right to start a lawsuit, continue with a lawsuit, or be part of any other lawsuit against the City and the other Defendant’s Releasees about the legal issues resolved by this Settlement. In addition, if you are a Former Customer Class Member and do not file a Claim Form, you will not be eligible to receive a cash payment.