Hurtado, et al. v. Rainbow Disposal, Inc. et al.

 US District Court Central District of CA Southern (Santa Ana) Division |  Case No. 17-cv-1605-JLS-DFM

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Status of Settlement Distributions:

The settlement proceeds have been transferred to the Republic 401(k) Plan for allocation to class members’ accounts. Class members who are current participants of the Republic 401(k) Plan account will have their settlement payments deposited into their existing 401(k) Plan account. Class members who are not already participants will have a 401(k) Plan account created for them. Class members will also receive a distribution election packet in the mail from Vanguard with information on how to request a rollover of the settlement payment into an IRA or another eligible retirement plan, or receive a cash distribution (less tax withholding). Class members who do not request a rollover or cash distribution can keep their settlement payment in the Republic 401(k) Plan to be invested according to their investment instructions or the default investment options.

Please contact Vanguard at 1-800-523-1188 if you have questions about the Republic 401(k) Plan including how to receive a distribution and how to update your investments.

The Court granted the Motion for Final Approval of the Settlement on May 21, 2021. The settlement will become final and non-appealable 30 days after the date of the Order granting final approval. This means that the settlement will become final and non-appealable on June 21, 2021 if no appeal is filed. Class Counsel expects that payments from the settlement can be processed 30 days after the settlement becomes final and non-appealable.

If you were a vested participant in the Rainbow Disposal Co., Inc. Employee Stock Ownership Plan as of October 1, 2014, you may be able to benefit from a Class Action Settlement.
What Is This Case About?
The lawsuit is a class action on behalf of certain participants and beneficiaries in the ESOP alleging claims under the Employee Retirement Income Security Act (“ERISA”). The lawsuit challenges certain business practices which allegedly negatively impact-ed the value of the ESOP; the failure to allow all ESOP participants to vote on the sale of the ESOP to Republic Services, Inc. (“Republic”); the conduct of certain individual defendants who allegedly negotiated the terms of the sale to Republic and re-ceived certain payments that the Complaint alleged were prohibited under ERISA; the value of stock sold by the ESOP in the sale to Republic; the process by which that valuation was approved; and the manner in which certain funds belonging to ESOP participants were invested after the sale of the ESOP stock to Republic. The lawsuit also alleges that the price paid to the ESOP participants and beneficiaries was less than fair market value. Defendants deny any liability and have vigorously defend-ed the lawsuit. A detailed description of the claims is contained in the Second Amended Complaint, which is available here.
Who is a Member of the Class?
The Court defined the “Class” as follows:

All persons who were vested participants in the Rainbow Disposal Co., Inc. Employee Stock Ownership Plan as of October 1, 2014 and the beneficiaries of any such participants.

Excluded from the Class are the following: Defendants and persons who were named fiduciaries of the Rainbow Disposal Co., Inc. Employee Stock Ownership Plan, who are alleged in this action to have engaged in prohibited transactions or breaches of corporate fiduciary duties, or who had decision-making or administrative authority relating to the administration, modification, funding, or interpretation of the Rainbow Disposal Co., Inc. Employee Stock Ownership Plan, or who had such authority relating to the decision to sell assets of the Rainbow Disposal Co., Inc. Employee Stock Ownership Plan on or about October 1, 2014.

If you meet the definition of the Class and are not excluded as set forth above, you are a member of the Class. For additional information, please visit the FAQs page.

What Are the Terms of The Settlement Agreement?
The Settlement requires Defendants to pay $7.9 million (the “Settlement Amount”) to resolve all of the claims of the Class against all Defendants arising from the sale of the ESOP to Republic in October 2014 and claims following the October 2014 Transaction before the ESOP was terminated. After deduction of any Court-approved attorneys’ fees and costs and any Court-approved service awards to the Class Representatives, the net settlement amount will be distributed to the Class pursuant to a Court-approved distribution formula called the “plan of allocation.”


If You received this Notice your settlement payment will be transferred to the Republic 401(k) Plan. You may then elect to take a rollover or receive a distribution of your account from the Republic 401(k) Plan in accordance with the terms of the Republic 401(k) Plan or provide instructions about how to invest your settlement monies (if you want to leave the money in the 401(k) Plan). If you do not currently have an account in the Republic 401(k) Plan, one will be created for you and if you do not provide other instruc-tions, the monies will be invested in the default investment option for the Plan.


If you believe that the data about your shares is incorrect OR you believe that you are a class member but did not receive personalized notice sent to you, you can submit information explaining why the data needs to be corrected or why you are a Class Member. You need to submit this challenge by April 30, 2021.


If you are not satisfied with the terms of the proposed Settlement, then you or your attorney may inform the Court by sending a letter or written statement by April 30, 2021.


If you object or challenge data, you may still request a distribution or provide instructions about the investment of your settlement proceeds.


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