California Wage Class Action Ends in $1.89M Deal

Case Background

A legal battle focused on widespread labor violations that affected an entire class of employees reached its conclusion in October 2025. The case, filed in the Superior Court of California, Los Angeles County, pitted former employee Yolanda Soto against her employer, MD Hydration Inc., and its principal, Brett Florie. Soto claimed the company systematically broke state labor laws, creating an environment where workers were denied basic rights and proper pay. This case, originally filed in February 2024, quickly turned into a class action lawsuit, representing dozens of employees who worked for the company over a four-year period.

Cause

Soto’s complaint alleged a pattern of practices that violated numerous sections of the California Labor Code. She argued that the company’s business model relied on failing to meet standard employment obligations.

Wage and Hour Violations

Soto claimed the company failed to pay employees for all the time they worked. This included minimum wage violations and unpaid overtime wages, where employees worked beyond the required hours without receiving the mandated higher rate of pay. She asserted the company routinely forced employees to work during mandated time off, denying them both proper meal periods and rest periods that California law required. The law entitles workers to these breaks, and Soto argued MD Hydration simply never provided them or discouraged employees from taking them.

Record Keeping and Expense Violations

The complaint also detailed failures related to record-keeping. Soto alleged that the company did not provide employees with accurate wage statements pay stubs that clearly showed hours worked, pay rates, and deductions. Furthermore, she claimed the company failed to reimburse employees for necessary business expenses they incurred while performing their jobs, forcing workers to cover company costs out of their own pockets.

Termination and Penalty Violations

Finally, Soto brought claims alleging the company did not pay employees their final wages immediately upon termination, a violation known as waiting time penalties. Because the labor violations affected many employees, Soto also filed the lawsuit under the Private Attorneys General Act (PAGA), a provision that allows individual employees to sue on behalf of the state for civil penalties for Labor Code violations.

Injury

Yolanda Soto and the employees she represented claimed they suffered direct financial losses and emotional distress because of the alleged violations. The key injury was the underpayment of wages, which included years of unpaid overtime and missed break time compensation. Employees also lost money when they used personal funds to cover business costs the company never reimbursed. The inaccurate pay stubs created confusion and made it difficult for workers to track the money they were owed.

Damages Sought

The Plaintiffs sought substantial financial relief across several categories. They demanded compensatory damages to cover all unpaid minimum wages, unpaid overtime, and compensation for missed meal and rest periods. Soto also requested reimbursement of business expenses and waiting time penalties for workers who had left the company. Under the PAGA claim, they sought civil penalties as a punishment for the systemic violations. Finally, the Plaintiffs sought to recover attorneys’ fees and litigation costs, which California law permits successful Plaintiffs to recoup in such cases.

Key Arguments and Proceedings

Legal Representation

The legal teams prepared for a challenging Court battle that ultimately spanned over a year and a half.

Plaintiff(s): Yolanda Soto, individually and on behalf of the Class.

·       Counsel for Plaintiff(s): Young W. Ryu | Zachariah E. Moura | Kee S. Mah | Harley M. Phleger

Defendant(s): MD Hydration Inc. | Brett Florie

·       Counsel for Defendant(s): Ronald S. Hodges

Key Arguments or Remarks by Counsel

Claims

Plaintiffs’ counsel built a case around the idea that MD Hydration prioritized profit over legal compliance. They argued that the company intentionally kept employees off the clock during mandatory breaks and pressured them to work through lunch periods. They asserted that this practice was not accidental, but an unlawful business model that saved the company labor costs at the expense of its vulnerable workforce. Their core argument was that the evidence, including employee testimonies and payroll records, demonstrated the company consistently failed to track and pay for all hours worked.

Defense

The defense team denied the central allegations of wrongdoing. They argued that MD Hydration had policies in place that fully complied with California's strict labor laws. They likely asserted that any instances of missed breaks or unrecorded work time resulted from individual employee choices or lack of proper internal reporting, not from the company’s mandatory directive. The defense often also raised affirmative defenses, claiming that the company acted in good faith and that the Plaintiffs’ own actions contributed to the alleged injuries.

Settlement

The complex nature of class action litigation and the high financial risk associated with PAGA claims ultimately led the parties away from a full jury trial. Instead, the Plaintiffs and Defendants successfully negotiated a comprehensive settlement of the entire case.

On November 1, 2024, the parties filed a Notice of Settlement with the Court, indicating they had reached a final agreement. Following a period of review and preliminary approval by the Court, which included notifying all affected class members, the judge approved the terms of the deal.

The Court entered the Final Judgment and Order on October 1, 2025, officially closing the case. The terms of the resolution established a Total Settlement Amount of $1,894,233. This money was set aside to cover the payments to the class members for their wage and hour claims, civil penalties owed under PAGA, costs to administer the settlement, and payment for the Plaintiffs' attorneys' fees.

Court documents are available upon request at jurimatic@exlitem.com