The Merchant of Tennis, Inc. v. Superior Court, 2026 WL 102728 (Cal. Ct. App. 2026)
After Jessica Garcia filed a putative class action for unpaid wages against her former employer (The Merchant of Tennis), the employer entered into approximately 954 individual settlement agreements (ISAs) with employees (paying over $875,000) in exchange for waiving their claims and opting out of the class action litigation. After concluding the ISAs were voidable (due to alleged “coercion and fraud”), the trial court ordered the parties to give a curative notice to all putative class members advising that they could revoke their ISAs and join the class action lawsuit. Over the employer’s objection, the trial court ruled that the curative notice did not need to include a statement that if employees chose to revoke their ISAs, they may have to pay back the settlement amount if the employer prevailed in the litigation. The employer filed a petition for writ of mandate asking the Court of Appeal to issue a peremptory writ of mandate directing the trial court to vacate its ruling and require a curative notice informing the employees that if they rescinded their ISAs to join the class action lawsuit, they would be required to immediately return the settlement payment they had received. The Court of Appeal granted the writ but required a curative notice that employees who rescinded their ISAs could be responsible for repayment of the settlement proceeds at the conclusion of the litigation, subject to the trial court’s discretion to “adjust the equities between parties.”
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