Reyes et al v. Mi Pueblo Greensprings LLC et al

Filing 56

MEMORANDUM OPINION. Signed by Magistrate Judge John H England, III on 06/04/2021. (AKD)

FILED
2021 Jun-04 AM 08:19
U.S. DISTRICT COURT
N.D. OF ALABAMA

UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
VADIM LOPEZ-REYES, et al.,
Plaintiffs,
v.
MI PUEBLO GREENSPRINGS, LLC, et al.
Defendants.

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Case No.: 2:19-cv-01584-JHE

MEMORANDUM OPINION1
Plaintiffs Vadim Lopez-Reyes and Jose Estrada, as well as Opt-in Plaintiffs Walter
Cifuentes Herrera, Joel Quinonez-Nunez, Salvador Quinones, and Ruperto Veliz Veliz
(collectively “Plaintiffs”), along with Defendants Mi Pueblo Greensprings, LLC, Mi-Pueblo
Supermarket LLC, Mi-Pueblo Supermarket #3, and Joel Rivera (collectively “Defendants”),
jointly move for approval of their settlement agreement, which they assert represents a resolution
of a disputed matter under the Fair Labor Standards Act, 29 U.S.C. § 201, et seq. (“FLSA”). (Doc.
55). For the reasons set forth below, the court APPROVES the parties’ settlement.2
I. Background Facts
Plaintiffs Lopez-Reyes and Estrada initiated this action against Defendants, alleging that
Defendants unlawfully failed to pay overtime wages for hours worked in excess of forty during
multiple work weeks in violation of the FLSA. (Doc. 1). Plaintiffs Lopez-Reyes and Estrada then

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In accordance with the provisions of 28 U.S.C. § 636(c) and Federal Rule of Civil
Procedure 73, the parties have voluntarily consented to have a United States Magistrate Judge
conduct any and all proceedings, including trial and the entry of final judgment. (See doc. 14).
2
The parties’ agreement to settle their FLSA claims is wholly contained in document 55.
(See doc. 55 at 7-16).

filed an Amended Complaint alleging that Defendants retaliated against Estrada for filing this
action. (Doc. 10). Opt-in Plaintiff Herrera filed his consent to opt-in to this litigation on October
31, 2019. (Doc. 17-1). Opt-in Plaintiffs Quinonez-Nunez and Quinones filed their consents to optin to this litigation on November 12, 2019. (Doc. 18-1). Opt-in Plaintiff Veliz-Veliz filed his
consent to opt-in to this litigation on January 29, 2020. (Doc. 26-1).
During the relevant statutory period, Lopez-Reyes contends he worked for Defendants
during various work weeks ending September 25, 2016 through June 30, 2019, for which he was
not compensated overtime premium and/or overtime wages for hours worked in excess of forty
hours in a work week. (Doc. 55 at ¶ 16).
During the relevant statutory period, Estrada contends he worked for Defendants during
various work weeks ending on September 25, 2016 through September 30, 2019, for which he was
not compensated overtime premium and/or overtime wages for hours worked in excess of forty
hours in a work week. (Id. at ¶ 17).
During the relevant statutory period, Herrera contends he worked for Defendants during
various work weeks ending on September 1, 2017 through April 8, 2018, for which he was not
compensated overtime premium and/or overtime wages for hours worked in excess of forty hours
in a work week. (Id. at ¶ 18). Herrera also worked weeks in which his regular rate of pay fell
below the federal minimum wage, and this settlement purports to satisfy that shortfall. (Id.).
During the relevant statutory period of November 12, 2016 through July 30, 2017,
Quinonez-Nunez contends he worked for Defendants for various work weeks which he was not
compensated overtime premium and/or overtime wages for hours worked in excess of forty hours
in a work week. (Id. at ¶ 19).

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During the relevant statutory period of November 12, 2016 through March 26, 2017,
Quinones contends he worked for the Defendants for various work weeks which he was not
compensated overtime premium and/or overtime wages for hours worked in excess of forty hours
in a work week. (Id. at & 20).
During the relevant statutory period, Veliz-Veliz contends he worked for Defendants
during various work weeks ending on February 25, 2018 through November 11, 2018, for which
he was not compensated overtime premium and/or overtime wages for hours worked in excess of
forty hours in a work week. (Id. at ¶ 21). Veliz-Veliz also contends he worked for the Defendants
during various work weeks January 29, 2017 through February 24, 2018; however, Defendants
dispute Veliz-Veliz worked for Defendants during this time period. (See id.).
Defendants deny that they failed to pay overtime premiums, and they deny that they
otherwise owe Plaintiffs any wages at all. (Doc. 55 at ¶ 22). Defendants contend they paid
Plaintiffs a set, agreed-upon weekly amount for a set number of weekly hours, which included
overtime premiums when the set number of hours exceeded forty in any given workweek. (Id.).
Plaintiffs, Defendants contend, never worked in excess of the set number of weekly hours. (Id.).
If they did, which is denied, Defendants contend they never reported these hours nor otherwise
advised Defendants that they worked in excess of the set number of weekly hours. (Id.). When
they did—when they advised Defendants that they exceeded the set number of weekly hours—
Plaintiffs, Defendants contend, were properly compensated for those hours, including any
overtime premium. (Id.). Finally, even if there was a violation or there are wages owed,
Defendants contend that any such violation occurred in good faith and was not otherwise willful.
(Id.). Before this lawsuit, Defendant, for example, had no knowledge of any alleged violation nor

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had it otherwise been confronted with any such violation in an earlier lawsuit or government
investigation. (Id.).
In an effort to resolve the lawsuit, Defendants produced payroll records and time punch
records to aid Plaintiffs' evaluation of their claims and Defendants’ defenses. (Doc. 55 at 10). The
Parties recognize that gathering additional records and testimonial evidence during the alleged
liability period and determining whether Defendants failed to pay overtime premiums and operated
in "good faith" would significantly increase litigation costs and potentially jeopardize the
settlement amounts and delay payment of the settlements. (Id.). These disputes would likely
remain unresolved, require summary judgment filings, and the court having to expend resources
regarding liability and Defendants’ contentions that it acted in good faith. (Id.).
Using Defendants’ records for Lopez-Reye, Estrada, Herrera, and Veliz-Veliz, Plaintiffs
were able to calculate the total number of regular and overtime hours they claim to have worked
for which Defendants did not pay the Plaintiffs the proper overtime premium compensation for
hours worked in excess of forty in a work-week. (Doc. 55 at 10). Defendants were unable to
locate and produce, in connection with the Parties’ mediation, records for the Quinonez-Nunez
and Quinones, and the amount recovered is based on their declarations submitted with Plaintiffs’
Motion for Conditional Class Certification. (Id. at 10-11). Throughout settlement negotiations,
the parties discussed the strengths and weaknesses of their respective positions. (See id. at 11).
Notably, the parties recognized the inherent risks with continued litigation. (Id.). Plaintiffs believe
that the amount each will receive pursuant to this settlement reflects a fair and reasonable
compromise of unpaid overtime premium and/or overtime wages that each could expect to recover
if he were to prevail on his individual FLSA claims at trial, including the recovery of liquidated
damages. (Id.). While still denying any liability at all, Defendants believe the amount Plaintiffs

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will receive pursuant to this settlement reflects an amount well in excess of complete and total
satisfaction for any unpaid overtime wages and liquidated damages they could expect to recover
if they were to prevail on their FLSA claims at trial. (Id.).
The Settlement Agreement provides for a Payroll check to each Plaintiff in the amount
stated below for unpaid overtime premium and/or overtime wages (less applicable taxes and
withholdings and Defendants being responsible for paying the amounts withheld to the appropriate
agencies and responsible for paying its own share of any matching taxes) with Defendants to issue
a W-2:
Lopez-Reyes, Vadim

$ 10,000.00

Estrada, Jose

$ 7,500.00

Herrera, Walter (Cifuentes)

$ 1,156.02

Quinonez-Nunez, Joel

$ 2,338.19

Quinnones, Salvador

$ 1,339.24

Veliz-Veliz, Ruperto

$ 4,500.00

The Settlement Agreement further provides for a lump sum check to each Plaintiff in the
amount stated below for liquidated damages with Defendants to issue a 1099 (if necessary):
Lopez-Reyes, Vadim

$ 10,000.00

Estrada, Jose

$ 7,500.00

Herrera, Walter (Cifuentes)

$ 1,156.02

Quinonez-Nunez, Joel

$ 2,338.19

Quinnones, Salvador

$ 1,339.24

Veliz-Veliz, Ruperto

$ 4,500.00
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(Doc. 55 at 13-14).
Plaintiffs understand and agree that each of them is responsible for the tax implications for
the payments rendered to them as payment for liquidated damages. (Doc. 55 at 14). Defendants
will issue a check in the amount of $40,000.00 to Allen D. Arnold, LLC, with Defendants to issue
a 1099. (Id.). Defendants shall pay the entire invoice amount owed by both Plaintiffs and
Defendants for the mediation services provided by David Middlebrooks. (Id.). Defendants will
render all payments described herein to Plaintiffs' counsel within 21 days of the Court's approval
of the above settlement and entry of a final order of dismissal with prejudice. (Id.). Upon such
payment, Plaintiffs shall release Defendants from any and all known and unknown wage-and-hour
compensation claims arising out of the facts and circumstances of this litigation, whether under
local, state, or federal law, including but not limited to those claims and allegations included in
this litigation. (Id. at 14-15). The parties represent that they have reached a reasonable and fair
resolution of Plaintiffs' FLSA claims. (Id. at 15). The parties represent that they engaged in good
faith, arms' length negotiations in an effort to resolve the matter. (Id.). The record indicates that
a bona fide dispute existed regarding Defendants’ errors and omission to compensate Plaintiffs'
minimum wage and overtime premium occurring in good faith. (Id.). Plaintiffs and Defendants
agree that Defendants entering into this Agreement is not intended to be and shall not be construed
to be an admission of any liability in this or any other similar matters. (Id.).
II. Analysis
If an employee proves his employer violated the FLSA, the employer must remit to the
employee all unpaid wages or compensation, liquidated damages in an amount equal to the unpaid
wages, a reasonable attorney’s fee, and costs. 29 U.S.C. § 216(b). “FLSA provisions are

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mandatory; the ‘provisions are not subject to negotiation or bargaining between employer and
employee.’” Silva v. Miller, 307 Fed. Appx. 349, 351 (11th Cir. 2009) (quoting Lynn’s Food
Stores, Inc. v. U.S. Dep’t of Labor, 679 F.2d 1350, 1352 (11th Cir. 1982)). “Any amount due that
is not in dispute must be paid unequivocally; employers may not extract valuable concessions in
return for payment that is indisputably owed under the FLSA.” Hogan v. Allstate Beverage Co.,
Inc., 821 F. Supp. 2d 1274, 1282 (M.D. Ala. 2011). Consequently, parties may settle an FLSA
claim for unpaid wages only if there is a bona fide dispute relating to a material issue concerning
the claim.
In Lynn’s Food Stores, Inc. v. United States, 679 F.2d 1350, 1355 (11th Cir. 1982), the
Eleventh Circuit stated there is only one context in which compromises of FLSA back wage or
liquidated damage claims may be allowed: a stipulated judgment entered by a court which has
determined that a settlement proposed by an employer and employees, in a suit brought by the
employees under the FLSA, is a fair and reasonable resolution of a bona fide dispute over FLSA
provisions. The primary focus of a court’s inquiry in determining whether to approve an FLSA
settlement is to ensure that an employer does not take advantage of its employees in settling their
claim for wages and other damages due under the statute. Collins v. Sanderson Farms, Inc., 568
F. Supp. 714, 719 (E.D. La. 2008). Having reviewed the Joint Motion for Settlement Approval
and Incorporated Settlement Agreement (doc. 55) and the terms of the Settlement Agreement, the
parties’ dispute as to the merits of the case is legitimate and the settlement is fair and reasonable.
“Where the attorney’s fee was agreed upon separately, without regard to the amount paid
to the plaintiff, then ‘unless the settlement does not appear reasonable on its face or there is reason
to believe that the plaintiff’s recovery was adversely affected by the amount of fees paid to his
attorney, the Court will approve the settlement without separately considering the reasonableness

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of the fee to be paid to plaintiff’s counsel.’” Davis v. The Filta Group, Inc., 2010 WL 3958701,
*2 (M.D. Fla. Sept. 20, 2010) (quoting Bonetti v. Embarq Mgmt. Co., 2009 WL 2371407, *5 (M.D.
Fla. Aug. 4, 2009)). The parties aver that Plaintiffs’ attorneys’ fees were negotiated at arm’s length
and only after Plaintiffs and Defendants arrived at an agreement regarding the Plaintiffs’ unpaid
overtime premium wages. (Doc. 55 at 11). Defendants agree the sum of $ 38,927.75 for attorneys’
fees and $ 1,072.25 for the reimbursement of the filing fee and postage is fair and reasonable. (See
id.). With this in mind, and upon further review of the settlement agreement, the undersigned finds
the attorneys’ fees are reasonable.3
III. Conclusion
The undersigned finds Plaintiffs’ FLSA claims represent a bona fide dispute over FLSA
provisions and the parties’ settlement is a fair and reasonable resolution of these bona fide disputes.
Therefore, the parties’ motion for settlement approval, (doc. 55), is GRANTED, and the
settlement is APPROVED. A separate order will be entered.
DONE this 4th day of June, 2021.

_______________________________
JOHN H. ENGLAND, III
UNITED STATES MAGISTRATE JUDGE

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Plaintiffs' counsel expended time drafting the complaint, prevailing on a motion for
conditional class certification, studying Defendants’ time and pay records, as well as time
negotiating with Defendants, preparing an individualized damages calculation for Plaintiffs
Lopez-Reyes and Estrada as well as Opt-In Plaintiffs Herrera and Veliz-Veliz; and an estimated
damages calculation for Quinonez-Nunez and Quinones, research, mediation, and the drafting of
the present settlement agreement. Defendants have agreed that this amount be awarded to counsel
for Plaintiffs. (Doc. 55 at 12-13). Defendants’ counsel does not dispute that Plaintiffs’ counsel’s
hourly rate of $375.00 per hour is reasonable. (Id. at 13). Defendants agreed to pay this amount
in light of the costs, work performed, hours spent, likely hourly rates awardable, and in an effort
to expedite payment to Plaintiffs and to avoid costs and delay associated with continued litigation
and fee petition. (Id.).
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