Goldsby v. Renosol Seating, LLC

Filing 171

ORDER denying are denied with leave to re-file by 10/29/13 167 and 169 Motion to Dismiss and Amended Notice of Dismissal; denying with leave to re-file by 10/29/13 170 Motion to Approve Settlement Agreement; denying with leave to re-file by 10/29/13 168 Notice of Dismissal as set out. Signed by Judge Kristi K. DuBose on 10/11/2013. (cmj)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ALABAMA
NORTHERN DIVISION
SHERRY GOLDSBY, on behalf of
herself and all others similarly situated
Plaintiffs,
v.
RENOSOL SEATING, LLC, et al.,
Defendants.

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CIVIL ACTION NO. 2:08-00148-KD-N1

ORDER

This action is before the Court on the amended2 joint motion for approval of settlement
agreement and dismissal of claims with prejudice (doc. 170), the parties’ amended settlement
agreement and release (doc. 170-1), the joint stipulation of dismissal for Cowanda Cobb, Lewis J.
Freeman, Taika Hall, Johnnie Hamilton, Rosalind Reeves, and Joyce Williams’ claims against
Renosol Seating, LLC (doc. 167), the notice of dismissal of the Plaintiffs’ claims against the
individual defendants David Ash, Pete Bernier, Connie Messer, Wayne Savage, Ricky Brown, and
Robert Stricklin (doc. 168), and the amended notice of dismissal and joint stipulation of dismissal
for certain plaintiffs’ claims against Renosol Seating, LLC (doc. 169).
Upon consideration and for the reasons set forth herein, the amended joint motion for
approval of the amended settlement agreement and release (doc. 170) is DENIED with leave to refile on or before October 29, 2013; the joint stipulation of dismissal for Cowanda Cobb, Lewis J.
1

Sherry Goldsby, et al. v. David Ash, et al., Civil Action No. 10-0187-C and Cassandra
Brown, et al. v. Renosol Seating LLC, Civil Action No. 11-00626-CG-C were consolidated with this
action.
2

The parties’ joint motion filed on September 9, 2013 (doc. 165) and the settlement
agreement and release (doc. 165-1) are superseded by the amended joint motion (doc. 170) and the
amended settlement agreement and release (doc. 170-1).

Freeman, Taika Hall, Johnnie Hamilton, Rosalind Reeves, and Joyce Williams’ claims against
Renosol Seating, LLC (doc. 167) and the amended notice of dismissal and joint stipulation of
dismissal (doc. 169) are DENIED with leave to re-file on or before October 29, 2013; and the
notice of dismissal as to the individual defendants doc. (168) is DENIED with leave to re-file on
or before October 29, 2013.
I) Background
On March 18, 2008, plaintiff Sherry Goldsby filed her complaint on her own behalf and on
behalf of others similarly situated. She alleged claims for unpaid overtime under the Fair Labor
Standards Act of 1938, as amended, 29 U.S.C. § 201, et seq. (FLSA) (Doc. 1). Defendant Renosol
Seating, LLC, answered the complaint, admitted that it is an employer subject to the FLSA, denied
all allegations as to any violation of the FLSA, and set forth its affirmative defenses. (Doc. 14) On
December 12 2008, the plaintiffs’ motion for collective action pursuant to 29 U.S.C. § 216(b) was
granted and this action was conditionally certified as a collective action under the FLSA and the
parties were ordered to jointly submit a proposed class notice for approval. (Doc. 31) Plaintiffs
submitted the proposed notice of collective action and proposed consent that was not opposed by
Renosol. (Doc. 36) United States Magistrate Judge Sonja F. Bivins approved the notice and consent
and counsel for plaintiffs was directed to mail the documents to the potential opt-in plaintiffs
identified by Renosol. (Doc. 37) Since that time, approximately two hundred and twenty five
employees have opted in and filed consents to become party plaintiffs.
On July 7, 2009, Renosol filed a voluntary petition for relief under Chapter 11 of Title 11 of
the United States Code, in the United States Bankruptcy Court for the Southern District of New
York, Case No. 09-14326 (ALG). (Doc. 62) On July 14, 2009, this action was stayed pursuant to
11 U.S.C. §362(a). (Doc. 63)
While the bankruptcy action was pending, on October 19, 2009, Sherry Goldsby and
2

Teyonna Olds filed an FLSA action on behalf of themselves and others similarly situated in the
Middle District of Alabama against the individual defendants David Ash, Pete Bernier, Connie
Messer, Wayne Savage, Ricky Brown and Robert Stricklin. This action was transferred to the
Southern District of Alabama in June 2010. Goldsby v. David Ash, et al., Civil Action No. 2:100187-C (S.D. Ala. 2010). Plaintiffs allege that these defendants “acted directly and/or indirectly in
the interest of Renosol Seating, LLC in relation to Plaintiffs’ employment, and [are] thus, subject to
individual liability under the FLSA.” (Id. at doc. 52, p. 124-127, First Amended Complaint). The
individual defendants were identified as corporate officers, participating shareholders and/or
members, supervisors, managers and/or other employees of Renosol who exercised supervisory
authority over the plaintiffs including their compensation, were “employers” as contemplated under
the FLSA, and were responsible in whole or in part for the violations alleged. (Id.) Plaintiffs
alleged that defendants failed to pay overtime at the statutory rate in violation of 29 U.S.C. § 207
and failed to pay wages for some hours worked in violation of 29 U.S.C. § 206. (Id.) On June 9,
2010, after transfer of venue, that action was consolidated with this action for all purposes. (Doc.
89) The individual defendants filed a motion to dismiss but the motion was found moot. (Doc. 138)
On motion for reconsideration, the motion was denied. (Doc. 155)
Also while the bankruptcy action was pending, on November 4, 2011, Cassandra Brown and
Sarah Johnson filed an FLSA action in the Southern District of Alabama against Renosol and four
of the six individual defendants: Messer, Savage, Brown and Stricklin. Brown v. Renosol Seating,
LLC, et al., Civil Action No. 2:11-0626-CG-C (S.D. Ala. 2011). The individual defendants were
identified as “management-level employees” and “joint employer[s]. . . who supervise[d] Plaintiffs
and/or other similarly situated”. (Doc. 1) Plaintiffs alleged that defendants failed to pay overtime at
the statutory rate in violation of 29 U.S.C. § 207 and failed to pay wages for some hours worked in
violation of 29 U.S.C. § 206. (Id.) Defendant Renosol admitted that it was an employer subject to
3

the FLSA but Renosol and the individual defendants denied all other allegations but for venue,
jurisdiction, and plaintiff’s employment. Defendants raised eighteen affirmative defenses in their
answer. In February 2012, that collective action was also consolidated for all purposes with this
action. (Doc. 91)
In May 2012, the stay in bankruptcy was lifted and plaintiffs filed an amended complaint
against all defendants in July 2012. (Docs. 103, 125) Renosol and the individual defendants
answered the amended complaint in the main action and denied all allegations but for those related
to residence and venue. Renosol admitted that it is an employer subject to the FLSA. (Doc. 132)
The parties have now filed their amended joint motion for approval of settlement agreement
and dismissal of claims with prejudice and their amended settlement agreement and release (Doc.
170; Doc 170-1) Plaintiff Goldsby, the opt-in plaintiffs, and Renosol state that they have reached a
settlement as to all actions. Under the terms of the amended agreement and release, Renosol has
agreed to pay a total of $250,00.00 which is divided into plaintiffs’ overtime compensation in the
total sum of $142,334.59 and $107,665.41 as an agreed attorney’s fees and costs to plaintiffs’
counsel.
The parties also “stipulate and agree that the terms of this settlement set forth in the
Settlement Agreement constitute a fair and reasonable resolution of a bona fide dispute” under the
FLSA. They agreed to settle this action because of the continued disagreement over the merits of
plaintiffs’ claims and the amount of overtime compensation, the uncertainty of the outcome, and the
complexity, expense, and duration of continued litigation. The parties request that the Court enter an
order to approve the amended settlement agreement and release and dismiss this case with prejudice
with each party to bear its own costs.3
3

Although the parties refer to the amended agreement as a “Confidential Settlement
Agreement and General Release”, the document is captioned “Settlement Agreement and Release”
(Continued)
4

The parties also filed the joint stipulation of dismissal without prejudice of the claims of
Cowanda Cobb, Lewis J. Freeman, Taika Hall, Johnnie Hamilton, Rosalind Reeves, and Joyce
Williams (doc. 167) and an amended notice of dismissal and joint stipulation of dismissal for
certain plaintiffs’ claims against Renosol (doc. 169). The parties stipulate to dismissal without
prejudice pursuant to “Rule 41(a)(1) and/or 41(a)(2)” (doc. 167). In the amended notice, the parties
clarify that Cowanda Cobb and Taika Hall will participate in the settlement and their claims would
not be dismissed. As a result, the amended joint motion to approve settlement and an amended
settlement agreement and release were filed (docs. 170, 170-1).
Plaintiffs also filed a notice of dismissal of their individual claims against defendants David
Ash, Pete Bernier, Connie Messer, Wayne Savage, Ricky Brown, and Robert Stricklin (doc. 168).
Plaintiffs seek dismissal without prejudice pursuant to “Rule 41(a)(1) and/or 41(a)(2)” of the
Federal Rules of Civil Procedure, with each party to bear its own costs.
II) Analysis
In Lynn’s Food Stores, Inc., the Eleventh Circuit recognized two (2) methods for settlement
of claims brought pursuant to the FLSA: Supervision by the Secretary of Labor or by court approval
in a private action where plaintiff is represented by counsel. 679 F.2d 1350 (11th Cir. 1982). As to
the latter, the parties may compromise and settle the FLSA claims but only with Court approval of
the settlement agreement. The rationale is that:
[s]ettlements may be permissible in the context of a suit brought by employees
under the FLSA for back wages because initiation of the action by the employees
provides some assurance of an adversarial context. The employees are likely to be
represented by an attorney who can protect their rights under the statute. Thus,
when the parties submit a settlement to the court for approval, the settlement is
more likely to reflect a reasonable compromise of disputed issues than a mere
waiver of statutory rights brought about by an employer's overreaching. If a
and does not contain a confidentiality clause nor was it filed under seal. (Doc. 170-1)

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settlement in an employee FLSA suit does reflect a reasonable compromise over
issues, such as FLSA coverage or computation of back wages, that are actually in
dispute; we allow the district court to approve the settlement in order to promote
the policy of encouraging settlement of litigation.
Lynn’s Food, 679 F.2d at 1354. The circuit court concluded that:
[o]ther than a section 216(c) payment supervised by the Department of Labor,
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.
Id. at 1355.
Thus, before the Court may approve the amended settlement agreement and release and
enter a stipulated judgment, it must “scrutiniz[e]” the settlement for fairness” and determine
whether the settlement is a “fair and reasonable resolution of a bona fide dispute” over FLSA
provisions. Lynn’s Food, 679 F. 2d at 1353, 1355); Stalnaker v. Novar Corp., 293 F. Supp. 2d 1260,
1263 (M.D. Ala. 2003). In that regard, the Eleventh Circuit has noted that the FLSA “contemplates
that ‘the wronged employee should receive his full wages plus the penalty without incurring any
expense for legal fees or costs.’” Silva v. Miller, 307 Fed. Appx. 349, 351 (11th Cir. 2009). Thus,
“in any case where a plaintiff agrees to accept less than his full FLSA wages and liquidated
damages, he has compromised his claim within the meaning of Lynn's Food Stores.” Vergara v.
Delicias Bakery & Restaurant, Inc., 2012 WL 2191299, *1 (M.D. Fla. May 31, 2012).
A) Bona fide dispute
Section 216(b) of the FLSA provides that “... [a]ny employer who violates the provisions of
section 206 or section 207 of this title shall be liable to the employee or employees affected in the
amount of their unpaid minimum wages, or their unpaid overtime compensation, as the case may
be, and in an additional equal amount as liquidated damages...” 29 U.S.C. § 216(b). Section 207 is
captioned “Maximum Hours” and paragraph (a)(1) states as follows:
6

Except as otherwise provided in this section, no employer shall employ any of his
employees who in any workweek is engaged in commerce or in the production of
goods for commerce, or is employed in an enterprise engaged in commerce or in
the production of goods for commerce, for a workweek longer than forty hours
unless such employee receives compensation for his employment in excess of the
hours above specified at a rate not less than one and one-half times the regular
rate at which he is employed.
29 U.S.C. § 207(a)(1).
Upon review of the amended complaint, answer, and the amended joint motion to approve
settlement, the Court finds that there is a “bona fide dispute” as to whether the defendants violated
the FLSA by failing to pay Plaintiffs for overtime work. In the amended complaint in the main
action, Plaintiffs allege that Renosol “failed to pay Plaintiffs and others similarly situated, overtime
at the statutory rate of time and one-half for all hours worked in excess of 40 each week in direct
violation of 29 U.S.C. § 207” and that Renosol “failed to pay any wages for some hour worked in
direct violation of 29 U.S.C. § 206.” (Doc. 125, p. 6) Renosol and the individual defendants denied
these allegations and raised sixteen specific defenses and reserved their right to assert further
defenses as appropriate. (Doc. 132)
In the amended joint motion to approve settlement, the parties indicate that after extensive
discovery including the production of Plaintiffs’ pay records, they continued to disagree over the
merits of Plaintiffs’ claims with Renosol contending that Plaintiffs were properly paid and disagreed
as to the amount of overtime compensation. Also, in the consolidated actions, Goldsby v. David
Ash, et al., Civil Action No. 2:10-0187-C (S.D. Ala. 2010) and Brown v. Renosol Seating, LLC, et
al., Civil Action No. 2:11-0626-CG-C (S.D. Ala. 2011), plaintiffs alleged that defendants failed to
pay wages for some hours worked in violation of 29 U.S.C. § 206.
B) Fair and reasonable resolution
The Court is obligated to “scrutiniz[e]” the settlement for fairness” and determine whether
the settlement is a “fair and reasonable resolution of a bona fide dispute” over FLSA provisions.
7

Lynn’s Food, 679 F. 2d at 1353, 1355). Upon review of the complaints, answers, the amended joint
motion to approve settlement and the amended settlement agreement and release, the Court finds
that the amended joint motion to approve the settlement must be denied with leave to re-file, for the
following reasons:
1) “Total damages”
The FLSA provides that “[a]ny employer who violates the provisions of section 206 or
section 207 of this title shall be liable to the employee or employees affected in the amount of their
unpaid minimum wages, or their unpaid overtime compensation, as the case may be, and in an
additional equal amount as liquidated damages.” 29 U.S.C. § 216(b). Generally, an award of
liquidated damages is mandatory if a FLSA violation occurs.
Plaintiffs in this consolidated action have alleged claims for unpaid wages, unpaid overtime
wages, and liquidated damages. (Doc. 125, amended complaint) However, the parties state
that”[t]his action was filed by Plaintiff on her behalf and others similarly situated, . . . alleging
claims for unpaid overtime” and that “[u]nder the settlement agreement, Defendant has agreed to
pay Plaintiffs’ overtime compensation.” (Doc. 170, p.1-2) Also, the amended settlement agreement
and release provides for an amount of “Total Damages” but does not break down the amount to
show whether it is composed of unpaid overtime compensation, unpaid wages, or liquidated
damages. (Id., 2-7) However, the amended settlement agreement and release contains a release
provision for a broad spectrum of wage and hour claims under federal and state law which arguably
could include a release of wage claims and liquidated damages under the FLSA. (Id., ¶ 3)
In order for the Court to determine whether the settlement is a fair and reasonable resolution
of the plaintiffs’ FLSA claims, the court must consider whether in compromising their claims, the
plaintiffs agreed to forego their statutory right to liquidated damages and their unpaid hourly wage
claim and receive only their unpaid overtime compensation. However, the information before the
8

Court is not clear on this point.
2) Retention of jurisdiction
Paragraph 12, of the amended settlement agreement and release, captioned “Retention of
Jurisdiction”, provides that
The Court shall retain jurisdiction with respect to the interpretation,
implementation, and enforcement of the terms of this Agreement and all orders
and judgments entered in connection therewith, and the Parties and their counsel
hereto submit to the jurisdiction of the Court for purposes of interpreting,
implementing and enforcing the settlement embodied in this Agreement and all
orders and judgments entered in connection therewith.
(Doc. 170-1, p. 10).
As a general rule, this Court does not retain jurisdiction to enforce the terms of any
settlement agreement. Moreover, the parties did not move the Court for an order retaining
jurisdiction and did not provide the Court with any factual or legal basis for the Court to retain
jurisdiction.
3) Missing consent to become a party plaintiff
Debra Sarvory is included as a plaintiff in the amended settlement agreement and release.
(Doc. 170-1, p. 6) However, the Court has been unable to locate her consent to become a party
plaintiff.
4) Reasonable attorneys’ fee and costs
Pursuant to 29 U.S.C. § 216(b), “[t]he court in [an FLSA action] shall ... allow a reasonable
attorney's fee to be paid by the defendant, and costs of the action.” In the context of a collective
action, the Court must determine the reasonableness of attorneys’ fees to minimize the conflicts that
may arise between the attorney and the plaintiffs. Piambino v. Bailey, 610 F. 2d 1306, 1328 (5th
Cir. 1980). According to the amended settlement agreement and release, the parties agreed to settle
this action for a total sum of $250,000.00 that was then apportioned between plaintiffs’ damages in
the amount of $142,334.59 and their counsels’ attorneys’ fees and costs in the amount of
9

$107,665.41. (Doc. 170-1) Thus, the Court must ascertain whether $107,665.41 is a reasonable
attorneys’ fee and costs and not the result of any fraud or collusion and not tainted by any conflict
of interest between the plaintiffs and their counsel.
The parties assert that the amended settlement agreement and release “should be approved
because the separately negotiated payment of attorney’s fees and expenses is reasonable” and that
the “agreement regarding payment of Plaintiffs’ counsel’s attorney’s fees and costs was reached
separately and without regard to the amount paid to Plaintiffs.” (Doc. 170, p. 4) They also state
that “Plaintiffs’ claims were not compromised by any deduction of attorney’s fees, costs or
expenses.” (Id.)
However, the parties agreed to a lump sum of $250,000.00 and the amount of attorneys’ fees
falls when plaintiffs’ are awarded damages.4 Therefore, the amount of attorneys’ fees and costs
does not appear to have been “reached separately and without regard to the amount paid to
Plaintiffs.” See Crabtree v. Volkert, Inc., 2013 WL 593500, *7 (S.D. Ala. Feb. 4, 2013) (addressing
a lump sum payment that was divided between counsel and plaintiffs pursuant to a contingency fee
agreement). Thus, the Court must be sure that the settlement agreement and release has not been
tainted by any conflict of interest regarding the agreed upon attorneys’ fees. Silva v. Miller, 307
Fed. Appx. 349, 351 (11th Cir. 2009) (“FLSA requires judicial review of the reasonableness of
counsel's legal fees to assure both that counsel is compensated adequately and that no conflict of
interest taints the amount the wronged employee recovers under a settlement agreement.”). In that
regard, since the Court cannot ascertain whether the “Total Damages” includes liquidated damages
and damages for unpaid wages in addition to damages for unpaid overtime wages, and thus cannot
4

When Cowanda Cobb and Taika Hall’s damages were included in the settlement
agreement, the amount of attorneys’ fees and costs were reduced by the amount of their combined
damages awards. (Compare the Settlement agreement at Doc. 165-1 with Doc. 170-1).

10

resolve the question of whether the settlement is a fair and reasonable resolution of a bona fide
dispute over FLSA provisions, the Court cannot ascertain whether the agreed upon attorneys’ fee is
reasonable.
Additionally, when attorneys’ fees and expenses are negotiated separately from the amount
paid to plaintiffs, the Court still must determine the reasonableness of those fees and expenses by
considering “the number of hours reasonably expended on the litigation, together with the
customary hourly rate for similar legal services.” Padurjan v. Aventura Limousine &
Transportation Service, Inc., 441 Fed. Appx. 684, 686 (11th Cir.2011) (citing Hensley v. Eckerhart,
461 U.S. 424, 433, 103 S.Ct. 1933, 1939, 76 L.Ed.2d 40 (1983). Multiplying the reasonable hourly
rate by the hours reasonably expended yields the “lodestar” which is the “starting point” for the
Court's determination. Patel v. Shree Jalarm, Inc., 2013 WL 5175949, 6 (S.D. Ala., Sept. 13, 2013)
(slip copy) (citing Bivins v. Wrap It Up, Inc., 548 F.3d 1348, 1350 (11th Cir.2008) and Norman v.
Hous. Auth. of the City of Montgomery, 836 F.2d 1292, 1299 (11th Cir.1988) (explaining that the
Eleventh Circuit “mirrored the evolving standards of the Supreme Court” and its election of the
lodestar method)).
C) Final certification of the collective action
The Eleventh Circuit has suggested that the district courts “adopt” a “two-tiered approach to
certification of § 216(b) opt-in classes . . . [as] an effective tool for district courts to use in
managing these often complex cases.” Hipp v. National Life Ins. Co., 252 F 3d 1208, 1219 (11th
Cir. 2001); 5 Anderson v. Cagles, Inc., 488 F. 3d 945, 953 (11th Cir. 2007); Morgan v. Family
Dollar Stores, Inc., 551 F. 3d 1233, 1260 (11th Cir. 2008) (“while not requiring a rigid process for
5

Plaintiff Hipp brought an action under the Age Discrimination in Employment Act. The
ADEA adopts certain provisions of the FLSA including the penalties provision found in 29 U.S.C. §
216(b). 29 U.S.C. § 626(b)

11

determining similarity, we have sanctioned a two-stage procedure for district courts to effectively
manage FLSA collective actions in the pretrial phase”). The first tier, the conditional certification of
the representative class or “notice” stage, is complete6 and the action is now at the second tier when
the Court must decide whether to grant final certification of the class. Hipp, 252 F. 3d at 1218.
This second stage is “typically precipitated by a motion for decertification by the defendant”
after discovery and before trial. Hipp, 252 F. 3d at 1218.7 However, the issue may also arise upon
agreement of the parties when an FLSA action has been settled before final class certification and
trial. See Hosier v. Mattress Firm, Inc., 2012 WL 2813960, *3 (M.D. Fla. June 8, 2012) (“Here, the
parties agree for purposes of settlement that all Qualified Claimants ‘are similarly situated.’ . . .The
parties represent that ‘the discovery in this case indicated that the [Qualified Claimants] share a
common job description and allegedly performed similar job duties nationwide.’”)
In that circumstance, before the settlement can be approved, “the Court must make a
decision whether final certification of the collective action is appropriate.” Hosier, 2012 WL
2813960 at *2. In making the decision, the court must determine whether the plaintiffs “are
similarly situated by considering the following factors: ‘(1) disparate factual and employment
settings of the individual plaintiffs; (2) the various defenses available to defendant[s] [that] appear
to be individual to each plaintiff; [and] (3) fairness and procedural considerations[.]’” Id. (quoting
Morgan v. Family Dollar Stores, Inc., 551 F.3d 1233, 1261 (11th Cir.2008) (internal quotations and
citations omitted)). Also, at the second stage, the burden to show substantial similarity is more
stringent than at the first stage. Id.
6

“[T]he importance of certification, at the initial stage, is that it authorizes either the
parties, or the court itself, to facilitate notice of the action to similarly situated employees.” Morgan
v. Family Dollar Stores, Inc., 551 F. 3d 1233, 1259 (11th Cir. 2008).
7

At that procedural posture, the plaintiffs bear the burden of establishing that

12

However, the parties have not agreed that the plaintiffs and opt-in plaintiffs are “similarly
situated”. 8 Nor have they provided the Court with any evidence in support of the factors that the
Court must consider in making the decision. Also, they have not provided the Court with any legal
basis for approving the settlement of this collective action without first deciding whether final
certification should be granted.
D. Notice of dismissal without prejudice as to the individual defendants David Ash, Peter
Bernier, Connie Messer, Wayne Savage, Ricky Brown, and Robert Stricklin (doc. 168).
Plaintiffs filed a notice of dismissal without prejudice with each party to bear its own costs
as to their claims against the individual defendants Ash, Bernier, Messer, Savage, Brown and
Stricklin, the management level employees of Renosol. Plaintiffs filed the notice pursuant to “Rule
41(a)(1) and/or Rule 41(a)(2)” of the Federal Rules of Civil Procedure.
Dismissal under Rule 41(a)(1)(i) is not available because defendants did not sign the notice
of dismissal and because defendants served their answer on August 10, 2012.9 Thus, only Rule
41(a)(2) is available. In that regard, the “action may be dismissed at the plaintiff's request only by
court order, on terms that the court considers proper” and “[u]nless the order states otherwise, a
dismissal under this paragraph (2) is without prejudice.” Fed. R. Civ. P. 41(a)(2). See Garcia v.
Spirit Airlines, Inc., 2011 WL 2312562 (S.D. Fla. June 8, 2011) (applying Rule 41(a)(2) in an FLSA
action). Generally, “[t]he decision to grant or deny a Rule 41(a)(2) motion to dismiss an action
without prejudice is entrusted to the sound discretion of the district court; thus, a plaintiff holds no
right to such dismissal.[] What is more, in exercising its discretion, the court must ‘keep in mind
8

Plaintiffs allege that they were hourly employees who worked at Renosol’s manufacturing
plant. Defendants generally admitted only that plaintiffs were employed by Renosol.
9

Fed. R. Civ. P. 41(a)(1)(A)(i) allows voluntary dismissal without court action, if the notice
of dismissal is filed before the defendants “serve either an answer or a motion for summary
judgment.”

13

the interests of the defendant, for Rule 41(a)(2) exists chiefly for protection of defendants.’” In re
Bayshore Ford Trucks Sales, Inc., 471 F.3d 1233, 1259 (11th Cir.2006) (quoting Fisher v. P.R.
Marine Mgmt., Inc., 940 F.2d 1502, 1503 (11th Cir.1991)) Plaintiffs have presented inconsistent
information that impairs the Court’s ability to determine what terms are proper for the dismissal.
As stated above, plaintiffs seek to voluntarily dismiss these individual defendants without prejudice
(doc. 168). However, in paragraph 1(b) of the amended settlement agreement and release, plaintiffs
agree that upon court approval of the settlement, they will “take all action necessary to have the
claims in the Litigation dismissed with prejudice, subject to the terms of paragraph ‘3’” (doc. 170-1,
p. 7) (underline added). Then, in paragraph 3, they release and forever discharge Renosol “and (iii)
any current or former . . . employee . . . from any and all claims that were or could have been
brought by him or her in the Litigation . . .” (doc. 170-1, p.8) (underline added). Reading these
paragraphs together, if the Court approves the settlement agreement and release, the claims against
the individual defendants will be dismissed with prejudice.
In view of the FLSA’s requirement that the Court scrutinize any settlement agreement for
fairness, the protection offered defendants when plaintiffs move to dismiss pursuant to Rule
41(a)(2), and the inconsistency discussed herein, the Court declines to enter an order of dismissal as
to the claims against the individual defendants at this time. Accordingly, dismissal of the individual
defendants is denied with leave to re-file on or before October 29, 2013.
E. The joint stipulation of dismissal and the amended notice of dismissal (doc. 169) and joint
stipulation of dismissal (doc. 167)
Counsel for all parties who have appeared in the action signed a joint stipulation of dismissal
for Cowanda Cobb, Lewis J. Freeman, Taika Hall, Johnnie Hamilton, Rosalind Reeves, and Joyce
Williams’ claims against Renosol wherein the parties stipulate to dismissal without prejudice with
each party to bear its own costs. (Doc. 167) The parties also stipulated that the dismissal was
“pursuant to Federal Rules of Civil Procedure 41(a)(1) and /or 41(a)(2).” Id. The parties then filed
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an amended notice of dismissal and joint stipulation wherein the claims of Cobb and Hall were not
dismissed but instead were to be included in the amended joint motion to approve settlement and in
the amended settlement agreement and release (doc. 169).
The parties have given the Court two options for addressing the joint stipulation. First, the
Court may treat the stipulation for dismissal without prejudice as made under Rule 41(a)(1)(A)(ii)
which provides for voluntary dismissal by the plaintiff without a court order by filing a “stipulation
of dismissal signed by all parties who have appeared.” Fed. R. Civ P. Rule 41(a)(1)(A)(ii). Some
courts have recognized this method for dismissal without prejudice of a FLSA action. Appleby v.
Hickman Const., Inc., 2013 WL 1197758 (N.D. Fla. Mar. 25, 2013) (slip copy) (“Where the parties
stipulate to dismissal without prejudice, the plaintiff is not foreclosed from refiling any FLSA claim
at a later time, and thus, such a stipulated dismissal remains self executing without contravening the
FLSA.”) (citing PerezNunez v. N. Broward Hosp. Dist., 609 F.Supp.2d 1319, 1320–21
(S.D.Fla.2009)) (italics in original); Caban v. Installation and Service Technologies, Inc., 2009 WL
4730537, *5 (M.D. Fla. Dec. 4, 2009) (recommending dismissal without prejudice where court had
not reviewed the fairness of an oral settlement agreement and stating that “the dismissal cannot be
with prejudice on that basis alone.”).
However, some courts have found that FLSA claims cannot be dismissed in this manner
because Rule 41(a)(1) states that a stipulation under that rule is “[s]ubject to . . . any applicable
federal statute” such as the FLSA. 1 See Santos v. Gomez, LLC, 2013 WL 4523492 (M.D. Fla. Aug.
26, 2013) (slip copy) (“If plaintiff's Notice of Dismissal With Prejudice [pursuant to Rule
41(a)(1)(A)(ii)] is the product of a settlement, the Court must be notified and must review the terms
of the proposed settlement. If not, and plaintiff has just decided to dismiss her case without
consideration from defendants, plaintiff can simply tell the Court that no settlement is involved. The
Federal Rules of Civil Procedure do not overrule the FLSA's substantive requirement of a court15

approved settlement.”). The district court in Wolinsky v. Scholastic, Inc., 900 F. Supp 2d 332 (S.D.
N.Y. 2012) was confronted with a possible Rule 41(a)(1) voluntary dismissal and reasoned as
follows:
Finally, it bears noting that while Scholastic's letter says nothing on the subject,
the Agreement itself contains a clause providing that if “the Court refuses to
accept this Agreement on a confidential basis, the parties agree in the alternative
to dismissal of the litigation via stipulation pursuant to Federal Rule of Civil
Procedure 41.” Voluntary dismissal by the plaintiff without a court order under
Rule 41(a)(1), however, is subject to “any applicable federal statute,”
Fed.R.Civ.P. 41 (a)(1), and as discussed above, the FLSA does not allow an
employee to waive or otherwise settle a claim for unpaid wages for less than the
full statutory damages unless the settlement is supervised by the Secretary of
Labor or made pursuant to a judicially supervised stipulated settlement. There
may be circumstances in which voluntary dismissal of an FLSA claim without a
court order is proper, but to allow it in the present circumstances—where the
parties have reached a settlement agreement— would permit an end run around
the FLSA's judicial-supervision requirement. Accordingly, the Court concludes
that the parties in this case may not stipulate to dismissal of the case without a
court order pursuant to Rule 41(a)(1). Instead, the case “may be dismissed at the
plaintiffs request only by court order, on terms that the court considers proper.”
Fed.R.Civ.P. 41(a)(2).
Id. at 340-341.10
This leads the Court to the second option presented by the joint stipulation: That the Court
may treat the stipulation as plaintiffs’ motion pursuant to Rule 41(a)(2) for dismissal on “terms that
the court considers proper.” However, this option calls upon the Court to consider the
circumstances surrounding the plaintiffs’ dismissal without prejudice in order to determine what
terms of dismissal are proper. See In re Family Dollar FLSA Litigation, 2012 WL 370068 (W.D.
10

A different result was reached in Acosta v. United Temps, Inc., 2012 WL 3038167, *2 (M.D.
Fla. July 16, 2012). The district court, citing Anago Franchising, Inc. v. Shaz LLC, 677 F.3d 1272
(11th Cir. 2012), recognized that courts in that district had dismissed FLSA cases on joint
stipulation of dismissal “without determining whether the parties’ settlement is fair and reasonable”
but noted “that a defendant who exacts a compromise of a plaintiff's FLSA claim and does not
obtain approval of the settlement from the Department of Labor or the court acts at his own peril
because the settlement is unenforceable.”)
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N.C. Feb. 3, 2012) (allowing plaintiff to be dismissed from the litigation without prejudice pursuant
to Rule 41(a)(2) upon finding that “Plaintiff indicated her desire to withdraw from this litigation,
due to the birth of her son”).
The Court is hesitant to apply either Rule 41(a)(1)(A)(ii) or Rule 41(a)(2) without
information as to the circumstance surrounding the decision by these four plaintiffs to dismiss their
FLSA claims without prejudice and information why their claims are addressed separately from the
plaintiffs who are receiving compensation and agree to dismissal with prejudice. Therefore, the
Court declines to enter an order of dismissal as to the claims of Freeman, Hamilton, Reeves and
Williams at this time and the joint stipulation of dismissal (doc. 167) and the amended notice of
dismissal and joint stipulation of dismissal (doc. 169) are denied with leave to re-file on or before
October 29, 2013.
Conclusion
For the foregoing reasons, the amended joint motion for approval of the amended joint
motion for approval of the amended settlement agreement and release is DENIED with leave to refile on or before October 29, 2013; the joint stipulation of dismissal for Cowanda Cobb, Lewis J.
Freeman, Taika Hall, Johnnie Hamilton, Rosalind Reeves, and Joyce Williams’ claims against
Renosol Seating, LLC (doc. 167) and the amended notice of dismissal and joint stipulation of
dismissal (doc. 169) are DENIED with leave to re-file on or before October 29, 2013; and the
notice of dismissal as to the individual defendants (doc. 168) is DENIED with leave to re-file on
or before October 29, 2013.
DONE and ORDERED this the 11th day of October 2013.
/s/ Kristi K. DuBose
KRISTI K. DuBOSE
UNITED STATES DISTRICT JUDGE

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