Goldsby v. Renosol Seating, LLC
PRELIMINARY APPROVAL ORDER approving pending notice of settlement to the Opt-In Plaintiffs re: 172 Joint MOTION to Approve Settlement Agreement (Second) filed by Sherry Goldsby. Plaintiffs notice of dismissal without prejudice as to the i ndividual defendants Ash, Bernier, Messer, Savage, Brown and Stricklin is MOOT (doc. 168) Parties are to submit by 12/18/13 a draft proposed notice to the Opt-In Plaintiffs with the objection date of 1/24/14. ( Draft proposed notice set for 12/18/2013; objection to notice of settlement set for 1/24/2014.). Signed by Judge Kristi K. DuBose on 12/13/2013. (cmj)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ALABAMA
SHERRY GOLDSBY, et al, on behalf of
herself and all others similarly situated;
RENOSOL SEATING, LLC, et al.,
Civil Action No. 2:08-0148-KD-N1
PRELIMINARY APPROVAL ORDER
This action is before the Court on the second amended joint motion for approval of
settlement agreement and dismissal of claims with prejudice (doc. 172); the parties’ revised
settlement agreement and release (doc. 172-3); the joint stipulation of dismissal for Lewis J.
Freeman, Johnnie Hamilton, Rosalind Reeves, and Joyce Williams’ claims against Renosol
Seating, LLC (doc. 167) and the amended joint stipulation of dismissal and notice of dismissal2
(doc. 169); and 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
Upon consideration and for the reasons set forth herein, the second amended joint motion
for approval of settlement agreement and dismissal of claims with prejudice and the revised
Sherry Goldsby, et al. v. David Ash, et al., Civil Action No. 10-0187-C (S.D. Ala. 2010)
and Cassandra Brown, et al. v. Renosol Seating LLC, Civil Action No. 11-00626-CG-C (S. D.
Ala. 2011) were consolidated with this action.
Cowanda Cobb and Taika Hall initially joined the stipulation of dismissal. However, the
parties determined that they had claims against Renosol. An amended notice and joint
stipulation that did not include dismissal of Cobb and Hall’s claims was filed. (Docs. 167, 169,
settlement agreement and release (docs. 172, 172-3) are preliminarily approved pending notice
of the settlement to the Opt-In Plaintiffs as set forth herein in Section III (D).
Pursuant to the joint stipulation of dismissal, the amended notice of dismissal and joint
stipulation of dismissal, and the second amended joint motion for approval of settlement (docs.
167, 169, 172), and in the interests of fairness, the claims of Opt-In Plaintiffs Lewis J. Freeman,
Johnnie Hamilton, Rosalind Reeves, and Joyce Williams against Renosol Seating LLC, are
dismissed without prejudice.3 See Fed. R. Civ. P. 41(a)(2)(“. . . an action may be dismissed at
the plaintiff’s request only by court order, on terms that the court considers proper.”)
The Plaintiffs’ notice of dismissal without prejudice as to the individual defendants Ash,
Bernier, Messer, Savage, Brown, and Stricklin is MOOT. (Doc. 168) 4
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
In the order denying the amended joint motion for approval, the Court explained that it
was hesitant to apply either Rule 41(a)(1)(A)(ii) or Rule 41(a)(2) to the joint stipulation of
dismissal without information as to the circumstance surrounding the decision by these four
plaintiffs to dismiss their FLSA claims without prejudice and as to why their claims are
addressed separately from the plaintiffs who are receiving compensation and agree to dismissal
with prejudice. (Doc. 171) The parties now explain that Opt-In Plaintiffs Freeman and Reeves
worked at Renosol prior to the requisite three-year time period at issue in this action. As to OptIn Plaintiffs Johnnie Williams and Joyce Williams, plaintiffs explain that Renosol has no records
of their having worked at Renosol and they did not provide any documentation otherwise. (Doc.
172) In this circumstance, the Court finds that dismissal without prejudice is proper.
Previously, the Court found an inconsistency between the notice of dismissal without
prejudice and the terms of the amended settlement agreement and release whereby these same
defendants would be dismissed with prejudice. (Doc. 171) The parties now agree that the notice
of dismissal without prejudice is moot because the individual defendants will be dismissed with
prejudice upon approval of the revised settlement agreement and release. (Doc. 172, p. 7)
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
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 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.
The parties filed a joint motion for approval of settlement agreement and dismissal of
claims with prejudice and their settlement agreement and release (doc. 165, 165-1). Shortly
thereafter, the parties filed an amended joint motion and an amended settlement agreement and
release (Doc. 170; Doc 170-1) The motion and release were amended to include the claims of
Cowanda Cobb and Taika Hall. The amended motion was denied for reasons set forth in the
order denying the motion. (Doc. 171)
The parties have now filed a second amended joint motion for approval of settlement
agreement wherein the parties address certain issues raised in the order denying the amended
joint motion. (Doc. 172)5 They have also filed a revised settlement agreement and release. (Doc.
172-3) Plaintiffs and Renosol state that they have reached a settlement as to all actions. Under
the terms of the revised settlement agreement and release, Renosol has agreed to pay a total of
$250,00.00 which is divided into Plaintiffs’ damages 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 now agree
and stipulate that the named Plaintiffs and the Opt-In Plaintiffs are similarly situated, that it is
now appropriate for the Court to enter a final order certifying the action as a collective action for
settlement purposes, and that the terms of this settlement set forth in the revised settlement
The Court was unable to locate Debra Sarvory’s consent to become a party plaintiff.
(Doc. 171, p. 9) The parties inform the Court that her consent was docketed in Goldsby v. Ash,
Civil Action No. 2:09-0975-TFM (M.D. Ala. 2009) (Doc. 11) before that action was transferred
to this court and became Goldsby v. Ash, Civil Action No. 2:10-0187-C (S.D. Ala. 2010). The
Court also questioned the necessity of the “Retention of Jurisdiction” provision. (Doc. 171, p. 9)
The parties have now removed that provision from their settlement agreement.
agreement and release constitute a fair and reasonable resolution of a bona fide dispute under the
FLSA. The parties request that the Court enter an order to approve the revised settlement
agreement and release and dismiss this case with prejudice with each party to bear its own costs.
II) Final certification as a 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); 6Anderson 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 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 complete7 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.
At the second tier, before the settlement can be approved, the Court must decide whether
final certification of the collective action is appropriate. Morgan v. Family Dollar Stores, Inc.,
551 F.3d 1233, 1261 (11th Cir.2008). To do so, the Court may consider factors such as “(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
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).
“[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).
procedural considerations[.]” Id. (quoting Anderson v. Cagle’s, 488 F.3d 945, 953 11th Cir.
2007) (quoting with approval Thiessen v. General Electric Capital Corp., 267 F.3d 1095, 1103,
(10th Cir. 2001)). Although the FLSA does not require class members to “hold identical
positions”, similarities must be more than “job duties and pay provision” and “encompass”
Renosol’s defenses “to some extent.” Id. at 1261-1262 (citing Anderson v. Cagle’s, 488 F.3d at
953). “[U]ltimately, whether a collective action is appropriate depends largely on the factual
question of whether the plaintiff employees are similarly situated to one another.” Id., at 1262.
The parties agree and stipulate that Plaintiffs and the Opt-In Plaintiffs are similarly
situated. The parties also agree and stipulate that it is appropriate for the Court to enter a final
order certifying this action as a collective action for settlement purposes. (Doc. 172, p. 7; Doc.
172-3, p. 7) As to similarity, this action involves hourly employees employed at Defendant’s
Selma, Alabama manufacturing plant wo allege that Renosol “routinely provided unpaid rest and
meal breaks of less than twenty minutes in duration in direct violation of 29 C.F.R. ¶ 785.19.”
(Doc. 172, p. 2) As to defenses available, Renosol raised numerous affirmative defenses,
including those that were common to all Plaintiffs such as equitable defenses (estoppel, unclean
hands), the good faith provisions of the Portal-to-Portal Act of 1947, and lack of knowledge that
Plaintiffs were not properly compensated. (Doc. 132) Although certain defenses may have been
individual to certain Plaintiffs such as whether they were employed by Renosol or statute of
limitations defenses, these defenses appear to have held true for only four of the 230 employees
who opted in to this litigation.8
Therefore, in consideration of the above, and fairness and procedural concerns attendant
to the possibility of 226 separate lawsuits, the Court makes a preliminary determination that this
Freeman, Reeves, Williams and Williams as discussed herein.
action should be finally certified as a collective action pursuant to § 216(b). 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.’ . . . Certification of
this case also serves judicial economy. If each individual Qualified Claimant had to file
individual lawsuits rather than participate in this action, the Court could potentially be faced with
775 individual cases”).
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 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 revised 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). Therefore, “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:
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 second amended joint motion to
approve settlement, the Court finds that there is a “bona fide dispute” as to whether Renosol and
the individual 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” (“Maximum hours”)
and that Renosol “failed to pay any wages for some hour worked in direct violation of 29 U.S.C.
§ 206.” (“Minimum wage”) (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) 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.
However, in the second amended joint motion to approve settlement, the parties clarified
that the evidence revealed that Plaintiffs were properly paid a minimum wage and therefore, the
claims in this action involved only claims for unpaid overtime compensation.9 The parties state
that after extensive document and interrogatory discovery including the production of Plaintiffs’
pay records, they continued to disagree over the merits of Plaintiffs’ claims and the amount of
overtime compensation owed to Plaintiffs. Plaintiffs allege that “at all times relevant to this
action, Plaintiffs were routinely provided unpaid rest and meal breaks of less than twenty
minutes in direct violation of 29 CFR §785.18.” (Doc. 172, p. 2) Thus, there is a bona fide
In the order denying the amended joint motion to approve settlement, the Court
explained that the pleadings and motions were not clear as to whether Plaintiffs claimed unpaid
minimum wages in addition to unpaid overtime wages. (Doc. 171, p. 8)
dispute over FLSA provisions.
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. Lynn’s Food, 679 F. 2d at 1353, 1355). In Silva, the circuit court explained that the
FLSA imposes “a duty to review the compromise” of an FLSA claim. 307 Fed. Appx. at 352. As
a framework, the Court may consider the following factors: “1) the existence of fraud or
collusion behind the settlement; 2) the complexity, expense, and likely duration of the litigation;
3) the stage of the proceedings and the amount of discovery completed; 4) the probability of
plaintiff's success on the merits; 5) the range of possible recovery; and 6) the opinions of the
counsel.” Dees v. Hydradry, Inc., 706 F.Supp.2d 1227, 1241 (M.D. Fla. 2010) (finding that the
factors for evaluating the fairness of a settlement in a class action were applicable in an FLSA
action); Mason v. Wyndham Vacation Ownership, Inc., 2012 WL 570060 (M.D.Fla. Feb. 17,
Additionally, the Court may approve the settlement of FLSA claims where there are
“problems” which warrant a compromise and settlement. Moreno v. Regions Bank, 729
F.Supp.2d 1346 (M.D.Fla.2010) (“Problems, for example, in proving hours-worked or ‘nonexempt’ status—or the presence of some other lawful defense to payment (if any)—may warrant
a reasonable compromise, if the court approves.”); Meek v. Wachovia Corporation, 2007 WL
2728404, 2 (M.D. Fla. Sept. 17, 2007) (“The settlement to Plaintiff is a reflection of the
difficulties of proof Plaintiff faced, should he proceed to trial, and makes allowances for the
inherent difficulties and costs of a trial.”).
Upon consideration of the joint motion, and the factors identified in Dees and Moreno,
especially the possible complexity and expenses of the litigation, the probability of Plaintiffs’
success on the merits, and certain problems that warrant a compromise, the Court finds that
Plaintiffs’ compromise and settlement is a fair and reasonable resolution of their FLSA claims.
Plaintiffs initially sought unpaid minimum wages, unpaid overtime wages, and liquidated
damages. After discovery and review of the evidence, they no longer seek unpaid minimum
wages and agree to receive approximately 60% of their respective unpaid overtime wages. The
parties explain that the decision to compromise was based, in part, on the uncertain area of the
law regarding the interplay between 29 C.F.R. § 785.18 and § 785.19. Section 785.18 provides
that short rest periods of 5 to 20 minutes duration are customarily paid as working time. Section
785.19 provides that bona fide meal periods are not paid as working time and that 30 minutes or
more is generally long enough to qualify as a bona fide meal period. However, § 785.19 also
states that meal periods that last less than 30 minutes, such as the alleged 20 minute meal period
at issue in this case, where an employee is completely relieved from work may be a bona fide
meal break where certain conditions are met. The parties further explain that the issues in the
action appear to be a case of first impression in this jurisdiction, that there is minimal case law
on the issue, and that the Department of Labor’s Field Operation Handbook also does not
provide any certainty as to whether the meal breaks at issue in this case constitute FLSA
violations. This uncertainty regarding the law, the potential ambiguity of facts, and the increased
litigation expenses for this action and any appeal, lead Plaintiffs to compromise their claims and
settle this action.
The parties also explained that the Plaintiffs compromised their claim and agreed to
forego their statutory right to liquidated damages because of the uncertainty in the law discussed
above and the likelihood that liquidated damages would not be recovered at trial. The parties set
forth that Renosol would have a strong argument that its failure to pay Plaintiffs’ overtime was in
good faith and that it had reasonable grounds to believe that the 20 minute meal break was a
bona fide meal period.
C. Attorneys’ fees and costs
The FLSA requires that the Court “shall, in addition to any judgment awarded to the
plaintiff or plaintiffs, allow a reasonable attorney's fee to be paid by the defendant, and costs of
the action.” 29 U.S.C. § 216(b); Silva, 307 Fed. Appx. at 351; see also Norman v. Alorica, Inc.,
2012 WL 5452196 (S.D.Ala. Nov. 7, 2012); Wolff v. Royal American Mgt., Inc., 2012 WL
5303665 (S .D.Ala. Oct. 25, 2012). Previously, the Court found that it could not assess the
reasonableness of the attorneys’ fees and costs because the parties agreed to a lump sum of
$250,000.00 and the amount of attorneys’ fees would fall when Plaintiffs’ were awarded
damages. (Doc. 171) The Court questioned whether the attorneys’ fees and costs were separately
negotiated without regard to the amount paid to the Plaintiffs. (Doc. 171) The Court also
explained that it must be sure that the agreed upon attorneys’ fees were not tainted by any
conflict of interest. Also, because the Court could not determine what claims were covered by
the total damages awarded to each Plaintiff, the Court could not resolve the whether the agreed
upon attorneys’ fees were reasonable. Id.
The parties have now sufficiently explained that Plaintiffs’ total damages are for 60% of
their unpaid overtime compensation, that their claims for unpaid minimum wages were not
supported by the evidence, and that they compromised their claim for liquidated damages as part
of the settlement agreement. The Court now turns to the Plaintiffs’ claim for attorneys’ fees and
costs and the additional evidence provided in support of their claim. Plaintiffs seek a total
attorneys’ fee and costs in the agreed-upon amount of $107,665.41, which is made up of
$94,965.41 for attorney and paralegal fees and $12,700.00 for costs and expenses. Deducting
$107,665.41 from the $250,000.00 settlement amount yields $142,334.59, the damages awarded
to the Plaintiffs. (Doc. 172, 172-3) In support, Plaintiffs provide the Court with the affidavit of
counsel wherein he states that the three attorneys incurred a total of 222 hours of work and the
three paralegals incurred a total of 549 hours of work. Counsel states that the attorneys’ hourly
rates are $450.00 and the paralegals’ hourly rates are $90.00. The total amount of attorneys’ fees
incurred is $149,310.00. As to costs, counsel states that a total of $12,700.00 has been incurred.
(Doc. 172-1) In the joint motion, the parties state that due to the reduction of attorneys’ fees
from $149,310.00 to $94,965.41, the effective hourly rate for the attorneys is approximately
$205.00 per hour and $90.00 per hour for the paralegals.
Customarily, this Court has required the plaintiffs to provide an itemized billing
statement which describes the work actually performed during the hours invoiced in order for the
Court to determine the reasonableness of the hours expended. Padurjan v. Aventura Limousine &
Transportation Service, Inc., 441 Fed. Appx. 684, 686 (11th Cir.2011) (Applying the lodestar
method and stating that in order to “calculate reasonable attorneys' fees, courts are to consider
the number of hours reasonably expended on the litigation, together with the customary hourly
rate for similar legal services.”); Bivins v. Wrap It Up, Inc., 548 F.3d 1348, 1350 (11th Cir.2008)
(citation omitted) (Multiplying the reasonable hourly rate by the hours reasonably expended
yields the “lodestar” which is the “starting point” for the Court's determination). If the
description of the work actually performed shows that it was redundant, excessive, or
unnecessary, then those hours would not be reasonably expended and thus, could not form the
basis for determining a reasonable attorneys fee under the lode star method. Hensley v.
Eckerhart, 461 U.S. 424, 433, 103 S.Ct. 1933, 1939, 76 L.Ed.2d 40 (1983); Norman v. Hous.
Auth. of the City of Montgomery, 836 F.2d 1292, 1301 (11th Cir.1988) ((explaining that the
Eleventh Circuit “mirrored the evolving standards of the Supreme Court” and its election of the
lodestar method and that the prevailing party cannot recover hours “that would be unreasonable
to bill to a client and therefore to one's adversary irrespective of the skill, reputation or
experience of counsel.”) The Court has also required an itemized statement of the costs because
the costs allowed in an FLSA action are those set forth in 28 U.S.C. § 1920. See Mock v. Bell
Helicopter Textron, Inc., 456 Fed. Appx. 799, 802 (11th Cir.2012) (finding that costs pursuant to
29 U.S.C. § 219(b) are limited by 28 U.S.C. § 1920) (citing Glenn v. General Motors Corp., 841
F.2d 1567, 1575 (11th Cir.1988).
Also, the reasonable hourly rate is the prevailing market rate “in the relevant legal
community for similar services by lawyers of reasonably comparable skills, experience, and
reputation.” American Civil Liberties Union v. Barnes, 168 F.3d 423, 436 (11th Cir.1999);
Norman, 836 F.2d at 1299. In this case, the relevant legal community is the Southern District of
Alabama. See Barnes, 168 F.3d at 437 (providing that “the ‘relevant market’ for purposes of
determining the reasonable hourly rate for an attorney's services is the place where the case is
filed.” (citation omitted)). However, the parties have provided the Court with the hourly rate of
$450.00 invoiced by its attorneys and $90.00 invoiced by its paralegals, both of which exceed
this Court’s customary hourly rates for attorneys, which ranges from $250.00 to $300.00 for
more experienced and qualified attorneys, $150.00 to $225.00 for less experienced attorneys and
associates with few years of practice, and $75.00 for paralegals. See McCants v. Fred’s of
Tennessee, Inc., 2011 WL 172900, *4 (S.D. Ala. Jan. 16, 2013) (slip copy) (finding $250.00 per
hour for Banks C. Ladd, a partner with eleven years experience in employment litigation and a
specialization in FLSA cases was a reasonable hourly rate); Johnson v. TMI Management
Systems, Inc., 2012 WL 4435304, *1 (S.D. Ala., Sept. 26, 2012) (finding $75.00 per hour was a
reasonable hourly rate for paralegal time where movant did not show that paralegals possessed
special qualification or expertise to support an award of a higher hourly rate).
However, “[w]hen a district court finds the number of hours claimed is unreasonably
high, the court has two choices: it may conduct an hour-by-hour analysis or it may reduce the
requested hours with an across-the-board cut.” Bivins, 548 F.3d at 1350. Since Plaintiffs have
already cut their total attorneys’ fees by $54,344.5910 in order to come within the agreed-upon
settlement amount of $250,000.00, the Court finds that Plaintiffs have engaged in their own
“across-the-board” cut, and the Court need not inquire further. Additionally, although the
Plaintiffs’ compromise of their FLSA claims appears to have increased the amount payable to
their attorneys, the compromised does not appear to be tainted by a conflict of interest, but rather
was based upon a fair and reasonable assessment of the litigation and the possible recovery to the
Plaintiffs. Accordingly, the attorneys’ fees11 and costs in the reduced amount of $107,665.41 are
preliminarily approved as reasonable and awarded to the Plaintiffs.
D. Fairness hearing and notice to the Opt-In Plaintiffs
The parties did not move the Court to set a fairness hearing and did not provide the Court
with any evidence that the Opt-In Plaintiffs have had an opportunity to review the revised
settlement agreement and release. In the revised settlement agreement and release, the parties
agree that because the agreement must be approved by the Court, and because “it is impossible
or impractical to have each Opt-In Plaintiff execute this Agreement”, the named Plaintiff
Deducting $94,965.41, the compromised attorneys’ fee, from $149,310.00, the fees
actually incurred, yields $54,344.59.
The Court finds that the paralegal rate of $90.00 is not commensurate with the
prevailing rate in this district, but in consideration of the lower attorney hourly rate, the Court
does not find that an adjustment is necessary.
Goldsby will sign on their behalf. (Doc. 172-3, p. 10) Goldsby states that she has “been given
authority to sign this Agreement on behalf of the Opt-In Plaintiffs by the Consent to Join forms
filed with the Court in the Litigation.” Id. The parties also agree that to “confirm their agreement
to the terms of this Settlement Agreement and Release”, each settlement check will contain
language to the effect that signing, depositing or cashing the check confirms the release of
Renosol as approved by the Court. Id.
The Court has reviewed many of the FLSA collective action cases in this circuit as well
as others, and finds that the majority of the courts approve a settlement only after notice has been
provided to the opt-in plaintiffs and a fairness hearing conducted, or at the least, what is required
is a statement to the Court that the opt-in plaintiffs have had notice of the settlement and an
opportunity to object. See Hosier v. Mattress Firm, Inc., 2012 WL 2813960, *3 (M.D. Fla. June
8, 2012) (approving the settlement after notice to the opt-in plaintiffs and a fairness hearing);
Wineland v. Casey’s General Stores, Inc., 267 F. R.D. 669, 672 (S.D. Iowa 2009) (“Of 75,994
putative class members provided with notice of the settlement, 9,469 submitted timely claim
forms, and only 28 opted-out of the settlement.”) In Moore v. Ackerman Inv. Co., 2009 WL
2848858 (N.D. Iowa Sept. 1, 2009), the district court explained that 29 U.S.C. § 216(b) “does not
expressly require a ‘fairness’ hearing on a proposed settlement, as Rule 23 of the Federal Rules
of Civil Procedure does for class actions pursuant to that rule, and Rule 23 requirements are not
directly applicable to a collective action pursuant to § 216(b). Nevertheless, courts entertaining a
proposed settlement in a § 216(b) case must find that the litigation involves a bona fide dispute
and that the proposed settlement is fair and equitable to all parties concerned.” Id. at *2.
However, in reaching its decision to approve the settlement, the district court stated that “a
substantial majority of the ‘opt-in’ plaintiffs (64%) have responded to the proposed settlement
and those responding have overwhelmingly (98% of responding plaintiffs and 63% of all
plaintiffs) approved the proposed settlement[.]” Id. Thus, even where a fairness hearing was not
held, the district court in Moore ascertained that the opt-in plaintiffs had received notice of the
proposed settlement and had an opportunity to object. This Court has also approved a settlement
in a collective action upon proof of notice to the opt-in plaintiffs but without a fairness hearing.
Longcrier v. HL-A Co., Inc. Civil Action No. 2:08-0011-WS-C (S.D. Ala. 2009) (Doc. 90, order
granting joint motion to approve settlement; Doc. 84, joint motion to approve settlement with
signed agreements attached).
The Court finds that notice of the settlement and an opportunity to file a written objection
should be provided as to all Opt-In Plaintiffs. Accordingly, the parties are ORDERED to submit
on or before December 18, 2013, a draft proposed notice to the Opt-In Plaintiffs. The notice
shall contain sufficient information to apprise the Opt-In Plaintiffs as to the terms of the
settlement and that any objection to the settlement must be filed with the Court by January 24,
2014. Upon approval of the notice, the parties will be further ordered to mail notice of the
revised settlement agreement and release to the Opt-In Plaintiffs as collective class members by
first class U.S. Mail to their last known addresses.
DONE and ORDERED this the 13th day of December 2013.
/s/ Kristi K. DuBose
KRISTI K. DuBOSE
UNITED STATES DISTRICT JUDGE
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