Youngsman v. Bay Electric of Collier County, Inc.
REPORT AND RECOMMENDATION recommending that 18 Joint Motion for Approval of Settlement Agreement and Dismissal of the Action with Prejudice be granted. Signed by Magistrate Judge Douglas N. Frazier on 1/7/2014. (CAS)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
Case No: 2:13-cv-583-FtM-29UAM
BAY ELECTRIC OF COLLIER COUNTY,
REPORT AND RECOMMENDATION
TO THE UNITED STATES DISTRICT COURT
This cause is before the Court on the parties’ Joint Motion for Approval of Settlement
Agreement and Dismissal of the Action with Prejudice (Doc. 18) filed on December 19, 2013.
The parties are requesting that the Court approve their settlement of Plaintiff’s Fair Labor
Standards Act (“FLSA”) claim. For the reasons explained below, the Court recommends that the
parties’ motion be GRANTED.
To approve the settlement, the Court must determine whether the settlement is a “fair and
reasonable resolution of a bona fide dispute” of the claims raised pursuant to the Fair Labor
Standards Act (“FLSA”). Lynn’s Food Store, Inc. v. United States, 679 F.2d 1350, 1355 (11th
Cir. 1982), and 29 U.S.C. §216. There are two ways for a claim under the FLSA to be settled or
compromised. Id. at 1352-3. The first is under 29 U.S.C. § 216(c), providing for the Secretary
of Labor to supervise the payments of unpaid wages owed to employees. Id. at 1353. The second
is under 29 U.S.C. § 216(b) when an action is brought by employees against their employer to
recover back wages. Id. When the employees file suit, the proposed settlement must be presented
to the district court for the district court review and determination that the settlement is fair and
reasonable. Id. at 1353-54.
The Eleventh Circuit has found settlements to be permissible when the lawsuit is brought
by employees under the FLSA for back wages because the lawsuit
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.
Id. at 1354.
Plaintiff worked as an administrative assistant for Defendant from September 2011 through
December 2012. The parties have agreed to settle this matter. Under the settlement agreement,
Plaintiff will receive $1,500.00 representing payment for alleged unpaid wages and $1,500.00 as
liquidated damages. (Doc. 18-1 p. 3). Plaintiff’s counsel will receive $4,000.00 as compensation
for its fees and costs. (Doc. 18-1 p. 3). The parties represent that Plaintiff’s attorney’s fees were
agreed upon separately and without regard to the amount paid to Plaintiff. (Doc. 18 p. 5). Pursuant
to Bonetti v. Embarq Management Company, 715 F. Supp.2d 1222, 1228 (M.D. Fla. 2009), “the
best way to insure that no conflict [of interest between an attorney’s economic interests and those
of his client] has tainted the settlement is for the parties to reach agreement as to the plaintiff’s
recovery before the fees of the plaintiff’s counsel are considered. If these matters are addressed
independently and seriatim, there is no reason to assume that the lawyer’s fee has influenced the
reasonableness of the plaintiff’s settlement.” Judge Presnell concluded that
In sum, if the parties submit a proposed FLSA settlement that, (1)
constitutes a compromise of the plaintiff's claims; (2) makes full and
adequate disclosure of the terms of settlement, including the factors and
reasons considered in reaching same and justifying the compromise of
the plaintiff's claims; and (3) represents that the plaintiff's attorneys’ fee
was agreed upon separately and 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 of the fee to be paid to plaintiff's counsel.
Here, the Court does not find that the fees to be paid to Plaintiff’s counsel make the
Settlement Agreement unreasonable on its face. Defendants do not contest the fees to be paid to
Plaintiff’s counsel and have joined in the instant motion to approve the settlement agreement.
The settlement was reached, and the attorneys’ fees were agreed upon separately and without
regard to the amount paid to Plaintiff. For these reasons, the Court finds the parties’ Confidential
Settlement Agreement and Claimant’s Full and Final Release of Claims for Unpaid Wages (Doc.
18-1) to be fair and reasonable.
IT IS RESPECTFULLY RECOMMEDED:
That the parties’ Joint Motion for Approval of Settlement Agreement, and Dismissal of
the Action with Prejudice (Doc. 18) be GRANTED and the Confidential Settlement Agreement
and Claimant’s Full and Final Release of Claims for Unpaid Wages (Doc. 18-1) be approved by
the Court as a “fair and reasonable resolution of a bona fide dispute” of the FLSA issues. The
Court further recommends the Clerk be directed to dismiss this action with prejudice and close
the file if the District Court adopts this Report and Recommendation.
Failure to file written objections to the proposed findings and recommendations
contained in this report within fourteen (14) days from the date of its filing shall bar an aggrieved
party from attacking the factual findings on appeal.
Respectfully recommended in Chambers in Ft. Myers, Florida on January 7, 2013.
Copies furnished to:
Counsel of Record
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