Southward v. Tonerrefillkits.com, LLC et al

Filing 36

REPORT AND RECOMMENDATIONS re 34 Joint MOTION for Settlement to Review and Approve FLSA Settlement. Signed by Magistrate Judge Philip R. Lammens on 1/15/2014. (JWM)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
OCALA DIVISION
DEA SOUTHWARD, on her own behalf
and others similarly situated
Plaintiff,
v.

Case No: 5:13-cv-168-Oc-22PRL

TONERREFILLKITS.COM, LLC and
DUANE SIEBERT
Defendants.

REPORT AND RECOMMENDATION1
This matter is before the Court on the parties’ Joint Motion To Review and Approve
FLSA Settlement and Dismiss Action with Prejudice. (Doc. 16). The District Judge referred this
Motion to the undersigned to determine whether the settlement between Plaintiff and Defendant
is a “fair and reasonable resolution of a bona fide dispute” over Fair Labor Standards Act
(“FLSA”) issues. See Lynn’s Food Stores, Inc. v. United States, 679 F.2d 1350, 1354-55 (11th
Cir. 1982). (Doc. 35).
If a settlement is not one supervised by the Department of Labor, the only other route for
compromise of FLSA claims is provided in the context of suits brought directly by employees
against their employer under section 216(b) to recover back wages for FLSA violations. "When
employees bring a private action for back wages under the FLSA, and present to the district court
a proposed settlement, the district court may enter a stipulated judgment after scrutinizing the
1

Error! Main Document Only.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.

settlement for fairness." Id. at 1353 (citing Schulte, Inc. v. Gangi, 328 U.S. 108, 66 S.Ct. 925,
928 n.8, 90 L.Ed. 1114).
The Eleventh Circuit has held 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." Id. at 1354. In adversarial cases:
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.
As set forth in the motion and attached Settlement Agreement (Ex. A to Doc. 31), the
settlement provides that Defendant will pay Plaintiff $3,500. Defendant will also pay Plaintiff’s
counsel $4,000.00 in attorney's fees and costs. The parties represent that Plaintiff is receiving a
compromise payment for alleged unpaid overtime as designated in the Settlement Agreement,
and that the compromise is a reasonable resolution of disputes regarding Plaintiff’s alleged
wages and genuine disputes regarding whether Plaintiff was exempt from the overtime provisons
of the FLSA. In exchange for these payments, Plaintiff agrees to stipulate to an entry of an order
dismissing this action with prejudice. The parties wish to avoid litigation and settle and resolve
the controversy expeditiously. Under these circumstances, the undersigned finds the settlement
to be reasonable, especially considering the vagaries of litigation.
As for the amount of attorney’s fees and costs, in FLSA suits for unpaid minimum wages
or unpaid overtime wages, “[t]he 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

-2-

the action.” 29 U.S.C. § 216(b). This provision has been interpreted to mean that “fee awards
[are] mandatory for prevailing plaintiffs.” Kreager v. Solomon & Flanagan, P.A., 775 F.2d
1541, 1542 (11th Cir. 1985). The “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.” Silva
v. Miller, 307 Fed. Appx. 349, 351, 2009 WL 73164, 2 (11th Cir. 2009); see also Zegers v.
Countrywide Mortg. Ventures, LLC, 569 F.Supp. 2d 1259 (M.D. Fla. 2008) (applying lodestar
analysis in FLSA case).
Here, the settlement agreement reveals that the attorney’s fees and costs were negotiated
separately from Plaintiff’s recovery. See Bonetti v. Embarq Mgmt.Co., Case No.: 6:07-cv-1335,
2009 WL 2371407 (M.D. Fla. Aug. 4, 2009). The parties also recite that Plaintiff’s counsel
incurred $7,440.00 in attorney’s fees during this action, including 23.7 hours at a rate of $265.00
for attorney Camar Jones, 9.60 hours for paralegal Renata Araujo at $100.00 per hour, and 2.0
hours for paralegal Tayara Oliveira at $100.00 per hour. In addition, costs included $350.00 for
the filing fee, and $80.00 for service of process on both Defendants. Under the circumstances,
the undersigned finds that the amount of $4,000.00 for attorneys’ fees and costs appears to be
reasonable.2
2

Error! Main Document Only.In reaching this conclusion, the Court recognizes that it
must consider the reasonableness of any award of attorneys’ fees, but it is not required to
conduct “an in depth analysis . . . unless the unreasonableness is apparent from the face of the
documents.” King v. My Online Neighborhood, Inc., No. 6:06-cv-435-Orl-22JGG, 2007 WL
737575, at *4 (M.D. Fla. Mar. 7, 2007)(quoting Perez v. Nationwide Protective Servs., Case No.
6:05-cv-328-ORL-22JGG (M.D. Fla. Oct. 31, 2005)). As the total fee award sought in this case
is not patently unreasonable based on the history of this case and Defendants do not contest the
reasonableness of the award, the Court has not conducted an in-depth analysis of the attorneys’
fees sought. Accordingly, the award of attorneys’ fees in this action does not reflect a
determination that the hourly rate or time charged by Plaintiff’s counsel constitutes a reasonable
hourly rate in this or any applicable market.

-3-

As such, it is respectfull recomme
A
s
ly
ended that th parties’ M
he
Motion (Doc 34) be gra
c.
anted,
the settle
ement be acc
cepted by th District Court as a “f and reasonable reso
he
C
fair
olution of a bona
fide dispu over FL
ute”
LSA issues, and the matt be dismis
a
ter
ssed, with pr
rejudice.
Recommende in Ocala, Florida on January 14, 2
R
ed
J
2014.

Copies fu
urnished to:
Presiding District Jud
g
dge
Counsel of Record
Unrepres
sented Party
Courtroo Deputy
om

-4-