Blake v. Supreme Service & Specialty Company, Inc.

Filing 55

ORDER AND OPINION granting 53 Motion for Settlement. IT IS ORDERED that the Joint Motion to Approve Settlement is GRANTED and the parties' settlement is APPROVED. IT IS FURTHER ORDERED that the respective claims of Plaintiffs Larry L. Anzaldu a, Wyatt DeHart, Johnny Garcia, Jr., Justin R. Garza, Nathan Godard, Michael Gollehon, Eric Gutierrez, Justin Kanewske, Tom Kitchens, Chad E. Manuel, Alfredo Mendez, Brian Mosley, Ernesto Olivarez, Cole ONeal, Brian Riley, Joshua A. Sells, and Arturo Trevino are DISMISSED WITH PREJUDICE. IT IS FURTHER ORDERED that the portion of Defendants pending summary judgment motion[Doc.25] asserting the two-year statute of limitations is DENIED AS MOOT. Signed by Judge Susie Morgan. (cg)

IN THE UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF LOUISIANA
MICHAEL BLAKE, INDIVIDUALLY
AND ON BEHALF OF ALL OTHERS
SIMILARLY SITUATED
Plaintiffs,

*
*
*
*
*
vs.
*
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SUPREME SERVICE & SPECIALTY *
COMPANY, INC.
*

CIVIL ACTION NO.
2:16-cv-012713-SM-JCW
SECTION: E
DISTRICT JUDGE MORGAN
MAGISTRATE JUDGE WILKINSON

ORDER AND OPINION
Before the Court is the Joint Motion to Approve Settlement filed by Defendant Supreme
Service & Specialty Co., Inc. and Plaintiffs Larry L. Anzaldua, Wyatt DeHart, Johnny Garcia, Jr.,
Justin R. Garza, Nathan Godard, Michael Gollehon, Eric Gutierrez, Justin Kanewske, Tom
Kitchens, Chad E. Manuel, Alfredo Mendez, Brian Mosley, Ernesto Olivarez, Cole O’Neal,
Brian Riley, Joshua A. Sells, and Arturo Trevino in this Fair Labor Standards Act lawsuit. For
the reasons below, the motion is GRANTED.
CASE OVERVIEW AND SETTLEMENT TERMS
Michael Blake filed this lawsuit on July 13, 2016. He contended that Supreme Service
paid him and other similarly-situated oil field service workers a fixed salary plus a nondiscretionary bonus but did not pay overtime for all hours worked over 40 in a workweek. [Doc.1
¶1.2] The claims raised in this lawsuit are identical to those asserted against Supreme Service in
a prior Fair Labor Standards Act action styled Kervin et al. vs. Supreme Service & Specialty Co.,
Inc., Case No. 2:15-cv-01172-SM-KWR (the “Kervin lawsuit”) which settled in June 2016.
By agreement, a putative class of plaintiffs was conditionally certified in this lawsuit
shortly after the case was filed. [Docs.27,28] Plaintiffs Larry L. Anzaldua, Wyatt DeHart,

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Johnny Garcia, Jr., Justin R. Garza, Nathan Godard, Michael Gollehon, Eric Gutierrez, Justin
Kanewske, Tom Kitchens, Chad E. Manuel, Alfredo Mendez, Brian Mosley, Ernesto Olivarez,
Cole O’Neal, Brian Riley, Joshua A. Sells, and Arturo Trevino have joined the lawsuit at various
times, some before the Court’s conditional certification order and some afterwards.
Supreme Service asserted the statute of limitations as an affirmative defense in its
Answer. [Doc.23] Supreme Service also filed a motion for summary judgment on this issue.
[Doc.25] Supreme Service argued Plaintiffs’ lack evidence of “willfulness” sufficient to apply
the FLSA’s three-year statute of limitations. Supreme Service contends the claims of these 17
Plaintiffs should be wholly barred by the FLSA’s two-year statute of limitations and the claims
of eight other Plaintiffs should be partially barred.
Each side to this dispute believes that the evidence and testimony will indisputably
support their respective claims. But the parties recognize and acknowledge that the expense in
time and money of litigation, the uncertainty and risk of litigation, as well as the difficulties and
delays inherent in such litigation make settlement of this matter a mutually appealing resolution.
With respect to Supreme Service’s statute of limitations affirmative defense, Plaintiffs
made two proposals which were similar to the settlement negotiated for similarly-situated
plaintiffs in the Kervin lawsuit. First, the eight plaintiffs1 who arguably had claims partially
barred by the two-year statute of limitations would release those claims. Second, in exchange,
Supreme Service would pay a flat amount of overtime (not liquidated damages) to the 17
Plaintiffs whose claims would be wholly barred by the two-year statute of limitations. After
arms-length negotiations, the parties ultimately agreed to a flat payment of $750 in overtime to

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These Plaintiffs are Michael Blake, Junuis Bonvillain, Jerome Galloway, Ryan Holford, Carroll Lawson, Dustin
Miller, Vincent Soto, Jason Bradley Wagner.

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those 17 Plaintiffs who otherwise would have recovered nothing should Supreme Service prevail
on the statute of limitations defense.
The parties have agreed to defer the issue of potential attorneys’ fees and costs
recoverable for later settlement discussion or resolution by the Court. Counsel for the parties did
not wish to delay settlement payments to these 17 Plaintiffs. Supreme Service will withdraw its
pending motion for summary judgment after the Court’s order approving settlement. The
remaining Plaintiffs stipulate their claims are limited solely to the potential overtime (and
liquidated damages) due for the two-year period before each Plaintiff’s respective “opt in” date.
The Court acknowledges the parties’ postion that the settlement is a compromise of
disputed claims and is not to be deemed as an admission of fault or liability by Supreme Service.
The settlement is intended to be a total resolution and complete satisfaction of any and all claims
and allegations by these 17 Plaintiffs against Supreme Service known or unknown which are or
could have been asserted in this action. After approval of the settlement, the parties consent to
dismissal of these 17 Plaintiffs from this lawsuit with prejudice.
The parties maintain this settlement is fair and reasonable resolution of a bona fide FLSA
dispute. The attorneys for both parties are quite experienced in wage and hour litigation. They
reviewed the evidence and the applicable law and have concluded that settlement of these claims
is in the best interest all parties. They have recommended this settlement to their clients as a
reasonable compromise of all the disputed issues of law and fact, and the parties agree.
These 17 Plaintiffs will provide Supreme Service executed W-4 tax forms listing their
correct current mailing addresses and tax withholdings. Supreme Service will determine any
taxes due on the overtime payments and will mail the settlement checks and W-2 forms to the
Plaintiffs’ mailing addresses on those W-4 forms or any such different addresses provided by

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Anderson2X, PLLC. Settlement checks will be sent by first class United States mail within thirty
(30) business days after this Court’s order approving the settlement and dismissing these 17
Plaintiffs. If any checks are returned undeliverable with no forwarding address, Supreme Service
will attempt to locate an alternative address using a “skip trace” service and will mail the checks
to the alternative address, if any. If any check cannot be delivered in this manner or remains
uncashed within six months after date of mailing, Supreme Service may void the check and
return the funds to its general accounts and have no further obligation to the individual Plaintiff.
Clif Alexander, Michael Tusa Jr. and the law firms of Anderson2X, PLLC and Sutton, Alker &
Rather, LLC will not have any obligation to the individual Plaintiff(s) either.

LEGAL STANDARD
Court approval is required for any settlement to resolve a lawsuit brought under the Fair
Labor Standards Act. Istre v. Louisiana Tank Specialties, LLC., No. CV 14-339, 2016 WL
866709, at *1 (E.D. La. Mar. 7, 2016) (citing Collins v. Sanderson Farms, Inc., 568 F. Supp. 2d
714, 717 (E.D. La. 2008)). “’In order to approve a settlement proposed by an employer and
employees of a suit brought under the FLSA and enter a stipulated judgment, a court must
determine that the settlement is a fair and reasonable resolution of a bona fide dispute over FLSA
provisions.’” Id. “The Court must scrutinize the proposed settlement agreement to verify that
parties are not circumventing the ‘clear FLSA requirements’ by entering into a settlement
agreement.” Id. “When deciding whether to approve a proposed settlement, the Court must
assess whether the proposed settlement is both (1) the product of a bona fide dispute over the
FLSA's provisions and (2) fair and reasonable.” Id. (citing Domingue v. Sun Electric &
Instrumentation, Inc., No. 09-682, 2010 WL 1688793, at *1 (E.D. La. Apr. 26, 2010)). “A key

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focus is to ensure that an employer does not take advantage of its employees in settling their
claim for wages.” Sierra v. E.M.S.P., LLC, No. CIV.A. 15-0179, 2015 WL 5823293, at *2 (E.D.
La. Oct. 6, 2015).

ANALYSIS

“While conducting the analysis, the Court must keep in mind the ‘strong presumption’ in
favor of finding a settlement fair and remain aware that a settlement is a compromise, a yielding
of highest hopes for certainty and resolution.” Sierra, supra at *3 (quoting Collins, supra at 720).
a.

Bona fide dispute

“[S]ignificant dispute over the issue of Plaintiffs' classification, as well as other issues
relating to the calculation of overtime payment” are evidence of a bona fide dispute. Allen v.
Entergy Operations Inc., No. CV 11-1571, 2016 WL 614687, at *1 (E.D. La. Feb. 16, 2016). As
evidenced by the record in the Kervin lawsuit and this companion case, there is a significant
bona fide dispute as to whether Supreme Service “willfully” violated the FLSA with respect to
these 17 Plaintiffs, not to mention whether the Plaintiffs ultimately are entitled to overtime. The
Court finds a bona fide dispute exists.
b.

Fair and Reasonable.

“[T]here is a strong presumption in favor of finding a settlement fair”, and the fact a
“settlement is the negotiated result of an adversarial proceeding is an indication of its fairness.”
Domingue v. Sun Electric & Instrumentation, Inc., No. 09-682, 2010 WL 1688793, at *1 (E.D.
La. Apr. 26, 2010) (internal quotation marks deleted). Six factors generally guide this Court’s
analysis of the fairness and reasonableness of a FLSA settlement: “(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 the
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plaintiffs' success on the merits; (5) the range of possible recovery; and (6) the opinions of class
counsel, class representatives, and absent class members.” Istre, supra at *2. After due
consideration, the Court finds each of these factors weighs in favor of a conclusion the parties’
settlement is fair and reasonable.
i.

The existence of fraud or collusion behind the settlement.

“’[A]bsent evidence to the contrary, there is a presumption that no fraud or collusion
occurred between counsel.’” Istre, supra at *2 (quoting Domingue, 2010 WL 1688793, at *1).
There is nothing before this Court to rebut this presumption. The parties have engaged in goodfaith negotiations to resolve this matter amicably. This first factor indicates the settlement is fair
and reasonable.
ii.

The complexity, expense, and likely duration of the litigation.

The parties anticipate considerable time, effort and expense would be involved in further
discovery about and litigation concerning the willfulness/statute of limitations issue. The
contested issues might or might be resolved by summary judgment. Further pursuit of such
motion would entail additional expense which the parties seek to avoid through settlement. The
issue may not be resolved until after a trial which date has yet to be established. The Court finds
the second factor indicates the settlement is fair and reasonable.
iii.

The stage of the proceedings and the amount of discovery completed.

This Court “consider[s] how much formal discovery has been completed for two reasons:
(1) extensive discovery [by the parties indicates] a good understanding of the strengths and
weaknesses of their respective cases and hence that the settlement's value is based upon such
adequate information, and (2) full discovery demonstrates that the parties have litigated the case
in an adversarial manner and...therefore...settlement is not collusive but arms-length.’” Istre,

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supra at *3 (internal quotation deleted; citation omitted). But the “lack of much formal discovery
is not necessarily fatal, however, and a court may look to informal avenues of gathering
information or may approve a settlement with no formal discovery conducted.” Id. In addition to
discovery undertaken in the Kervin lawsuit, the parties have engaged in additional discovery in
this case as well as informally exchanged information. This third factor indicates the settlement
is fair and reasonable.
iv.

The probability of the plaintiff's success on the merits.

Given the unresolved factual and legal disputes between the parties, it is unlikely that
these Plaintiffs would establish Supreme Service’s liability or significant recovery for 100% of
the Plaintiffs. The settlement reached by the parties provides recoveries for these 17 Plaintiffs
which recognize the strengths and weaknesses of their claims. This factor indicates the
settlement is fair and reasonable.
v.

The range of possible recovery.

The settlement involves compromise amounts of overtime for these 17 Plaintiffs whose
claims may be completely barred. The Court finds that the agreed-upon amounts are within a
range of possible recovery and thus indicates the settlement is fair and reasonable.
vi.

The opinions of counsel, class representatives, and absent class members.

The only parties to the settlement are the Plaintiffs and Supreme Service. There are no
“absent class members.”2 All parties are represented by counsel.3 The parties jointly seek judicial

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See LaChapelle v. Owens-Illinois, Inc., 513 F.2d 286, 288 (5th Cir. 1975) (“Under [29 U.S.C. § 216(b)],...no person
can become a party plaintiff and no person will be bound by or may benefit from judgment unless he has
affirmatively ‘opted into’ the class; that is, given his written, filed consent.”); Brown v. United Furniture Industries,
Inc., 2015 WL 1457265, at *5 (N.D. Miss. Mar. 30, 2015) (“[I]n an FLSA collective action, there are no absent class
members; only those who have opted in are considered parties to the suit and bound by the results of the action.”).
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“’The Court is entitled to rely on the judgment of experienced counsel in its evaluation of the merits of a class
action settlement.’” Lackey v. SDT Waste & Debris Servs., LLC, No. CIV.A. 11-1087, 2014 WL 4809535, at *2
(E.D. La. Sept. 26, 2014) (quoting Collins, supra, at 727).

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approval of a settlement agreement which addresses a bona fide dispute and was negotiated in
good faith. The Court finds the final factor indicates the settlement is fair and reasonable.

CONCLUSION
For the foregoing reasons, the Court finds the parties’ settlement is both premised on a
bona fide dispute and fair and reasonable.
Accordingly;
IT IS ORDERED that the Joint Motion to Approve Settlement is GRANTED and the parties'
settlement is APPROVED.

IT IS FURTHER ORDERED that the respective claims of Plaintiffs Larry L. Anzaldua, Wyatt
DeHart, Johnny Garcia, Jr., Justin R. Garza, Nathan Godard, Michael Gollehon, Eric Gutierrez,
Justin Kanewske, Tom Kitchens, Chad E. Manuel, Alfredo Mendez, Brian Mosley, Ernesto
Olivarez, Cole O’Neal, Brian Riley, Joshua A. Sells, and Arturo Trevino are DISMISSED WITH
PREJUDICE.

IT IS FURTHER ORDERED that the potential recovery on the claims of Plaintiffs Michael
Blake, Junuis Bonvillain, Jerome Galloway, Ryan Holford, Carroll Lawson, Dustin Miller,
Vincent Soto, Jason Bradley Wagner are hereafter limited solely to the potential overtime (and
liquidated damages) due for the two-year period before each Plaintiff’s respective “opt in” date
and that these Plaintiffs shall take nothing from Defendant by way of damages, attorneys’ fees,
or costs with respect to any alleged FLSA violations/failures to pay overtime for any time which
is more than two years before each Plaintiff’s respective “opt in” date.

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IT IS FURTHER ORDERED that the portion of Defendant’s pending summary judgment motion
[Doc.25] asserting the two-year statute of limitations is DENIED AS MOOT.

New Orleans, Louisiana this 20th day of January, 2017.

___ _______ __________ ___________
HON. SUSAN MORGAN
DISTRICT JUDGE

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