Johnson et al v. Helion Technologies, Inc.
MEMORANDUM OPINION. Signed by Judge Deborah K. Chasanow on 10/7/2019. (td for sat, Chambers)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
TYLER JOHNSON, et al.,
Individually and on behalf of
similarly situated employees
Civil Action No. DKC 18-3276
HELION TECHNOLOGIES, INC.
Previously pending in this employment collective action was
the joint motion for approval of acceptance of offer of judgment
and entry of judgment filed by Defendant Helion Technologies, Inc.,
and Plaintiff Tyler Johnson.
(ECF No. 45).
The court denied the
motion because the parties failed to provide any information to
support the requested attorneys’ fees and costs.
(ECF No. 46, at
The parties then jointly filed a supplemental memorandum in
support of their joint motion for approval of acceptance of offer
of judgment and entry of judgment.
(ECF No. 50).
The issues have
been briefed, and the court now rules, no hearing being deemed
Local Rule 105.6.
For the following reasons, the
motion, as supplemented, will be granted.
Plaintiffs, Tyler Johnson and James Phelan, filed a complaint
on behalf of themselves and those that are similarly situated on
October 23, 2018.
(ECF No. 1).
The complaint alleges that
Defendant “improperly classified them as exempt employees and/or
failed to pay them overtime wages in violation of the” Fair Labor
Standards Act (“FLSA”), 29 U.S.C. § 201 et seq.; the Maryland Wage
and Hour Law (“MWHL”), Md.Code Ann., Lab. & Empl. § 3-401, et seq.;
and the Maryland Wage Payment and Collection Law (“MWPCL”), Md.
Code, Lab. & Emp. § 3-501 et seq.
(ECF No. 45-1, at 2).
Johnson’s counsel an Offer of Judgment.
(ECF No. 45-1, at 2).
The offer proposed “to allow judgment to be entered against
Defendant, and in favor of Plaintiff Johnson, in the total amount
of $31,500.00, inclusive of attorneys[’] fees and costs, $5,250.00
of which shall be wages, $5,250.00 of which shall be liquidated
damages, and $21,000[.00] of which shall be attorneys[’] fees[.]”
(ECF No. 45-2, at 1). Plaintiff Johnson, through counsel, accepted
the offer on the same day.
(ECF No. 45-1, at 2).
[Defendant] dismissing with prejudice the action which [Defendant]
has initiated against [Plaintiff Johnson] in the Circuit Court for
Baltimore County, Helion Technologies, Inc. v. Johnson, Case No.
03-C-18-012051 (the ‘State Court Action’), and [Defendant] has
agreed to that condition.”
Judge Hazel outlined the proper interplay between the FLSA
and Rule 68 in Banegas v. Gen. Lawn Serv. Corp., No. 13-cv-3728GJH, 2014 WL 12740666, at *1 (D.Md. July 17, 2014):
instructs the court to enter judgment after
receiving an accepted offer of judgment.
However, the [FLSA] . . . does not permit
settlement or compromise except with (1)
supervision by the Secretary of Labor or (2)
a judicial finding that the settlement
reflects “a reasonable compromise of disputed
issues” rather than “a mere waiver of
employer’s overreaching.” Lynn’s Food Stores,
Inc. v. U.S., 679 F.2d 1350, 1354 (11th Cir.
1982); see also Lopez v. NTI, LLC, 748
F.Supp.2d 471 (D.Md. 2010) (explaining that
Accordingly, the FLSA
modifies Rule 68(a) such that in claims filed
under the FLSA, the court will enter judgment
when presented with an offer and acceptance
only after the court is satisfied that the
settlement is a reasonable compromise.
Although the United States Court of Appeals for the Fourth
Circuit has not directly addressed the factors to be considered in
deciding whether to approve such settlements, district courts in
this circuit typically employ the considerations set forth by the
United States Court of Appeals for the Eleventh Circuit in Lynn’s
See, e.g., Duprey v. Scotts Co. LLC, 30 F.Supp.3d
404, 407-08 (D.Md. 2014); Lopez, 748 F.Supp.2d at 478.
settlement generally should be approved if it reflects “a fair and
reasonable resolution of a bona fide dispute over FLSA provisions.”
Lynn’s Food Stores, 679 F.2d at 1355.
Thus, as a first step, the
bona fides of the parties’ dispute must be examined to determine
if there are FLSA issues that are “actually in dispute.”
Then, as a second step, the terms of the proposed settlement
agreement must be assessed for fairness and reasonableness, which
requires weighing a number of factors, including:
(1) the extent of discovery that has taken
place; (2) the stage of the proceedings,
including the complexity, expense and likely
duration of the litigation; (3) the absence of
fraud or collusion in the settlement; (4) the
experience of counsel who have represented the
plaintiffs; (5) the opinions of counsel. . .;
and (6) the probability of plaintiffs’ success
on the merits and the amount of the settlement
in relation to the potential recovery.
Hackett v. ADF Rest. Investments, 259 F.Supp.3d 360, 365 (D.Md.
(quoting Saman v. LBDP, Inc., No. 12-cv-1083-DKC, 2013 WL
F.Supp.3d at 408, 409.
Finally, where a proposed settlement of
FLSA claims includes a provision regarding attorneys’ fees, the
reasonableness of the award must also “be independently assessed,
regardless of whether there is any suggestion that a ‘conflict of
interest taints the amount the wronged employee recovers under a
Lane v. Ko–Me, LLC, No. 10-cv-2261-DKC,
2011 WL 3880427, at *3 (Aug. 31, 2011) (citation omitted).
The court previously determined that a bona fide dispute
exists, (ECF No. 46, at 5) and that the offer of judgment appears
to be a fair and reasonable compromise of the parties’ bona fide
dispute (Id., at 5–6).
However, the parties failed to provide any
information to support the requested $21,000.00 attorneys’ fees
(Id., at 7).
The court accordingly denied the joint
motion for approval of acceptance of offer of judgment without
(Id., at 7–8).
The parties’ supplemental briefing
addresses the joint motion’s deficiencies and the reasonableness
of the attorneys’ fees and costs may now be assessed.
To assess “the reasonableness of the fee, courts typically
refer to the principles of the traditional lodestar method as a
Hackett, 259 F.Supp.3d at 367 (internal citations
The starting point in the lodestar calculation is
multiplying the number of hours reasonably expended by a reasonable
Robinson v. Equifax Info. Servs., LLC, 560 F.3d 235,
243 (4th Cir. 2009).
“An hourly rate is reasonable if it is ‘in
line with those prevailing in the community for similar services
Duprey, 30 F.Supp.3d at 412 (quoting
established presumptively reasonable rates in Appendix B to its
The parties propose that “$21,000.00 is an appropriate amount
of attorney’s fees and costs to allocate to work performed on
behalf of [Plaintiff] Johnson in this matter.”
(ECF No. 50, at
The parties explain that “[a]t the time the [o]ffer was made,
a total of 394.43 hours were spent by Plaintiff[s’] counsel in
preparing the case, which equates to $89,975.42 in fees.”
The parties elaborate that when they previously negotiated a
Rule 68 offer for Plaintiff Willis, they agreed that Defendant
would pay one fourth of the fees and costs because there were four
plaintiffs in the case.
(Id., at 2).
They “agreed to abide by
the same formula” when “negotiating the amount of fees and costs
attributable to” Plaintiff Johnson, even though there are now only
three plaintiffs in the action and the proper calculation would be
to take one third of the fees and costs.
“[A] quarter of
the total fee equates to $22,493.86” and the parties “further
agreed to reduce the [amount] to $21,000.00.”
agree that “Plaintiffs’ [c]ounsel are recovering only 23.33% of
the attorney fees’ in this case, when 33.33% of fees are actually
attributable to [Plaintiff] Johnson[,]” and that “the discount is
reasonable under the circumstances.”
The parties also provide “a breakdown of the attorneys and
staff who have worked on this case.”
(ECF No. 50, at 1).
correctly note that the hourly rates “are in line with Appendix B
of the Local Rules[.]” (Id., at 2). The supplementary information
supports the conclusion that $21,000.00 is a reasonable amount of
attorney’s fees and costs.
For the foregoing reasons, the joint motion for approval of
acceptance of offer of judgment and entry of judgment will be
A separate order will follow.
DEBORAH K. CHASANOW
United States District Judge
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