Tall v. MV Transportation

Filing 43

MEMORANDUM OPINION (c/m to Plaintiff 1/22/15 sat). Signed by Judge Deborah K. Chasanow on 1/22/2015. (sat, Chambers)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
:
HESMAN TALL
:
v.

:

Civil Action No. DKC 13-2306

:
MV TRANSPORTATION
:
MEMORANDUM OPINION
Presently pending and ready for resolution in this Fair
Labor Standards Act (“FLSA”) case are Defendant’s motion for
approval of a settlement agreement that resolves the claims of
Plaintiff Hesman Tall for unpaid overtime wages, (ECF No. 39),
and

a

separate

settlement

motion

agreement

to

filed

review
by

specific

Plaintiff

provisions

(ECF

No.

of

40).

the
The

issues have been fully briefed, and the court now rules, no
hearing being deemed necessary.

Local Rule 105.6.

Because the

proposed settlement agreement represents a fair and reasonable
resolution of a bona fide FLSA dispute, the settlement agreement
will be approved.
I.

Background
The factual allegations surrounding this case are contained

in prior opinions.

(See ECF Nos. 18 & 26).

In short, Plaintiff

was employed as a Paratransit Driver/Operator with Defendant MV
Transportation from September 6, 2009 until January 6, 2011.

He

asserts that Defendant violated the FLSA by failing to pay him
overtime.

The crux of Plaintiff’s overtime claim is that he was

required to perform certain assignments “off-the-clock” which
were not considered “work” by MV Transportation and for which he
was not compensated.
On December 22, 2014, the parties submitted their proposed
settlement agreement for consideration, along with a proposed
order.

(ECF No. 37).

outlining

the

settlement.

They did not, however, file a memorandum

reasons

why

the

court

should

approve

the

On December 23, 2014, the undersigned issued a

memorandum opinion and order directing the parties to supplement
the record, providing supporting information as described in the
memorandum

opinion

to

enable

the

court

assessment of the proposed settlement.

to

conduct

a

proper

(See ECF No. 38).

On January 2, 2015, Defendant filed a motion to approve the
settlement agreement.

(ECF No. 39).

In that motion, defense

counsel indicated that he:
repeatedly contacted Plaintiff to discuss
the Court’s December 23, 2014 Order and
circulated a draft of the instant motion.
Plaintiff, however, refused to discuss the
‘joint’ motion and appears to lack []
complete understanding of what the Court
required of the parties in its December 23,
2014 Order.
Accordingly, Defendant has no
choice but to file this motion unilaterally
2

and allow Plaintiff the ability to respond
if necessary.
(Id.

at

4

requesting

n.1).
that

the

Plaintiff
court

settlement agreement.

followed

review

with

specific

(ECF No. 40).

his

own

provisions

motion
of

the

Defendant filed a response

to Plaintiff’s motion (ECF No. 41), and Plaintiff submitted a
supplement (ECF No. 42).
The Settlement Agreement states that, upon court approval,
Defendant

will

statutory

deductions,

withholding

pay

Plaintiff

taxes.1

$2,200,

including
(ECF

No.

less

federal
41-1,

at

all

applicable

and

state

4).

In

payroll
exchange,

Plaintiff agrees to a general release of all claims against
Defendant and upon court approval of the Settlement Agreement,
dismissal of this lawsuit with prejudice.

(Id. at 4-6).

The

Settlement Agreement also contains a confidentiality provision
and a “non-disparagement” clause, pursuant to which Plaintiff
agrees not to criticize MV Transportation and its employees and
services, publicly or privately.
Agreement

1

includes

a

no-hire

(Id. at 7).
provision,

The Settlement

pursuant

to

which

The Settlement Agreement provides that each party “will be
solely
responsible
for
all
expenses
incurred
by
them
respectively or on their behalf, including but not limited to
their respective attorneys’ fees, costs, and disbursements.”
(ECF No. 41-1 ¶ 3).
3

Plaintiff agrees never to seek employment with MV Transportation
or

any

of

its

predecessors,

affiliates,

and

parents,

assigns.

subsidiaries,

(Id.).

Finally,

successors,

Paragraph

11

requires Plaintiff to agree – to the extent permitted by law not

voluntarily

Transportation

to

cooperate

arising

out

of

in

any

litigation

or

relating

to

against

his

MV

employment

relationship with it.
II.

Analysis
Because Congress enacted the FLSA to protect workers from

the poor wages and long hours that can result from significant
inequalities

in

bargaining

power

between

employers

and

employees, the statute’s provisions are mandatory and, except in
two

narrow

circumstances,

are

generally

not

subject

to

bargaining, waiver, or modification by contract or settlement.
See Brooklyn Sav. Bank v. O’Neil, 324 U.S. 697, 706 (1945).
Under the first exception, the Secretary of Labor may supervise
the payment of back wages to employees, who waive their rights
to seek liquidated damages upon accepting the full amount of the
wages

owed.

See

29

U.S.C.

§ 216(c).

Under

the

second

exception, a district court can approve a settlement between an
employer and an employee who has brought a private action for
unpaid

wages

pursuant

to

Section
4

216(b),

provided

that

the

settlement reflects a “reasonable compromise of disputed issues”
rather than “a mere waiver of statutory rights brought about by
an employer’s overreaching.”

Lynn’s Food Stores, Inc. v. United

States, 679 F.2d 1350, 1354 (11th Cir. 1982).
Although the Fourth Circuit has not directly addressed the
factors to be considered in deciding motions for approval of
such

settlements,

district

courts

in

this

circuit

typically

employ the considerations set forth by the Eleventh Circuit in
Lynn’s Food Stores.

See, e.g., Hoffman v. First Student, Inc.,

No. WDQ-06-1882, 2010 WL 1176641, at *2 (D.Md. Mar. 23, 2010);
Lopez

v.

NTI,

LLC,

748

F.Supp.2d

471,

478

(D.Md.

2010).

Pursuant to Lynn’s Food Stores, an FLSA settlement generally
should

be

approved

if

it

reflects

“a

fair

and

reasonable

resolution of a bona fide dispute over FLSA provisions.”
Food, 679 F.2d at 1355.

Lynn’s

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.”

Lane v. Ko-Me,

LLC, No. DKC-10-2261, 2011 WL 3880427, at *2 (D.Md. Aug. 31,
2011) (citing Dees v. Hydradry, Inc., 706 F.Supp.2d 1227, 124142 (M.D.Fla. 2010)).

Then, as a second step, the terms of the

proposed settlement agreement must be assessed for fairness and
reasonableness,

which

requires

weighing
5

a

number

of

factors,

including:
(2)

the

“(1) the extent of discovery that has taken place;

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.”

Lomascolo

v.

Parsons

Brinckerhoff,

Inc., No. 08–cv–1310, 2009 WL 3094955, at *10 (E.D.Va. Sept. 28,
2009)

(collective

action);

see

also

Poulin

v.

Gen.

Dynamics

Shared Res., Inc., No. 09–cv–00058, 2010 WL 1813497, at *1 n.1
(W.D.Va. May 5, 2010) (applying the same factors to a settlement
that involved only individual FLSA claims).
A. Bona Fide Dispute
“In deciding whether a bona fide dispute exists as to a
defendant’s
pleadings

in

liability
the

under

case,

the

along

FLSA,

with

courts

the

examine

the

representations

and

recitals in the proposed settlement agreement.”

Amaya v. Young

& Chang, Inc. Civil Case No. PWG-14-749, 2014 WL 3671569, at *2
(D.Md. July 22, 2014).
dismiss,

Plaintiff’s

After Defendant filed several motions to
only

remaining

claim

is

for

overtime,

limited to the time period between August 8, 2010 and January 6,
6

2011, the date he was terminated.

See Tall v. MV Transp., Civ.

Action No. DKC 13-2306, 2014 WL 5298023 (D.Md. Oct. 14, 2014).
Under the FLSA, “no employer shall employ any of his employees .
. . 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.”
an

employer

violates

Section

207,

he

29 U.S.C. § 207.

is

liable

overtime and an equal amount of liquidated damages.
216.

for

If

unpaid

29 U.S.C. §

Although neither party provides much detail regarding the

disputed factual allegations, Defendant states that “[l]iability
under the FLSA is a contested issue, with MV strongly disputing
Plaintiff’s

arguments

that

he

was

denied

any

overtime

compensation during the August 8, 2010 and January 6, 2011 time
period at issue.”

(ECF No. 39, at 6) (emphasis in original).

Thus, Defendant has not admitted liability, and continues to
maintain that Plaintiff was properly compensated for all work
performed.

Plaintiff believes that he completed tasks for which

he was not compensated.

The pleadings, along with the parties’

representations in court filings, establish that a bona fide
dispute exists as to Defendant’s liability under the FLSA for
overtime payments.
7

B. Fairness & Reasonableness
Upon

review

of

the

considering

the

court,

Settlement

the

relevant

parties’

factors

submissions

enumerated

Agreement

appears

by

to

be

and

the
a

after

Lomascolo
fair

and

reasonable compromise of the parties’ bona fide dispute.
The parties agreed to settle at a relatively early stage of
the

proceedings,

after

several

motions

to

dismiss

had

been

adjudicated and the parties engaged in minimal discovery after
the court entered a scheduling order on November 10, 2014.
No.

29).

Defendant

represents

that

it

provided

(ECF

initial

disclosures to Plaintiff on November 26, 2014, “which included a
list of each individual likely to have discoverable information
that Defendant may use to support its claims or defenses in this
case.”
“[w]hile
payroll

(ECF No. 33, at 1).
the

[p]arties

records

at

both

issue

Defendant further contends that
possess

in

order

the
to

relevant
fully

time

assess

and

their

respective positions on the[] issues [concerning tasks for which
Plaintiff believes he was not compensated], if the [p]arties
were to continue with this litigation, both would still expend
significant time and expense in discovery which would greatly
exceed the amount of alleged damages at issue without certainty
that either would ultimately prevail.”
8

(ECF No. 39, at 7).

Thus, the parties have had sufficient opportunity to “obtain and
review evidence, to evaluate their claims and defenses[,] and to
engage in informed arms-length settlement negotiations with the
understanding

that

it

would

be

a

difficult

and

undertaking to proceed to the trial of this case.”

costly

Lomascolo,

2009 WL 3094955, at *11.
Additionally,

there

is

no

evidence

that

the

proposed

Settlement Agreement – which Defendant represents was reached
after a month of active negotiations – is the product of fraud
or collusion.

Defendant points out that although Plaintiff is

pro se,
he was sufficiently sophisticated to draft
several pleadings, compile his time and
payroll records into a spreadsheet detailing
on a week-by-week basis precisely the total
amount of alleged overtime due, and actively
engaged
in
[]
on-going
negotiations
(including
several
counter-offers)
with
counsel for MV over the past months which
resulted in the final terms set forth in the
proposed settlement agreement.
(ECF No. 39, at 7).

The Settlement Agreement appears to be the

product of negotiations between Plaintiff and defense counsel.
Indeed, Plaintiff indicates that “[D]efendant has been fair and
reasonable
settlement.”

throughout

the

negotiations

(ECF No. 42, at 2).
9

of

the

terms

of

As to the relationship between the amount of the settlement
and

Plaintiff’s

potential

recovery,

the

Settlement

Agreement

requires Defendant to pay $2,200 – less all applicable statutory
deductions - to settle Plaintiff’s overtime claims.
No. 41-1, at 4).

(See ECF

Defendant represents that it has agreed to

resolve this matter “in [an] amount which considerably exceeds
the alleged unpaid overtime at issue – approximately $655.79
according to Plaintiff’s own calculations.”

(ECF No. 39, at 7).

Plaintiff submitted a spreadsheet as an exhibit to his amended
complaint,

which

alleged

overtime

hours

worked

during

the

applicable period, the rate of pay, and the “[t]otal net pay
owed,” which amounts to $655.79.
amended

complaint,

Plaintiff

(See ECF No. 20-1).2

estimated

his

damages

In his
to

be

approximately $3,880, but this was before the court dismissed
his

claim

alleging

minimum

wage

violations

under

the

FLSA,

leaving only his overtime claim. (See ECF No. 20, at 1).

As

stated above, if an employer violates Section 207, he is liable
for unpaid overtime and an equal amount of liquidated damages.
2

In a prior memorandum opinion, the court noted that
Plaintiff may recover only for overtime worked from August 8,
2010 through January 6, 2011.
In his spreadsheet, Plaintiff
included two weeks during which he allegedly worked overtime and
was not compensated, but the time period is outside the
applicable statute of limitations.
10

29 U.S.C. § 216.

Crediting the figures Plaintiff identified in

his spreadsheet, he would only be entitled to $1,311.58 ($655.79
plus an equal amount of liquidated damages).
amount

of

$2,200

exceeds

his

likely

prevailed on his overtime claim.
costs

associated

with

The settlement

recovery

assuming

he

In light of the risks and

proceeding

further

and

Defendant’s

assertions that Plaintiff was compensated for all the overtime
hours

worked,

reasonable

the

$2,200

compromise

over

figure
issues

appears

to

actually

“reflect[]
in

a

dispute.”

Lomascolo, 2009 WL 3094955, at *8.
The Settlement Agreement also contains a general release of
claims beyond those specified in the amended complaint.
ECF No. 41-1, at 5-6).

(See

The Settlement Agreement states, in

relevant part:
Tall . . . hereby unconditionally and
irrevocably releases, remises and forever
discharges MV and all of its respective
parents,
subsidiaries,
partners,
representatives . . . . from any and all
suits,
claims,
demands,
interest
costs
(including
attorney’s
fees
and
costs
actually incurred), expenses, actions and
causes of actions, rights, liabilities,
obligations . . . of any nature whatsoever
which Tall, . . . now has, owns or holds, or
at any time heretofore ever had, owned or
held, or could have owned or held, whether
known or unknown, suspected or unsuspected,
11

through
the
Agreement.

Effective

(Id.) (emphases added).

Date[3]

of

this

The Settlement Agreement specifies that

the above provision constitutes a general release and that
[t]hough Tall may file a charge against MV
with an administrative agency, he is waiving
and releasing the right to recover any
monetary or non-monetary relief . . . in
connection
with
a
charge
and/or
investigation filed or initiated by himself,
another individual, group of individuals,
with
the
Equal
Employment
Opportunity
Commission and/or any other federal or state
agency, for any claim or cause of action of
any type arising at any time prior to the
Effective Date of this Agreement.
The Agreement also includes a “Covenant Not to Sue,” requiring
Plaintiff to agree never to sue MV or any of the Releasees in
any forum for claims, laws, or theories covered by the general
release provision.
Some
provision
release

3

courts
can

(Id. at 6).
have

render

includes

held
an

claims

FLSA

that

an

overly

agreement

unrelated

to

broad

unreasonable

those

asserted

release
if

the

in

the

Paragraph 19.d defines “Effective Date” as the date that
the parties have executed and delivered the Settlement Agreement
to counsel for MV, “when Tall has provided MV with a completed
IRS W-4 Form, after the expiration of the Revocation Period,
after MV’s receipt of the Stipulation of Dismissal executed by
Tall, and after the Court has approved the Agreement and entered
the fully executed Stipulation of Dismissal, whichever is
later.” (ECF No. 41-1, at 9).
12

complaint.
1346,
release

See, e.g., Moreno v. Regions Bank, 729 F.Supp.2d

1352,
in

(M.D.Fla.
an

unevaluated,

FLSA

and

unfair

2010)

(concluding

settlement
benefit

that

confers
on

the

an

“a

pervasive

uncompensated,

employer”

that

fails

“judicial scrutiny”); McKeen-Chaplin v. Franklin Am. Mortg. Co.,
No. 10-5243 SBA, 2012 WL 6629608, at *3 (N.D.Cal. Dec. 19, 2012)
(rejecting

FLSA

settlement

agreement

where

the

release

“provision does not track the breadth of the allegations in this
action

and

releases

unrelated

claims”).

Although

a

general

release can render an FLSA settlement agreement unreasonable,
the court “is not required to evaluate the reasonableness of the
settlement

as

it

relates

to

non-wage-dispute

claims

if

the

employee is compensated reasonably for the release executed.”
Villarroel v. Sri Siva Vishnu Temple, No. GJH-I-T-02617, 2014 WL
7460967, at *3 (D.Md. Dec. 31, 2014); see also Duprey v. Scotts
Co. LLC, PWG-13-3946, ---F.Supp.2d----, 2014 WL 2174751, at *4
(D.Md.

May

Settlement

23,

2014).

Agreement

As

explained

compensates

above,

Plaintiff

in

an

the

proposed

amount

that

exceeds his likely recovery on the overtime claim assuming he
could prevail.

See, e.g., Coles v. Von Paris Enterprise, Inc.,

2014 WL 6893861, at *8 n.2 (D.Md. Dec. 3, 2014) (“Although the
Settlement Agreement does not explicitly account for the portion
13

of the $4500 that compensates the Plaintiffs for their FLSA
overtime claims and the portion that compensates the Plaintiffs
for

their

non-FLSA

base

pay

claims,

the

fact

remains

that

Plaintiffs’ total recovery exceeds the amount that they claimed
in overtime under the FLSA.

Accordingly, the Court finds that

the

provision

broad

general

release

does

not

render

Agreement unreasonable as to Plaintiff’s FLSA claims.”).

the
Based

on the foregoing, the $2,200 appears reasonable for the general
release executed.
Plaintiff largely agrees with the terms of the proposed
Settlement Agreement, but seeks the court’s review of several
provisions therein.

(See ECF Nos. 40 & 42).

Specifically,

Plaintiff believes that the “no hire” provision may violate the
Whistleblower Protection Enhancement Act of 2012.
at 1).

(ECF No. 40,

Plaintiff states:
For [] purposes of a smooth resolution,
[P]laintiff is not averse to agreeing to the
above stipulations, as he has already signed
and submitted the Release.
Plaintiff is
only asking for the court’s review of
whether the stipulation is a violation of
the retaliation clause of the Whistleblower
Protection Enhancement Act of 2012 and upon
the
court’s
determination[,]
[P]laintiff
will comply and hopes that [D]efendant will
also.

14

(ECF

No.

42,

requiring

at

him

proceedings

2).

to

Plaintiff

agree

against

MV

not

to

also

points

cooperate

Transportation,

to

except

clause

other

in

the

legal

to

the

extent

prohibited by law.
Mr. Tall was terminated on January 6, 2011.
the

Settlement

Agreement

covers

the

Paragraph 9 of

parties’

agreement

concerning reemployment:
Tall hereby covenants and agrees that he
will not ever seek or accept employment,
either directly or indirectly, with MV or
any
of
its
affiliates,
parents,
subsidiaries, successors, predecessors and
assigns.
Tall further agrees that the
execution of this Agreement is good and
sufficient cause for MV and its affiliates,
parents,
subsidiaries,
successors,
predecessors and assigns to reject any
application by him for employment.
Tall
further agrees, admits, and acknowledges
that any future refusal by MV to employ him,
retain his services, or any termination of
such employment based on this Section is a
legitimate,
non-discriminatory
and
nonretaliatory business reason for such refusal
or termination, and that such reason shall
be conclusive and binding on any court or
finder or fact.
(ECF No. 41-1, at 7).

The Whistleblower Protection Enhancement

Act of 2012 that Plaintiff cites is wholly inapplicable here, as
it protects federal employees and applicants from retaliation
for

whistleblowing

activities.
15

As

Defendant

points

out,

“Plaintiff is neither a federal employee nor has he engaged in
any whistleblowing activities [] by virtue of his FLSA lawsuit
filed against a private entity for alleged unpaid overtime.”
(ECF No. 41, at 3) (emphasis in original).
provision

is

a

negotiated

term

of

the

The “no re-hire”

proposed

Settlement

Agreement in exchange for payment by Defendant of $2,200 to
settle

the

lawsuit.

By

Plaintiff’s

own

admission,

defense

counsel was fair during negotiations and there is no indication
that Plaintiff was coerced into agreeing to the “no re-hire”
provision.

Plaintiff also appears to take issue with Paragraph

11, which requires him to agree not voluntarily to cooperate in
any litigation against MV Transportation.
states

that

“Tall

[]

agrees

that

he

will

The provision also
not

assist,

join,

participate in, or consent to opt in to any FLSA claim against
MV that arose prior

to the Effective Date of this Agreement,

and that he will elect to opt out of any FLSA action against MV
of which he is involuntarily made a member or participant.”
(ECF No. 41-1, at 7) (emphasis added).

Again, this clause is

something the parties negotiated in exchange for payment of the
settlement amount by Defendant.
provision

discussed

above,

the

releases executed.
16

As with the general release
$2,200

is

reasonable

for

the

III. Conclusion
For

the

foregoing

reasons,

the

Settlement Agreement will be granted.

motion

to

approve

A separate order will

follow.
/s/
DEBORAH K. CHASANOW
United States District Judge

17

the