Berrios v. Green Wireless, LLC et al

Filing 29

MEMORANDUM OPINION. Signed by Judge George Jarrod Hazel on 4/18/2016. (kns, Deputy Clerk)

FILED

U

Dlslfi DISTRICT

COURT

IN THE UNITED STATES DISTRICT COURT
ler OF ,'1ARYLAND
FOR HIE DISTRICT OF MARYLAND
Zllib APR

I 8 A q, 33

Southern I)ivision

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CLfR~~SOFFICE
1\1 Gt""'I"-'-'
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DIANA C. BERRIOS,

B'(

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r'y

Plaintiff,

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Case No.: G./H-I-t-3655

v.

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GREEN WIRELESS, LLC , el 11/.,
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Defendants.

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MEMORANDUM OPINION
Plaintiff Diana C. Berrios tiled this action against her fonner employers Grcen Wirelcss.
LLC, Michael Shin. and Michael Pak. allcging failure to pay her overtime wages in violation of

* 201 elseq .. the Maryland Wage and Hour
Law ("MWHLOO).Md. Code. Lab. & Empl. Article * 3-40 I el seq .. and the Maryland Wage
Payment and Collection Law ("MWPCLOO).Md. Codc. Lab. & Empl. Artiele * 3-501 el seq. lOCI'
the Fair Labor Standards Act ("'FLSA"). 29 U.S.c.

No.1. Presently pending before the Court are several motions: (1) Plaintiffs Motion for Deluult
Judgment, ECF No. 18; (2) Plaintiffs Motion to Strike. ECF No. 21; (3) Defendant's Motion to
Deny. or in the Altemative. Determine Reasonableness of Attorneys' Fees. lOCI'No. 22; and (4)
a Joint Motion to Approve Consent Judgment. lOCI'No. 26. For the reasons that follow. the Joint
Motion to Approve Consent Judgment will be granted. and all other motions will be denied.

I.

BACKGROUND
According to thc Complaint. Green Wireless is a ccll phonc and ccll phone plan provider.

and Mr. Shin is the owner and co-manager of the company. ECI' NO.1 at

'i'i 13-14.

Mr. Pak is

also a co-manager. and both he and Mr. Shin had powcr to hire. lire. suspend. and otherwise

discipline

Plaintiff.

lei. at ~~ 14-15. PlaintifT began working at Green Wireless in May 2013 and

was initially paid on an hourly basis.
biweekly

Id. at 'i'116-17.

In December

2013. she was put on an $800

salary. and in March 2013. that salary was increascd to $1000. Jd. at ~ 17. In addition

to her salary. Plaintiffwas
Plaintiff

frequently

of roughly $100 pcr month. Id.

also paid a commission

worked in exccss of 40 hours pcr week. onen between 50 and 75
wages for such exccss hours. lei. at

hours pcr week. but she was never paid overtime

n 18-20.

Plaintiff alleges that she did not perform any work that was exempt from the minimum
overtime

pay requirements
Plaintiff

of the FLSA. MWHL. or MWPCA.

initiated this action on November

and hearing no response.

Plaintifftiled

wage and

lei. at ~ 21.

20. 2014. After serving all three defendants

Motions fbr Clerk's

Entry of Default. ECF Nos. 6 & IS.

Default was entered against Green Wireless on March 30. 20 IS. and against Messrs. Shin and
I. 20 IS. ECF Nos. 8 & 16. Plaintiff then moved for default judgment

Pak on September
all three Defendants

on October 22. 2015. ECF No. 18. Mr. Shin then appcared.

filed an Answer to the Complaint

on Novcmber

fees calculations

of Attorneys'
in Plaintiffs

by counscl. and

16.20 IS. which Plaintiff has moved to strike.

ECF Nos. 20 & 21. Mr. Shin then filed a Motion to Deny. or in the Alternative.
Reasonableness

against

Fees. ECF No. 22. in which he ehallcnges

Detennine

the costs and attorneys'

Motion for Default Judgmcnt.

While these motions were pending.
entered against him in the amount 01'$3.000.
notilied the COUl1 of her acceptance

Mr. Shin made an offcr to PlaintifTthat
exclusive

ofattorncys'

of that of"!er on December

now jointly move for the Court to approve the consent judgment.

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judgment

fees and costs. Plaintiff

15.2015.

and these two Parties

ECF Nos. 24 & 26.

be

II.

DISCUSSION
A. Motion to Approve Consent .Iudgment
The FLSA does not permit settlement or compromise over alleged FLSA violations

except with (I) 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 statutory
rights brought about by an employer's oven-eaching:' Lynn's Food SIores, Inc, \', Uniled SWIe.l'.
679 F.2d 1350, 1354 (11 th Cir. 1982),1 These restrictions help carry out the purpose of the
FLSA, which was enacted "to protect workers from the poor wages and long hours that can
result from significant inequalities in bargaining power between employers and employees:'
Duprey v. SCOIIS Co. LLC. 30 F. Supp. 3d 404, 407 (D. Md. 2014). Before approving an FLSA
settlement, courts must evaluate whether thc "settlement proposed by an employer and
employee[] ... is a fair and reasonable resolution of a bona fidc dispute over FLSA provisions:'
Lynn's Food Stores. 679 F.2d at 1355. To do so. courts examine ,.( 1) whether therc are FLSA
issues actually in dispute, (2) the fairness and reasonableness of the settlement in light of the
relevant factors from Rule 23, and (3) the reasonableness ofthc attorneys' fces, if included in the
agreement." Duprey, 30 F. Supp. 3d at 408, "These factors are most likely to be satisfied where
there is an 'assurance of an adversarial context' and thc cmployee is 'represented by an attorney
who can protect [his] rights under the statute .... Id. (quoting Lynn's Food SIores, 679 F.2d at
1354).
In determining whether a bona fide dispute over FLSA liability cxists, the Court rcvicws
the pleadings, any subsequent cOUI1filings. and the parties' recitals in the proposed agreement.

I See also Duprey \'. Smits Co, LLC. 30 F, Supp, 3d 404. 407-08 (D. Md. 2014) (noting thaI"[alhhough
Ihe FOllnh
Circuit has not addressed the factors to be considered in approving FLSA settlements. district courts in this circuit
typically employ the considerations set forth by the Eleventh Circuit in Lpm 's Food Stores:" (internal quotation

marks and citation omitted»

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See Lamaseolo \'. Parsons Brineker!lrJ/f Inc., No. I :08CV 1310 (AJT/JFA). 2009 WL 3094955.
at *16-17 (ED. Va. Sept. 28. 2009). Hcrc. PlaintitTalleges that she never perlormcd work lhat
was exempt from the provisions ofthc FLSA and Maryland wage and hour laws and that shc is
therefore entitlcd to $2.017.84 in unpaid ovcrtime wages. ECl' No. I at fl21. Shc also allegcs
that the denial of overtime wages was willful and intentional. and that she is thereforc cntitled to
additionalliquidatcd

damages. ECl' No. 18-1 at3. Mr. Shin. however. contends that Plaintiff was

a managcr and was cxempt from thc ovcrtime provisions and is thcrefore entitled to no damages.
ECl' No. 22-1 at 2. Under these circumstances. a bona tidc dispute exists regarding liability
under the FLSA.
To detemline whcther the parties' resolution of the dispute is "fair and rcasonable:'the
Court considers several factors including:
(I) the extent of discovery that has taken place: (2) the stage ofthc proceedings.
including thc complexity. expcnsc and likcly duration of the litigation: (3) the
absence of fraud or collusion in the settlemcnt: (4) the experience of counscl who
have represented the plaintiffs: (5) thc opinions of ... counsel ... : and (6) the
probability of plaintiffs' success on the merits and the amount ofthc settlement in
relation to the potential recovery.
Duprey. 30 l'. Supp. 3d at 409 (internal quotation marks and citations omitted). Herc. although
the Parties have not engaged in any formal discovery. PlaintitT represents that she possesses all
of the documents necessary to dctermine her damages. Givcnthe current stagc of the litigation.
signilicalll expcnses would be incurred if the parties cngagcd in lormal discovcry, dispositive
motions. and possibly trial. See, e.g. Saman \'. LBDI', Inc.. No. CIV.A. DKC 12-1083,2013 \VL
2949047, at *3 (D. Md. June 13.2013). Because Plaintiff-s claim is relativcly small. thc Parties
prefer to resolve this matter as el1iciently as possible. Additionally. therc has bccn no evidence to
suggest any fraud or collusion in Plaintiffs agrccmcnt to accept Mr. Shin's olTer ofjudgmcnt,
and counsels' filings demonstrate that this agreement was achieved afier each party. with the

advice of their respective counsel, considered the potential value of Plaintiffs claims. considered
the strengths and weaknesses ofMr. Shin's defenses. and determined that the Rule 68 ofter of
judgment was in their best interests. ECF No. 26 at 3. Furthermore. counsel are competent and
experienced, as evidenced by their tilings submitted to date and their prior involvement in
federal litigation in this district.
The offer of judgment entitles PlaintitTto $3,000. exclusive of attorneys' fees and costs.
ECF No. 24. This figure entitles Plaintiff to roughly 150% of her total unpaid overtime.
Although this amount is less than the total damages she sought in her Motion lor Default
Judgment, the Parties took into account the risks attendant with litigation. as well as the
possibility that. even if liability were flllmd. Plaintiff may not be entitled to additional liquidated
damages. and they each detennined that this otTer represented a fair settlement of Plaintiffs
claims. Thus, "[iln light of the risks and costs associated with proceeding further and
Defendants' potentially viable defenses. this amount appears to retlect[] a reasonable
compromise over issues actually in dispute:'

Salllall.

2013 WL 2949047. at *5 (internal

quotation marks and citation omitted).
Because the Parties have not provided for attorneys' fces in their otTer ofjudgmcnt. the
Court need not address that issue in considering its reasonablcness. Pursuant to Local Rule
109.2, Plaintin- s motion for attorneys' fees is due within tourteen days of the entry of judgment.
The Court understands that Mr. Shin may dispute Plaintiffs request tor attorneys' fees and costs.
Any objections to PlaintifTs request is more appropriately raised through a response in
opposition to Plaintiffs motion. if one is tiled. alier the entry of judgment. Accordingly. his
Motion to Deny, or in the Alternative, Dctermine Reasonableness of Attorneys' Fees. Ecr No.
22, is denied.

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B. Remaining Motions
Also pending before the Court is Plaintifrs Motion for Default Judgment against all three
defendants, ECF No. 18. and her Motion to Strike the answer to her Complaint filed by Mr. Shin.
ECF No. 21. The Motion to Strike is now moot in light of PlaintiJrs acceptance of Mr. Shin's
offer of judgment and the Court's approvalthereoL

and her Motion for Default .Iudgmcnt with

respect to Mr. Shin is similarly moot. As to the two remaining defendants. it is unclear whether.
in light of the settlement with Mr. Shin, Plaintiff intends to seek additional damages from Green
Wireless or Mr. Pak. Accordingly, Plaintiffs Motion for Default Judgment will be denied
without prejudice. Plaintiff may refile her motion against the remaining defendants within
fourteen days of the accompanying Order.
III.

CONCLUSION
The Parties' Joint Motion to Approve Consent Judgment. ECF No. 26. is GRANTED

and the offer of judgment is APPROVED. Plaintiffs Motion for Default Judgment. ECF No. 18.
is DENIED without prejudice. Plaintiffs Motion to Strikc. ECF No. 21. is DENIED as moot.
and Defendant's Motion to Deny. or in the Alternative. Determine Reasonableness of Attorncys'
Fees is DENIED. A separate Order follows.

Dated: April

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, 2016

GEORGE .I. HAZEL
United States District Judge

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