Parker v. KB Hauling, LLC et al

Filing 26

MEMORANDUM OPINION. Signed by Magistrate Judge Ajmel Ahsen Quereshi on 8/1/2022. (heps, Deputy Clerk)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
(SOUTHERN DIVISION)
ROBERT BAILEY PARKER

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Plaintiff

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v.

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KB HAULING, LLC, et al.

Civil Case No. 8:22-cv-00697-AAQ

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Defendants

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MEMORANDUM OPINION
This is a dispute over unpaid overtime wages and alleged retaliation under the Fair Labor
Standards Act, 29 U.S.C. § 201, et seq and Maryland state law. Pending before the Court is a Joint
Motion and Memorandum for Approval of Settlement of said dispute between the parties pursuant
to 29 U.S.C. § 216. For the reasons discussed below, the Joint Motion shall be GRANTED, and
the case will be DISMISSED.
BACKGROUND
According to the parties’ Joint Motion and Memorandum in support, Plaintiff Robert
Bailey Parker (“Plaintiff” or “Mr. Parker”) worked as a truck driver and dispatcher for Defendant
KB Hauling, LLC (“KB Hauling”), which is owned and operated by Defendant Kenneth Batten.
ECF No. 25, at 1-2. During the course of Mr. Parker’s alleged employment, he worked 167.15
overtime hours, but was paid only a regular rate of pay for such overtime work. Id. at 2. Plaintiff
asserts, as a result, he is owed $1,867.00 in unpaid overtime wages. Id. Plaintiff bases his
calculation on the Fair Labor Standards Act (“FLSA”) mandate that employees be paid one-andone half times their regular rate of pay for overtime hours worked. ECF No. 1 at ¶ 27. Defendants,
for their part, maintain that Plaintiff was paid for services as a driver, but was not “under their
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employment.” ECF No. 11, at ¶ 5. Defendants also deny that they have failed and/or refused to
pay Plaintiff any wages he may have rightfully earned as required by the FLSA, the Maryland
Wage and Hour Law (“MWHL”) and the Maryland Wage Payment and Collection Law
(“MWPCL”). Id. at ¶ 20.
On February 16, 2022, Plaintiff’s counsel sent a demand letter to Defendants, outlining a
claim for unpaid overtime wages. Id. at ¶ 22. On or about February 25, 2022, Plaintiff was
terminated from his employment at KB Hauling. Id. at ¶ 24. Plaintiff asserts that such termination
was an act of retaliation for “contesting Defendants’ illegal employment practices.” ECF No. 1,
at ¶ 24. Defendants deny this assertion. ECF No. 11, at ¶ 25.
Plaintiff filed his Complaint in this case on March 22, 2022, seeking all unpaid overtime
wages, liquidated damages, interest, attorneys’ fees, costs and any and all other relief deemed
appropriate by the Court under the FLSA. ECF No. 1, at 6. As part of his retaliation claim,
Plaintiff sought back pay and compensatory damages in excess of $75,000 and punitive damages.
Id. at 6-7. In addition, Plaintiff brought claims under the MWHL and the MWPCL for failure to
pay overtime wages. Id. at 8-10.
Following informal discovery, including the exchange of time and pay records, counsel for
the parties filed the present Joint Motion and Memorandum for Approval of Settlement Agreement
on July 14, 2022. ECF No. 25.
STANDARD OF REVIEW
When evaluating settlement agreements for approval under the FLSA, courts should
approve settlements that “reflect a ‘reasonable compromise of disputed issues’ rather than ‘a mere
waiver of statutory rights brought about by an employer’s overreaching.’” Saman v. LBDP, Inc.,

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No. DKC-12-1083, 2013 WL 2949047, at *2 (D. Md. June 13, 2013) (quoting Lynn’s Food Stores,
Inc. v. United States, 679 F.2d 1350, 1354 (11th Cir. 1982)).
In making such a determination, typically, district courts in the Fourth Circuit “employ the
considerations set forth by the Eleventh Circuit in Lynn’s Food Stores.” Id. at *3 (citing Hoffman
v. First Student, Inc., No. WDQ-06-1882, 2010 WL 1176641, at *1 (D. Md. Mar. 23, 2010); Lopez
v. NTI, LLC, 748 F.Supp.2d 471, 478 (D. Md. 2010)). Courts should ensure there is a “fair and
reasonable resolution of a bona fide dispute over FLSA provisions,” by evaluating: (1) whether
there are FLSA issues actually in dispute; (2) the fairness and reasonableness of the settlement in
light of the relevant factors; and (3) the reasonableness of the attorneys’ fees, if included in the
agreement. Id. (citing Lynn’s Food Stores, Inc., 679 F.2d at 1355; Lomascolo v. Parsons
Brinckerhoff, Inc., No. 08-1310, 2009 WL 3094955, at *10 (E.D. Va. Sept. 28, 2009); Lane v. Kome, LLC, No. DKC-10-2261, 2011 WL 3880427, at *2-3 (D. Md. Aug. 31, 2011)).
DISCUSSION
The parties have asked the Court to approve their proposed Settlement Agreement and
dismiss this case. I find that approval is proper as the settlement agreement reflects a fair and
reasonable resolution of a bona fide dispute between the parties. In addition, the award of
attorneys’ fees has been reached independently of the Settlement Agreement pursuant to a
preexisting agreement in place between Plaintiff and his counsel.
A. There is a Bona Fide Dispute Between the Parties.
To determine whether a bona fide dispute exists as to a defendant’s liability under the
FLSA, the Court should examine the pleadings in the case, along with representations and recitals
in the proposed settlement agreement. See Duprey v. Scotts Co. LLC, 30 F.Supp.3d 404, 408 (D.
Md. 2014) (citing Lomascolo, 2009 WL 3094955, at *16-17).

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Plaintiff’s Complaint maintains that Plaintiff was an employee of KB Hauling, while
Defendants dispute this assertion. Disagreements as to the employment status of individuals
constitute bona fide disputes. See Portero v. Abuobaid, No. DKC-14-2108, 2015 WL 1061988, at
*1 (D. Md. Mar. 10, 2015) (finding a bona fide dispute where the parties disagreed as to whether
Plaintiff was an employee or independent contractor as defined under the FLSA).
In addition, the parties disagree as to whether Plaintiff’s termination in late February 2022
constituted an act of retaliation in response to Plaintiff’s demand letter. Defendants have also
asserted multiple affirmative defenses to the claims in the case. ECF No. 11. See De La Cruz v.
Chopra, No. DKC 18-0337, 2018 WL 2298717, at *1, *2 (D. Md. May 21, 2018) (finding a bona
fide dispute where the parties disagreed as to proper rate of payment to plaintiff for overtime hours
and defendants asserted affirmative defenses).
As a result of these issues, I find a bona fide dispute clearly exists between the parties under
the FLSA.
B. The Settlement Agreement is Fair and Reasonable.
In assessing whether the settlement is fair and reasonable, the Court should evaluate six
factors: “(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
settlement in relation to potential recovery.’”

Saman, 2013 WL 2949047, at *3 (quoting

Lomascolo, 2009 WL 3094955, at *10).
To begin, the parties have engaged in informal discovery including the exchange of “time
and pay records.” ECF No. 25, at 2. Based on such discovery, the parties were able to come to a

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mutual agreement as to the “exact number of overtime hours Plaintiff worked and amount of
unpaid overtime due to Plaintiff.” Id. In addition, the parties were able to reach an agreement
regarding the amount of liquidated damages to be paid to Plaintiff, prior to engaging in expensive
discovery. Id. at 3.
As to factor two, the parties have yet to engage in formal discovery, but Defendants have
filed an Answer asserting a number of affirmative defenses. ECF No. 11. Given that the parties
contest both the status of Plaintiff’s employment and the facts surrounding his termination, the
parties maintain that litigation is likely to be protracted and expensive. ECF No. 25, at 4. The
parties have determined settlement to be the best option to “resolve the dispute . . . while
minimizing their own further expenditures and potential expenses.” Id. at 5. See Black v. Reviera
Enter., Inc., No. DLB-19-201, 2020 WL 6544820, at *1, *2 (D. Md. Nov. 6, 2020) (holding
settlement agreement was fair and reasonable where parties recognized remaining discovery would
require significant investment of time, effort, and financial resources); Monzon v. Gali Service
Indus., Inc, No. DKC 15-0286, 2015 WL 1650167, at *1, *2 (D. Md. Apr. 13, 2015) (holding
settlement agreement was fair and reasonable where parties agreed to settle at “very early stage of
the proceedings.”).
The third factor revolves around fraud and collusion. The facts and evidence before me
display no showing of fraud or collusion, and thus, I “presum[e] that no fraud or collusion occurred
between counsel, in the absence of any evidence to the contrary.” Lomascolo, 2009 WL 3094955,
at *12. The parties also state that no fraud or collusion exists. ECF No. 25, at 4.
Regarding factors four and five, counsel for both Plaintiff and Defendants represent
themselves as “experienced attorneys who practice in this area of law.” Id. The opinions of
counsel regarding the fairness of the resolution are also clearly asserted. Plaintiff’s counsel

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believes Plaintiff’s claims have merit, but acknowledges that with litigation comes risks, delays,
difficulties, and uncertain outcomes. Id. Plaintiff’s counsel believes that the settlement is “fair,
reasonable, adequate, in accordance with the law, and the best interests of Plaintiff.”

Id.

Defendants’ counsel likewise believes the settlement agreement’s terms are reasonable, noting that
Defendants have already expended time and other resources on the case, and wish to settle to
minimize their own future expenses. Id. at 5.
Finally, factor six contemplates the probability of Plaintiff’s success on the merits and the
amount of settlement in relation to potential recovery. Plaintiff’s success on the merits depends
on a resolution in his favor as to the bona fide dispute of both his status as an employee and whether
his termination was an act of retaliation. Pursuant to settlement, Plaintiff will receive both the
entirety of his unpaid wages, $1,867.00, as well an additional $1,867.00 to account for any harm
to him from the delay in payment. Id. at 2. This figure is fair and reasonable considering that,
under the terms of the settlement, Plaintiff recoups the entirety of his unpaid wages and that, if the
litigation moves forward, he may not recover at all. See De La Cruz, 2018 WL 2298717, at *2
(finding a fair and reasonable settlement after taking into consideration the fact that “losing on the
issue of Defendants’ FLSA liability would result in no recovery of overtime pay [for plaintiff] . .
.”).
The Settlement Agreement before me does contain a general release of claims that exceeds
those specified in the Complaint.

Such a release can render the Settlement Agreement

unreasonable. Duprey, 30 F.Supp.3d at 410 (referencing Moreno v. Regions Bank, 729 F.Supp.2d
1346, 1352 (M.D. Fla. 2010)). However, so long as the “employee is compensated reasonably for
the release executed, the settlement can be accepted” and I do not need to consider the
“reasonableness of the settlement as to the non-FLSA claims.” Id. at 411. As noted above,

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Plaintiff, under the terms of the Agreement, will receive the entirety of his unpaid wages, as well
as an additional amount doubling his recovery.
Taking all the aforementioned factors into account, I find the Settlement Agreement
presented to be fair and reasonable.
C. The Settlement Agreement Awards Reasonable Attorneys’ Fees.
The Settlement Agreement must also contain reasonable provisions regarding attorneys’
fees. Id. Here, settlement was reached “independent of the issue of Plaintiff’s attorneys’ fees and
costs.” ECF No. 25, at 5. Plaintiff’s attorneys’ fees and costs will be paid pursuant to a separate,
preexisting agreement in place between Plaintiff and his counsel. Id. In addition, the parties
maintain that “no attorney fees or costs will infringe on Plaintiff receiving his full relief of unpaid
wages and liquidated damages.” Id.
CONCLUSION
For the reasons stated above, the Joint Motion for Judicial Approval of Settlement will be
GRANTED and this case shall be DISMISSED with prejudice.
So Ordered.
Date: August 1, 2022

_______/s/_____________
Ajmel A. Quereshi
United States Magistrate Judge

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