CHILLOGALLO v. JOHN DOE LLC #1, ET AL
Filing
64
OPINION. Signed by Judge Renee Marie Bumb on 10/1/2018. (dmr)
[Dkt. No. 62]
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
CAMDEN VICINAGE
DANIEL ENRIQUE CHILLOGALLO,
Plaintiff,
Civil No. 15-537 (RMB/KMW)
v.
JOHN DOE LLC #1, et al.,
Defendants.
APPEARANCES:
LAW
By:
277
New
OFFICE OF JUSTIN A. ZELLER, P.C.
Brandon D. Sherr, Esq.
Broadway, Suite 408
York, New York 10007
Counsel for Plaintiff
KAO LAW FIRM, LLC
By: Tara P. Kao, Esq.
911 Arch Street, Suite 101
Philadelphia, Pennsylvania 19107
Counsel for Defendants
OPINION
BUMB, UNITED STATES DISTRICT JUDGE:
This matter comes before the Court upon the joint motion of
Plaintiff Daniel E. Chillogallo (“Plaintiff”) and Defendants
John Doe LLC #1, Vin Lin Sushi Corp. d/b/a Megu Sushi Japanese
Cuisine, Megu Sushi Ventnor LLC d/b/a Megu Modern Japanese
Cuisine, Steven Megu Lin, and Brenda Ong (“Defendants”) to
approve the parties’ settlement and dismiss the action with
prejudice [Dkt. No. 62]. The Court has considered the parties’
joint submissions, as well as the parties’ representations at
the in-person status conference on May 1, 2018, and decides the
motion without oral argument pursuant to Fed.R.Civ.P. 78(b).
For the reasons set forth herein, the Court will grant the
parties’ motion to approve the settlement agreement and dismiss
the case with prejudice.
I.
FACTUAL AND PROCEDURAL HISTORY
Plaintiff commenced this action on January 26, 2015,
alleging unpaid wages, tips, and overtime under the Fair Labor
Standards Act (“FLSA”), 29 U.S.C. § 201, et seq., and the New
Jersey State Wage and Hour Law, N.J.S.A. § 42:11-56a4. [Dkt. No.
1].
Plaintiff has amended his complaint twice, most recently
filing a Second Amended Complaint on February 24, 2016. [Dkt.
No. 19].
Although Plaintiff filed this case as a putative
collective action, no other potential plaintiffs have opted-in
2
and Plaintiff has not filed a motion to conditionally certify
the class.1
Following months of fact discovery and negotiations, on May
31, 2018, the parties entered into a Settlement Agreement and
Release (the “Settlement Agreement”)[Dkt. No. 63, Ex. 1].
The
Settlement Agreement resolves all of Plaintiff’s claims, on an
individual basis, against Plaintiffs in exchange for a total sum
of $15,000.00.
On June 1, 2018, the parties filed the instant
motion seeking approval of the Settlement Agreement and
dismissal of this matter with prejudice.
II.
LEGAL STANDARD
“When employees bring a private action for back wages under
the FLSA, and present to the district court a proposed
settlement, the district court may enter a stipulated judgment
after scrutinizing the settlement for fairness.” Lynn's Food
1
Therefore, the Court may approve Plaintiff’s settlement
agreement and dismiss the case without unduly prejudicing any
individuals who could have potentially opted-in. See Brumley v.
Camin Cargo Control, Inc., No. 08-1798, 2012 WL 1019337, at *1
(D.N.J. Mar. 26, 2012)(“An employee's failure to opt in does not
prevent him or her from bringing a separate suit at a later
date”).
3
Stores, Inc. v. United States, 679 F.2d 1350, 1353 (11th Cir.
1982); see also Rabbenou v. Dayan Foods, Ltd., No. 17-1330, 2017
WL 3315263, at *1 (D.N.J. Aug. 3, 2017); Morales v. PepsiCo,
Inc., No. 11–6275, 2012 WL 870752, at *1 (D.N.J. Mar. 14, 2012).
“Although the Third Circuit has not addressed whether
[FSLA] actions claiming unpaid wages may be settled privately
without first obtaining court approval, district courts within
the Third Circuit have followed the majority position and
assumed that judicial approval is necessary.” Bettger v.
Crossmark, Inc., No. 13–2030, 2015 WL 279754, at *3 (M.D. Pa.
Jan. 22, 2015). “[A] district court may enter a stipulated
judgment if it determines that the compromise reached ‘is a fair
and reasonable resolution of a bona fide dispute over FLSA
provisions.’” Brumley, 2012 WL 1019337, at *2 (citing Lynn's
Food Stores, 679 F.2d at 1354).
Accordingly, the Court must
review whether the settlement agreement (i) concerns a bona fide
dispute, and (ii) is a fair and reasonable resolution for the
Plaintiff.
III. ANALYSIS
Based on the record, the terms and conditions of the
settlement, and the applicable law, the Court finds that the
Settlement Agreement reflects a fair and reasonable resolution
of a bona fide dispute over Plaintiff's FLSA claims.
4
First, the Settlement Agreement concerns a bona fide
dispute as to Plaintiff's ability to recover for unpaid wages,
tips, and overtime. Plaintiff alleges that Defendants failed to
pay him the minimum wage and overtime for all hours worked and
wrongfully deprived him of tips, in violation of the FLSA.
Defendants dispute Plaintiff’s allegations, arguing that
Plaintiff was compensated above the minimum wage, received a
two-hour break daily, and was provided with lodging and living
expenses.
Defendants also disagree with Plaintiff’s calculation
of hours worked and maintain that Plaintiff was not employed in
a tipped position.
Second, the Settlement Agreement is fair and reasonable
to Plaintiff. According to the parties, Plaintiff’s counsel’s
initial damages estimate was approximately $26,718.23,
consisting of $2,570.21 in unpaid minimum wages, $9,0003.02 in
unpaid overtime, and $15,145.00 in misused tips.
Agreement ¶7.
Settlement
Defendant maintains that the unpaid minimum wage
and tip claims are entirely without merit, but acknowledges a
risk of exposure on the unpaid overtime claim. Both parties
acknowledge that there would be substantial risks and costs
associated with fully litigating the case.
Under the terms of
the Settlement Agreement, Plaintiff will receive $15,000.00,
with $5,000.00 allocated to Plaintiff’s attorneys’ fees and
costs, in return for a release of Plaintiff’s wage and hour
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claims under federal and state law.
After the disbursement of
attorneys' fees and costs, Plaintiff will receive $10,000.00,
which still reflects an amount higher than his calculated unpaid
overtime damages.
On this basis, the Court finds that the Settlement
Agreement reflects a fair and reasonable resolution of a bona
fide dispute over Plaintiff's wage and hour claims under the
FLSA and the analogous New Jersey state statute.
IV.
CONCLUSION
For the reasons set forth above, the joint motion for
approval of the parties’ settlement and dismissal of this action
with prejudice will be granted.
An appropriate Order shall
issue on this date.
DATED: October 1, 2018
s/Renée Marie Bumb
RENÉE MARIE BUMB
UNITED STATES DISTRICT JUDGE
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