Basurto v. Osman et al

Filing 24

ORDER granting 23 Motion for Settlement; ORDER DISMISSING CASE: The Court approves the settlement agreement and this case is dismissed. The Court shall retain jurisdiction over this matter until settlement is consummated. Either party may, on notice to the other side, file to reopen if settlement is not effectuated in accordance with the terms of the settlement agreement. Ordered by Magistrate Judge Lois Bloom on 2/22/2013. (Nair, Rekha)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
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LUIS BASURTO,
Plaintiff,
-against-

ORDER
12 CV 3190 (LB)

STEVE OSMAN, BOB FATHELBAB, and
Z-TWO DINER & LOUNGE INC.
Defendants.
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BLOOM, United States Magistrate Judge:

The Court held a settlement conference in this Fair Labor Standards Act (FLSA) action
on January 16, 2013 and the parties settled the case on the record. As the FLSA requires judicial
approval of settlement agreements, see Marfak v. Vincenzo Peretta & Volatour, Inc., No. 10 Civ.
7785 (DLC), 2011 U.S. Dist. LEXIS 48994, at *4-5 (S.D.N.Y. May 6, 2011), the parties filed a
joint motion for settlement approval on February 14, 2013 (ECF No. 23).1 I hereby approve the
proposed settlement agreement for the reasons stated below.
Courts reviewing a FLSA settlement agreement “must consider whether the agreement
reflects a reasonable compromise of disputed issues rather than a mere waiver of statutory rights
brought about by an employer’s overreaching.” Mosquera v. Masada Auto Sales, Ltd., No. 09cv-4925, 2011 WL 2822327, at *1 (E.D.N.Y. Jan. 25, 2011) (quoting Le, 2008 WL 724155 at
*1). In making this determination, the Court takes into account the “(1) complexity, expense,
and likely duration of the litigation, (2) stage of the proceedings, (3) risks of establishing
liability, (4) risks of establishing damages, (5) ability of defendants to withstand a larger
judgment, and (6) reasonableness in light of best possible recovery and all risks of litigation.”
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The parties consent to the jurisdiction of a United States Magistrate Judge. (ECF No. 22.)
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Peralta v. Allied Contracting II Corp., No. 09-cv-0953, 2011 WL 3625319, at *1 (E.D.N.Y. Aug.
1, 2011) (citing Misiewicz v. D’Onofrio Gen. Contractors Corp., No. 08-CV-4377, 2010 WL
2545439, at *4 (E.D.N.Y. May 17, 2010)). The Court also reviews attorney’s fees in FLSA
settlement agreements for reasonableness. Falleson v. Paul T. Freund Corp., 736 F. Supp. 2d
673, 674 (W.D.N.Y. 2010). There is a “greater range of reasonableness” where, as here, “the
parties [have] settled on the fee through negotiation.” Misiewicz, 2010 WL 2545439, at *5.
Nonetheless, the Court should ensure that simultaneous negotiation of fees and settlement
amounts did not create improprieties or conflicts. Cisek v. Nat’l Surface Cleaning, Inc., 954 F.
Supp. 110, 111 (S.D.N.Y. 1997).
The Court finds that the instant settlement “reflects a reasonable compromise over
contested issues.” Diaz v. Scores Holding Co., Inc., No. 07-cv-8718, 2011 WL 6399468, at *3
(S.D.N.Y. Jul. 11, 2011). The parties’ proposed settlement was the result of “arm’s length
negotiations, which were undertaken in good faith by counsel,” and which were mediated, in
part, by this Court. Reyes v. Buddha–Bar NYC, No. 08–CV–2494, 2009 WL 5841177, at *3
(S.D.N.Y. May 28, 2009); see also Palacio v. E*Trade Fin. Corp., No. 10-cv-4030, 2012 WL
2384419, at *5 (S.D.N.Y. Jun. 22, 2012) (approving FLSA settlement that “was the result of
contested litigation and arm’s-length negotiation”); Diaz, 2011 WL 6399468, at *2 (“In FLSA
settlements , . . . arm’s length negotiations involving counsel and a mediator raise a presumption
that the settlement achieved is procedurally fair, reasonable, adequate, and not a product of
collusion.”). Moreover, in light of the disputed issues of fact regarding plaintiff’s wages and
hourly rates, the lack of complete employment and payroll records, and the likely duration of
discovery and trial, the terms of the settlement agreement are reasonable and fair. Misiewicz,
2010 WL 2545439, at *4; see also Reyes, 2009 WL 5841177, at *3 (approving settlement and
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noting that “the value of an immediate recovery outweighs the mere possibility of further relief
after protracted and expensive litigation”).
The Court has reviewed the parties’ proposal regarding the attorneys’ fees and costs and
supplemental records regarding plaintiff’s attorneys’ rates and hours, in order to determine
whether the fees to be paid fall within the “prevailing [market rates] in the community for similar
services by lawyers of reasonably comparable skill, experience and reputation.” Cho v. Koam
Medical Services P.C., 524 F.Supp.2d 202, 206 (E.D.N.Y.2007).

Courts in this disctrict have

held a $250 hourly fee for an associate like plaintiff’s counsel to be reasonable. See, e.g., Callier
v. Superior Bldg. Servs., Inc., No. 09-cv-4590, 2010 WL 5625906, at *6 (E.D.N.Y. Dec. 22,
2010) (approving hourly rates of $350

for partner and $250 for associate in “relatively

straightforward” FLSA case where “all three defendants defaulted”).

Moreover, plaintiff’s

counsel’s records demonstrate that his fees if billed by the hour actually far exceed the $1,500 he
will receive as part of this settlement. The Court therefore approves the attorneys’ fees and costs
agreed to by the parties.
Accordingly, the Court approves the settlement agreement and this case is dismissed.
The Clerk of Court is directed to close this case. The Court shall retain jurisdiction over this
matter until settlement is consummated. Either party may, on notice to the other side, file to
reopen if settlement is not effectuated in accordance with the terms of the settlement agreement.
SO ORDERED.
/S/
LOIS BLOOM
United States Magistrate Judge
Dated: February 22, 2013
Brooklyn, New York

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