Surdu, et al v. Madison Global, LLC, et al.
OPINION AND ORDER re: 66 MOTION for Settlement Notice of Plaintiffs' Motion for Preliminary Approval of Class Action Settlement, Conditional Certification of the Settlement Class, Appointment of Plaintiffs' Counsel as Class Counsel, and A pproval of Plaintiffs filed by Constantine Haralabopolous, Dino Tito, Adnan Dibra, Susanna De Martino, Alexandru Surdu, Luca Federico, Francesco Desideri, Anastasia Mayfat, Luis Lopez, Juan Carlos Rios, Bilguun Ganhuyag, Stefano Naia, Gian Maria Mont oro, Ciprian Grosu, 58 MOTION for Settlement Notice of Plaintiffs' Motion for Preliminary Approval of Class Action Settlement, Conditional Certification of the Settlement Class, Appointment of Plaintiffs' Counsel as Class Counsel, and App roval of Plaintiffs, filed by Constantine Haralabopolous, Dino Tito, Adnan Dibra, Susanna De Martino, Alexandru Surdu, Luca Federico, Francesco Desideri, Anastasia Mayfat, Juan Carlos Rios, Bilguun Ganhuyag, Stefano Naia, Gian Maria Montoro, Ciprian Grosu. Plaintiffs' motion is granted. It is hereby ORDERED that: 1. The proposed class is conditionally certified pursuant to Rule 23 (a) and (b) (3). Alexandru Surdu, Dino Tito, Anastasia Mayfat, Ciprian Grosu and Luis Lopez are appointed class representatives and the Klein Law Group, P.C. is appointed class counsel. 2. The Settlement Agreement is approved preliminarily. 3. Counsel shall submit a proposed revised notice to class members to my chambers no later than September 22, 2017. 4. W ithin 15 days of the date of this Order, defendants will provide the settlement claims administrator and plaintiffs' counsel with a list, in electronic form, of the (1) names, (2) last known addresses, (3) dates of employment and (4) social secu rity numbers of each class member. 5. Within 40 days of the final approval of the notice to class members, the settlement claims administrator shall mail, via first class mail, the revised notice to the members of the class using each individual' ;s last known address. 6. Class members will have 45 days from the date the revised notice is mailed to file a claim form, opt out of the settlement or file written objections. 7. The Court shall hold a fairness hearing on January 19, 2018 at 10:00 a .m. at the United States District Court for the Southern District of New York, 500 Pearl Street, Courtroom 18-A, New York, New York 10007. 8. No later than January 3, 2018, counsel for plaintiffs shall move and file a memorandum of law in support of final approval of the Settlement Agreement, an award of attorneys' fees and costs and service awards. 9. The Clerk of the Court is respectfully requested to close Docket Items 58 and 66. (Motions due by 1/3/2018.) (Fairness Hearing set for 1/19/2018 at 10:00 AM in Courtroom 18A, 500 Pearl Street, New York, NY 10007 before Magistrate Judge Henry B. Pitman.) (Signed by Magistrate Judge Henry B. Pitman on 9/1/2017) Copies Transmitted By Chambers. (ras)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
ALEXANDRO SURDU, DINO TITO,
ANASTASIA MAYFAT, CIPRIAN GROSU
and LUIS LOPEZ, on behalf of
themselves and those similarly
situated, et al.,
15 Civ. 6567
-againstMADISON GLOBAL, LLC, d/b/a NELLO,
NELLO BALAN and THOMAS MAKKOS,
PITMAN, United States Magistrate Judge:
Plaintiffs Alexandru Surdu, Dino Tito, Anastasia
Mayfat, Ciprian Grosu and Luis Lopez, on behalf of themselves and
all others similarly situated, commenced this action pursuant to
the Fair Labor Standards Act (the "FLSA"), 29 U.S.C.
and the New York Labor Law (the "NYLL")
against defendants Madison Global, LLC d/b/a Nello ("Nello"),
Nello Balan and Thomas Makkos to recover unpaid minimum wages,
misappropriated gratuities, uniform purchase and maintenance
costs and penalties for failure to provide wage statements and
Plaintiffs brought the action as a collective action
pursuant to 29 U.S.C. § 216(b) with respect to the FLSA claims
and as a class action with respect to the NYLL claims.
the filing of the complaint, opt-in plaintiffs Gulnaz
Badakshanova, Constantine Haralabopolous, Bilguun Ganhuyag,
Francesco Desideri, Gian Maria Montoro, Stefano Naia, Adnan
Dibra, Susanna De Martino, Luca Federico and Juan Carlos Rios
consented to join the FLSA collective action.
By letter to the Honorable Paul G. Gardephe, United
States District Judge, dated September 30, 2016, the parties
informed the Court that they had reached a settlement of the FLSA
collective action and the NYLL class action (Letter from Noel P.
Tripp, Esq., to Judge Gardephe, dated Sept. 30, 2016 (Docket Item
The parties subsequently memorialized their
agreement in a written settlement agreement (the "Settlement
Plaintiffs now move for preliminary approval of the
Settlement Agreement and other related relief.
plaintiffs seek an order (1)
conditionally certifying a NYLL
class pursuant to Rule 23 (a) and (b) (3);
P.C. as class counsel;
(2) appointing the Klein
(3) preliminarily approving the
(4) approving plaintiffs' proposed Notice
of Class Action Settlement (the "Proposed Notice") and (5)
scheduling a Fairness Hearing to consider the parties' motion for
final approval of the settlement, attorneys' fees and costs and a
service award to Surdu, Tito, Mayfat, Grosu and Lopez
Plaintiffs' Renewed Motion for Preliminary Approval of Class
Action Settlement, dated July 28, 2017
66); Memorandum of
Law in Support of Plaintiffs' Renewed Motion for Preliminary
Approval of Settlement, dated July 28, 2017
Mem. ") , at 1) .
The parties have consented to my exercising
plenary jurisdiction pursuant to 28 U.S.C.
For the reasons set forth below, plaintiffs' motion is
Relevant Factual and
Surdu, Tito, Mayfat, Grosu and Lopez commenced this
action on August 19, 2015.
The complaint alleges that the
members of the FLSA collective and the putative NYLL class are or
were employed by defendants as tipped "food service workers,"
which the complaint defines as "servers, bussers, runners, and
(Class and Collective Action Complaint, dated Aug.
18) . 1
The complaint further
The FLSA collective includes food service workers that
(continued ... )
alleges that defendants
failed to pay the minimum wage by
improperly applying the FLSA and NYLL's tip credit allowance;
unlawfully retained portions of the food service workers' tips
and distributed them to non-tip-eligible employees;
reimburse food service workers for uniform purchase and maintenance costs and (6)
failed to provide food service workers with
wage statements and notices as required by the NYLL (Compl.
Plaintiffs filed an amended complaint on May 10, 2016,
adding retaliation claims on behalf of Surdu and Tito
tion Regarding Plaintiffs' Proposed Amendment of Complaint, dated
May 9, 2016 (D.I. 38), Ex. A ("Amended Compl.")
The parties engaged in extensive discovery to develop
Plaintiffs produced approximately
their claims and defenses.
1,500 pages of documents, including tip sheets, pay stubs,
schedules, employee handbooks, dry cleaning receipts, disciplinary write-ups and tax forms
Esq., dated July 28, 2017
(Declaration of Darren P.B. Rumack,
Defendants produced approximately 2,000 pages of documents,
including pay stubs, schedules and personnel files for the named
( • • • continued)
worked for defendants on or after August 19, 2012, and the NYLL
class includes food service workers that worked for defendants on
or after August 19, 2009 (Compl. ~~ 16, 25).
and opt-in plaintiffs
According to plain-
tiffs' calculations, plaintiffs and the putative class members
are owed approximately $375,000.00 in misappropriated tips
Plaintiffs have not submitted any estimate
of the class's other elements of damages.
In September 2016, the parties engaged in an arm'slength negotiation during an hours-long mediation session with
mediator Ralph S. Berger, whom plaintiffs' counsel describes as
an "experienced and well-known mediator" in wage and hour cases
At the mediation,
hours of negotiations," the parties reached an agreement on the
The parties thereafter
negotiated the remaining terms of the settlement, which are
memorialized in the Settlement Agreement
Letter from Darren Rumack, Esq., to the undersigned, dated Aug.
("Rumack Letter"), Ex. A).
The Settlement Agreement
The Settlement Agreement provides that defendants,
without conceding the validity of plaintiffs' claims or admitting
liability, agree to create a common settlement fund of $342,500.00
(Rumack Letter, Ex. A§ 3.l(A)).
From the settlement fund,
Surdu, Tito, Mayfat, Grosu and Lopez will each receive an
$8,500.00.00 service award, a settlement claims administrator
will receive a fee 2 to administer the settlement and counsel for
plaintiffs will receive no more than $114,166.66, or one-third of
the total settlement amount, in attorneys' fees and costs,
subject to the Court's approval
(Rumack Letter, Ex. A§§ 1.10,
2.2(B), 3.3(A), 3.4(A)).
The Settlement Agreement provides that the claims
administrator will allocate the remainder of the settlement
proceeds to those class members who validly file a claim form
("Authorized Claimants") as follows:
All Class Members will receive one point for each
week worked for Nello between August 19, 2009 and the
date [the] Agreement is signed[.]
The Net Settlement Fund will be divided by the
aggregate number of points accrued by all of the Class
Members during the period of August 19, 2009 through
the date this Agreement is signed.
Each Authorized Claimant's total points will be
multiplied by the Point Value to determine his or her
Individual Settlement Amount.
No Authorized Claimant shall receive less than
If any Authorized Claimant's Individual
Settlement Amount under this formula is less than
$100.00, that Authorized Claimant's Individual Settlement Amount will be increased to $100.0, with the
difference subtracted from the Net Settlement Fund, and
all other Authorized Claimants' Individual Settlement
The Settlement Agreement does not specify the amount of the
fee that will be paid to the settlement claims administrator.
Amounts recalculated according to the formula set forth
above to account for the difference.
(Rumack Letter, Ex. A§§ 1.2, 3.5(A)).
Any portion of the net
settlement amount not claimed by class members will revert to
(Rumack Letter, Ex. A§ 3.S(B)).
For tax purposes,
settlement checks paid to class members will be allocated 33% to
W-2 wage payments and 67% to 1099 non-wage payments for interest,
liquidated damages and statutory penalties
(Rumack Letter, Ex. A
3. 6 (A))
Additionally, the Settlement Agreement provides that
upon final approval of the Settlement Agreement, each individual
who does not opt out of the class, including those who do not
submit a claim form, will release defendants from all wage and
hour claims that were brought, or could have been brought, in
this action through the date of this Order (Rumack Letter, Ex. A
§§ 1. 2 8, 4. 1 (A) ) .
The Settlement Agreement also provides that neither
side shall make any statement to the media about the settlement,
other than"' [t]he matter has been resolved'"
(Rumack Letter, Ex.
4. 2 (B)) .
Finally, the Settlement Agreement provides that either
party has the right to terminate the Settlement Agreement if I
decline to preliminarily or finally approve the Settlement
Agreement, except if the denial is solely due to attorneys' fees
(Rumack Letter, Ex. A§ 2.8(A)).
Additionally, defendants have
the right to terminate the Settlement Agreement if ten percent or
more of the putative class members opt out
(Rumack Letter, Ex. A
2. 8 (B)).
of the NYLL Rule 23 Class
Plaintiffs request that the Court conditionally certify, for the purpose of settlement only, a class pursuant to
Rule 23 consisting of individuals who worked as servers, runners,
bussers and bartenders and who received tips at Nello from August
19, 2009 through the date of this Order.
"Before certification is proper for any purpose -settlement, litigation, or otherwise -- a court must ensure that
the requirements of Rule 23(a) and (b)
Deutsche Bank AG,
v. Midan Rest.
443 F.3d 253, 270
Inc., 14 Civ. 1693
have been met."
(2d Cir. 2006); accord Manley
(HBP), 2016 WL 1274577 at *3
Individuals who meet this definition, but who have released
all claims against defendants as a result of settlements in cases
bearing docket numbers 09 Civ. 9940 (PAC) (S.D.N.Y.) and 12 Civ.
3060 (JPO) (S.D.N.Y.), would be excluded from this putative
(S.D.N.Y. Mar. 30, 2016)
(Pitman, M.J.); Long v. HSBC USA Inc.,
(HBP), 2015 WL 5444651 at *5
(S.D.N.Y. Sept. 11,
(Pitman, M.J.); Cohen v. J.P. Morgan Chase & Co., 262
F.R.D. 153, 157-58 (E.D.N.Y. 2009).
Class certification under
(1) the class is so numerous that joinder of all members is impracticable; ( 2) there are questions of law
or fact common to the class; ( 3) the claims .
the representative parties are typical of the claims .. of the class; and (4) the representative parties
will fairly and adequately protect the interests of the
"If each of these four threshold requirements are met,
class certification is appropriate if the action also satisfies
one of the three alternative criteria set forth in Rule 23(b)
Long v. HSBC USA Inc., supra, 2015 WL 5444651 at *5; accord
Manley v. Midan Rest.
Inc., supra, 2016 WL 1274577 at *3;
Lizondro-Garcia v. Kefi LLC,
300 F.R.D. 169, 174
Here, plaintiffs argue that class certification
is proper under Rule 23(b) (3), which provides that a class action
may be maintained where
the questions of law or fact common to class members
predominate over any questions affecting only individual members, and
. a class action is superior to
other available methods for fairly and efficiently
adjudicating the controversy.
The party seeking class certification bears the burden
of establishing each of these elements by a "preponderance of the
Teamsters Local 445 Freight Div.
546 F.3d 196, 202
Inc. v. Windsor,
Pension Fund v.
(2d Cir. 2008); see Amchem
Peter T. Roach & Assocs.,
Although the Second Circuit has "di-
354 F. Supp. 2d 471,
rected district courts to apply Rule 23 according to a liberal
rather than a restrictive interpretation," In re NASDAQ MarketMakers Antitrust Litig.,
F.2d 1206, 1208-09
169 F.R.D. 493,
(2d Cir. 1972), class certification should not
be granted unless, after a "'rigorous analysis,'" the court is
satisfied that Rule 23's requirements have been met.
Chubb Corp., 264 F.R.D. 76,
quoting In re Initial Pub. Offerings Sec. Litig.,
(2d Cir. 2006).
471 F.3d 24,
Any doubts concerning the propriety of class
certification should be resolved in favor of class certification.
Long v. HSBC USA Inc.,
supra, 2015 WL 5444651 at *6, citing
J.P. Morgan Sec.,
710 F.3d 454,
Rule 23(a) 's Requirements
requires that the members of the proposed
class be "so numerous that joinder of all members is impracticable."
Here, plaintiffs' counsel represents that it has identi-
fied more than 82 members of the putative class
This clearly meets the numerosity requirement.
v . CNA Mgmt . , Inc . , 2 6 4 F . R . D. 61 , 6 4 ( S . D . N . Y . 2 0 0 9 )
( Jones ,
(" [N] umerosi ty is generally presumed when the prospective
class consists of 40 members or more."), citing Iglesias-Mendoza
v. La Belle Farm,
Inc., 239 F.R.D. 363, 370
(McMahon, D.J.); accord Consolidated Rail Corp. v. Town of Hyde
Park, 47 F.3d 473,
(2d Cir. 1995); Lizondro-Garcia v. Kefi
LLC, supra, 300 F.R.D. at 174.
Rule 23(a) also requires the existence of questions of
The Supreme Court has empha-
law or fact common to the class.
sized that "[c]ommonality requires the plaintiff to demonstrate
that the class members 'have suffered the same injury.'"
Mart Stores, Inc. v. Dukes, 564 U.S. 338, 349-50
General Tel. Co. v. Falcon, 457 U.S. 147, 157
[a]ny competently crafted class complaint literally raises common
questions," I must assess whether the common questions are
capable of "generat[ing] common answers apt to drive the resolution of the litigation."
Wal-Mart Stores, Inc. v. Dukes, supra,
564 U.S. at 349-50 (emphasis and second alteration in original;
internal quotation marks omitted); accord Lizondro-Garcia v. Kefi
300 F.R.D. at 175.
"[P]laintiffs may meet the
commonality requirement where the individual circumstances of
class members differ, but 'their injuries derive from a unitary
course of conduct by a single system.'"
Fox v. Cheminova,
213 F.R.D. 113, 126 (E.D.N.Y. 2003), quoting Marisol A. v.
Giuliani, 126 F.3d 372, 377
(2d Cir. 1997)
single common legal or factual question will suffice."
v. Bloomberg, L.P., 298 F.R.D. 152, 162 (S.D.N.Y. 2014)
(internal quotation marks omitted)
Plaintiffs claim, and defendants do not dispute, that
class members worked as tipped employees for defendants on or
after August 19, 2009.
Plaintiffs also identify several ques-
tions common to the putative class, including whether defendants
paid minimum wages and whether defendants misappropriated tips
(Pl. 's Mem., at 16).
This is sufficient to satisfy the commonal~.g.,
659 F. 3d 234, 252
Shahriar v. Smith & Wollensky Rest.
(2d Cir. 2011)
(" [T] he District
Court properly found there to be questions of law or fact common
to the class .
. since the Plaintiffs' NYLL class claims all
derive from the same compensation policies and tipping practices. " ) ; San ch e z v . JM P Ventures , L . L . C . , 1 3 Ci v . 7 2 6 4 ( GW ) ,
2015 WL 539506 at *3 (S.D.N.Y. Feb. 10, 2015)
Flores v. One Hanover, LLC, 13 Civ. 5184
(AJP), 2014 WL 632189 at
(plaintiffs and class
(S.D.N.Y. Feb. 18, 2014)
members "share common issues of fact and law, including whether
Defendants unlawfully took a 'tip credit' and paid less than the
[and] misappropriated tips by unlawfully
distributing a portion to non-tip eligible workers")
Garcia v. Kefi LLC, supra, 300 F.R.D. at 175.
Rule 23(a) 's third requirement, typicality, ensures
that "'maintenance of a class action is economical and [that] the
named plaintiff's claim and the class claims are so interrelated
that the interests of the class members will be fairly and
adequately protected in their absence.'"
Marisol A. v. Giuliani,
supra, 126 F.3d at 376 (alteration in original), quoting General
Tel. Co. v. Falcon, supra,
457 U.S. at 157 n.13.
requirement is satisfied where 'each class member's claim arises
from the same course of events and each class member makes
similar legal arguments to prove the defendant's liability.'"
Long v. HSBC USA Inc., supra, 2015 WL 5444651 at *7, quoting,
In re Flag Telecom Holdings, Ltd. Sec. Litig., 574
F.3d 29, 35 (2d Cir. 2009); accord Marisol A. v. Giuliani, supra,
126 F.3d at 376; Manley v. Midan Rest. Inc., supra, 2016 WL
1274577 at *4.
Plaintiffs satisfy the typicality requirement of Rule
23(a) because their claims arise from the same factual and legal
circumstances that form the bases of the putative class members'
Specifically, plaintiffs and members of the putative
class worked as tipped employees for defendants and claim that
they were subjected to the same minimum wage and tipping practices
(Pl. 's Mem., at 16-17)
This is sufficient to satisfy the
To satisfy Rule 23 (a)' s adequacy requirement,
named plaintiffs must 'possess the same interest[s] and suffer
the same injur[ies] as the class members.'"
in Elec. Databases Copyright Litig.,
In re Literary Works
654 F.3d 242, 249
(alterations in original), quoting Amchem Prods.,
Windsor, supra, 521 U.S. at 625-26.
a twofold requirement:
"Adequate representation is
class counsel must be qualified and able
to conduct the proposed litigation, and the class representatives
must not have interests antagonistic to those of the other class
Fox v. Cheminova,
Inc., supra, 213 F.R.D. at 127,
citing In re Drexel Burnham Lambert Grp.,
960 F.2d 285, 291
(2d Cir. 1992); accord Cordes & Co. Fin. Servs., Inc. v. A.G.
Inc., 502 F.3d 91,
(2d Cir. 2007).
Plaintiffs' counsel has cited five recent multi-plaintiff cases for which he has served as the attorney of record and
states that that is a non-exhaustive list
Additionally, there is no evidence that the named plaintiffs have
any conflicts with any of the class members.
conclude that plaintiffs satisfy the adequacy requirement of Rule
23 (a) ( 4).
The Implied Requirement
Ascertainability is not expressly required under the
terms of Rule 23, but is an implied element of class certification.
As explained by the late Honorable Harold Baer, United
States District Judge, in Fears v. Wilhelmina Model Agency,
02 Civ. 4911
(HB), 2003 WL 21659373 at *2
(S.D.N.Y. July 15,
"[W]hile Rule 23(a) does not expressly require that a
class be definite in order to be certified, a require15
ment that there be an identifiable [aggrieved] class
has been implied by the courts."
In re Methyl Tertiary
Butyl Ether ( "MTBE") Prods. Liability Li tig. , 2 0 9
F.R.D. 323, 336 (S.D.N.Y. 2002) (internal quotes and
citations omitted); Dunnigan v. Metropolitan Life Ins.
Co., 214 F.R.D. 125, 135 (S.D.N.Y. 2003).
"An identifiable class exists if its members can be ascertained
by reference to objective criteria." MTBE Prods., 209
F.R.D. at 336.
Membership should not be based on
subjective determinations, such as the subjective state
of mind of a prospective class member, but rather on
objective criteria that are administratively feasible
for the Court to rely on to determine whether a particular individual is a member of the class.
Further, the Court "must be able to make this determination without having to answer numerous fact-intensive
Id. at 336 n.20 (quoting Daniels v. City
of New York, 198 F.R.D. 409, 414 (S.D.N.Y. 2001).
(Alterations in original); accord Brecher v. Republic of Argentina,
806 F.3d 22, 24
(2d Cir. 2015); Flores v. Anjost Corp., 284
F.R.D. 112, 122 (S.D.N.Y. 2012)
(McMahon, D.J.); see Manual for
Complex Litigation§ 21.222 at 270
(4th ed. 2004)
identity of individual class members need not be ascertained
before class certification, the membership of the class must be
In this case, plaintiffs' counsel represents,
and defendants do not dispute, that both plaintiffs and defendants produced extensive documentation,
including pay stubs and
schedules, from which class members can be identified (Rumack
Deel. '!!'!! 14-16).
Because plaintiffs can identify the class by
reviewing these documents,
I conclude that the implied
ascertainability requirement of Rule 23 is met here.
Rule 2 3 (b) ( 3) 's Requirements
As discussed above, Rule 23 (b) (3)
requires that a
plaintiff seeking to represent a class establish "that the
questions of law or fact common to class members predominate over
any questions affecting only individual members, and that a class
action is superior to other available methods for fairly and
efficiently adjudicating the controversy."
The Second Circuit explained the predominance requirement in Moore v.
306 F.3d 1247, 1252
"The Rule 2 3 (b) ( 3) predominance inquiry tests
whether proposed classes are sufficiently cohesive to
warrant adjudication by representation." Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 623, 117 S. Ct. 2231,
138 L.E.2d 689 (1997).
It is a more demanding criterion than the commonality inquiry under Rule 23(a).
Id. at 623-24, 117 S. Ct. 2231.
predominate if resolution of some of the legal or
factual questions that qualify each class member's case
as a genuine controversy can be achieved through generalized proof, and if these particular issues are more
substantial than the issues subject only to individualized proof.
[In re Visa Check/MasterMoney Antitrust
Litig., 280 F. 3d 124, 136 (2d Cir. 2001)].
See Myers v. Hertz Corp.,
624 F.3d 537, 549
(2d Cir. 2010)
("[E]conomies of time, effort, and expense in fully resolving
each plaintiff's claim will only be served, and the predominance
requirement satisfied, if the plaintiffs can show that
. questions can be answered with respect to the members
of the class as a whole through generalized proof and that those
common issues are more substantial than individual ones."
ets in original; internal quotation marks and citations omitted) ) .
Plaintiffs' counsel argues that the predominance
requirement is satisfied because the class is unified by common
factual and legal issues:
"[C]lass members' common factual
allegations and legal theory,
that Defendants implemented
the same employment policies and practices, which violated
federal and state wage and hour laws, predominate over any
variations among class members"
(Pl. 's Mem., at 18).
defendants do not dispute plaintiffs' counsel's contention.
Defendants' alleged failure to pay minimum wages and
misappropriation of plaintiffs' tips are the central issues in
this litigation and relate to the general practices of defendants
with respect to their tipped employees.
inance requirement is met.
300 F.R.D. at 177
Accordingly, the predom-
Lizondro-Garcia v. Kefi LLC, supra,
("Because defendants' practices applied to
members of the putative NYLL class uniformly, questions regarding
the legality of those policies 'are about the most perfect
questions for class treatment.'"), quoting Iglesias-Mendoza v. La
Inc., supra, 239 F.R.D. at 373; accord Shahriar v.
Smith & Wollensky Rest. Grp.,
659 F.3d at 253
(predominance requirement satisfied where plaintiffs alleged that
servers were required to share tips with a manager).
Rule 23(b) (3) also requires plaintiffs to demonstrate
that class-wide adjudication is "superior to other available
methods for fairly and efficiently adjudicating the controversy."
In making this determination, the court must balance "the advantages of a class action against those of alternative available
methods of adjudication."
F.R.D. 105, 114
Fairfield Greenwich Ltd.,
D.J.), vacated on other
grounds sub nom., St. Stephen's Sch. v. PricewaterhouseCoopers
Accountants N.V., 570 F. App'x 37
Rule 23(b) (3)
(2d Cir. 2014)
sets forth four non-exhaustive factors relevant to
the superiority inquiry:
(A) the class members' interests in individually controlling the prosecution or defense of separate actions; (B) the extent and nature of any litigation
concerning the controversy already begun by or against
class members; (C) the desirability or undesirability
of concentrating the litigation of the claims in the
particular forum; and (D) the likely difficulties in
managing a class action.
Although there has been previous litigation against
defendants arising out of similar allegations presented here, see
footnote 3, supra, the rest of these factors weigh in favor of
First, litigation by way of a class action is more
economically feasible due to the putative class members' limited
(Pl. 's Mem., at 19).
action is likely the only means by which all plaintiffs can
practically adjudicate their state law claims."
Long v. HSBC USA
Inc., supra, 2015 WL 5444651 at *9; see Iglesias-Mendoza v. La
Belle Farm, Inc.,
supra, 239 F.R.D. at 373.
ing this litigation in the Southern District of New York is
appropriate because the allegedly wrongful conduct occurred
within this jurisdiction, and Defendants' business is located in
the jurisdiction (Pl. 's Mem., at 19).
Third, class adjudication,
as opposed to multiple individual actions, will conserve judicial
resources and avoid the waste and delay of repetitive proceedings
on the same issues.
for all the foregoing reasons,
tionally certify, pursuant to Rule 23(a)
and (b) (3), a class
consisting of individuals who worked as servers, runners, bussers
and bartenders and who received tips at Nello from August 19,
2009 through the date of this Order.
Music Grp. Coro.,
10846300 at *l
13 Civ. 4449
Grant v. Warner
13 Civ. 5031
(S.D.N.Y. Aug. 21, 2015)
(PGG), 2015 WL
tionally certifying class "consisting of all individuals who were
Interns for Defendants in the State of New York from June 17,
2007 through the date of this Preliminary Approval Order"); Davis
v. J.P. Morgan Chase & Co., 775 F. Supp. 2d 601,
(conditionally certifying class "consisting of all individ-
uals who were employed by defendant JPMorgan Chase in the United
States in a Covered Position either (1) at any time from September 8, 1999 through the date of this Decision and Order in any
state other than New York, or (2) at any time from September 8,
1996 through the date of this Decision and Order in New York
Appointment of Class Counsel
Rule 23 (c) (1)
fies a class action must .
2 3 ( g) . "
provides that "[a] n order that certi. appoint class counsel under Rule
Darren P. B. Ruma ck, Esq. , lead counsel for plain ti ff s,
Individuals who meet this definition, but who have released
all claims against defendants as a result of settlements in cases
bearing docket numbers 09 Civ. 9940 (PAC) (S.D.N.Y.) and 12 Civ.
3060 (JPO) (S.D.N.Y.), are excluded from the class.
requests that I designate his firm,
the Klein Law Group, P.C., as
counsel for the NYLL class.
Rule 23 (g) ( 1) (A) sets forth four factors that must be
considered in appointing class counsel:
(i) the work counsel has done in identifying or investigating potential claims in the action; (ii) counsel's
experience in handling class actions, other complex
litigation, and the types of claims asserted in the
action; (iii) counsel's knowledge of the applicable
law; and (iv) the resources that counsel will commit to
representing the class.
A court may also consider "any other matter pertinent to counsel's ability to fairly and adequately represent the interests of
Fed. R. Ci v. P. 2 3 ( g) ( 1) ( B) .
As discussed in Section I I I (A) ( 1) ( d) , supra, plaintiffs' counsel has experience litigating wage-and-hour cases,
including multi-plaintiff cases, and is knowledgeable concerning
the applicable law (Rumack Deel.
29, 30-31, 33).
the Klein Law Group, P.C. has done substantial work in investigating, prosecuting and settling the action (Rumack Deel.
Although the Klein Law Group,
P.C. did not represent
plaintiffs from the lawsuit's inception, counsel met with several
of the named plaintiffs, reviewed documents and corresponded with
defendants regarding pending discovery matters before their
substitution as counsel
When substituted as
counsel, counsel prosecuted the action and participated in an
hours-long mediation to resolve the dispute
Accordingly, the Klein Law Group,
(Rumack Deel. ]] 15-
P.C. is appointed counsel
for the class.
of the Settlement Agreement
Plaintiffs also seek preliminary approval of the
Settlement Agreement, which would resolve the claims brought on
behalf of the FLSA collective and the NYLL class.
Pursuant to Rule 23(e), the settlement of a class
action is not effective until judicially approved.
there is a general policy favoring settlements, the court may
approve a class action settlement only if it is "fair, adequate,
and reasonable, and not a product of collusion."
Giuliani, 218 F.3d 132, 138
(2d Cir. 2000).
Joel A. v.
"A court determines
a settlement's fairness by looking at both the settlement's terms
and the negotiating process leading to settlement."
Stores, Inc. v. Visa U.S.A., Inc.,
396 F.3d 96, 116 (2d Cir.
2005), citing D'Amato v. Deutsche Bank, 236 F.3d 78, 85
In assessing procedural fairness,
tion of fairness,
there is a "presump-
reasonableness, and adequacy as to the settle-
ment where 'a class settlement [is]
reached in arm's-length
negotiations between experienced, capable counsel after meaningful discovery.'"
(2d Cir. 2009)
McReynolds v. Richards-Cantave,
588 F.3d 790,
(alteration in original), quoting Wal-Mart
Stores, Inc. v. Visa U.S.A.,
Inc., supra, 396 F.3d at 116.
In assessing whether a settlement is substantively
reasonable and adequate, courts in this Circuit use the
nine-factor test set forth in City of Detroit v. Grinnell Corp.,
495 F.2d 448,
(2d Cir. 1974), abrogated on other grounds 12.y
Inc., 209 F.3d 43
McReynolds v. Richards-Cantave, supra,
Charron v. Wiener, 731 F.3d 241, 247
588 F.3d at 804; accord
(2d Cir. 2013); Morris v.
Affinity Health Plan, Inc., 859 F. Supp. 2d 611,
(A. Carter, D.J.).
(2d Cir. 2000)
Those factors include:
(1) the complexity, expense and likely duration of the
litigation; ( 2) the reaction of the class to the settlement; (3) the stage of the proceedings and the
amount of discovery completed; ( 4) the risks of establishing liability; ( 5) the risks of establishing damages; ( 6) the risks of maintaining the class action
through the trial; ( 7) the ability of the defendants to
withstand a greater judgment; (8) the range of reasonableness of the settlement fund in light of the best
possible recovery; (9) the range of reasonableness of
the settlement fund to a possible recovery in light of
all the attendant risks of litigation.
McReynolds v. Richards-Cantave, supra,
588 F.3d at 804, quoting
City of Detroit v. Grinnell Corp., supra,
495 F.2d at 463.
Preliminary approval is the first step in the settlement of a class action whereby the court "must preliminarily
determine whether notice of the proposed settlement .
be given to class members in such a manner as the court directs,
and an evidentiary hearing scheduled to determine the fairness
and adequacy of settlement."
2016 WL 1274577 at *8
Manley v. Midan Rest. Inc., supra,
(alteration in original; internal quotation
marks omitted); accord Lizondro-Garcia v. Kefi LLC, supra,
F.R.D. at 179; Davis v. J.P. Morgan Chase & Co., supra, 775 F.
Supp. 2d at 607.
Preliminary approval of a settlement agreement
requires only an "initial evaluation" of the fairness
of the proposed settlement on the basis of written
submissions and an informal presentation by the settling parties.
Clark v. Ecolab, Inc., Nos. 07 Civ.
8623 (PAC) et al., 2009 WL 6615729, at *3 (S.D.N.Y.
Nov. 27, 2009) (citing Herbert B. Newberg & Alba Conte,
Newbera on Class Actions ("Newberg") § 11.25 (4th ed.
Nevertheless, courts often grant preliminary
settlement approval without requiring a hearing or a
See Hernandez v. Merrill Lynch &
Co., Inc., No. 11 Civ. 8472 (KBF) (DCF), 2012 WL 5862749, at *1 (S.D.N.Y. Nov. 15, 2012) (granting preliminary
approval based on plaintiffs' memorandum of law, attorney declaration, and exhibits).
To grant preliminary
approval, the court need only find that there is
"'probable cause' to submit the [settlement] to class
members and hold a full-scale hearing as to its fairness."
In re Traffic Exec. Ass'n, 627 F.2d 631, 634
(2d Cir. 1980); see Newberg§ 11.25 ("If the preliminary evaluation of the proposed settlement does not
disclose grounds to doubt its fairness .
. and appears to fall within the range of possible approval,"
the court should permit notice of the settlement to be
sent to class members); see also Girault v. Supersol
661 Amsterdam, LLC, No. 11 Civ. 6835 (PAE), 2012 WL
2458172, at *1 (S.D.N.Y. June 28, 2012) (granting
preliminary approval where the "proposed Settlement
Agreement [was] within the range of possible settlement
approval, such that notice to the Class [was] appropriate"); Danieli v. IBM, No. 08 Civ. 3688, 2009 WL
6583144, at *4-5 (S.D.N.Y. Nov. 16, 2009) (granting
preliminary approval where settlement "has no obvious
defects" and proposed allocation plan is "rationally
related to the relative strengths and weaknesses of the
respective claims asserted").
"If the proposed settlement appears to fall within the range of possible
approval, the court should order that the class members
receive notice of the settlement." Yuzary, 2013 WL
1832181, at *1 (internal quotation marks and citation
Public House Invs., LLC, 11 Civ. 7679
(CM), 2013 WL 2254551 at *1
(CM), 11 Civ. 8249
(S.D.N.Y. May 22, 2013)
(alterations in original).
I previously refused to preliminarily approve the
Settlement Agreement on several grounds
(Order, dated May 23,
First, it was impossible to evaluate the
reasonableness of the settlement fund because counsel did not
provide an estimate of the putative class's damages.
Settlement Agreement contained a general release for the named
plaintiffs that ran only in favor of defendants.
Settlement Agreement contained a clause in Section 4.2(C) prohibiting plaintiffs from publicizing the terms of the agreement.
ordered the parties to either (1)
putative class's damages;
(a) provide an estimate of the
(b) narrow the named plaintiffs'
release to the conduct set forth in the lawsuit and (c) delete
the confidentiality clause identified above or (2)
file a letter
indicating their intention to abandon the settlement and proceed
The parties have submitted a revised Settlement Agreement that addresses the foregoing issues.
In accordance with my
previous Order, counsel has provided an estimate of the putative
Counsel has also deleted the general release
from the Settlement Agreement; instead, the named plaintiffs
agreed to a general release by a separate agreement. 5
the parties deleted the confidentiality clause that previously
appeared in Section 4.2(C)
of the Settlement Agreement.
Applying the foregoing principles, including the
Grinnell factors "to the extent they are relevant at the preliminary stage," Long v. HSBC USA Inc., supra, 2015 WL 5444651 at *3,
I conclude, based on plaintiffs' memorandum of law, the declaration of Darren P.B. Rumack, Esq., and my own review of the
Settlement Agreement, that there is probable cause to believe
that the Settlement Agreement is fair,
reasonable and adequate.
Such a bifurcated settlement agreement is permissible.
Ortiz v. Breadroll, LLC, 16 Civ. 7998 (JLC), 2017 WL 2079787 at
*2 (S.D.N.Y. May 15, 2017) (Cott, M.J.); Yunda v. SAFI-G, Inc.,
15 Civ. 8861 (HBP), 2017 WL 1608898 at *2 (S.D.N.Y. Apr. 28,
2017) (Pitman, M.J.); Abrar v. 7-Eleven, Inc., No. 14-cv-6315
(ADS) (AKT), 2016 WL 1465360 at *l (E.D.N.Y. Apr. 14, 2016).
First, litigation of this matter, which includes more
than 82 class members and both federal and state claims, through
trial would be complex, costly and long.
Henry v. Little Mint,
Inc., 12 Civ. 3996 (CM), 2014 WL 2199427 at *7
(McMahon, D. J.)
(S.D.N.Y. May 23,
("'Most class actions are inherently
complex and settlement avoids the costs, delays and [the] multitude of other problems associated with them.'"), quoting In re
Austrian & German Bank Holocaust Litig., 80 F. Supp. 2d 164, 174
(Kram, D.J.), aff'd sub nom.,
Bank, supra, 236 F.3d 78.
D'Amato v. Deutsche
Additional discovery, including
depositions of all parties, would be required (Pl. 's Mem., at 9).
. seriously prolong the outcome
"Preparation for trial would .
of this suit in addition to consuming tremendous amounts of time,
expenses and judicial resources."
Inc., 09 Civ. 6548
Sewell v. Bovis Lend Lease,
(RLE), 2012 WL 1320124 at *7
(Ellis, M. J.).
"[l] itigating the claims of
[more than 80] putative class members would undoubtedly yield
expensive litigation costs that can be curbed by settling the
Sewell v. Bovis Lend Lease,
supra, 2012 WL
1320124 at *7.
Second, discovery has advanced sufficiently to allow
the parties to resolve the case responsibly.
The parties have
exchanged thousands of pages of documents, including tip sheets,
pay stubs, schedules, personnel files,
employee handbooks and tax
Additionally, the parties engaged
in an hours-long mediation with an experienced, neutral, thirdparty mediator before reaching their settlement (Rumack Deel.
This factor further weighs in favor of preliminarily
finding the settlement fair,
adequate and reasonable.
in v. AllianceBernstein, L.P.,
4713553 at *2
09 Civ. 5904
(S.D.N.Y. Aug. 27, 2013)
E*TRADE Fin. Corp., 10 Civ. 4030
*1 (S.D.N.Y. Mar. 12, 2012)
(JPO), 2013 WL
(Oetken, D.J.); Palacio v.
(RJH) (DCF), 2012 WL 1058409 at
Third, plaintiffs would face real risks with respect to
establishing liability and damages, as well as maintaining the
if the case proceeded to trial.
potentially strong defenses to plaintiffs' allegation that
defendants misappropriated plaintiffs' tips.
plaintiffs alleged that five individuals were not entitled to
participate in the tip pool, defendants have provided information
indicating that four of these individuals could legally participate in the tip pool
(Pl. 's Mem., at 13).
dants contend that their actions were not willful
(Pl. 's Mem., at
Further, if this case were to continue to trial, defendants
would likely contend that class certification would be inappropriate because determining liability and damages would require
individual determinations for each putative class member
Mem., at 11-12).
Fourth, defendants' ability to satisfy a greater
judgment is unclear.
"Even if [defendants]
a greater judgment, a
'defendant's ability to withstand a greater
could have withstood
judgment, standing alone, does not suggest that the settlement is
(Ellis, M.J.), quoting Frank v. Eastman Kodak Co., 228
F.R.D. 174, 186 (W.D.N.Y. 2005).
Fifth, the settlement fund represents a substantial
percentage of plaintiffs' best possible recovery; given the risks
of litigation, the amount of the settlement weighs in favor of
approving the settlement.
Plaintiffs' counsel has calculated
that the putative class is owed at least $375,000.00 in misappropriated tips
22), and the total settlement amount
After deducting the service awards and attor-
fees and costs, class members will receive approximately
50% of their claimed misappropriated tips.
In light of the risks
of litigation, this recovery weighs in favor of approving the
2015 WL 588656 at *6
Domino's Pizza, LLC, No.
(E.D.N.Y. Jan. 16, 2015)
(Report & Recommen-
(" [T] he question [in assessing the fairness of a class
action settlement] is not whether the settlement represents the
highest recovery possible .
. but whether it represents a
reasonable one in light of the many uncertainties the class
" (internal quotation marks omitted)), adopted sub
nom . .Qy, Bodon v. Domino's Pizza,
Inc., 2015 WL 588680
Feb. 11, 2015); Massiah v. MetroPlus Health Plan,
cv-05669 (BMC), 2012 WL 5874655 at *5
Inc., No. 11-
(E.D.N.Y. Nov. 20, 2012)
("[W]hen a settlement assures immediate payment of substantial
amounts to class members, even if it means sacrificing speculative payment of a hypothetically larger amount years down the
road, settlement is reasonable
" (internal quotation marks
omitted; assessing fairness of class action settlement)).
Finally, the Settlement Agreement was reached after
arm's-length negotiations between counsel, which included an
hours-long mediation before a neutral, third-party mediator
In light of counsels' experience and
conduct in this action, I have no reason to doubt that the terms
of the Settlement Agreement are fair,
reasonable and adequate.
Although plaintiffs do not apply at this time for attorneys' fees and costs, the claims administrator's costs or the
service awards to the named plaintiffs, such items are routinely
approved in this Circuit.
Lizondro-Garcia v. Kefi LLC, supra,
300 F.R.D. at 180; see Chavarria v. New York Airport Serv., LLC,
875 F. Supp. 2d 164, 177-79 (E.D.N.Y. 2012); Morris v. Affinity
Health Plan, Inc., supra, 859 F. Supp. 2d at 622-24.
Accordingly, plaintiffs' motion for preliminary approval of the Settlement Agreement is granted.
Plaintiffs' Proposed Notice
Plaintiffs also seek approval of the revised Proposed
Notice accompanying their motion (Rumack Letter, Ex. B) . 7
ant to the Settlement Agreement, the settlement claims administrator will mail the Proposed Notice to each class member's last
known address by first-class mail
2. 4 (B)).
(Rumack Letter, Ex. A§§ 1.9,
Additionally, if notices to any class members are
returned as undeliverable, the claims administrator "shall take
reasonable steps to obtain the correct address of such Class
Member, including one skip trace, and shall attempt a re-mailing
provided it obtains a more recent address"
(Rumack Letter, Ex. A
2. 4 (C))
"Where, as here, the parties seek simultaneously to
certify a settlement class and to settle a class action, the
elements of Rule 23(c) notice (for class certification) are
combined with the elements of Rule 23(e) notice
or dismissal) . "
In re Global Crossing Sec. & ERISA Litig., 225
(Lynch, then D.J., now Cir. J.);
Counsel revised the Proposed Notice after I had a conference call with all counsel on August 15, 2017.
accord Gatto v.
2014 WL 7338721 at *3
JPMorgan Chase & Co.,
7 9 61
2 0 14 WL 12 2 4 6 6 6 at * 1 7
Pursuant to Rule 23 (c) (2) (B),
( S . D . N . Y . Mar . 2 4 ,
In re Citigroup Inc.
[be provided with]
practicable under the circumstances,
2 0 14 )
"the court must direct
the best notice that is
including individual notice
to all members who can be identified through reasonable effort."
("The court must direct notice in a
reasonable manner to all class members who would be bound by the
proposal. ") .
The notice must describe:
(i) the nature of the action; (ii) the definition of
the class certified; (iii) the class claims, issues, or
defenses; (iv) that a class member may enter an appearance through an attorney if the member so desires; (v)
that the court will exclude from the class any member
who requests exclusion; (vi) the time and manner for
requesting exclusion; and (vii) the binding effect of a
class judgment on members under Rule 23 (c) (3)
Fed. R. Ci v. P.
2 3 ( c) ( 2) ( B) .
I conclude that the process described by counsel for
providing notice to the class comports with Rule 23 (c) (2) (B).
As to the form and content of the Proposed Notice,
find that a majority of the Rule 23 (c) (2) (B)
However, plaintiffs are directed to make the follow-
ing additional modifications to the Proposed Notice.
First, a bullet point should be added under the section
entitled "IMPORTANT DEADLINES" setting out the last date on which
a claim can be filed.
Second, the section entitled "DISMISSAL OF THE CASE AND
RELEASE OF CLAIMS" must be revised.
Section 4.l(A) of the
Settlement Agreement provides that "each individual Class Member,
who does not timely opt-out pursuant to this Agreement," will
release defendants and the other releasees "from all wage and
hour claims asserted, or wage and hour claims that could have
been asserted, under federal or state laws"
§ 4. 1 (A)
(emphasis added) ) . 8
(Rumack Letter, Ex. A
However, the Proposed Notice cur-
rently states that only those class members who submit a claim
form and cash their checks will release their FLSA claims.
Proposed Notice is ambiguous on the claims class members who do
not submit a claim form would release; while the first paragraph
states that "all Class Members will fully release and discharge
Defendants from any wage or hour claims and/or state or local
While the second paragraph of the release specifically
provides that those class members who submit a claim form will
release their FLSA claims (Rumack Letter, Ex. A§ 4.l(A)), the
language of the first paragraph, quoted above, is broad enough to
cover those class members who do not submit a claim form (Rumack
Letter, Ex. A§ 1. 7 (defining "Class Members")).
wage and hour laws," the second paragraph states that "Class
Members that do not submit a claim form will still release their
NYLL claims against Defendants."
The Proposed Notice must be
revised to match the Settlement Agreement and consistently
provide that all class members who do not opt out, even those who
do not submit a claim form, will release claims under both the
FLSA and NYLL.
Third, I direct that the first bullet point under the
second paragraph of the section entitled "HOW WILL MY SHARE BE
CALCULATED IF I PARTICIPATE?" be revised to correctly state
per Section 3.5(A) of the Settlement Agreement -- that "[e]ach
Class Member will be assigned one point for each week worked at
Nello from August 19, 2009 through July 28, 2017, the date the
settlement agreement was signed."
This section should also
explain that no class member who timely and validly submits a
claim form will receive less than $100.00.
I direct that the second paragraph of the
section entitled "UNCASHED CHECKS" be revised to correctly state
-- per Section 4.l(A) of the Settlement Agreement -- that an
Authorized Claimant's "release of all FLSA and NYLL claims will
still be effective" if the Authorized Claimant does not cash his
or her settlement check.
motion is granted.
for all the foregoing reasons, plaintiffs'
It is hereby ORDERED that:
The proposed class is conditionally certified
pursuant to Rule 23 (a)
and (b) (3).
Dino Tito, Anastasia Mayfat, Ciprian Grosu and Luis
Lopez are appointed class representatives and the Klein
is appointed class counsel.
The Settlement Agreement is approved prelimi-
Counsel shall submit a proposed revised notice
to class members to my chambers no later than September
Within 15 days of the date of this Order,
defendants will provide the settlement claims administrator and plaintiffs' counsel with a list,
dates of employment and (4)
( 1) names,
last known adsocial secu-
rity numbers of each class member.
Within 40 days of the final approval of the
notice to class members, the settlement claims administrator shall mail, via first class mail, the revised
notice to the members of the class using each individual's last known address.
Class members will have 45 days from the date
the revised notice is mailed to file a claim form,
out of the settlement or file written objections.
The Court shall hold a fairness hearing on
January 19, 2018 at 10:00 a.m. at the United States
District Court for the Southern District of New York,
500 Pearl Street, Courtroom 18-A, New York, New York
No later than January 3, 2018, counsel for
plaintiffs shall move and file a memorandum of law in
support of final approval of the Settlement Agreement,
an award of attorneys'
fees and costs and service
The Clerk of the Court is respectfully re-
quested to close Docket Items 58 and 66.
New York, New York
September 1, 2017
United States Magistrate Judge
Copies transmitted to:
All Counsel of Record