Navarro Zavala et al v. Trece Corp. et al
Filing
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ORDER: Accordingly, the Court accepts the multiplier of 1.7 and determines $11,288 in attorneys' fees to be reasonable under the circumstances. The requested costs of $1272 are also reasonable. With respect to Navarro Zavala's o bligations under the Agreement, they include no objectionable confidentiality provisions, and his release is appropriately limited to "claims in the Litigation that have occurred as of the Effective Date of this Agreement." Doc. 52 Ex. 1 § 2; see Nights of Cabiria, 96 F. Supp. 3d at 177-81. Accordingly, the parties' request for approval of the Agreement is GRANTED. The Clerk of Court is respectfully directed to terminate the motion, Doc. 52, and close the case. It is S O ORDERED. Motions terminated: 52 FOURTH LETTER MOTION to Adjourn Conference on Consent/Settlement Fairness Motion addressed to Judge Edgardo Ramos from Michael Faillace, Esq. dated February 11, 2020. filed by Claudio Navarro Zavala. (Signed by Judge Edgardo Ramos on 2/13/2020) (ks)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
CLAUDIO NAVARRO ZAVALA, individually
and on behalfofothers similarly situated,
Plaintiff,
-against-
ORDER
TRECE CORP., doing business as Trece Mexican
Restaurant, 54 EAST ENTERTAINMENT MGT
INC. doing business as Trece Mexican Restaurant,
and JOEL LIM,
18 Civ. 1382 (ER)
Defendants.
RAMOS, D.J.:
Claudio Navarro Zavala brought this action in February 2018 against Trece Corp.,54
East Entertainment MGT,Inc. and Joel Lim,for unpaid overtime wages under the Fair Labor
Standards Act ("FLSA") and New York Labor Law ("NYLL"); violation of minimum wage
provisions under FLSA and NYLL; violation of notice,recordkeeping,and wage statement
requirements under the NYLL; and umeimbursed equipment costs under the FLSA and NYLL.
Compl.,Doc. 1. Pending before the Court is the parties' application for court approval of their
Settlement Agreement. Doc. 52.
In this Circuit,parties cannot privately settle FLSA claims with prejudice absent the
approval of the district court or the Department of Labor. Cheeks v. Freeport Pancake House,
Inc., 796 F.3d 199,200 (2d Cir. 2015). The parties therefore must satisfy the Court that their
agreement is "fair and reasonable." Beckert v. Ronirubinov, No. 15 Civ. 1951 (PAE),2015 WL
8773460,at * 1 (S.D.N.Y Dec. 14,2015). "In determining whether the proposed settlement is
fair and reasonable,a court should consider the totality of circumstances,including but not
limited to the following factors: (1) the plaintiff's range of possible recovery; (2) the extent to
which 'the settlement will enable the parties to avoid anticipated burdens and expenses in
establishing their respective claims and defenses'; (3) the seriousness of the litigation risks faced
by the parties; (4) whether 'the settlement agreement is the product of arm's-length bargaining
between experienced counsel'; and (5) the possibility of fraud or collusion." Id. (quoting
Wolinsky v. Scholastic Inc., 900 F. Supp. 2d 332, 335 (S.D.N.Y. 2012)). Courts may reject a
proposed FLSA settlement where the parties do not provide the basis for the recovery figure or
documentation supporting the reasonableness of the attorneys' fees, or the settlement agreement
includes impermissible provisions such as restrictive confidentiality clauses or overbroad
releases. Lopez v. Nights of Cabiria, LLC, 96 F. Supp. 3d 170, 176-82 (S.D.N.Y. 2015), cited
with approval in Cheeks, 796 F.3d at 205-06.
Here, Navarro Zavala has calculated that he worked just over 11,600 hours from
December 2013 to December 2017. Doc. 52 Ex. 2. Navarro Zavala alleges that the defendants
failed to pay him at the overtime rate of 1.5 times his regular wage for any of his overtime hours.
He also claims liquidated damages, penalties, and unreimbursed costs. Navarro Zavala estimates
that, "if he had recovered in full for his claims," he would recover about $196,500 in damages,
penalties, and interest. The defendants have produced records that may dispute the amount of
hours Navarro Zavala claims he work, and the two corporate defendants have filed for
bankruptcy, potentially complicating collection on a judgment. Following a mediation in
October 2019, the parties agreed to settle Navarro Zavala's claims for a total of $37,500. Of that
amount, Navarro Zavala would receive $25,000 after attorneys' fees and costs. In light of the
parties' submissions and the risks and costs of litigating these issues to trial, the Court concludes
that the parties' proposed settlement amount of $37,500 is fair and reasonable under the
circumstances. See Garcia v. Good for Life by 81, Inc., No. 17 Civ. 07228 (BCM), 2018 WL
3559171, at *2 (S.D.N.Y. July 12, 2018) (concluding that the settlement amount reflected a
"reasonable compromise of disputed issues").
As noted, Navarro Zavala states that he would receive $25,000 from the settlement fund,
and his counsel would receive $12,500, which represents one-third of the total settlement
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amount. 1 "[C]ourts in this District routinely award one third of a settlement fund as a reasonable
fee in FLSA cases. Nonetheless, even when the proposed fees do not exceed one third of the
total settlement amount, courts in this circuit use the lodestar method as a cross check to ensure
the reasonableness of attorneys' fees." Lazo v. Kim s Nails at York Ave., Inc., No. 17 Civ. 3302
(AJN), 2019 WL 95638, at *2 (S.D.N.Y Jan. 2, 2019) (citation omitted).
"The lodestar amount is 'the product of a reasonable hourly rate and the reasonable
number of hours required by the case."' Id. (quoting Gaia House Mezz LLC v. State St. Bank &
Tr. Co., No. 11 Civ. 3186, 2014 WL 3955178, at *1 (S.D.N.Y. Aug. 13, 2014)). Here, Navarro
Zavala has submitted the billing records for two of his attorneys, managing member Michael
Faillace, who bills at $450 per hour, and associate Jesse Barton, who bills at $375 per hour. See
Doc. 52 at 3, Ex. 3. Although the attorneys' rates "are on the high end of what is typical in FLSA
cases," Lopez v. Ploy Dee, Inc., No. 15 Civ. 647 (AJN), 2016 WL 1626631, at *4 (S.D.N.Y. Apr.
21, 2016), they are within the range of reasonable hourly rates for similarly experienced
attorneys, see Rodriguez v. 3551 Realty Co., No. 17 Civ. 6553, 2017 WL 5054728, at *3
(S.D.N.Y Nov. 2, 2017) (stating that although hourly rates of $450 for partners and $350 for
associates "are somewhat higher than the presumptively reasonable rates in this District, they are
not beyond the pale"); Redzepagic v. Hammer, No. 14 Civ. 9808 (ER), 2017 WL 1951865, at *2
n.2 (S.D.N.Y May 8, 2017) (approving rate of $500 per hour for a named partner). These rates,
and the 16.4 hours of work reasonably spent on this case, yield a lodestar of $6528. Costs total
$1272.
The lodestar of $6428, compared to the requested $11,228 of the settlement net of costs,
results in a lodestar multiplier (net of fees) of approximately 1.7. "[A] multiplier near 2 should,
in most cases, be sufficient compensation for the risk associated with contingent fees in FLSA
cases." Fujiwara v. Sushi Yasuda Ltd., 58 F. Supp. 3d 424, 439 (S.D.N.Y. 2014). Accordingly,
1 "[W]hen assessing the reasonableness of an attorney's fee on the basis of its percentage of the settlement, it is
fairer to look to the percentage of the settlement net ofcosts." Montalvo v. Arkar Inc., No. 17 Civ. 6693 (AJN),
2018 WL2186415, at *2 (S.D.N.Y. May 10, 2018) (emphasis added).
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the Court accepts the multiplier of 1.7 and determines $11,288 in attorneys' fees to be reasonable
under the circumstances. The requested costs of $1272 are also reasonable.
With respect to Navarro Zavala's obligations under the Agreement, they include no
objectionable confidentiality provisions, and his release is appropriately limited to "claims in the
Litigation that have occurred as of the Effective Date of this Agreement." Doc. 52 Ex. 1 ยง 2; see
Nights of Cabiria, 96 F. Supp. 3d at 177-81.
Accordingly, the parties' request for approval of the Agreement is GRANTED. The Clerk
of Court is respectfully directed to terminate the motion, Doc. 52, and close the case.
It is SO ORDERED.
Dated:
February 13, 2020
New York, New York
EDGARDO RAMOS, U.S.D.J.
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