Davis et al v. T&T Express Shipping, LLC et al

Filing 67

ORDER: Accordingly, the parties' application for approval of the Agreement is DENIED WITHOUT PREJUDICE. No later than February 16, 2024, the parties shall file a revised settlement agreement with a revised Cheeks submission, as follows: 1. R evising the Mutual General Release or providing a written explanation as to why it is not unfair; and 2. Revising the Non-Disparagement Clause to include a carve-out for truthful statements. SO ORDERED. (Signed by Magistrate Judge Stewart D. Aaron on 2/6/2024) (va)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
Dawain Davis, et al.,

2/6/2024
Plaintiffs,

1:22-cv-01936 (SDA)

-against-

ORDER

T&T Express Shipping, LLC, et al.,
Defendants.
STEWART D. AARON, UNITED STATES MAGISTRATE JUDGE:
The Court has reviewed the parties’ joint letter, dated January 31, 2024 (Cheeks Letter,
ECF No. 66), seeking approval of their proposed Settlement Agreement and Release (the
“Agreement”) (Agmt., ECF No. 66-1). For the following reasons, the application is DENIED
WITHOUT PREJUDICE and subject to renewal in accordance with the provisions of this Order.
DISCUSSION
I.

Mutual General Release And Covenant Not To Sue (Paragraph 3)
Paragraph 3 of the Agreement provides for a mutual general release by and between the

Plaintiffs and the Defendants (the “Mutual General Release”). (Agmt. ¶ 3.) In their Cheeks Letter,
the parties represent to the Court that “Plaintiff’s release of claims is narrowly tailored.” (Cheeks
Ltr. at 5.) However, the language in the Agreement does not reflect a narrow tailoring. The
Mutual General Release provides, in relevant part:
In consideration of the promises and undertakings set forth in this Agreement,
Plaintiffs hereby unconditionally and irrevocably releases, waives, discharges and
gives up any and all claims that Plaintiffs have or may have against Defendants, its
past and present successors, assigns, affiliated entities, and their respective past
and present owners, directors, officers, managers, insurers, and attorneys,
included, but not limited to all named defendants in the Action (together
“Defendant Releasees”) of and from all debts, obligations, promises, covenants,

agreements, contracts, endorsements, bonds, controversies, suits, claims, or
causes known or unknown, suspected or unsuspected, of every kind and nature
from the beginning of the world to the date of this Agreement. Nothing in this
Paragraph 3 is intended to, or shall, interfere with Plaintiffs’ right to file a charge
with, or participate in a proceeding before, any federal, state or local agency
responsible for enforcing discrimination laws. Plaintiffs shall not, however, be
entitled to any monetary relief arising from or relating to any such charge or
proceeding, regardless of how the matter was initiated.
(Agmt. ¶ 3.)
The release of “any and all claims that Plaintiffs have or may have against Defendants”
(Cheeks Ltr. at 5) exceeds the issues in this action. “A number of judges in this District refuse to
approve any FLSA settlement unless the release provisions are ‘limited to the claims at issue in
this action.’” Weng v. T&W Restaurant, Inc., No. 15-CV-08167 (PAE) (BCM), 2016 WL 3566849, at
*5 (S.D.N.Y. June 22, 2016) (quoting Lazaro-Garcia v. Sengupta Food Servs., No. 15-CV-04259
(RA), 2015 WL 9162701, at *2 (S.D.N.Y. Dec. 15, 2015) (collecting cases)). Courts are reluctant to
approve settlement agreements with general releases unless there is some limiting factor in the
general release clause or a specific showing that the language “is not unfair.” Weng, 2016 WL
3566849, at *5.
Accordingly, the Court orders the parties to revise the Mutual General Release or provide
a written explanation as to why it is not unfair.
II.

Non-Disparagement Clause (Paragraph 6)
Paragraph 6 of the Agreement provides for a mutual non-disparagement by and between

the Plaintiffs and the Defendants (the “Non-Disparagement Clause”). (Agmt. ¶ 6.) The parties
represent to the Court that “the parties’ non-disparagement clause is . . . mutual and makes clear
that truthful statements about the nature of the case, the settlement of the case, and the parties’
experiences in litigating their claims and defenses, do not constitute disparagement.” (Cheeks
2

Ltr. at 5.) However, this representation is inconsistent with the language in the Agreement.
Paragraph 6 provides:
Plaintiffs and Defendants mutually agree to forbear from making, causing to be
made, publishing, ratifying or endorsing any and all disparaging remarks,
derogatory statements or comments made to any party with respect to either of
them. As used in this paragraph, the term “disparage” includes, without limitation,
comments or statements to the press or any individual or entity which could
adversely affect the parties’ personal or business reputation or interests, as well
as any statements or postings on any social media or other internet platforms
(including, but not limited to blogs, X (a/k/a Twitter), Facebook, LinkedIn,
Glassdoor, Indeed, Snapchat, Threads, Reddit, YouTube, Wikipedia, Tumblr,
TikTok and Instagram), or any statements on any reality or other television, video,
film or other program of any kind, which could adversely affect the parties’
personal or business reputations or interests. Nothing in this Agreement prevents
Plaintiffs or Defendants from responding truthfully to an inquiry from a court,
government entity or subpoena or as otherwise required by law.
(Agmt. ¶ 6.)
In this District, courts “routinely reject proposed settlement agreements that contain
non-disparagement clauses, as they ‘bar plaintiffs from openly discussing their experiences
litigating [their] wage-and-hour case[s]’ and ‘run afoul of the purposes of the FLSA and the
public’s independent interest in assuring that employees’ wages are fair.’” Rodriguez v. Taco Mix
LLC, No. 21-CV-03644 (ER), 2023 WL 5051898, at *3 (S.D.N.Y. July 5, 2023) (quoting Lopez v.
Nights of Cabiria, 96 F. Supp. 3d 170, 178 (S.D.N.Y. 2015) (quotation omitted)). While the NonDisparagement Clause provides a carve-out for the parties to respond truthfully to any inquiries
from a court or government entity, pursuant to a subpoena or as otherwise required by law, it
does not permit Plaintiffs to make truthful statements outside of such inquiries.
While the Court is cognizant that consideration for a settlement payment will not render
“every non-disparagement clause in an FLSA settlement [as] per se objectionable,” there still
must be room for free and open discussion for the parties to express their experience litigating
3

the applicable matter. Lopez, 96 F. Supp. 3d at 181. Thus, the Court will not approve the NonDisparagement Clause as currently written. See Alvarez v. Schnipper Restaurants LLC, No. No. 16CV-05779 (ER), 2019 WL 5682633, at *4 (S.D.N.Y. Nov. 1, 2019) (“Because the Settlement
Agreement contains a non-disclosure provision and because the non-disparagement clause at
issue here does not include a carve-out for truthful statements, the Court will not approve the
Agreement with the confidentiality clause as currently written.”); see also Rodriguez, 2023 WL
5051898, at *3 (rejecting second attempt by Bell Law Group, PLLC, to provide non-disparagement
provision in settlement agreement that did not provide necessary carveouts).
CONCLUSION
Accordingly, the parties’ application for approval of the Agreement is DENIED WITHOUT
PREJUDICE. No later than February 16, 2024, the parties shall file a revised settlement agreement
with a revised Cheeks submission, as follows:
1.

Revising the Mutual General Release or providing a written explanation as to why

it is not unfair; and
2.

Revising the Non-Disparagement Clause to include a carve-out for truthful

statements.
SO ORDERED.
DATED:

New York, New York
February 6, 2024
______________________________
STEWART D. AARON
United States Magistrate Judge

4