Hane v. On Time Securing, Inc.

Filing 63

Memorandum Opinion and Order: The Court approves the settlement and directs that the Confidential Settlement Agreement and Release supplied in camera to the Court be filed under seal as an attachment to this Memorandum Opinion and Orde r. The claims in plaintiff's complaint are dismissed with prejudice, and this case is closed. The Court retains jurisdiction over this action to enforce the terms of the settlement. (Related Doc. Nos. 59 , 62 ). Judge Sara Lioi on 8/28/2018. (Attachments: # 1 Confidential Settlement Agreement and Release)(P,J)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION

CHRISTOPHER HANE, on behalf of
himself and others similarly situated,
PLAINTIFF,
vs.
ON TIME SECURING, INC., et al.,
DEFENDANTS.

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CASE NO. 5:16-cv-2002

JUDGE SARA LIOI
MEMORANDUM OPINION
AND ORDER

On May 29, 2018, the parties and counsel participated in a status conference with the Court,
during which they reached a settlement resolving plaintiff’s claim under the Fair Labor Standards
Act (“FLSA”), 29 U.S.C. §§ 201, et seq. (Minutes of Proceedings, dated 5-29-2018.) Now before
the Court is the parties’ joint Proposed Stipulated Order for Approval of Settlement and Dismissal
with Prejudice, (Doc. No. 59), supported by the Declaration of Hans A. Nilges, filed under seal
with leave of Court (Doc. No. 62). Because the Court finds that the settlement represents a fair
resolution of plaintiff’s FLSA claim, the Joint Motion is granted and the settlement is approved.
I. BACKGROUND
Plaintiff Christopher Hane filed a collective action complaint against defendant On Time
Securing, Inc. alleging that defendant violated the FLSA by failing to pay overtime to him and
other similarly-situated current and former hourly employees. (Doc. No. 1.) The complaint was
amended on December 22, 2016, adding two individual defendants (Doc. No. 21),1 one of whom

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Prior to the amendment of the complaint, the parties and counsel engaged in unsuccessful mediation with the assigned
magistrate judge.

was later voluntarily dismissed. (See Doc. No. 37.) In its answer, defendant2 denied that plaintiff
was entitled to any additional wages, and denied that it violated the FLSA. (Doc. No. 25.)
On February 10, 2017, the Court conducted a telephonic case management conference with
counsel for the parties, and discussed several issues, including a briefing schedule for certification
of a collective. Following briefing, on September 20, 2017, the Court granted plaintiff’s motion
for conditional certification of the collective. (See Doc. No. 43.) Thereafter, twenty-three (23)
parties opted in as members of the plaintiff collective.
On May 29, 2018, during a regularly-scheduled status conference attended by party
representatives and counsel, the parties reached a settlement. They now ask the Court to approve
their settlement.
II. APPLICABLE LAW
“Employees are guaranteed certain rights by the FLSA, and public policy requires that
these rights not be compromised by settlement.” Crawford v. Lexington-Fayette Urban Cty. Gov’t,
Civil Action No. 06-299-JBC, 2008 WL 4724499, at *2 (E.D. Ky. Oct. 23, 2008). “The central
purpose of the FLSA is to protect covered employees against labor conditions ‘detrimental to the
maintenance of the minimum standard of living necessary for health, efficiency, and general wellbeing of workers.’” Id. (quoting 29 U.S.C. § 202) (further citation omitted).
The provisions of the FLSA are mandatory and, except in two narrow circumstances, are
generally not subject to bargaining, waiver, or modification by contract or settlement. Brooklyn
Sav. Bank v. O’Neil, 324 U.S. 697, 706, 65 S. Ct. 895, 89 L. Ed. 1296 (1945); Lynn’s Food Stores,
Inc. v. United States, 679 F.2d 1350, 1353 (11th Cir. 1982). The first exception involves FLSA

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Although there are two defendants, the Court refers to them collectively in the singular.

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claims that are supervised by the Secretary of Labor pursuant to 29 U.S.C. § 216(c). Lynn’s Foods,
679 F.2d at 1353. The second exception, applicable here, encompasses instances where a federal
district court approves the settlement of a suit brought pursuant to § 16(b) of the FLSA. Id.
In reviewing the settlement of a plaintiff’s FLSA claims, the district court must “‘ensure
that the parties are not, via settlement of [the] claims, negotiating around the clear FLSA
requirements of compensation for all hours worked, minimum wages, maximum hours, and
overtime.’” Rotuna v. W. Customer Mgmt. Grp. LLC, No. 4:09CV1608, 2010 WL 2490989, at *5
(N.D. Ohio June 15, 2010) (quoting Collins v. Sanderson Farms, Inc., 568 F. Supp. 2d 714, 719
(E.D. La. 2000) (further citation omitted)). The existence of a bona fide dispute serves as a
guarantee that the parties have not manipulated the settlement process to permit the employer to
avoid its obligations under the FLSA. Id. (citing Crawford, 2008 WL 4724499, at *3). The Court
should also consider the following factors: the risk of fraud or collusion; the complexity, expense,
and likely duration of the litigation; the amount of discovery completed; the likelihood of success
on the merits; and, the public interest in settlement. Crawford, 2008 WL 4724499, at *3 (citing
Int’l Union, United Auto., Aerospace, and Agric. Implement Workers of Am. v. Gen. Motors Corp.,
497 F.3d 615, 631 (6th Cir. 2007)). Further, in collective actions, the Court should consider the
opinion of counsel and collective representatives and the reaction of absent collective members.
Id. Where the settlement agreement proposes an award of attorney’s fees, such fees must be
reasonable. See generally Reed v. Rhodes, 179 F.3d 453, 471 (6th Cir. 1999) (citing Blum v.
Stenson, 465 U.S. 886, 893, 104 S. Ct. 1541, 79 L. Ed. 2d 891 (1984)).

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III. ANALYSIS
At the outset, the Court finds that the divergent views of the facts and the law presented
bona fide disputes that, had the parties not reached settlement, would have necessitated resolution
by the Court and/or a jury.
Having reviewed the terms of the settlement, the Court finds that the settlement represents
a fair and reasonable resolution to bona fide disputes. Further, the Court notes that the settlement
was the result of arms-length negotiations between parties that were represented by able counsel.
As such, the Court finds no risk of fraud or collusion. Additionally, the Court finds that the award
of attorney’s fees to plaintiff’s counsel, which is supported by a declaration filed by counsel, is
reasonable, taking into consideration the course of proceeedings and the successful outcome on
behalf of the members of the collective. While the Court is not in a position to assess the likelihood
of success on the merits, the Court finds that the other relevant factors weigh in favor of approving
the settlement.
IV. CONCLUSION
For all of the foregoing reasons, the Court approves the settlement and directs that the
Confidential Settlement Agreement and Release supplied in camera to the Court be filed under
seal as an attachment to this Memorandum Opinion and Order. The claims in plaintiff’s complaint
are dismissed with prejudice, and this case is closed. The Court retains jurisdiction over this action
to enforce the terms of the settlement.
IT IS SO ORDERED.
Dated: August 28, 2018
HONORABLE SARA LIOI
UNITED STATES DISTRICT JUDGE

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