Davis v. Capital One Home Loans, LLC et al

Filing 127

MEMORANDUM OPINION AND ORDER denying 124 (Document Restricted) Joint Consent Motion for Leave to File Under Seal (Sealed pursuant to motion to seal). The court declines to rule on the parties' 125 motion for approval of the settlement agr eement, however, until the court has considered and acted upon the parties' response to this memorandum opinion and order. The parties are ORDERED to file their response, stating whether they continue to request approval of the settlement agreement, by no later than 6/3/2020. (Ordered by Senior Judge A. Joe Fish on 5/20/2020) (aaa)

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UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION

JEFFREY DAVIS, on Behalf of Himself
and All Others Similarly Situated,
Plaintiffs,
VS.
CAPITAL ONE HOME LOANS, LLC,
ET AL.,
Defendants.

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CIVIL ACTION NO.
3:17-CV-3236-G

MEMORANDUM OPINION AND ORDER
Before the court are the parties’ consent motion for leave to file under seal
(“Motion for Leave”) (docket entry 124) and joint motion for approval of
confidential settlement agreement and release (“Motion for Approval”) (docket entry
125). For the reasons set forth below, the motion for leave is DENIED, and the
parties are ORDERED to advise the court within 14 days whether they continue to
request approval of their settlement agreement.
I. BACKGROUND
This case arises from the defendants’ Capital One Home Loans, LLC and
Capital One National Association (collectively “Capital One”) alleged failure to pay
the named plaintiff Jeffrey Davis (“Davis”) and similarly situated Capital One

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employees minimum wage and overtime pay, in violation of the Fair Labor Standards
Act (“FLSA”).
A full statement of the factual and procedural background of this case can be
found in the court’s August 2, 2018 memorandum opinion and order. See
Memorandum Opinion and Order (docket entry 67) at 2-4. To address the parties’
motion for leave and motion for approval, the court need only summarize the factual
and procedural background relevant to these motions.
On November 28, 2017, Davis filed his original complaint on behalf of
himself and all others similarly situated, alleging a single claim against Capital One
for violation of the FLSA. Plaintiff’s Original Complaint (“Complaint”) (docket
entry 1) at 10. Davis was employed by Capital One as a mortgage loan officer from
approximately November 2014 through October 2015. Id. at 3. The crux of the
plaintiffs’ FLSA claim is that Capital One failed to pay Davis and other similarly
situated loan officers and loan originators minimum wage and overtime wages for
hours worked in excess of forty hours per week.
During and following a mediation session on February 4, 2020, the parties
reached a settlement agreement. On March 19, 2020, the parties filed their motion
for approval, seeking the court’s approval of the settlement agreement, as required by
law.1 See Memorandum in Support of Joint Motion for Approval of Confidential

1

Under Section 216(b) of the FLSA, “[w]hen employees bring a private
action for back wages under the FLSA, and present to the district court a proposed
settlement, the district court may enter a stipulated judgment after scrutinizing the
settlement for fairness.” Lynn’s Food Stores, Inc. v. United States, 679 F.2d 1350, 1353
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Settlement Agreement and General Release (docket entry 126) at 2. Also on March
19, 2020, the parties filed their motion for leave, seeking the court’s leave to file
their settlement agreement under seal. See Motion for Leave. Neither motion is
opposed, and both are ripe for determination.
II. ANALYSIS
By their motion for leave and motion to approve, the parties seek leave to file
their settlement agreement under seal, approval of their settlement agreement, and
dismissal of this case. The court considers the motions in turn.
A. Motion for Leave to File an FLSA Settlement Agreement Under Seal
When the parties to an FLSA wage-settlement case submit a settlement
agreement for the court’s approval, “there is a strong presumption in favor of keeping
the settlement agreement[] . . . unsealed and available for public review. The public’s
interest in accessing the settlement agreement, including the settlement amount,
often outweighs any interest in confidentiality.” Parrish v. Defender Security Company,
No. 3:10-CV-2604-D, 2013 WL 372940, at *1 (N.D. Tex. Jan. 31, 2013)
(Fitzwater, C.J.) (quoting Rodriguez v. El Polio Regio, Inc., 2012 WL 5506130, at *1
(N.D. Tex. Feb. 23, 2012) (Fitzwater, C.J.)). “The overwhelming consensus of
district courts that have considered the issue hold that an FLSA settlement cannot be
sealed absent some showing that overcomes the presumption of public access.” Id.
(citing Rodriguez, 2012 WL 5506130, at *1) (brackets omitted); see also Weismantle

(11th Cir. 1982).
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v. Jali, No. 2:13-CV-01087, 2015 WL 1866190, at *2 (W.D. Pa. Apr. 23, 2015)
(“[A]bsent something very special in a very specific case which generates a very good
reason above and beyond the desire of the parties to keep the terms of an FLSA
settlement out of the public’s view, if the parties want the [c]ourt to approve the
substance of an FLSA settlement agreement, it cannot be filed under seal.”); Parrish,
2013 WL 372940, at *1 (citing Stalnaker v. Novar Corporation, 293 F.Supp. 2d 1260,
1264 (M.D. Ala. 2003)) (citing with approval Stalnaker’s “listing [of] trade secrets,
identity of informants, privacy of children, or scandalous or libelous information as
compelling reasons to seal settlement agreements”).
Here, the parties do not point to any case in which a court granted leave to file
an agreement to settle FLSA claims under seal. The parties assert, however, that the
agreement should be filed under seal because:
(1) confidentiality is a material term of the Agreement
without which settlement may not have been possible; (2)
public disclosure of the terms of the Agreement may harm
Defendants by encouraging other lawsuits; (3) the individual
facts of this case were significant in settlement negotiations
and keeping the terms of the Agreement confidential will
allow settlement negotiations in similar cases to focus on the
merits of each individual case; (4) unsealing the Agreement
and revealing its terms may chill the efforts of future litigants
to settle FLSA claims; (5) sealing protects the privacy
interests of the Parties; (6) the non-FLSA claims addressed
do not require Court approval and would otherwise remain
private; and (7) sealing the Agreement, consistent with the
Parties’ wishes, facilitates the early resolution of the Parties’
dispute and conserves judicial resources.2

2

The court notes that the parties’ sixth proffered reason why the
settlement agreement should be filed under seal appears to be a typographical error
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Memorandum in Support of Consent Motion for Leave to File Under Seal
(“Memorandum in Support”) (docket entry 124-1) at 3-4. The court concludes that
none of the parties’ assertions present a “very special” circumstances “which
generates a very good reason above and beyond the desire of the parties to keep the
terms of an FLSA settlement out of the public’s view.” See Weismantle, 2015 WL
1866190, at *2. Rather, the parties’ asserted reasons to seal the settlement
agreement appear “more akin to a business’s general interest in keeping its legal
proceedings private, and [are thus] insufficient to overcome the presumption of
public access.” Parrish, 2013 WL 372940, at *1 (citation and internal brackets
omitted); see also Weismantle, 2015 WL 1866190, at *2 (denying motion for leave to
file FLSA settlement agreement under seal where the “reasons articulated for sealing
the settlement agreement . . . boil[ed] down to a recitation of the parties’ desire that
the public not know their financial business, coupled with a contention that there is
no public interest to be served by the disclosure of the” agreement).
Accordingly, the parties’ motion for leave to file their settlement agreement
under seal is denied.
B. Motion for Approval of FLSA Settlement Agreement
Under section 216(b) of the FLSA, “when employees bring a private action for
back wages under the FLSA, and present to the district court a proposed settlement,

or the product of a copy-and-paste job gone awry, as the plaintiffs in this case have
not asserted any “non-FLSA claims.” See Complaint.
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the district court may enter a stipulated judgment after scrutinizing the settlement
for fairness.” Diaz v. Panhandle Maintenance, LLC, No. 2:18-CV-097-Z, 2020 WL
587644, at *2 (N.D. Tex. Feb. 6, 2020) (Kacsmaryk, J.) (quoting Lynn’s Food Stores,
679 F.2d at 1353). In approving a proposed settlement agreement that compromises
FLSA claims, courts consider two primary factors: “(1) [whether] the settlement
resolves a bona fide dispute over FLSA provisions, and (2) [whether] the resolution is
fair and reasonable.” Id. (citing Lee v. Metrocare Services, 3:13-CV-2349-O, 2015 WL
13729679, at *3 (N.D. Tex. July 1, 2015) (O’Connor, J.)).
Here, upon review of the pleadings, motions, and settlement agreement in this
case, the court concludes that the settlement agreement appears to resolve a bona
fide dispute over FLSA provisions between the parties, and that the agreement is
neither unfair nor unreasonable. The court is therefore inclined to approve the terms
of the agreement and to dismiss this lawsuit with prejudice. The parties, however,
maintain that “confidentiality is a material term of the [a]greement without which
settlement may not have been possible.” Memorandum in Support at 3.
Accordingly, the parties are ordered to advise the court in writing within 14 days
from the date of this memorandum opinion and order “whether they continue to
request approval of the settlement, with the understanding that the settlement will
be approved, but the settlement agreement will be unsealed. The settlement
agreement will remain sealed until the court has considered and acted upon the
parties’ response.” See Parrish, 2013 WL 372940, at *2.

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III. CONCLUSION
In accordance with the foregoing, the parties’ motion for leave to file their
settlement agreement under seal (docket entry 124) is DENIED. The court declines
to rule on the parties’ motion for approval of the settlement agreement (docket entry
125), however, until the court has considered and acted upon the parties’ response to
this memorandum opinion and order. The parties are ORDERED to file their
response, stating whether they continue to request approval of the settlement
agreement, by no later than June 3, 2020 (14 days from the date of this
memorandum opinion and order).
SO ORDERED.

May 20, 2020.
________________________________
A. JOE FISH
Senior United States District Judge

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