United States District Court, D. Maryland
JOSE RUBIN RUIZ, et al.
CMT DESIGN BUILD, LLC
DEBORAH K. CHASANOW, United States District Judge
pending and ready for resolution in this Fair Labor Standards
Act (“FLSA”) case is a joint motion for approval
of a settlement agreement (the “Agreement”). (ECF
No. 13). The issues have been briefed, and the court now
rules, no hearing being deemed necessary. Local Rule 105.6.
Because the Agreement represents a fair and reasonable
resolution of a bona fide FLSA dispute, it will be
José Ruben Ruiz and Audi Ruben Ruiz (collectively,
“Plaintiffs”) allege that Defendant CMT Design
Build, LLC (“Defendant”) employed them as manual
laborers for five weeks but only paid them for one of those
weeks. Plaintiffs aver that they worked forty-five hours
during their first week and Defendant paid them $340.00. For
the next four weeks, they worked fifty-four, thirty-six,
forty-five, and eighteen hours, but they received no wages.
Plaintiffs contend that they are owed $1, 348.42 each in back
pay in addition to possible double or treble damages under
the FLSA and its Maryland equivalents. (ECF No. 13, at 4).
commenced this action by filing a complaint on April 5, 2016.
(ECF No. 1). The parties did not engage in discovery or
mediation, but they filed the pending motion for approval of
the Agreement on July 29, 2016. (ECF No. 13). The Agreement
provides that, upon court approval, Defendant will pay
Plaintiffs and their attorney $6, 741.21. (ECF No. 13-1
¶ B(1)). Plaintiffs are to receive $4, 741.32, to be
divided evenly between each plaintiff. (Id. ¶
B(1)(a)). Defendant, pursuant to the Agreement, does not
admit liability, but agrees to settle in order to avoid
further costs of litigation. (Id. at 1). In exchange
for the settlement amount, Plaintiffs agree to waive and
release all claims against Defendant. (Id. ¶
initial review of the pending motion, the undersigned issued
a memorandum opinion and order directing Plaintiffs to
supplement the record with information that would enable the
court to assess the reasonableness of the Agreement's
provisions regarding attorney's fees and costs. (ECF No.
14). Plaintiffs supplemented the motion by providing a
declaration from their counsel, Dennis A. Corkery. (ECF No.
15). The declaration includes: receipts for the filing fee
and cost of service; information regarding the qualifications
of counsel and his hourly rate; and itemized time records
from the Washington Lawyers' Committee for Civil Rights
and Urban Affairs.
Congress enacted the FLSA to protect workers from the poor
wages and long hours that can result from significant
inequalities in bargaining power between employers and
employees, the statute's provisions are mandatory and,
except in two narrow circumstances, are generally not subject
to bargaining, waiver, or modification by contract or
settlement. See Brooklyn Sav. Bank v. O'Neil,
324 U.S. 697, 706 (1945). Under the first exception, the
Secretary of Labor may supervise the payment of back wages to
employees, who waive their rights to seek liquidated damages
upon accepting the full amount of the wages owed.
See 29 U.S.C. § 216(c). Under the second
exception, a district court can approve a settlement between
an employer and an employee who has brought a private action
for unpaid wages, provided that the settlement reflects a
“reasonable compromise of disputed issues” rather
than “a mere waiver of statutory rights brought about
by an employer's overreaching.” Lynn's Food
Stores, Inc. v. United States, 679 F.2d 1350, 1354
(11th Cir. 1982); see also Duprey v. Scotts
Co. LLC, 30 F.Supp.3d 404, 407-08 (D.Md. 2014).
the United States Court of Appeals for the Fourth Circuit has
not directly addressed the factors to be considered in
deciding motions for approval of such settlements, district
courts in this circuit typically employ the considerations
set forth by the Eleventh Circuit in Lynn's Food
Stores. See, e.g., Duprey, 30
F.Supp.3d at 407-08; Lopez v. NTI, LLC, 748
F.Supp.2d 471, 478 (D.Md. 2010). Pursuant to Lynn's
Food Stores, an FLSA settlement generally should be
approved if it reflects “a fair and reasonable
resolution of a bona fide dispute over FLSA
provisions.” 679 F.2d at 1355. Thus, as a first step,
the bona fides of the parties' dispute must be
examined to determine if there are FLSA issues that are
“actually in dispute.” Lane v. Ko-Me,
LLC, No. DKC-10-2261, 2011 WL 3880427, at *2 (D.Md. Aug.
31, 2011) (citing Dees v. Hydradry, Inc., 706
F.Supp.2d 1227, 1241-42 (M.D.Fla. 2010)). Then, as a second
step, the terms of the proposed settlement agreement must be
assessed for fairness and reasonableness, which requires
weighing a number of factors, including: “(1) the
extent of discovery that has taken place; (2) the stage of
the proceedings, including the complexity, expense and likely
duration of the litigation; (3) the absence of fraud or
collusion in the settlement; (4) the experience of counsel
who have represented the plaintiffs; (5) the opinions of 
counsel . . .; and (6) the probability of plaintiffs'
success on the merits and the amount of the settlement in
relation to the potential recovery.” Lomascolo v.
Parsons Brinckerhoff, Inc., No. 08-cv-1310, 2009 WL
3094955, at *10 (E.D.Va. Sept. 28, 2009); see also
Duprey, 30 F.Supp.3d at 408 (citations and internal
quotation marks omitted).
Bona Fide Dispute and Fairness &
court previously found that the Agreement appeared to
represent a fair and reasonable resolution of a bona fide
FLSA dispute. (ECF No. 14). The pleadings and the
parties' representations in court filings establish that
a bona fide dispute exists as to Defendant's
liability to Plaintiffs for wage and overtime payments under
the FLSA. (Id. at 4-5). Upon review of the
parties' submissions and after considering the relevant
factors, see Duprey, 30 F.Supp.3d at 409, the
Agreement appears to be a fair and reasonable compromise of
the parties' bona fide dispute. (Id. at
Attorney's Fees and Costs
addition to assessing the reasonableness of the settlement
amount to be received by Plaintiffs, the court must assess
the reasonableness of the Agreement's provisions
regarding attorney's fees and costs. See 29
U.S.C. § 216(b). The awarding of attorney's fees to
Plaintiffs turns on application of the traditional lodestar
methodology factors. The starting point in the lodestar
calculation is multiplying the number of hours reasonably
expended by a reasonable hourly rate. Robinson v. Equifax
Info. Servs., LLC, 560 F.3d 235, 243 (4th
Cir. 2009). “An hourly rate is reasonable if it is
‘in line with those prevailing in the community for
similar services by lawyers of reasonably comparable skill,
experience, and reputation.'” Duprey, 30
F.Supp.3d at 412 (quoting Blum v. Stenson, 465 U.S.
886, 890 n.11 (1984)). This court has established
presumptively reasonable rates in Appendix B to its Local
Rules. See, e.g., id. (citing Poole ex
rel. Elliott v. Textron, Inc., 192 F.R.D. 494, 509
(D.Md. 2000)). In addition, the specific facts of the case
are to be considered in calculating a reasonable figure.
Agreement provides that - separate and apart from the
payments to Plaintiffs - Defendant will pay Plaintiffs'
counsel $2, 000.00 in attorney's fees and costs. This
includes $1, 540.00 in legal fees and $460.00 in filing and
service of process costs. A review of the billing ...