United States District Court, D. Maryland, Southern Division
TANGINKA C.L. GORHAM Plaintiff,
REGENCY MANAGEMENT SERVICES, LLC, et al. Defendants.
J. HAZEL United States District Judge.
Tanginka C.L. Gorham filed this action against her former
employer, Defendants Regency Management Services, LLC,
Regency Furniture, Inc., and Mid-Atlantic Warehouse Services,
Inc. (collectively, "Regency" or
"Defendants"), seeking damages and other relief for
Defendants' alleged failure to pay her overtime wages in
violation of the Fair Labor Standards Act ("FLSA"),
29 U.S.C. § 201 et seq., the Maryland Wage and
Hour Law ("MWHL"), Md. Code, Lab. & Empl.
Article ("LE") § 3-401 et seq., and
the Maryland Wage Payment and Collection Law
("MWPCL"), Md. Code, LE § 3-501 et
seq. ECF No. 2. The parties now jointly move for
approval of a settlement agreement. ECF Nos. 21 and 25. A
hearing is not necessary. See hoc. R. 105.6.
Court has reviewed the Amended Complaint, ECF No. 3,
Defendants' Answer, ECF No. 8, the Joint Motion for
Approval of Settlement Agreement, ECF No. 21, the
Supplemental Motion, ECF No. 25, and the Settlement Agreement
and Release, ECF Nos. 21 -1. For the reasons explained below,
the Court finds that bona fide disputes exist
regarding liability under the FLSA, the settlement agreement
is a fair and reasonable compromise of the disputes, and the
attorney's fees are reasonable. See Leigh v. Bottling
Group, LLC, 2012 WL 460468 at * 4 (D. Md. Feb. 10,
2012); Lopez v. NTI, LLC, 748 F.Supp.2d 471, 478 (D.
Md. 2010); Lynn's Food Stores, Inc. v. United
States, 679 F.2d 1350, 1355 (11th Cir. 1982). Therefore,
the Court will GRANT the motion and instruct the clerk to
close this case.
to the Amended Complaint, Defendants are corporate entities
that operate a for-profit furniture business. ECF No, 3
¶ 9. Plaintiff was employed by Defendants from
approximately May 12, 2005 until January 13, 2015, during
which time she worked at Defendants' Brandy wine
warehouse location, Id. ¶ 7. Beginning in
October 2012, Defendants instructed Plaintiff to work a
schedule of 50 hours or more per week and prior to this time
she also generally worked more than 40 hours per week.
Id. ¶ ¶ 22-23. Despite working in excess
of 40 hours per work week, Defendants failed to pay Plaintiff
any overtime premium for her overtime work. Id¶
25. When Plaintiff asked Defendants why she was not paid
overtime, she was told that "she was exempt and/or that
Defendants had a policy or practice of not paying
overtime." Id. ¶ 26-27.
removed this case, which was initially filed in the District
Court of Maryland for Prince George's County, Maryland,
to this Court on October 15, 2015 and filed Answers to the
Amended Complaint on October 22, 2015. ECF Nos. 8 and 11. The
parties conducted limited discovery. On May 18, 2016, the
parties filed a Joint Motion for Settlement Approval of
Settlement Agreement, ECF No. 21, which was later
supplemented at the Court's request, ECF No. 25.
FLSA does not permit settlement or compromise over alleged
FLSA violations except with (1) supervision by the Secretary
of Labor or (2) a judicial finding 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., 679 F.2d at 1354;
see also Lopez, 748 F.Supp.2d at 478 (explaining
that courts assess FLSA settlements for reasonableness).
These restrictions help carry out the purpose of the FLSA,
which was enacted "to protect workers from the poor
wages and long hours that can result from significant
inequalities in bargaining power between employers and
employees." Duprey v. Scotts Co. LLC, 2014 WL
2174751 at *2 (D. Md. May 23, 2014). Before approving an FLSA
settlement, courts must evaluate whether the "settlement
proposed by an employer and employees ... is a fair and
reasonable resolution of a bona fide dispute over
FLSA provisions." Lynn's Food Stores, Inc.,
679 F.2d at 1355 (italics not in original). To do so, courts
examine "(1) whether there are FLSA issues actually in
dispute, (2) the fairness and reasonableness of the
settlement in light of the relevant factors from Rule 23, and
(3) the reasonableness of the attorneys' fees, if
included in the agreement." Duprey, 30
F.Supp.3d at 408. "These factors are most likely to be
satisfied where there is an 'assurance of an adversarial
context' and the employee is 'represented by an
attorney who can protect [his] rights under the
statute."' Id. (citing Lynn's Food
Stores, Inc., 679 F.2d at 1354).
Bona Fide Dispute
determining whether a bona fide dispute over FLSA
liability exists, the Court reviews the pleadings, any
subsequent court filings, and the parties' recitals in
the proposed settlement. Lomascolo v. Parsons
Brinkernoff, Inc., 2009 WL 3094955 at *10 (E.D. Va.
Sept. 28, 2009). Here, while Plaintiffs claims are outlined
above, Defendants contend that Plaintiff met the requirements
for an administrative or executive exemption from overtime
while carrying the title of supervisor. ECF No. 25 at 3.
Plaintiff disputes this characterization and contends that
she was entitled to unpaid overtime. Id. Defendant
also contends that the statute of limitations would bar some
of Plaintiff s claims. Id. at 4. The Court finds
that these issues demonstrate that there was a bona
fide dispute over FLSA liability.
Fairness & Reasonableness
determining whether a settlement of FLSA claims is fair and
reasonable, the Court may consider the following:
(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 class counsel and class members after receiving notice of
the settlement whether expressed directly or through failure
to object; and (6) the probability of ...