United States District Court, D. Maryland, Southern Division
XINIS, UNITED STATES DISTRICT JUDGE
Carlos Yanes (Plaintiff) and Defendants ACCEL Heating and
Cooling, LLC and Edward Riley, Jr., (collectively,
“Defendants”), jointly move for approval of a
settlement agreement. Plaintiff filed this action alleging
that Defendants denied him overtime pay 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. 1.
Court has reviewed the Amended Complaint (ECF No. 14), the
parties' Joint Motion for Approval of Settlement
Agreement, and the Settlement Agreement and Release. ECF No.
18. For the reasons explained below, the Court finds that
bona fide disputes exist under the FLSA, the
settlement agreement is a fair and reasonable compromise of
the disputes, and the attorney's fees are reasonable.
See Lynn's Food Stores, Inc. v. United States,
679 F.2d 1350, 1355 (11th Cir. 1982); Leigh v. Bottling
Group, LLC, No. DKC 10-0218, 2012 WL 460468, at * 4 (D.
Md. Feb. 10, 2012); Lopez v. NTI, LLC, 748 F.Supp.2d
471, 478 (D. Md. 2010). Therefore, the Court will GRANT the
motion and instruct the clerk to close this case.
Yanes worked for Defendants as a helper and technician from
March 2009 to February 2015. Plaintiff was paid an hourly
wage during that time. ECF No. 14 at ¶¶ 24-25.
Plaintiff alleges that he was denied overtime wages during
this time period for hours worked in excess of forty hours
per work week. Id. ¶ 39.
filed his initial Complaint on July 14, 2016, styled as a
class action. Plaintiff then amended his complaint on
September 23, 2016 to proceed on his own behalf only. The
parties engaged in early and fruitful settlement
negotiations. ECF No. 18. On December 15, 2016, the parties
submitted the Joint Motion for Settlement Approval.
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, 30 F.Supp.3d 404, 407 (D. Md. 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 (emphasis added). To
do so, courts examine whether there are FLSA issues actually
in dispute, the fairness and reasonableness of the
settlement, and the reasonableness of the attorney's
fees. Duprey, 30 F.Supp.3d at 408 (internal
citations omitted). “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. See Lomascolo v. Parsons
Brinkernoff, Inc., No. 1:08cv1310 (AJT/JFA), 2009 WL
3094955, at *10 (E.D. Va. Sept. 28, 2009). Here, the
defendants expressly denied liability in response to
Plaintiff's Amended Complaint and make no admissions of
liability. Whether Plaintiff is entitled to overtime wages as
a covered employee under the FLSA is a fact-specific inquiry
that is frequently at the heart of FLSA litigation. See,
e.g., Schultz v. Capital Int'l Sec., Inc.,
466 F.3d 298 (4th Cir. 2006). The Court further notes that
the parties engaged in extensive settlement negotiations
where both sides vigorously contested the merits of the
claims. Accordingly, this factor is satisfied.
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 ...