United States District Court, D. Maryland, Southern Division
MEMORANDUM OPINION & ORDER
W. Grimm, United States District Judge
February 11, 2015, Plaintiff Dong Kim (“Mr. Kim”)
filed this action against his former employer, Confidental
Studio, Inc. (“Confidental”), and Raphael Choi
(“Mr. Choi”), seeking recovery for “unpaid
back wages, overtime pay, liquidated damages, pre and
post-judgment interest, treble damages, [and] reasonable
attorneys' fees and costs” under the Fair Labor
Standards Act (“FLSA”), 29 U.S.C. §§
201-219, the Maryland Wage and Hour Law (“MWHL”),
Md. Code Ann., Lab. & Empl. §§ 3-401 to 3-430,
and the Maryland Wage Payment and Collection Law
(“MWPCL”), Md. Code Ann., Lab. & Empl.
§§ 3-501 to 3-509. Compl. ¶ 8, ECF No. 1. On
July 17, 2017, the parties moved for court approval of a
jointly executed settlement agreement. Jt. Mot., ECF No. 54;
Settlement Agr., ECF No. 54-1. I find the net amount Mr. Kim
is to receive pursuant to the proposed Agreement to be fair
and reasonable in light of the facts of this case.
was employed by defendants, Confidental, a Maryland
corporation operating as a dental laboratory, and Mr. Choi,
Confidental's Chief Executive Officer, for approximately
three-and-a-half years during the period of August 2011 to
January 2015, as a dental technician.Plaintiff alleges that he and
others similarly situated were paid similar amounts, but
never received overtime compensation when working in excess
of 40 hours per week; Defendants deny these claims, asserting
Plaintiff was paid on a salary basis and did not work
overtime hours. Compl. ¶¶ 10-13; Jt. Mot.
¶¶ 1-5. On this basis, Mr. Kim filed a three-count
Complaint, seeking unpaid overtime wages, liquidated damages,
treble damages, attorneys' fees, and other various forms
of recovery. Compl. ¶ 8. He initially estimated his
unpaid wages at $58, 467.13, Damages Disc., ECF No. 10, but,
after discovery, asserts that he is owed $18, 085.60 in
unpaid wages, Jt. Mot. ¶ 4. Defendants deny both that
Mr. Kim worked overtime hours and that he is entitled to
overtime compensation, however have decided to discontinue
litigation to avoid incurring further expense. Jt. Mot.
The parties subsequently entered settlement negotiations in
June 2017 and filed their Joint Motion for Approval of
Settlement on July 17, 2017. Jt. Mot. ¶ 7.
Settlement Agreement provides that the Defendants will pay
Plaintiff a total of $55, 000.00 as compensation for alleged
overtime wages, liquidated damages, and attorneys' fees.
Settlement Agr. ¶ 7; Jt. Mot. ¶ 9. This figure is
further broken down such that (1) $30, 245.67 of the amount to
be paid will cover unpaid overtime wages and liquidated
damages, (2) $6, 054.33 will cover the costs of bringing this
action, and (3) the remaining $18, 700.00 will go to
Plaintiff's attorneys' fees. Jt. Mot. ¶ 10. A
detailed payment schedule is outlined within the Settlement
Agreement. Settlement Agr. 6-8. Additionally, the Agreement
contains both a specific and general waiver, which are
intended to release Defendants from any and all claims (that
can be lawfully released) that could have been brought in
this case or relate to Plaintiff's employment with
Defendants in any capacity. Settlement Agr. ¶ 2-3; Jt.
Mot. ¶ 21.
FLSA Settlement Generally
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. To that
end, the statute's provisions are mandatory and generally
are not subject to bargaining, waiver, or modification by
contract or settlement. See Brooklyn Sav. Bank v.
O'Neil, 324 U.S. 697, 706 (1945). Court-approved
settlement is an exception to that rule, “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.'” Saman v. LBDP, Inc., No.
DKC-12-1083, 2013 WL 2949047, at *2 (D. Md. June 13, 2013)
(quoting Lynn's Food Stores, Inc. v. United
States, 679 F.2d 1350, 1354 (11th Cir. 1982)).
the Fourth Circuit has not addressed the factors to be
considered in approving FLSA settlements, “district
courts in this circuit typically employ the considerations
set forth by the Eleventh Circuit in Lynn's Food
Stores.” Id. at *3 (citing Hoffman v.
First Student, Inc., No. WDQ-06-1882, 2010 WL 1176641,
at *2 (D. Md. Mar. 23, 2010); Lopez v. NTI, LLC, 748
F.Supp.2d 471, 478 (D. Md. 2010)). The settlement must
“reflect a fair and reasonable resolution of a
bona fide dispute over FLSA provisions, ”
which includes findings with regard to (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.
Id. (citing Lynn's Food Stores, 679
F.2d at 1355; Lomascolo v. Parsons Brinckerhoff,
Inc., No. 08-1310, 2009 WL 3094955, at *10 (E.D. Va.
Sept. 28, 2009); Lane v. Ko-Me, LLC, No.
DKC-10-2261, 2011 WL 3880427, at *2-3 (D. Md. Aug. 31,
2011)). 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.” Lynn's
Food Stores, 679 F.2d at 1354.
Bona Fide Dispute
deciding whether a bona fide dispute exists as to a
defendant's liability under the FLSA, courts examine the
pleadings in the case, along with the representations and
recitals in the proposed settlement agreement. See
Lomascolo, 2009 WL 3094955, at *16-17. The previous
filings as well as the contentions in the Joint Motion, make
clear that FLSA issues are in bona fide dispute.
Most importantly, the parties disagree about whether Mr. Kim
worked any overtime hours and, if he did, whether he is
entitled to compensation for them. Jt. Mot. ¶¶ 8,
11-12. Accordingly, bona fide disputes exist as to
liability and damages.
Fairness & Reasonableness
finding this settlement fair and reasonable, I should
evaluate several 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