United States District Court, D. Maryland
Xinis United States District Judge
before the Court is Plaintiffs Carlos Suazo Corea, Saturnino
Romero Boquin, and Karen Reyes' third motion to approve
settlement with consent of Defendants SLDB, LLC, Shen Lin,
and David Beeker. ECF Nos. 23, 24. Plaintiffs filed this
action alleging that Defendants failed to pay 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. 1. For the reasons that
follow, the Court GRANTS the parties' motion and approves
worked as hourly employees in the kitchen of Defendants'
restaurant, Sarku Japan. ECF No. 1 ¶¶ 1, 15.
Plaintiffs allege that Defendants paid Plaintiffs one rate
for all work, including for overtime. Id. The
complaint avers that Corea is owed approximately $15, 000 in
overtime wages, Boquin is owed approximately $21, 000 in
overtime wages, and Reyes is owed approximately $4, 000 in
overtime wages. Id. ¶¶ 34-36.
September 27, 2018, the parties jointly moved for the Court
to approve a third settlement agreement. ECF No.
After informal discovery, Plaintiffs learned that, under
their theory of the case, their unpaid overtime wages would
be $7, 112.35 for Corea, $17, 758.29 for Boquin, and $2,
115.55 for Reyes. Id. at 2. The settlement agreement
provides Plaintiffs with 85% of their maximum potential
recovery, in both overtime and liquidated damages, under the
FLSA. Id. The agreement also provides $9, 700 in
attorneys' fees and costs. Id. The
Plaintiffs' explained how their attorneys spent their
time on the case and their hourly billing rates. Id.
at 6- 7. In the agreement, Defendants deny all liability to
Plaintiffs. ECF No. 24 at 7. Finally, the agreement releases
all claims, by each party, related to Plaintiffs'
employment with Defendants. Id. at 6-7.
STANDARD OF REVIEW
Congress enacted the FLSA to shield workers from substandard
wages and working conditions arising from the unequal
bargaining power between workers and employers, the
FLSA's requirements generally cannot be modified, waived,
or bargained away by contract or settlement. See Brooklyn
Saw Bank v. O'Neil, 324 U.S. 697, 706 (1945).
However, Court-approved settlement is an exception to this
rule where “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)); see
also Acevedo v. Phoenix Pres. Grp., Inc., No. PJM
13-3726, 2015 WL 6004150, at *4 (D. Md. Oct. 8, 2015).
reviewing FLSA settlements for approval, ‘district
courts in this circuit typically employ the considerations
set forth by the Eleventh Circuit in Lynn's Food
Stores.'” Hackett v. ADF Rest. Invs.,
259 F.Supp.3d 360, 365 (D. Md. 2016) (quoting Beam v.
Dillon's Bus Serv., Inc., No. DKC 14-3838, 2015 WL
4065036, at *3 (D. Md. July 1, 2015)). More particularly,
“[t]he settlement must reflect a ‘fair and
reasonable resolution of a bona fide dispute over
FLSA provisions.” Hackett, 259 F.Supp.3d at
365 (quoting Beam, 2015 WL 4065036, at *3)). The
court considers (1) whether FLSA issues are actually in
dispute; (2) the fairness and reasonableness of the
settlement; and (3) the reasonableness of the attorneys'
fees, if included in the agreement. Hackett, 259
F.Supp.3d at 365. The Court addresses each factor in turn.
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
Brinckerhoff, Inc., No. 1:08cv1310 (AJT/JFA), 2009 WL
3094955, at *10 (E.D. Va. Sept. 28, 2009). Here, Defendants
“expressly deny any wrongdoing or liability of any
kind.” ECF No. 24 at 7. Defendants maintain that no
labor laws were violated and that, even if there were
violations, Defendants did not act willfully. ECF No. 23 at
3. Accordingly, the threshold factor of bona fide
dispute is met.
Fairness and Reasonableness of the Settlement
evaluate the fairness and reasonableness of a settlement
based on six factors: (1) the extent of discovery undertaken;
(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 plaintiff's counsel; (5) the opinions of
counsel; and (6) the probability of the plaintiff's
success on the merits, and the amount of settlement
contrasted with the potential recovery. Hackett, 259
F.Supp.3d at 365.
Court finds the agreement is fair and reasonable. The parties
agree that discovery was “extensive” and that
Plaintiffs' counsel had “all the useful information
he could ever hope to obtain.” ECF No. 23 at 3. The
case is relatively “simple” and Plaintiffs'
counsel believes this agreement is an “optimal
resolution.” Id. at 4. Plaintiffs' counsel
has litigated over one hundred wage and hour cases.
Id. Although the agreement includes a general
release of claims related to Plaintiffs' employment,
Defendants have fairly compensated Plaintiffs for the
release. See Duprey v. Scotts Co., LLC, 30 F.Supp.3d
404, 410 (2014). The recovery itself is fair and reasonable
because it provides Plaintiffs with nearly the maximum