Kaloshi v. West Village Oasis, Inc.

Background

Adriana Kaloshi and Mishele Koroveshi brought claims under the New York State Human Rights Law, the New York City Human Rights Law, the New York State Labor Law, and the Fair Labor Standards Act (FLSA). The parties agreed to settle the FLSA claim and submitted their settlement agreement and supporting memorandum for court approval.

The agreement provided for a total payment of $26,000. The plaintiffs would each receive $8,558.09 after payment of attorneys’ fees and costs. Plaintiffs’ counsel would receive $8,883.81, including $836.28 in out-of-pocket costs. The opinion describes the agreement as including a release of wage-and-hour claims related to the case, while also stating that it did not contain a general confidentiality provision or a release.

Court’s analysis

Under Second Circuit precedent, parties generally may not privately settle FLSA claims through a stipulated dismissal without approval from the district court or the Department of Labor. The court evaluated the agreement under the fairness factors used for FLSA settlements, including the plaintiffs’ possible recovery, the costs and burdens of continued litigation, the risks at trial, the parties’ represented and adversarial negotiations, and the possibility of fraud or collusion.

The court found the settlement fair and reasonable. Although the amount each plaintiff would receive was relatively low, the settlement avoided additional trial expenses and accounted for serious litigation risks. Both sides were represented by counsel, and the court found no indication of fraud or collusion.

The court also reviewed the requested attorneys’ fees and costs. It noted that the fee represented approximately 32% of the settlement amount used for the percentage calculation and that courts in the district had approved fees of up to 36% in comparable cases. As a cross-check, the court reviewed counsel’s billing records, which showed more than $24,000 in fees incurred on the FLSA portion of the case and 146.1 attorney and paralegal hours on the matter more broadly. The court found the work and staffing reasonable, the hourly rates of $350 to $400 consistent with prevailing rates in the district, and the requested amount lower than counsel’s actual billed fees.

Ruling

Judge Arun Subramanian approved the FLSA settlement and the requested attorneys’ fees and costs. The court directed the parties to file a dismissal under Federal Rule of Civil Procedure 41 concerning the remaining claims no later than July 8, 2024. The Clerk of Court was directed to terminate Docket 113.