Raghnal v. Josselyne, Inc.

Background

The plaintiffs brought this action under the Fair Labor Standards Act (FLSA), a federal law governing certain wage and hour rights, and the New York Labor Law. The parties advised the court that they had agreed to a settlement in principle. The court had previously directed them to submit their settlement agreement and a memorandum explaining why it was fair, or alternatively required the defendant to respond to the complaint.

Settlement Approval

After reviewing the parties’ joint letter and settlement agreement, the court found the settlement fair and reasonable. The court considered the nature and scope of the plaintiffs’ claims, as well as the risks and expenses of additional litigation.

The plaintiffs requested approval of $25,000 in attorneys’ fees and costs. That amount represented 33.33% of the $75,000 settlement. The court stated that courts in the circuit typically approve fees between 30% and 33.33% and concluded that one-third of the recovery was appropriate under the facts of this case.

The court made approval subject to one condition: any modification of the settlement agreement must receive court approval, even if the agreement purports to allow the parties to modify it without court approval.

Disposition

Judge Margaret M. Garnett approved the settlement subject to that condition. The court dismissed the case with prejudice, meaning the case was closed and could not be brought again in that form. It also ruled that all pending motions were moot, canceled all conferences, and directed the clerk to close the case.