Galeas v. 1401 Grand Concourse LLC.

Background

Edwin Galeas sued 1401 Grand Concourse LLC, 1401 Grand Concourse Associates LLC, David Green, and Yona Roth. He alleged violations of the Fair Labor Standards Act, a federal wage law, and New York Labor Law based on the alleged failure to pay minimum and overtime wages and to provide wage statements and notices.

The parties reached a settlement and sought court approval. The court had denied two earlier approval requests without prejudice. The second denial focused on plaintiff’s counsel’s request for $5,700 in costs for private investigators who located Galeas during the litigation.

Court’s Analysis

The court explained that settlements of Fair Labor Standards Act wage claims require approval by the Department of Labor or a district court. A court may approve such an agreement only if it is fair and reasonable. Relevant considerations include the plaintiff’s possible recovery, the burdens and expenses of continued litigation, the risks of the case, whether the agreement resulted from arm’s-length negotiations between experienced counsel, and the possibility of fraud or collusion. Courts also examine confidentiality provisions and releases of claims.

Under the Second Revised Settlement, the defendants agreed to pay $17,500, of which Galeas would receive $11,720.10. The court noted that this increased Galeas’s share by $4,358.10 from the previous proposals and found the amount reasonable. The court had previously found that the parties adequately addressed the other settlement factors and that the release was sufficiently narrow.

Counsel removed the $5,700 private-investigator request and sought $757 for filing fees and service costs. The court found those costs reasonable. Counsel also requested $5,022.90 in attorney’s fees, equal to 30% of the settlement amount after expenses. The attorneys submitted contemporaneous billing records showing 39.9 billable hours, attorney rates of $300 to $450 per hour, and rates of $125 per hour for other employees who appeared to be paralegals. The court found the hours and rates reasonable. It calculated a lodestar—the reasonable hourly rates multiplied by the reasonable hours—of $11,602.50, and accepted the resulting fee request as fair and reasonable.

Ruling

Judge Analisa Torres granted the parties’ second renewed motion for settlement approval. The court directed the Clerk of Court to terminate any pending motions, vacate all conferences, and close the case.