Velasquez v. The Baodega LLC

Background

Robinson Velasquez sued The Baodega LLC and Kenny Yie, individually, under the Fair Labor Standards Act (FLSA) and the New York Labor Law. He alleged that he worked for the defendants for about 17 months, often more than 40 hours per week, but was not paid required minimum or overtime wages. He also alleged violations of New York’s notice and recordkeeping requirements.

The parties reached a settlement and asked the court to approve it. The proposed agreement provided for a total recovery of $15,000, including attorney’s fees and costs. Velasquez was to receive $9,137.50. He estimated that his maximum possible recovery was about $30,000; supporting calculations listed $29,727.68 in unpaid wages and $32,226.83 in unpaid wages with interest. The defendants disputed that Velasquez had been paid less than the federal or state minimum wage.

Settlement Approval

The court explained that FLSA wage claims require approval by the Department of Labor or a district court before the parties can settle them. The court evaluated whether the agreement was fair and reasonable by considering the possible recovery, the burdens and expenses of continued litigation, the parties’ litigation risks, the bargaining process, and the possibility of fraud or collusion.

The court found that the settlement provided approximately 28% of Velasquez’s estimated maximum recovery. Although that percentage was on the lower side of typical settlement awards, the court found it reasonable given the disputed facts and other legal uncertainties. The parties represented that the agreement resulted from legitimate bargaining between experienced labor and employment counsel.

The court also found that the release was sufficiently narrow because it covered only FLSA and New York wage-and-hour claims arising from Velasquez’s employment through the date the agreement was signed. The agreement did not prevent Velasquez from openly discussing his experience litigating the case and contained no confidentiality, nondisclosure, or non-disparagement provision.

Attorney’s Fees and Costs

Velasquez’s counsel requested $5,862.50 in attorney’s fees and costs, approximately 39% of the total settlement. Counsel Lina Stillman submitted billing records showing 17.5 hours of work at $400 per hour, producing a lodestar—reasonable hours multiplied by a reasonable hourly rate—of $6,995 in attorney’s fees. The court found the hours and hourly rate reasonable and accepted the requested award, which represented a lodestar multiplier of 0.84. The court also found $863 in court fees, service, and mediation costs reasonable.

Disposition

The court granted the parties’ motion for settlement approval. The Clerk of Court was directed to terminate pending motions, vacate all conferences, and close the case.