Lowery v. Police Athletic League, Inc.

Background

The parties jointly sought approval of a proposed settlement under the Fair Labor Standards Act (FLSA), which governs certain wage and overtime claims. Their submission described two agreements:

- A Negotiated Settlement Agreement and Release resolving Vincent Lowery’s wage-and-hour claims under the FLSA and the New York Labor Law (NYLL). - A separate agreement resolving Lowery’s wrongful-termination claim under the Family and Medical Leave Act (FMLA).

The court first required the parties to submit the separate FMLA agreement for review and required Lowery’s counsel to explain the calculation of his potential damages. After reviewing the additional submissions, the court evaluated whether the FLSA settlement was fair and reasonable.

Court’s analysis

The court found the economic terms of the FLSA agreement fair and reasonable. Counsel estimated $95,856 in unpaid overtime wages for the roughly four-year period covered by the FLSA and NYLL claims. Of that amount, approximately $44,539 fell within the FLSA’s two-year period for non-willful violations. With possible doubled damages, the potential recovery on the FLSA and NYLL claims was estimated at $191,712.

The agreement required Police Athletic League, Inc. to pay $37,500. Lowery was to receive $24,680, and his counsel was to receive $12,820 in fees and costs. The court noted that the settlement followed mediation conducted by an experienced FLSA mediator and that the recovery percentages were similar to percentages approved in other FLSA settlements.

The court also found the agreement’s non-economic terms fair and reasonable. Although the release was not mutual, the court found that it was narrowly limited to wage-and-hour claims. The agreement did not contain confidentiality or non-disparagement provisions.

The court approved the combined $12,820 award for attorney’s fees and costs. It described the award as approximately one-third of the $37,500 settlement, plus $481 in costs, and noted that the amount was consistent with Lowery’s retainer agreement and with fees commonly approved in FLSA cases.

The court reviewed the separate FMLA agreement only to determine whether it affected the fairness of the FLSA settlement. It found no concern that the separate agreement was being used to obtain unfavorable terms from Lowery in a way inconsistent with the FLSA’s purposes. The court expressly stated that it did not separately review or offer an opinion on the fairness and reasonableness of the FMLA agreement.

Disposition

The court approved the FLSA agreement and dismissed the action with prejudice. The Clerk of Court was directed to close the action. This was a settlement-approval ruling; the opinion did not decide the underlying wage or wrongful-termination claims after trial or summary judgment.