Francisco Delgado Escamilla, et al. v. 48 West 21st Street Corp., et al.

Background

The parties sought entry of judgment under Federal Rule of Civil Procedure 68 based on the plaintiffs’ acceptance of the defendants’ offer of judgment in this Fair Labor Standards Act case. Rule 68 permits a party to make an offer to have judgment entered on specified terms.

The court explained that, under the Second Circuit’s decision in Cheeks v. Freeport Pancake House, Inc., parties generally cannot privately resolve Fair Labor Standards Act claims without court approval or approval from the Department of Labor. The court also explained that the Second Circuit later held in Mei Xing Yu v. Hasaki Restaurant, Inc. that judicial approval is not required for a Rule 68 offer of judgment resolving Fair Labor Standards Act claims.

Court’s Analysis

The offer set the judgment amount at $300,000, inclusive of attorneys’ fees and costs, but did not identify the amount allocated to fees or costs. The court stated that this made it impossible to determine whether the attorneys’ fees were reasonable. The court also stated that it could not compare the judgment amount with the plaintiffs’ maximum possible recovery.

The court said these terms were ones it would likely consider unreasonable if the agreement had been submitted for review under Cheeks. It nevertheless concluded that Mei Xing Yu required the court to enter the proposed judgment, even though the court believed the result would likely differ under the Cheeks review process.

Disposition

The court ordered that judgment be entered according to the parties’ Rule 68 offer and acceptance of judgment. The judgment was to be filed simultaneously with the order. The opinion does not state how much of the $300,000 would be paid as attorneys’ fees or costs.