Stephanie Prasad v. Pinnacle Management Services Company, LLC

Background

Stephanie Prasad alleged that Pinnacle Property Management Services, LLC misclassified its property managers as exempt from overtime pay. Her claims included a Fair Labor Standards Act (FLSA) overtime claim and several state-law wage-and-hour and disability-discrimination claims. The court had previously granted the defendant’s motion to compel arbitration. After a three-day arbitration hearing, the parties informed the court that they had reached a settlement of Prasad’s individual FLSA claim.

The parties jointly asked the court to approve the settlement. They also asked the court to seal the settlement agreement and portions of their briefing. The court considered the parties’ supplemental briefing and determined that oral argument was unnecessary.

Court’s Analysis

The court applied the standard used in the Northern District of California for reviewing FLSA settlements: whether the proposed agreement is a fair and reasonable resolution of a genuine dispute about FLSA rights.

The court found that the parties had a genuine dispute about whether Prasad was properly classified as exempt. It also found that settlement allowed both sides to avoid the risks and costs of continued litigation. Based on the parties’ explanations and calculations, the court concluded that the amount Prasad would receive was fair and reasonable in relation to her claimed damages and the release of her claims. The record also showed that the settlement resulted from negotiations conducted at arm’s length between the parties and their counsel.

The court found compelling reasons to seal the settlement agreement, information concerning the parties’ private arbitration proceedings, and portions of the briefing that disclosed either of those subjects. A footnote states that the parties apparently intended to include the settlement agreement with their supplemental briefing but did not; the court therefore filed under seal the copy previously lodged with the court.

Disposition

Judge Virginia K. Demarchi granted the motion to seal. The court also granted the parties’ joint request to approve their settlement to the extent that it released Prasad’s rights under the FLSA. Pursuant to the parties’ agreement, the action was dismissed with prejudice, with each side to bear its own attorneys’ fees and costs.

The parties also requested dismissal without prejudice of a claim under California’s Private Attorneys General Act. The court noted, however, that no such claim had been asserted in this court: although Prasad had been granted permission to file an amended complaint adding a PAGA claim, she never did so.