Rich v. American Association of Advertising Agencies, Inc.
- Edgardo Ramos
- 1:18-cv-03332
- U.S. District Court · Southern District of New York
- 3
In Rich v. American Association of Advertising Agencies, Inc., Judge Ramos approved the revised wage settlement and dismissed the case with prejudice.
James Rich and American Association of Advertising Agencies, Inc.; the approved settlement also addressed fees and costs for Rich’s counsel.
What happened
James Rich sued his former employer, American Association of Advertising Agencies, Inc., under the Fair Labor Standards Act and New York Labor Law for unpaid wages, including overtime. The parties later agreed to settle the case for $37,500, subject to court approval.
The settlement allocated $15,000 to the wage claims, including $5,000 for Rich’s lawyer’s fees and costs. The court had rejected an earlier version because it lacked enough support for the fees and contained an overly broad release. The revised agreement included redacted billing records and limited the release to claims related to Rich’s wage claims.
In Rich v. American Association of Advertising Agencies, Inc., Judge Edgardo Ramos found that the revised agreement complied with the required standards and approved it. The court dismissed the case with prejudice and directed the clerk to close it.
The detailed version
- Rich v. American Association of Advertising Agencies, Inc. · No. 1:18-cv-03332
- Edgardo Ramos
- Dec. 5, 2019
Background
James Rich brought claims against his former employer under the Fair Labor Standards Act of 1938 and the New York Labor Law. He sought unpaid wages, including overtime wages. The parties engaged in discovery and mediation before agreeing to settle for $37,500, subject to the court’s approval.
The settlement also included an allocation for employment-related claims that Rich had threatened to bring but had not asserted as Fair Labor Standards Act claims, including age-discrimination claims. The parties allocated $15,000 of the total settlement to the Fair Labor Standards Act wage claims. That amount included $5,000 for Rich’s counsel’s fees and costs. Rich estimated that his maximum unpaid-wage recovery would be no more than $20,000, making the wage-claim settlement 75% of that estimate.
Earlier Settlement Review
On June 20, 2019, the court declined to approve the initial settlement agreement. The court stated that the agreement did not identify an evidentiary basis for the proposed attorney’s fees and costs and contained an impermissibly broad release.
The parties then submitted a revised agreement on July 26, 2019. The revised agreement included redacted billing records supporting the attorney’s fees and costs and limited the release to claims, facts, or matters asserted in the action that arose from or related to Rich’s wage-and-hour claims. Counsel explained that the redactions covered attorney-client communications and offered to provide an unredacted version for private court review.
Ruling
Judge Edgardo Ramos determined that the billing records left enough information about counsel’s work for the court to assess the reasonableness of the proposed fees. The court found that the revised agreement complied with the standards for approving Fair Labor Standards Act settlements and approved it.
The court dismissed the case with prejudice under Rule 41(a)(2) of the Federal Rules of Civil Procedure and directed the clerk to close the case. The order approved the parties’ settlement; it did not decide the underlying wage claims after a trial or other merits ruling.
Read the full 3-page opinion on CourtListener, the free public archive maintained by the Free Law Project.