Ho v. Shana Nails Inc.

Background

Yun Ho brought wage claims against Shana Nails Inc., doing business as Shana's Nail & Spa, and Bong Jun Choi. The opinion states that Ho worked for the defendants as a massage therapist from August 2015 through March 19, 2018. His claims included claims under the Fair Labor Standards Act and the New York Labor Law.

The parties filed a joint motion seeking approval of their fully executed settlement agreement and general release. The agreement required the defendants to pay Ho $31,000 in full settlement. The payment was to be made in five installments. Under the original agreement, $11,135.33 would go to Ho's attorney, Mark L. Lubelsky, for fees and costs, leaving $19,864.67 for Ho.

Settlement Terms

The agreement contained a one-way release limited to wage-and-hour claims and a separate bilateral release concerning claims related to Ho's employment. It did not include a confidentiality clause or a non-disparagement provision. Its severability clause allowed the court to reform or discard an unenforceable provision without invalidating the rest of the agreement.

Ho represented that his possible recovery ranged from $30,000 to $50,000. The court found that the $31,000 settlement was within that range and represented a reasonable compromise in light of litigation risks and the costs of continuing the case. The court found the non-economic terms fair and reasonable.

Attorney Fees

The court found the attorney-fee provision too high. Of the proposed $11,135.33 payment to counsel, $802 was for costs and $10,333.33 was for fees. The fee amount was slightly more than 34% of the net settlement amount of $30,198, which the court said was higher than the range ordinarily approved in the district. The court also found nothing in counsel's time records to justify an above-range award in this straightforward, single-plaintiff wage-and-hour case.

Using the agreement's severability provision, the court modified the fee provisions. It reduced the total award to counsel to $10,868, representing one-third of the net settlement plus costs. The modified amount was payable at $2,717 from each of the last four settlement installments, with the balance going to Ho.

Disposition

As modified, the court found the agreement fair and reasonable and approved it. Judge Barbara Moses ordered that the action be dismissed with prejudice and without costs. She also directed the Clerk of Court to close the case.