Barrera v. 1611 Food Mart Inc.

Background

The plaintiffs brought this action under the Fair Labor Standards Act, a federal law governing issues including overtime pay. The parties informed the court that they had reached a settlement in principle. The opinion does not state the settlement amount or other specific settlement terms.

Court’s Requirements

The court explained that an FLSA settlement, including any proposed attorney’s fee award, must be reviewed to ensure that it is fair. It ordered the parties to submit the settlement agreement and a joint letter by January 17, 2020. The letter must explain the basis for the proposed settlement and why it is fair and reasonable, referring to the factors identified in Wolinsky v. Scholastic, Inc. It must also address any incentive payment to the plaintiff and any attorney’s fee award to the plaintiff’s counsel, including supporting documentation when appropriate.

The court advised that the parties could consent to have the assigned Magistrate Judge decide whether to approve the settlement. If all parties consented for that purpose, they were directed to email the completed consent form by January 20, 2020.

Settlement Provisions and Scheduling

The court stated that it would not approve a settlement containing a confidentiality provision unless the parties showed case-specific reasons sufficient to overcome the public’s common-law right of access to judicial documents. It also would not approve a release or waiver covering claims that had not accrued or claims unrelated to wage-and-hour matters without case-specific justification. Finally, a provision barring the plaintiff from making negative statements about a defendant would need an exception for truthful statements about the plaintiff’s experience litigating the case, unless the parties justified omitting that exception.

If the agreement contained any of those provisions, the parties’ letter had to state whether they would continue with the settlement if the court rejected only those provisions or would abandon the settlement and continue litigating. The court adjourned the January 8, 2020 pretrial conference and all pending deadlines indefinitely while awaiting submission of a settlement for review and approval.

Ruling

Judge Jesse M. Furman ordered the settlement materials and explanations to be submitted for review, set requirements concerning potentially impermissible settlement provisions, and adjourned the case’s pretrial conference and deadlines. The order did not approve or reject the settlement itself.