Bernardez Melendez v. Mokbar LLC.

Background

Lenard Sheyleth Bernardez Melendez brought claims against her former employers for alleged violations of the Fair Labor Standards Act, the New York Labor Law, and the New York City Human Rights Law. A footnote states that the complaint also included a claim under the New York State Human Rights Law, but the settlement letter referred only to the federal, New York, and New York City laws listed above.

The parties jointly asked the court to approve their proposed settlement. The opinion states that each side was represented by counsel and that the agreement resulted from arm’s-length negotiations.

Settlement Terms and Court’s Analysis

The defendants agreed to pay Bernardez Melendez $15,000. Her counsel agreed to waive any attorney’s fees to which counsel might have been entitled. Bernardez Melendez estimated that she could recover approximately $30,000 if she prevailed on all claims at trial, including $7,300 in unpaid wages and $5,700 in back wages. The court noted that the proposed settlement equaled 115% of the estimated unpaid and back wages and 50% of the estimated total damages, including liquidated and other damages.

The court found the amount fair and reasonable even though it was less than the maximum possible trial recovery. The court relied on the settlement’s substantial percentage of the estimated recovery and the legal and evidentiary challenges identified by the parties. The opinion states that the defendants disputed the estimated $30,000 damages figure and that the parties had exchanged records supporting their respective positions.

The court also examined the agreement’s release provision. It noted that courts generally reject Fair Labor Standards Act settlements that release unrelated or unknown claims. Here, the release applied only to claims specifically related to the claims in this lawsuit that arose by the agreement’s effective date. The court therefore found the release fair and reasonable.

Disposition

The court approved the parties’ settlement agreement. It dismissed the complaint with prejudice in accordance with that agreement and directed the Clerk of Court to close the case. The opinion’s caption identifies the defendants as Mokbar LLC, Mokbar I, LLC, and Esther Choi, while its opening paragraph refers to Mokbar II, LLC; the opinion does not explain that discrepancy.