Merino Leon v. Univ 45 Fruit & Vegetable Corp.

Background

Brigido Merino Leon, Maximo Martinez Ramirez, and Ricardo Ramirez Hernandez sued Univ 45 Fruit & Vegetable Corp. doing business as Epicurean Market; 45 University Place Corp. doing business as Epicurean Market; James Cho; and Sook J. Min. The plaintiffs sued individually and on behalf of other similarly situated workers. They alleged violations of the Fair Labor Standards Act (FLSA), the New York Labor Law, and supporting regulations.

The parties submitted a proposed settlement agreement and a fairness letter for court approval.

Settlement Amount

The defendants agreed to pay $42,000. That amount included $14,361.32 in attorneys’ fees and costs, leaving $27,638.68 for the plaintiffs. The plaintiffs estimated that they were owed approximately $127,168.62 in back wages. They estimated their total possible recovery, including actual damages, penalties, and interest but excluding attorneys’ fees and costs, at approximately $368,032.05.

The court applied a totality-of-the-circumstances review, considering the possible recovery, the burdens and expenses of continuing the litigation, litigation risks, whether experienced counsel negotiated at arm’s length, and the possibility of fraud or collusion. The court noted that the settlement resulted from extensive discussions before a court-appointed mediator. The plaintiffs’ counsel reported sharply disputed factual and legal issues, including disputes over the hours worked and amounts paid. The defendants had produced records supporting their position and indicated that they could provide witnesses.

Although the settlement provided only a small portion of the plaintiffs’ estimated possible recovery, the court concluded that the litigation risks and the possible costs of discovery and trial supported the settlement. The court therefore found the settlement amount fair and reasonable.

Attorneys’ Fees

The court independently reviewed the requested attorneys’ fees, as required in an FLSA case. It found the fee amount—approximately one-third of the settlement amount after costs—to be reasonable.

Release Provision

The court explained that FLSA settlements generally should not release unrelated or unknown claims. It found this release acceptable because the plaintiffs released only claims relating specifically to the claims in this litigation that occurred by the agreement’s effective date.

Disposition

Judge Ronnie Abrams approved the parties’ settlement agreement. The court dismissed the complaint with prejudice in accordance with that agreement and directed the Clerk of Court to close the case.