Pimentel v. 615 W. 176th St. LLC

Background

Defendants 615 W. 176th St. LLC and Chong S. Piper informed the court that the parties had reached a settlement in principle. They asked the court to adjourn all case deadlines and appearance dates indefinitely. The complaint asserted claims under the Fair Labor Standards Act, a federal law governing certain employee wages and working hours.

Settlement review

The court explained that a Fair Labor Standards Act settlement requires approval by either the district court or the U.S. Department of Labor. The court therefore stated that it had to examine the proposed agreement for fairness. The required joint letter had to explain why the settlement was a fair and reasonable compromise rather than a waiver of statutory rights caused by employer overreaching.

The court directed the parties to address the plaintiff’s possible recovery; the burdens and expenses the settlement would avoid; the seriousness of the litigation risks; whether the agreement resulted from arm’s-length bargaining between experienced counsel; and the possibility of fraud or collusion. The parties also had to address whether there was a genuine dispute about the hours worked or compensation owed and how much the plaintiff’s attorney would seek in fees. The court stated that, absent special circumstances, it would not approve a settlement filed under seal or in redacted form.

Order

The court ordered the parties to provide a copy of the settlement agreement and a joint explanatory letter by May 29, 2020. It also ordered the parties, including Manuel Pimentel personally, to appear by telephone for a fairness hearing on June 18, 2020, at 11:30 a.m. Defendants were invited but not required to attend. If Pimentel did not speak English, he was required to provide his own interpreter. The court adjourned all other filing deadlines and appearance dates indefinitely. This order did not approve or reject the settlement.