Wang v. CLL Brothers, Inc.

Background

Zhengjian Wang sued CLL Brothers, Inc., doing business as Fuji Sushi, and Qing Chen, Horng Biau Lee, and Sum Tan Lau, also known as Sum Tan Liu and John Liu. Wang asserted claims for unpaid minimum and overtime wages under the Fair Labor Standards Act and the New York Labor Law. He brought the action on his own behalf and on behalf of others similarly situated.

After the parties reached a settlement, they asked the court to approve it. Under the proposed agreement, the total recovery was $50,000: $33,063.67 for Wang, $16,531.83 for his counsel as attorney’s fees, and $404.50 for expenses.

Settlement Approval

The court explained that wage claims under the Fair Labor Standards Act cannot be settled without approval from the Department of Labor or a federal district court. The court therefore examined whether the agreement was fair and reasonable under the circumstances.

Wang’s counsel estimated that his possible recovery could be $73,742.28 after discussing Wang’s employment period, work, hours, and pay. The defendants disputed Wang’s allegations about his employment period and hours and disputed whether he was entitled to liquidated damages. The parties nevertheless agreed to settle for $50,000 after extensive negotiations, citing the risks of litigation and the defendants’ ability to pay. The court found that the settlement satisfied the relevant fairness factors and found no evidence of fraud or collusion.

The court also found that the release was not overly broad because it covered only claims alleged in the complaint. The agreement had no confidentiality or non-disparagement provision and preserved Wang’s ability to file a charge or participate in proceedings before specified agencies, including the National Labor Relations Board, the Securities and Exchange Commission, and the Equal Employment Opportunity Commission.

Attorney’s Fees

Counsel requested one-third of the settlement, or $16,531.83, plus $404.50 in expenses. Counsel’s billing records listed 69.72 hours and a total lodestar calculation of $31,963 in fees and $404.50 in costs. A lodestar is an estimate based on reasonable hourly rates multiplied by hours worked.

The court reduced John Troy’s hourly rate from $550 to $400 for purposes of the lodestar calculation because the proposed rate was higher than the usual range for experienced wage-and-hour attorneys in the district. Using that reduced rate, the court calculated a lodestar of $25,472.50. Because the requested fee was substantially lower than that amount and represented one-third of the settlement, the court found the fee and expense award fair and reasonable and did not alter it.

Disposition

The court granted the parties’ motion for settlement approval. The Clerk of Court was directed to close the case.