Deran v. Antalia Turkish Cuisine LLC

Background

Soner Deran worked as a waiter at Antalia during two periods: July 2016 through October 2017, and September 2018 through May 2019. He sued Antalia Turkish Cuisine, LLC, AntaliaNYC, Inc., and Serhat Cetinkaya under the Fair Labor Standards Act (FLSA), a federal wage law, and the New York Labor Law. The parties notified the court that they had reached an agreement in principle and later submitted a signed settlement agreement for review.

Deran estimated that his best potential recovery at trial was $82,000, including unpaid minimum wages and overtime, liquidated damages, spread-of-hours pay, allegedly retained tips, and damages under the Wage Theft Prevention Act. He acknowledged bona fide disputes about the number of hours he worked and how he was paid. Based on the defendants’ records, he estimated that his recovery could instead be about $59,000, and he expressed concern about collecting a judgment, particularly during the COVID-19 public-health crisis.

Settlement Terms

The agreement requires the defendants to pay $50,000 in eight installments: an initial $15,000 payment within 45 days after court approval, followed by seven monthly payments of $5,000. Of the total, $652.50 reimburses plaintiff’s counsel for costs, and $16,449.17—one-third of the remaining amount—goes to plaintiff’s counsel as attorneys’ fees. The agreement leaves $32,898.33 for Deran.

The agreement releases Deran’s wage-and-hour claims against the defendants and includes a general release of the defendants’ claims against Deran. It contains mutual non-disparagement provisions limited to false derogatory, disparaging, or defamatory statements. Truthful statements, even if unflattering, are not prohibited. The defendants also agreed to provide a neutral employment reference and not mention the lawsuit unless specifically asked, in which case they would state only that the matter had been resolved.

The installment payments are supported by an affidavit confessing judgment for $85,000, plus reasonable attorneys’ fees incurred to enter and enforce the judgment, reduced by payments already made under the agreement. The court noted that the additional amount could potentially be viewed as an unenforceable penalty, but stated that this issue was not necessary to decide during the settlement review and did not prevent approval of the agreement as fair to Deran.

Court’s Analysis

Under the Second Circuit’s decision in Cheeks v. Freeport Pancake House, Inc., courts review FLSA settlements to determine whether they are fair and reasonable. The court found that the $50,000 settlement was a fair compromise. The net amount was below Deran’s best-case trial estimate but almost 10 percent higher than his estimate of unpaid wages and overtime alone, and only slightly below his estimate including spread-of-hours pay and retained tips. The disputed work records, uncertainty of litigation, and collectability concerns supported approval.

The court also found the proposed attorneys’ fees reasonable. It noted that the requested one-third percentage was within the range historically approved in the district and was only slightly higher than counsel’s lodestar, a calculation based on counsel’s recorded time and hourly rates. The court also considered the degree of success obtained.

Disposition

Judge Barbara Moses approved the proposed settlement. The court ordered that the action be dismissed with prejudice and without costs, retained jurisdiction for the limited purpose of enforcing the agreement if necessary, and directed the clerk to close the case.