Bonilla Peralta v. Divya Drishti LLC

Background

The court reviewed the plaintiffs’ request for approval of a settlement agreement under the Second Circuit’s requirements for reviewing settlements of wage claims. The action involved claims by Taurina Bonilla Peralta and Susana Georgina Guillca under the Fair Labor Standards Act and the New York Labor Law against Divya Drishti LLC, doing business as Lenox Spa & Nails, and Archana Pokhrel, also known as Daisy.

Under the agreement, the defendants were required to pay $20,625.00 in 36 installments: an initial payment of $573.15 followed by 35 payments of $572.91. The agreement allocated $5,129.40 to Bonilla Peralta, $8,273.94 to Guillca, and $7,221.66 to the plaintiffs’ attorneys for fees and costs. The installment obligations were supported by affidavits of confession of judgment executed by the defendants.

The agreement contained a unilateral, limited release covering claims arising from the litigation and the federal and New York wage-and-hour claims asserted in it. It did not contain a confidentiality clause or another contractual restriction on the parties’ ability to discuss the case or settlement. The proposed attorney-fee award equaled one-third of the net settlement and was lower than counsel’s lodestar, meaning the fees calculated from counsel’s documented time and rates.

Court’s Analysis

The court found that the settlement terms, including the attorney-fee and cost award, were fair and reasonable. To ensure that the plaintiffs and their counsel shared the risk of nonpayment fairly, the court required each installment payment to be allocated in proportion to the agreement’s overall allocation of the settlement amount.

Ruling and Effect

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