Cabrera v. Rose Hill Asset Management Corporation

Background

The court was advised that the parties had reached a settlement in this Fair Labor Standards Act (FLSA) case. The plaintiff, Tenislao Toribio Cabrera, sued individually and on behalf of all others similarly situated. The defendants were Rose Hill Asset Management Corporation, also known as RHAMCO, and Brudava Corp.

Settlement-approval requirement

The court ordered that the action could not be dismissed with prejudice based on the settlement unless either the court or the Department of Labor approved the settlement agreement. The order did not itself approve the agreement or dismiss the action.

If the parties sought dismissal with prejudice, the court required them either to file a joint letter motion asking the court to approve the settlement or to provide documentation showing Department of Labor approval. Any letter motion and the settlement agreement had to be filed on the public docket by September 4, 2020.

The court directed any request for court approval to explain why the proposed settlement was fair and reasonable. It identified these minimum topics: the plaintiff's possible recovery; the burdens and expenses the settlement would avoid; the seriousness of the litigation risks; whether experienced counsel reached the agreement through arm's-length bargaining; and the possibility of fraud or collusion. The submission also had to address whether a genuine dispute existed about the hours worked or compensation owed and how much the plaintiff's attorney would seek in fees.

Attorney fees and filing requirements

The court required any attorney-fee request to include supporting documentation, including contemporaneous billing records for each attorney showing the date, hours worked, and nature of the work.

The court also stated that, absent special circumstances, it would not approve a settlement filed under seal or in redacted form. Absent compelling circumstances, it would not approve an agreement containing sweeping nondisclosure provisions or broad releases of claims unrelated to FLSA issues.

Ruling and case status

Judge Analisa Torres ordered that any pending motions were moot and vacated all conferences. The order left the settlement subject to the required approval process and did not state that approval had been granted.