Daniel Perez v. 82nd Street Grocery Inc.
- Sarah Cave
- 1:20-cv-04955
- U.S. District Court · Southern District of New York
- 2
In Jorge Daniel Perez v. 82nd Street Grocery, Judge Furman set procedures for reviewing a proposed Fair Labor Standards Act settlement.
Jorge Daniel Perez, 82ND Street Grocery, Inc., and the other defendants were affected. The parties had to either submit the settlement for fairness review or consent to have Magistrate Judge Cave decide whether to approve it by October 5, 2020.
What happened
In Jorge Daniel Perez v. 82nd Street Grocery, the parties told the court they had reached a settlement in a wage-and-overtime case under the Fair Labor Standards Act.
The court explained that it must review the settlement for fairness before approving a dismissal. By October 5, 2020, the parties could submit the agreement with a letter explaining why it was fair, or agree to let Magistrate Judge Cave decide whether to approve it.
Judge Jesse M. Furman also identified settlement terms the court generally would not approve, including certain confidentiality, broad release, and non-disparagement provisions. He adjourned the previously scheduled September 30 conference indefinitely.
The detailed version
- Daniel Perez v. 82nd Street Grocery Inc. · No. 1:20-cv-04955
- Sarah Cave
- Sept. 21, 2020
Background
The action was brought under the Fair Labor Standards Act, a federal law governing wage and overtime requirements. The court was advised on September 16, 2020, that the parties had reached a settlement. The opinion states that an employer violating overtime-payment requirements must pay unpaid overtime and an equal amount as liquidated damages.
Settlement-Approval Procedure
The court explained that, if the parties intended to dismiss the action under Rule 41 of the Federal Rules of Civil Procedure, the settlement and any proposed attorney’s-fee award had to be reviewed for fairness. By October 5, 2020, the parties could either submit the settlement agreement with a joint letter explaining the basis for the settlement and why it was fair and reasonable, or consent to proceed before Magistrate Judge Cave for all purposes so that she could decide whether to approve the settlement. The letter was also to address any incentive payment to the plaintiff and any attorney’s-fee award, with supporting documentation when appropriate.
The court noted that judicial approval is not required for an Fair Labor Standards Act settlement made through a Rule 68(a) offer of judgment. It also stated that it would not approve a settlement containing a confidentiality provision without case-specific justification overcoming the public-access right; a release or waiver covering unaccrued or unrelated claims without case-specific justification; or a non-disparagement clause that lacked an exception for truthful statements about the plaintiff’s experience litigating the case, unless case-specific reasons justified the clause. If the agreement contained such a provision, the parties were to state whether they would proceed without it or abandon the settlement and continue litigating.
Disposition
Judge Jesse M. Furman did not approve or reject the settlement in this order. He provided the parties with two ways to finalize the settlement and ordered that the September 30, 2020 conference be adjourned indefinitely.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.