Dector v. RCI Plumbing Corp.

Background

The court had previously denied the plaintiffs’ request to approve a collective-action settlement with the defendants. Applying the settlement-review standard from Cheeks v. Freeport Pancake House, Inc., the court concluded that the plaintiffs had not provided enough support for the reasonableness of the settlement amount or the proposed attorneys’ fee.

The plaintiffs resubmitted the settlement on August 24, 2020. The new submission included estimates of the collective members’ time worked, the damages owed to them, and the attorneys’ billing records.

Settlement Amount

The court found the $550,000 settlement reasonable. It relied on the nearly full recovery of the plaintiffs’ minimum-wage and overtime claims and the substantial recovery for claims under state law. The opinion does not identify the specific state-law claims.

Attorneys’ Fees and Costs

The proposed agreement provided for plaintiffs’ attorneys to receive $183,333.33, described as one-third of the $550,000 settlement, plus $5,275.68 in costs. The court evaluated the fee request using the lodestar method, which estimates a reasonable fee by multiplying reasonable hourly rates by the reasonable number of hours worked.

Counsel reported a lodestar calculation of $179,238.50 based on 533.7 hours. The work included preparing court documents, calculating damages, attending mediation, preparing for trial, and negotiating the settlement. The court found the billing rates, which ranged from $270 to $525, satisfactory. It concluded that the requested fees—about one-third of the settlement and approximately equal to the lodestar—were objectively reasonable.

Disposition

Judge Edgardo Ramos found that the settlement complied with the Cheeks standard and approved it. The court dismissed the case with prejudice and directed the Clerk of Court to close the case.