Galeana v. Mahasan Inc.
- Vernon Broderick
- 1:14-cv-03625
- U.S. District Court · Southern District of New York
- 2
In Galeana v. Mahasan Inc., Judge Broderick ordered FLSA settlement terms and fee evidence within 30 days for fairness review.
The plaintiffs and defendants in the FLSA case were required to submit the settlement terms, a joint fairness explanation, and, if applicable, evidence supporting attorney’s fees.
What happened
Galeana v. Mahasan Inc. is a Fair Labor Standards Act case in which the parties told the court they had reached a settlement.
The court explained that FLSA claims cannot be privately settled with prejudice without approval from the court or the Department of Labor. The parties therefore had to show that their agreement was fair and reasonable.
Judge Broderick ordered the parties to submit the settlement terms within 30 days, along with a joint letter of no more than five pages explaining why the agreement was fair. If the agreement included attorney’s fees, they also had to provide records supporting the fee request.
The detailed version
- Galeana v. Mahasan Inc. · No. 1:14-cv-03625
- Vernon Broderick
- Oct. 15, 2020
Background
The court was advised that the parties had reached a settlement in this Fair Labor Standards Act (FLSA) case. The opinion states that the plaintiffs were Adelaido Galeana and Nicholas Galeana, individually and on behalf of others similarly situated, and that the defendants included Mahasan Inc. and others.
Legal standard
The court explained that parties may not privately settle FLSA claims with prejudice unless the settlement is approved by the district court or the Department of Labor. The court must determine whether the settlement is fair and reasonable by considering the total circumstances, including:
- The plaintiffs’ possible recovery;
- Whether the settlement avoids the expected burdens and expenses of proving the claims and defenses;
- 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 court also stated that it must separately assess the reasonableness of any attorney’s-fee award. Counsel must provide a factual basis for the fees, including contemporaneous billing records showing each attorney’s date, hours, and work performed.
Order
The court did not approve the settlement in this order. It ordered the parties, within 30 days, to provide the settlement terms so the court could determine whether they complied with the FLSA and reflected a reasonable compromise of disputed issues. The parties also had to submit a joint letter of no more than five pages explaining why they believed the settlement was fair and reasonable, including information about the five listed factors. If the agreement included attorney’s fees, the parties had to submit supporting evidence for the fee award.
Effect
The order required additional submissions before the court could evaluate the settlement. It did not state the settlement amount or make a final determination that the agreement was fair and reasonable.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.