Small v. Stellar Management LTD

Background

Jonathan Small brought claims under the Fair Labor Standards Act against Stellar Management LTD and other defendants. On September 21, 2020, the parties reported that they had reached a settlement in principle covering all issues. After the matter was referred to Judge Stewart D. Aaron for disposition by consent, the parties submitted a proposed settlement, related papers, supplemental materials, a retainer agreement, attorney time records, and a fully executed settlement agreement.

Settlement review

The court reviewed the proposed settlement under the requirement that Fair Labor Standards Act settlements be fair and reasonable. The agreement included a mutual general release and released a claim that was not raised in the complaint. The court noted that such provisions are generally disfavored, but found that the settlement amount was slightly greater than 100% of Small’s potential recovery, reducing concerns about employer coercion.

The court also found the mutual general releases acceptable because Small no longer worked for the defendant, he was represented by experienced counsel, and the release covered individuals and entities other than the defendants only when they acted on behalf of, or in a legally connected relationship with, the defendants and only for claims arising from those activities.

Ruling

Judge Stewart D. Aaron approved the settlement and dismissed the action with prejudice and without costs except as provided in the settlement agreement. The court retained jurisdiction to enforce the settlement agreement and requested that the clerk close the case.