Saul Valeriano Villareal v. JMTJ Corp.
- Analisa Torres
- 1:20-cv-04337
- U.S. District Court · Southern District of New York
- 2
In Saul Valeriano Villareal v. JMTJ Corp., Judge Analisa Torres required court or Labor Department approval before an FLSA settlement could support dismissal with prejudice.
The plaintiffs, defendants, their attorneys, and potentially the others similarly situated whom the plaintiffs sought to represent are affected by the settlement-approval and attorney-fee requirements.
What happened
In Saul Valeriano Villareal v. JMTJ Corp., the parties told the court they had reached a settlement in a Fair Labor Standards Act case.
The court said the case could not be dismissed with prejudice based on the settlement unless the court or the Department of Labor approved it. The parties had to file a joint request and the settlement agreement, or documentation of Department of Labor approval, by January 10, 2021.
Judge Analisa Torres also required the parties to address whether the settlement was fair and reasonable, any genuine dispute about hours or compensation, and the requested attorney fees. She said fee requests must include billing records and identified settlement terms that generally would not be approved without special or compelling circumstances. Pending motions were declared moot, and conferences were vacated.
The detailed version
- Saul Valeriano Villareal v. JMTJ Corp. · No. 1:20-cv-04337
- Analisa Torres
- Dec. 9, 2020
Background
The court was advised that the parties had reached a settlement in this Fair Labor Standards Act (FLSA) action. The caption names Agustin Saul Valeriano Villareal and Prixco Soriano Reyes as plaintiffs, suing individually and on behalf of others similarly situated, and names JMTJ Corp. doing business as Wing Bistro, Cipolla Rossa on 61 Inc., Domingo Doe, Junior Doe, and Michael Doe as defendants.
Settlement-approval requirement
The court ordered that the action could not be dismissed with prejudice based on the settlement unless the settlement agreement was approved by the court or the Department of Labor. If the parties sought dismissal with prejudice, they had to file by January 10, 2021, either a joint letter motion asking the court to approve the settlement, together with the settlement agreement, or documentation showing Department of Labor approval.
The letter motion had to explain why the proposed settlement was fair and reasonable. The court identified these minimum topics: the plaintiffs’ possible recovery; the burdens and expenses the settlement would avoid; the seriousness of the litigation risks; whether experienced counsel negotiated the agreement at arm’s length; and the possibility of fraud or collusion. The parties also had to address whether a genuine dispute existed about the number of hours worked or the compensation owed, and how much of the settlement the plaintiffs’ attorney would seek as fees.
Attorney fees and settlement terms
The court required any fee request to include supporting documentation. Specifically, the request had to include 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 a settlement containing sweeping nondisclosure provisions or broad releases of claims unrelated to FLSA issues.
Ruling and case management
The court ordered that any pending motions were moot and vacated all conferences. The order did not itself dismiss the action or approve the settlement; it set conditions for seeking dismissal with prejudice based on the settlement.
Classification
This is a procedural order because it addressed approval of a settlement and related case-management matters rather than deciding the underlying FLSA claims.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.