Hernandez v. Between the Bread 55th Inc.

Background

Ramon Hernandez brought claims under the Fair Labor Standards Act and the New York Labor Law on behalf of himself and people he sought to represent. He alleged that the defendants failed to pay proper minimum wages and overtime premiums, misappropriated tips, and failed to comply with New York requirements concerning wage statements and wage notices. The defendants disputed the allegations and denied liability for the claims that had been or could have been asserted.

After private mediation, the parties negotiated a settlement. Hernandez asked the court to conditionally certify a settlement class under Federal Rule of Civil Procedure 23 and a similarly situated collective action under Section 16(b) of the Fair Labor Standards Act, preliminarily approve the settlement and plan of allocation, approve the proposed notice, and set a final-approval hearing.

Settlement Class and Collective Action

For settlement purposes only, the court conditionally certified a class consisting of Hernandez and all delivery workers, caterers, food preparers, and cashiers who worked for the defendants at any time between December 5, 2011, and May 29, 2020.

The court found that the class members were similarly situated for purposes of evaluating whether the settlement was fair and conditionally certified the class as a Fair Labor Standards Act collective action. The court authorized mailing notice to potential collective-action members, including notice of the Fair Labor Standards Act claim and their ability to join the lawsuit. A class member who signs, negotiates, endorses, deposits, or cashes a settlement check will opt into the lawsuit for settlement purposes and release the claims described in the settlement agreement.

The court also found, exclusively for evaluating the settlement, that the proposed class met the requirements of Rule 23(a) and Rule 23(b)(3). It certified the class for settlement, notice, and award-distribution purposes only. If the settlement does not receive final approval, is overturned on appeal, or otherwise is not completed, the certification will be dissolved, and the parties may return to their prior litigation positions. The defendants would retain the right to oppose class and collective certification and to contest the merits of the claims.

Preliminary Approval and Notice

The court granted preliminary approval to the settlement agreement and plan of allocation. It found that the settlement fell within the possible range for approval, was negotiated at arm’s length, was not collusive, and reflected class counsel’s consideration of the strengths and weaknesses of the case. The court also found that the allocation plan was rationally related to the relative strengths and weaknesses of the claims and was within the possible range for approval.

The court approved the form and method of distributing the class notice. The notice was required to explain the litigation, the settlement class, class counsel, the settlement’s essential terms, participation procedures, attorney-fee and payment requests, final-approval procedures, and the procedures for challenging or opting out of the settlement. The claims administrator was directed to mail the notice within 30 calendar days after entry of the order, using each class member’s last known address, and could use email, text messages, or social media messages when necessary.

Further Proceedings and Disposition

The order did not grant final approval of the settlement. It scheduled a fairness hearing for May 5, 2021, to consider final certification of the settlement class and Fair Labor Standards Act collective action, final approval of the settlement and allocation plan, and any requests for attorney fees, expenses, or service payments.

The court appointed Hernandez as class representative, C.K. Lee of Lee Litigation Group, PLLC as class counsel, and Advanced Litigation Strategies, LLC as claims administrator.