Matto v. Ourem Iron Works, Inc.
- John Cronan
- 1:20-cv-01868
- U.S. District Court · Southern District of New York
- 2
In Matto v. Ourem Iron Works, Judge Cronan scheduled a conference to examine a proposed Fair Labor Standards Act settlement without yet approving dismissal.
The three remaining plaintiffs—Robers Costilla Matto, Wilbert Costilla Matto, and Aldo Valenzuela Hilar—and defendants Ourem Iron Works, Inc. and Arthur Vieira, Sr.; the order required the parties and their counsel to attend a conference.
What happened
In Matto v. Ourem Iron Works, the parties asked the court to approve a settlement between Robers Costilla Matto and the defendants and to dismiss the Fair Labor Standards Act claims of three remaining plaintiffs. Two plaintiffs reportedly settled with the New York State Department of Labor.
The court identified concerns about the settlement’s broad release of claims, its effect on plaintiffs who were not parties to the proposed agreement, and whether the two Department of Labor settlements validly released federal wage claims. The court also questioned whether dismissing those claims would be fair and reasonable.
Judge Cronan ordered all parties to appear for a conference on January 29, 2021, to address those issues. The order did not approve the settlement or dismiss the claims.
The detailed version
- Matto v. Ourem Iron Works, Inc. · No. 1:20-cv-01868
- John Cronan
- Jan. 26, 2021
Background
On January 19, 2021, the plaintiffs submitted a letter asking the court to approve a settlement agreement between Plaintiff Robers Costilla Matto and Defendants Ourem Iron Works, Inc. and Arthur Vieira, Sr. The request was made under Cheeks v. Freeport Pancake House, Inc., which requires court review of certain Fair Labor Standards Act settlements for fairness and reasonableness.
The letter appeared to ask the court to dismiss the Fair Labor Standards Act claims of the three remaining plaintiffs: Robers Matto, Wilbert Costilla Matto, and Aldo Valenzuela Hilar. The proposed settlement was between Robers Matto and the defendants. The letter stated that Wilbert Matto and Hilar had separately settled with the New York State Department of Labor and had released the claims involved in this case. The court noted that this representation was not entirely clear and appeared to indicate that those settlements included releases of federal Fair Labor Standards Act claims.
Issues Identified by the Court
After independently reviewing the letter and settlement agreement, the court directed the parties to address four issues:
- Whether the settlement’s release of “any and all claims” was too broad to be fair and reasonable because it could cover claims unrelated to wage-and-hour issues.
- Whether it was fair and reasonable for Robers Matto’s settlement with the defendants to depend on dismissal of Wilbert Matto’s and Hilar’s claims, even though they were not parties to that settlement.
- Whether Wilbert Matto’s and Hilar’s releases of their Fair Labor Standards Act claims in settlements with the New York State Department of Labor were enforceable in this court.
- Whether dismissal of Wilbert Matto’s and Hilar’s claims would be fair and reasonable in light of the terms of those Department of Labor settlements.
Order
Judge John P. Cronan ordered all parties to appear for a conference on January 29, 2021, at 2:00 p.m., and directed counsel to be prepared to discuss the identified issues under the standards governing Fair Labor Standards Act settlement approval. The order did not approve the proposed settlement and did not dismiss any claims.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.