Romero v. New Blue Flowers Gourmet Corp.

Background

Marcos Romero brought this wage-and-hour case under the Fair Labor Standards Act and New York Labor Law against New Blue Flowers Gourmet Corp., doing business as Café Alice; 74Fifth Ave Market Corp., doing business as U Way Café; Valent & Cook At 57th Street Corp., doing business as C’est Bon Café; and Byung Sik Lim. The parties reached a settlement that the court approved in May 2018. The dismissal order expressly retained the court’s authority to enforce the settlement.

The settlement required the defendants to pay Romero $12,000 in 12 monthly payments of $1,000, beginning May 1, 2018, and ending April 1, 2019. If a payment was late beyond a one-week grace period, the full unpaid balance became immediately due, and the defendants owed a 10 percent penalty on the unpaid balance, compounded monthly. Romero moved to enforce the settlement and requested a judgment. He later withdrew a separate request for attorney’s fees related to enforcement.

The Austin Brown Law Firm also asked to withdraw as counsel for the defendants. The firm stated that it had been unable to contact its clients by mail, telephone, or email. The defendants did not respond to either motion.

Enforcement of the Settlement

The court held that it had authority to enforce the settlement because its dismissal order expressly retained jurisdiction over the agreement. It treated enforcement as a contract matter and applied New York law, finding that New York had the greatest interest in the dispute based on the parties’ connections and the location of the underlying events stated in the opinion.

The court found that Romero had performed his obligations under the settlement and that the defendants had failed to make any of the required payments. It therefore found the defendants in breach and concluded that Romero was entitled to judgment under the agreement.

The court calculated the judgment as follows:

- $12,000 in unpaid settlement principal; - $3,911.88 in contractual penalties, calculated from May 8, 2018, after the one-week grace period expired; and - $15,911.88 total.

The court granted in part and denied in part Romero’s motion to enforce the settlement. It granted the motion to the extent Romero sought judgment for the amount due under the agreement and denied it to the extent he sought an additional automatic 15 percent increase under Section 198(4) of the New York Labor Law. The court explained that Section 198(4) applies to judgments based on a New York Labor Law claim, while this judgment enforced a settlement agreement and therefore arose from breach of contract.

Withdrawal of Counsel

The court granted Brown Law’s motion to withdraw as counsel for the defendants. It found that the firm’s inability to communicate with the defendants was a sufficient reason for withdrawal, particularly because the application was unopposed and the settlement had already been reached. The withdrawal was subject to Brown Law serving the memorandum and order on the defendants by means reasonably calculated to reach them and filing proof of service.

Disposition

Romero’s motion to enforce the settlement was granted in part and denied in part. The court directed that judgment be entered for $15,911.88, without the requested additional 15 percent statutory increase. Brown Law’s application to withdraw was granted, subject to the service and proof-of-service requirement.