Polanco v. York Food Corp.

Background

The plaintiffs submitted a joint request for approval of a proposed settlement under the requirement that courts review certain settlements of claims under the Fair Labor Standards Act (FLSA). The parties said they reached the material terms after private mediation. The claims arose under the FLSA and New York Labor Law.

The defendants named in the agreement were York Food Corp., Le Souk, Inc., Marcus Andrews, Samir Jacob, and Lamia Funti. The agreement required them to pay $95,000 in five installments over approximately four months. Viktoryia Polanco would receive $36,000, opt-in plaintiff Salgara Valeryevna Orasheva would receive $26,457, and plaintiffs' attorneys would receive $32,543 for fees and costs.

Settlement Terms and Fees

The agreement contained a bilateral release. The plaintiffs released claims known or unknown relating to their employment with the defendants, and the defendants released all known claims against the plaintiffs, in each case as of the agreement's effective date. The agreement did not contain a confidentiality clause or another contractual restriction on the parties' ability to speak about the case or settlement.

Marcus Andrews also executed a confession of judgment on behalf of himself, York Food Corp., and Le Souk, Inc. The confession was for $190,000, twice the total settlement amount, reduced by twice the payments made under the agreement. The court noted that the confession was incorrectly captioned in a different district.

The court approved $32,543 in attorneys' fees and costs, consisting of $1,315 for filing fees and other out-of-pocket costs and $31,228, or one-third of the net settlement amount, as fees. The court found the award consistent with the attorneys' retainer agreements, substantial decisions in the district, and the recovery obtained for the plaintiffs. The court also noted that the fee award was approximately 140 percent of counsel's $22,425 lodestar, which was calculated from hourly rates ranging from $175 to $425.

Ruling

Judge Barbara Moses found that the settlement terms were fair and reasonable and that the proposed fee award was reasonable. The court therefore approved the proposed settlement.

The court ordered that the action be dismissed with prejudice and without costs. It retained jurisdiction for the limited purpose of enforcing the agreement if necessary and directed the clerk to close the case.