Acosta v. Superior One Management Corp.

Background

Rufino Acosta brought this action against Superior One Management Corp. and other defendants under the Fair Labor Standards Act (FLSA), a federal law governing matters including overtime pay. The parties notified the court by letter motion filed May 10, 2021, that they had reached a settlement in principle.

Court’s directions

The court explained that an FLSA settlement that would end the case through a dismissal generally must be reviewed to ensure that it is fair. It ordered the parties, by June 9, 2021, to submit the settlement agreement and a joint letter explaining the basis for the proposed settlement and why it should be approved as fair and reasonable. The letter must address the fairness factors identified in the court’s cited precedent, any incentive payment to Acosta, and any proposed attorney’s fee award, including supporting documentation when appropriate.

The court advised that it would not approve an agreement containing a confidentiality provision without case-specific reasons sufficient to overcome the public’s right to access court documents. It also would not approve a release or waiver covering claims that had not yet arisen or claims unrelated to wage-and-hour matters without case-specific justification. Likewise, a provision barring Acosta from making negative statements about a defendant would generally need an exception for truthful statements about his experience litigating the case, unless the parties justified the broader restriction. If the agreement included any of these provisions, the parties had to say whether they wanted the court to consider approving the agreement after removing the provision, while noting that the court could approve or reject the agreement but could not rewrite it.

Other procedural matters and disposition

The court reminded the parties that they could consent to proceed before Magistrate Judge Lehrburger for purposes of deciding whether to approve the settlement. Unless all parties submitted a completed consent form, however, filings were to be directed to Judge Furman. The initial pretrial conference scheduled for May 25, 2021, and all other pending deadlines were adjourned without new dates.

Judge Jesse M. Furman did not approve or reject the settlement in this order. Instead, he ordered further submissions so the proposed settlement could receive the required fairness review.