Santos v. Sofa Doctor Inc.
- James Cott
- 1:20-cv-09349
- U.S. District Court · Southern District of New York
- 4
In Santos v. Sofa Doctor Inc., Judge Cott approved the wage settlement except for striking its no-reemployment term and modifying its non-disparagement term.
Santos and Sofa Doctor, Inc.; the settlement terms govern their resolved wage-and-hour dispute, including Santos’s future employment rights and permitted statements about the litigation.
What happened
Santos and Sofa Doctor, Inc. asked the court to approve their settlement of a wage-and-hour case under the Fair Labor Standards Act, a federal wage law. Judge James L. Cott reviewed the parties’ fairness letter and signed agreement.
The court found the agreement fair and reasonable overall. It struck the provision barring Santos from future employment or reinstatement with Sofa Doctor because that restriction conflicted with the purposes of the wage law.
Judge Cott approved the mutual non-disparagement provision but required it to be read as allowing Santos to make truthful statements about his experience litigating the case. The court granted the settlement motion except as stated in the opinion and closed the case.
The detailed version
- Santos v. Sofa Doctor Inc. · No. 1:20-cv-09349
- James Cott
- Nov. 16, 2021
Background
Santos and Sofa Doctor, Inc. submitted a joint motion asking the court to approve their fully executed settlement agreement in this Fair Labor Standards Act (FLSA) wage-and-hour case. The parties consented to Judge James L. Cott’s authority to review the settlement under 28 U.S.C. § 636(c).
Court’s analysis
The court stated that FLSA settlements generally receive a strong presumption of fairness, but courts must still review them for reasonableness. After reviewing the parties’ submission and agreement, the court found that the agreement’s terms, including the allocation of attorneys’ fees and costs, appeared fair and reasonable under the circumstances, except for the no-reemployment provision and the non-disparagement provision.
Paragraph 15 barred “no re-employment or reinstatement” with Sofa Doctor. Relying on its earlier reasoning in a related case, the court held that provisions preventing a plaintiff from having a future employment relationship with the defendant are highly restrictive and conflict with the FLSA’s remedial purposes. Because the agreement allowed the court to strike or limit the provision and included a severability clause, the court struck paragraph 15 and deemed it unenforceable.
Paragraph 13 contained a mutual non-disparagement provision but did not expressly include an exception allowing truthful statements about Santos’s experience litigating the case. The court approved the provision as mutual, but ordered that it be read to permit Santos to make those truthful statements, rather than allowing them only in response to a subpoena or court order.
Disposition
The court approved the settlement agreement except for the no-reemployment provision in paragraph 15 and the non-disparagement provision in paragraph 13 except as modified. The Clerk was directed to mark the settlement motion at Docket No. 33 as “granted, except as noted” in the opinion and order, and to close the case. The court noted that approval of the attorneys’ fee allocation was not approval of the hourly rate charged by Santos’s counsel, and that approval of the agreement was not approval of the parties’ tax allocations.
Read the full 4-page opinion on CourtListener, the free public archive maintained by the Free Law Project.