Aguilera Mora v. Chinelus Corp.

Background

Maria del Carmen Aguilera Mora brought the case on behalf of herself and others similarly situated against Chinelus Corp. and Alma Felicies. The opinion concerns claims under the Fair Labor Standards Act (FLSA). Earlier the same day, the court had issued an order describing three ways for the parties to proceed. Judge Gregory H. Woods amended that order after the Second Circuit issued its decision in Samake v. Thunder Lube, Inc.

This order did not decide the merits of the FLSA claims. Instead, it established procedures for possible dismissal or resolution of the case.

Option 1: Court-approved dismissal with prejudice

The court explained that, under the Second Circuit’s decision in Cheeks v. Freeport Pancake House, Inc., the parties cannot dismiss FLSA claims with prejudice through a voluntary dismissal under Federal Rule of Civil Procedure 41(a)(1)(A). A dismissal with prejudice bars the dismissed claims from being brought again. To dismiss FLSA claims with prejudice, the parties must seek court approval under Rule 41(a)(2).

Before seeking that approval, the parties were ordered to discuss whether they would consent under 28 U.S.C. § 636(c) to having all further proceedings conducted by the assigned magistrate judge. If both parties consented, they were required to file a completed consent and reference form by February 10, 2022. If either party did not consent, the parties were required to file a joint letter by that date stating that they did not consent, without identifying the nonconsenting party or parties. The court stated that withholding consent would not have negative consequences.

If the parties did not consent to proceed before the magistrate judge, they were directed to file a joint motion by February 17, 2022, explaining why their settlement was fair and should be approved. The motion had to address the factors described in Wolinsky v. Scholastic Inc. and include the settlement agreement. The court stated that it would not approve settlement agreements containing confidentiality provisions. It also stated that documents related to settlement review could not be filed under seal without a particularized showing overcoming the presumption of public access to judicial documents.

If a settlement included attorney’s fees, the parties were directed to address whether the fees were reasonable under the framework in Goldberger v. Integrated Resources, Inc. Plaintiffs’ attorneys also had to provide detailed time records for the court’s review.

Option 2: Dismissal without prejudice

The court explained that the Second Circuit had reserved the question of voluntary dismissal of FLSA claims without prejudice under Rule 41(a)(1)(A), but had later held in Samake that the court must evaluate such dismissals to ensure they do not conceal a settlement. A dismissal without prejudice generally does not bar the claims from being brought again.

The court stated that it would accept a dismissal stipulation if it dismissed the FLSA claims without prejudice and the parties certified that there had been no settlement of FLSA claims. If the parties could not make that certification, they had to request court review of the settlement under the procedures described in Option 1. A proposed stipulation and certification had to be submitted by February 10, 2022.

Option 3: Offer of judgment

The court also described an offer of judgment under Federal Rule of Civil Procedure 68. Under that rule, a defending party may offer to allow judgment on specified terms, including accrued costs. If the opposing party accepts within the required period, either party may file the offer and acceptance, and the clerk must enter judgment.

The court noted that the Second Circuit had held in Mei Xing Yu v. Hasaki Restaurant, Inc. that court approval is not required for a Rule 68 offer of judgment involving FLSA claims. If the parties chose this option, they were directed to submit the executed offer and acceptance, along with a proposed judgment order consistent with their agreement, by February 10, 2022.

Effect of the order

The court directed the parties to follow one of the three described procedures. It did not grant or deny a dispositive motion, enter judgment, or resolve the underlying FLSA claims.