De la Cruz v. TJ Alvarez Corp.
- Ronnie Abrams
- 1:21-cv-05351
- U.S. District Court · Southern District of New York
- 5
In De la Cruz v. TJ Alvarez Corp., Judge Abrams approved the wage-settlement agreement and dismissed the complaint with prejudice.
The settlement affected Plaintiffs Orlando Xocua de la Cruz and Jose Miguel Gonzalez Conor and Defendants TJ Alvarez Corp. d/b/a Il Carino Restaurant and Julio Alvarez. Plaintiffs’ wage claims were resolved through a $15,000 settlement, and the complaint was dismissed with prejudice.
What happened
Orlando Xocua de la Cruz and Jose Miguel Gonzalez Conor sued TJ Alvarez Corp. and Julio Alvarez, alleging violations of federal and New York wage laws. The parties reached a settlement through court-sponsored mediation that required Defendants to pay $15,000, including $5,000 for attorneys’ fees.
The court reviewed whether the agreement was fair and reasonable. It found the payment reasonable given the disputed facts and legal issues, the risks of trial, and counsel’s representation that Defendants had limited financial resources. The court also approved the fees, the wage-related release, and the non-disparagement provision because it allowed truthful statements about the litigation.
Judge Ronnie Abrams approved the settlement agreement, dismissed the complaint with prejudice under that agreement, and directed the Clerk of Court to close the case.
The detailed version
- De la Cruz v. TJ Alvarez Corp. · No. 1:21-cv-05351
- Ronnie Abrams
- Feb. 7, 2022
Background
Orlando Xocua de la Cruz and Jose Miguel Gonzalez Conor sued TJ Alvarez Corp., doing business as Il Carino Restaurant, and Julio Alvarez. They alleged violations of the Fair Labor Standards Act, a federal wage law, and the New York Labor Law. After the parties negotiated through the Southern District of New York’s mediation program, they submitted a settlement agreement for the court’s approval.
Settlement Amount
The agreement required Defendants to pay Plaintiffs $15,000 total, with $5,000 reserved for Plaintiffs’ attorneys’ fees. Plaintiffs estimated that they were owed approximately $24,635.50 in unpaid wages and that their total recovery, including actual damages, liquidated damages, penalties, and interest, could be $74,155.42 if they prevailed fully.
The court nevertheless found the settlement amount fair and reasonable. It considered the legal and evidentiary challenges Plaintiffs would face, the sharply disputed factual and legal issues, and counsel’s representation that Defendants had limited financial resources because of the COVID-19 pandemic, which could have made collecting a larger judgment difficult.
Attorneys’ Fees
The court independently reviewed Plaintiffs’ counsel’s time records and approved the requested $5,000 fee. The fee was one-third of the settlement amount, a percentage that courts regularly approve in Fair Labor Standards Act cases.
Release and Non-Disparagement Terms
The court approved the release because it was limited to wage-and-hour and record-keeping claims under the Fair Labor Standards Act, the New York Labor Law, and the Hospitality Wage Order of the New York Commissioner of Labor. It did not release unrelated claims.
The agreement did not contain a confidentiality provision. It did contain a non-disparagement clause restricting remarks that could adversely affect the other parties’ reputations or interests. The court approved that clause because it included an exception allowing the parties to communicate truthfully about their experience during the litigation, including the claims and defenses.
Disposition
The court approved the parties’ settlement agreement. It dismissed the complaint with prejudice in accordance with the agreement and directed the Clerk of Court to close the case.
Read the full 5-page opinion on CourtListener, the free public archive maintained by the Free Law Project.