Jung v. Gina Group, Inc.

Background

The court was informed by the Magistrate Judge that HyeYoon Jung and Gina Group, LLC had reached a settlement in principle. Jung’s complaint asserted claims under the Fair Labor Standards Act (FLSA), the federal law governing certain minimum-wage, overtime, and related employment requirements. Under the court’s discussion of Second Circuit precedent, an FLSA settlement must be approved by either the district court or the U.S. Department of Labor.

Court’s Order

The court did not approve the settlement at this stage. Instead, it ordered the parties to file a copy of the proposed settlement agreement and a joint letter by March 25, 2022. The letter must explain why the agreement is a fair and reasonable compromise of disputed issues rather than an employer’s improper waiver of statutory rights.

The parties were directed to address five fairness factors: (1) Jung’s possible recovery; (2) the burdens and expenses the settlement would avoid; (3) the seriousness of the litigation risks; (4) whether experienced counsel reached the agreement through negotiations at arm’s length; and (5) the possibility of fraud or collusion. The letter must also discuss whether a genuine dispute exists about the number of hours worked or compensation owed, and how much Jung’s attorney will seek in fees.

Disposition and Effect

Judge Mary Kay Vyskocil ordered the parties to provide the requested materials and stated that, absent special circumstances, the court would not approve a settlement filed under seal or in redacted form. The order adjourned all other dates and deadlines without setting a new date. The opinion does not state whether the settlement was ultimately approved.