Bhattarai v. Flagship S B New York LLC
- James Cott
- 1:21-cv-01148
- U.S. District Court · Southern District of New York
- 3
In Bhattarai v. Flagship S B New York LLC, Judge Cott approved the parties’ Fair Labor Standards Act settlement and closed the case.
The plaintiffs and defendants in the wage-and-hour case, as well as the plaintiffs’ counsel regarding the settlement’s allocation of attorneys’ fees and costs.
What happened
In Bhattarai v. Flagship S B New York LLC, the parties asked the court to approve their settlement of a wage-and-hour lawsuit. They had agreed to the magistrate judge’s authority to decide the matter.
Judge Cott found that the settlement terms appeared fair and reasonable under the circumstances. He considered the general presumption favoring fair settlements in Fair Labor Standards Act cases and the defendants’ apparent financial difficulties during the COVID-19 pandemic, which could have made collecting a judgment difficult.
Judge Cott approved the settlement and directed the Clerk to close the case. The court retained authority to reopen the case if necessary, but only to enforce the settlement.
The detailed version
- Bhattarai v. Flagship S B New York LLC · No. 1:21-cv-01148
- James Cott
- Mar. 7, 2022
Background
The plaintiffs brought a wage-and-hour case under the Fair Labor Standards Act (FLSA). The parties consented to the jurisdiction of James L. Cott, a United States magistrate judge, under 28 U.S.C. § 636(c). They submitted a joint letter and a fully executed settlement agreement for court approval.
Under Second Circuit precedent, courts review FLSA settlements because employees and employers may not be equally positioned to assess whether a settlement is reasonable. The court noted a strong presumption that a fair settlement should be approved.
Court’s Analysis
The court reviewed the joint letter, the proposed settlement, and the circumstances surrounding the agreement. Judge Cott had also participated in a lengthy settlement conference with the parties. He concluded that all settlement terms appeared fair and reasonable under the totality of the circumstances, including the factors identified in applicable case law.
The court specifically considered the defendants’ apparent financial situation resulting from the COVID-19 pandemic. Because the settlement amount was to be paid on a schedule, and because collecting damages could have been difficult, that circumstance supported approval of the settlement.
The settlement allocated attorneys’ fees and costs as one-third of the settlement amount. The court stated that approving this allocation did not approve the hourly rate of the plaintiffs’ counsel. The court also identified a $36.02 discrepancy in the requested fees and costs, calculating the amount as $37,147.30 rather than the requested $37,183.32, and assumed the parties would make any necessary adjustment.
Disposition
The court approved the proposed settlement. Under the settlement agreement, the court retained jurisdiction over the case and could reopen it if necessary solely to enforce the settlement. The Clerk was directed to close the case.
Classification
This is a procedural order because the court approved a settlement and closed the case without deciding the underlying wage-and-hour claims on their merits.
Read the full 3-page opinion on CourtListener, the free public archive maintained by the Free Law Project.