Hernandez Ramirez v. 35 Bakery Cafe Corp.

Background

Alfredo Hernandez Ramirez and Lizabeth Huertas Ramirez sued AA BC Bakery Café Corp., doing business as The Bread Factory Cafe, Christine Pae, Bobby P. Pae, and Albert Pae. Their claims included minimum-wage and unpaid-overtime claims under the Fair Labor Standards Act (FLSA), along with related claims and wage-notice and wage-statement claims under the New York Labor Law.

On May 24, 2022, the court denied the parties’ request to approve an earlier proposed settlement. The parties then submitted a revised settlement for approval.

Settlement Approval

The court applied the requirement that an FLSA settlement be fair and reasonable. It considered the factors identified in Wolinsky v. Scholastic Inc., including the plaintiffs’ possible recovery, the burdens and costs of continued litigation, litigation risks, whether experienced counsel negotiated at arm’s length, and the possibility of fraud or collusion. The court had already found that the earlier settlement satisfied those factors, and it found that the revised settlement did as well because the agreements were largely identical in other respects.

The earlier agreement’s release clause was defective because it released only the defendants, bound or benefited entities beyond the parties, and was not limited to claims based on the facts of the lawsuit. The revised clause mutually released the plaintiffs and defendants, applied only to those parties, and covered wage-and-hour and record-keeping claims based on conduct arising on or before the date the revised settlement was signed, particularly the claims raised in this action. The court found that limitation fair and reasonable and approved the revised settlement.

Attorney’s Fees

The settlement provided for a total payment of $40,000, of which plaintiffs’ counsel requested $13,333.33 in attorney’s fees—approximately one-third of the settlement. The court reviewed contemporaneous billing records showing approximately 38.6 hours of work. Michael Faillace billed approximately 3.3 hours at $450 per hour, producing a lodestar of $1,485, and William Oates billed approximately 35.3 hours at $400 per hour, producing a lodestar of $14,120. The total lodestar was $15,605.

The requested fee produced a lodestar multiplier of 1.2. The court accepted that multiplier and found the $13,333.33 fee reasonable under the circumstances.

Disposition

The court GRANTED the parties’ request for approval of the settlement. The Clerk of Court was directed to terminate all pending motions and close the case.