Khan v. Dunwoodie Gas Station, Inc.

Background

Jawaid I. Khan brought claims under the Fair Labor Standards Act and New York Labor Law against the Dunwoodie Defendants and the Yonkers Defendants. Khan alleged that he worked approximately 68 hours per week as a cashier from about July 2016 through April 2018, earned between $9 and $11 per hour, was not paid overtime at one-and-a-half times his regular rate, and was not permitted an uninterrupted half-hour meal break.

The court had previously approved a stipulation dismissing the action as to the Dunwoodie Defendants. Khan and the Yonkers Defendants then jointly sought approval of a partial settlement resolving Khan’s claims against the Yonkers Defendants. The court had denied an earlier settlement request without prejudice and considered the parties’ revised agreement in this opinion.

Settlement Terms and Court’s Analysis

The revised agreement required the Yonkers Defendants to pay $15,000. Of that amount, $5,000 would go to Khan’s counsel for fees and other costs, leaving Khan with a $10,000 recovery. The parties calculated Khan’s base damages at $12,712, and estimated his best possible recovery—including base damages, an equal amount of liquidated damages, and damages under the Wage Theft Prevention Act—at approximately $35,424. The court found the parties’ calculation sufficiently close to its own approximation of $12,880 in base damages. Khan’s net recovery represented approximately 79% of the calculated base damages and 28% of the estimated best-case recovery.

The court also found that the settlement had been negotiated in good faith, that Khan was the only employee affected by the settlement and dismissal, and that the requested attorney fees were reasonable. The original agreement had released all claims Khan could have asserted against the Yonkers Defendants from the beginning of time. The revised agreement instead released only claims Khan asserted against those defendants under the Fair Labor Standards Act, New York Labor Law, and the Wage Theft Prevention Act in this action. The court found that limitation appropriately narrow.

Disposition

The court granted the parties’ request for approval of the Revised Proposed Settlement Agreement. The Clerk of Court was directed to close the case. This opinion approved the settlement; it did not decide whether Khan’s underlying wage-and-hour allegations were ultimately proven.

Key Terms

- Partial settlement: The agreement resolved Khan’s claims against the Yonkers Defendants, while the Dunwoodie Defendants had already been dismissed from the action. - Net payment to Khan: $10,000. - Attorney fees and costs: $5,000. - Release: Limited to claims asserted in this action against the Yonkers Defendants. - Result: The revised settlement was approved and the case was closed.