Parmar v. Fulton Family Pharmacy Inc.
- Edgardo Ramos
- 1:21-cv-07826
- U.S. District Court · Southern District of New York
- 6
Parmar v. Fulton Family Pharmacy, Judge Ramos denied settlement approval without prejudice because the parties did not document the proposed attorneys’ fees.
Hitendrasinh Parmar and the defendant pharmacies and individuals were affected: the proposed settlement was not approved, and the parties were given three procedural options for continuing or ending the case.
What happened
In Parmar v. Fulton Family Pharmacy Inc., Hitendrasinh Parmar alleged that the defendants violated federal, New York, and New Jersey wage laws by failing to pay required wages and by making unlawful deductions and disclosures. The parties asked the court to approve a $135,000 settlement.
The court found that the settlement amount and other agreement terms were fair and reasonable. But the parties did not provide billing records or other information needed to evaluate whether the proposed $45,000 attorneys’ fee was reasonable.
Judge Ramos denied the request for settlement approval without prejudice. The parties could submit a revised agreement with fee documentation, abandon the settlement and continue toward trial, or agree to dismiss the case without prejudice.
The detailed version
- Parmar v. Fulton Family Pharmacy Inc. · No. 1:21-cv-07826
- Edgardo Ramos
- July 29, 2022
Background
Hitendrasinh Parmar sued Fulton Family Pharmacy Inc., GS Pharmacy LLC, Wellcare Pharmacy LLC, Dilip Lavani, and Gita Lavani. He alleged violations of the Fair Labor Standards Act (FLSA), New York labor laws, and New Jersey labor laws involving minimum wages, overtime, spread-of-hours compensation, wage deductions, wage notices, and wage statements. The parties jointly sought approval of a proposed settlement.
Settlement Amount
The proposed settlement required payment of $135,000. Parmar’s counsel would receive $45,000 in attorneys’ fees and $477.74 in costs, leaving Parmar with $89,522.26. Parmar estimated that his unpaid back wages totaled $82,968, so the amount allocated to him was approximately 107.9% of that estimate. The court found the settlement amount fair and reasonable because it resolved contested issues, avoided the risks and delays of litigation, and resulted from arm’s-length negotiations after multiple court-ordered mediation conferences.
Attorneys’ Fees and Other Terms
The court explained that it uses the lodestar method as a cross-check for proposed fees. The lodestar is the reasonable number of hours worked multiplied by a reasonable hourly rate. The parties submitted no billing records showing the dates, hours, or work performed by the attorneys, and provided insufficient information for the court to assess the proposed fee’s reasonableness. The court therefore could not approve the fee request.
The court found the agreement’s other provisions fair and reasonable. The release was limited to wage-and-hour claims through the date Parmar signed the agreement. The agreement contained no objectionable confidentiality provision, and its mutual non-disparagement clause was permissible because it allowed truthful statements about the parties’ litigation experience.
Disposition
The court denied without prejudice the request for settlement approval. By August 12, 2022, the parties were directed to submit a revised agreement with documentation supporting the attorneys’ fees, file a joint letter saying they intended to abandon settlement and proceed toward trial, or stipulate to dismissal of the case without prejudice. The Clerk of Court was directed to terminate the settlement-approval motion.
Read the full 6-page opinion on CourtListener, the free public archive maintained by the Free Law Project.