Butler v. The All American Bar on First Avenue Inc.

Background

Alla Butler, Ian Hannah, and Edith Zagrod brought this wage-and-hour case against The All American Bar on First Avenue Inc., 58 E. 34th St. Wings Lodge Inc., Robert J. Gerola, Jr., Robert O’Rourke, Claudine M. O’Rourke, and Louise DeMarco. The claims arose under the Fair Labor Standards Act. The parties consented to jurisdiction by Sarah L. Cave, a United States Magistrate Judge, and jointly submitted a proposed settlement for court approval.

Settlement review

Under the Second Circuit’s decision in Cheeks v. Freeport Pancake House, Inc., the court reviewed the settlement. After the court identified two clerical errors in the first proposed agreement, the parties submitted a corrected agreement. The court stated that FLSA settlements generally receive a strong presumption of fairness. It also considered the plaintiffs’ serious concerns about collecting a judgment and the payment schedule in the agreement.

The court reviewed the settlement, its allocation of attorneys’ fees and costs, and the accompanying exhibits. Applying the factors identified in Wolinsky v. Scholastic Inc., the court found that the settlement terms appeared fair and reasonable under the circumstances. The court also found that the corrected agreement addressed the previously identified problems with the payment schedule. The parties confirmed that all defendants except Louise DeMarco had executed confessions of judgment under the agreement.

Ruling and disposition

Judge Sarah L. Cave approved the settlement. The action was dismissed with prejudice and without costs except as provided in the settlement agreement. The court retained jurisdiction to enforce the agreement, ruled that any pending motions were moot, directed the clerk to mark the corrected settlement agreement as granted, and directed the clerk to close the case.