Barreto Pelon v. Gabi Operating Corp.
- Robert Lehrburger
- 1:19-cv-00502
- U.S. District Court · Southern District of New York
- 2
In Barreto Pelon v. Gabi Operating Corp., Magistrate Judge Lehrburger approved the parties’ settlement of named plaintiffs’ Fair Labor Standards Act claims.
The order affects the named plaintiffs and the defendants by approving their Fair Labor Standards Act settlement. It does not resolve the separate Rule 23 class-action claims.
What happened
Barreto Pelon v. Gabi Operating Corp. is a collective and class action alleging damages under the Fair Labor Standards Act and New York Labor Law. The parties asked the court to approve a settlement between the defendants and the named plaintiffs, resolving only the named plaintiffs’ Fair Labor Standards Act claims.
The court reviewed the settlement and considered the risks, costs, possible recovery, bargaining process, attorney’s fees, potential fraud or collusion, and how the settlement funds were allocated between the Fair Labor Standards Act claims and the separate class claims. The court noted that the agreement had no confidentiality restriction, included a mutual non-disparagement provision with exceptions, limited the release to the named plaintiffs’ Fair Labor Standards Act claims, and provided attorney’s fees within a fair and reasonable range.
Magistrate Judge Robert W. Lehrburger found the settlement fair and reasonable and approved it. The opinion states that the court had separately given preliminary approval to the plaintiffs’ motion to certify the Rule 23 class for settlement purposes.
The detailed version
- Barreto Pelon v. Gabi Operating Corp. · No. 1:19-cv-00502
- Robert Lehrburger
- Aug. 5, 2022
Background
This case is a collective and class action seeking damages under the Fair Labor Standards Act and New York Labor Law. The parties jointly asked the court to approve their Fair Labor Standards Act settlement agreement and release. The agreement was between the defendants and the named plaintiffs and resolved only the named plaintiffs’ Fair Labor Standards Act claims.
The court stated that federal courts must review proposed settlements in Fair Labor Standards Act cases to determine whether they are fair and reasonable, were reached through arm’s-length negotiations, and were not the product of employer overreaching. The court had assisted with mediation and reviewed the settlement agreement and the parties’ submission. It also held a conference concerning the settlement and the plaintiffs’ pending motion to certify a Rule 23 class for settlement purposes. The court had separately granted preliminary approval of that class-certification request.
Court’s Analysis
The court considered the prior proceedings; the risks, burdens, and costs of continuing the case; the possible individual and collective recovery; whether experienced counsel or the parties negotiated at arm’s length; attorney’s fees; the possibility of fraud or collusion; and the amounts and proportions allocated to the named plaintiffs’ Fair Labor Standards Act claims compared with the Rule 23 class-action claims.
The court also noted that the agreement contained no confidentiality restriction, that its non-disparagement provision was mutual and included appropriate exceptions, that the release was limited to the named plaintiffs’ Fair Labor Standards Act claims, and that the attorney’s fees fell within a fair, reasonable, and acceptable range.
Disposition
Considering all the circumstances, the court found the Fair Labor Standards Act settlement agreement fair and reasonable and approved it. The opinion does not state the settlement amount or provide a final ruling on the separate Rule 23 class-action claims.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.