Lazri v. Studio Cahs, Ltd.
- Analisa Torres
- 1:22-cv-01158
- U.S. District Court · Southern District of New York
- 2
In Lazri v. Studio Cahs, Judge Torres required court or Labor Department approval before dismissing the settled Fair Labor Standards Act case with prejudice.
Priscilla Lazri and defendants Studio Cahs, Ltd.; Cahs Construction Ltd.; Caterina Heil; and Charles Stewart. The parties had to obtain court or Department of Labor approval before dismissing the action with prejudice based on their settlement.
What happened
In Lazri v. Studio Cahs, Ltd., Priscilla Lazri and the defendants told the court they had reached a settlement in a Fair Labor Standards Act case.
The court said the case could not be dismissed with prejudice based on the settlement unless either the court or the Department of Labor approved the agreement. It required any request for approval to explain why the settlement was fair and reasonable, address any dispute about hours or compensation, and disclose any requested attorney fees with supporting billing records.
Judge Analisa Torres also warned that the court generally would not approve sealed or redacted agreements, sweeping confidentiality terms, or releases covering claims unrelated to wage-and-hour issues. The parties could ask to have Magistrate Judge James L. Cott oversee approval, but the court terminated pending motions and vacated conferences.
The detailed version
- Lazri v. Studio Cahs, Ltd. · No. 1:22-cv-01158
- Analisa Torres
- Aug. 25, 2022
Background
Priscilla Lazri sued Studio Cahs, Ltd.; Cahs Construction Ltd.; Caterina Heil; and Charles Stewart in a case under the Fair Labor Standards Act (FLSA). The court was advised that the parties had reached a settlement.
Settlement-Approval Requirement
The court stated that the action could not be dismissed with prejudice based only on the parties’ settlement unless the settlement agreement was approved by the court or by the Department of Labor. To seek dismissal with prejudice, the parties had to file a joint letter motion asking the court to approve the agreement or provide documentation showing Department of Labor approval. The filing, including the settlement agreement, was due on the public docket by October 10, 2022.
The court required the approval request to explain why the proposed settlement was fair and reasonable. At a minimum, it had to discuss Lazri’s possible recovery, the burdens and expenses the settlement would avoid, the litigation risks, whether experienced counsel negotiated the agreement at arm’s length, and the possibility of fraud or collusion. It also had to address whether a genuine dispute existed about the hours worked or compensation owed and how much Lazri’s attorney would seek in fees.
Attorney Fees and Settlement Terms
Any request for attorney fees had to include supporting documentation, including contemporaneous billing records identifying each attorney’s dates, hours, and work performed. The court stated that, absent special circumstances, it would not approve an agreement filed under seal or in redacted form. It also stated that, absent compelling circumstances, it would not approve an agreement containing broad nondisclosure provisions or releases of claims unrelated to FLSA issues.
Magistrate-Judge Consent and Disposition
The parties could consent to proceed before Magistrate Judge James L. Cott, who would then oversee settlement approval. If they consented, they had to file a fully executed consent form by September 26, 2022. The court stated that the parties could withhold consent without negative consequences and that any appeal would go directly to the United States Court of Appeals for the Second Circuit.
Judge Analisa Torres directed the Clerk of Court to terminate all pending motions and vacate all conferences. The order did not approve the settlement or dismiss the action with prejudice.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.