Hines v. Memorial Sloan Kettering Cancer Center

Background

Paula Hines brought this action individually and on behalf of others similarly situated under the Fair Labor Standards Act, a federal law that requires covered employers to pay overtime wages and, when overtime is unlawfully withheld, an equal amount as additional damages. The parties informed the court that they had reached a settlement. Magistrate Judge Parker had been handling a settlement conference after the case was referred to her.

Settlement-review requirements

The court explained that when parties settle Fair Labor Standards Act claims and seek dismissal under Rule 41 of the Federal Rules of Civil Procedure, the court must review the settlement for fairness. That review includes any proposed award of attorneys’ fees. The court gave the parties two ways to complete the settlement process by September 30, 2022:

1. They could submit the settlement agreement to the court with a joint letter explaining why the agreement was fair and reasonable, addressing the factors identified in the cited precedent. The letter was also to address any payment intended to reward Hines for serving as the plaintiff and any attorneys’ fee award, with supporting documentation when appropriate. 2. They could consent to proceed before Magistrate Judge Parker for all purposes, allowing her to decide whether to approve the settlement.

The court stated that it would not approve an agreement containing a confidentiality provision unless the parties showed case-specific reasons sufficient to overcome the public’s common-law right of access to judicial documents. It also would not approve a release or waiver covering claims that had not accrued or claims unrelated to wage-and-hour matters unless the parties provided case-specific justification. In addition, a non-disparagement provision barring negative statements about the defendant would need an exception for truthful statements about the plaintiff’s experience litigating the case, unless the parties justified omitting that exception.

If the agreement contained one of those provisions, the parties were instructed to say whether they wanted the court instead to consider approving the agreement with the provision removed. The court noted that it could approve or reject the settlement but could not rewrite the agreement itself. The opinion also stated that court approval is not required for a Fair Labor Standards Act settlement made through a Rule 68(a) offer of judgment.

Disposition

The order did not approve or reject the settlement. It set deadlines and procedures for seeking approval and ordered that the conference scheduled for October 12, 2022, be adjourned indefinitely. The judge who issued and signed the order was Jesse M. Furman, United States District Judge.