Cortes v. DS Brooklyn Portfolio Owner LLC

Background

Joaquin Cortes and Raul Mera sought approval of a settlement reached with the defendants in their Fair Labor Standards Act (FLSA) case. Because the Department of Labor had not approved the agreement, the court reviewed whether it was fair and reasonable.

Cortes alleged that he worked at defendants’ buildings, including as a superintendent, from July 2016 through October 2019. He claimed $115,943.91 in unpaid overtime wages, plus liquidated damages, wage and payroll notice penalties, interest, costs, and attorneys’ fees. Mera alleged that he was hired to renovate three apartments for $34,000, received $9,000 for work on the first two apartments, and was not paid amounts he claimed were due for the remaining work. Mera claimed $21,250 in unpaid compensation and related damages. The opinion states that Mera also had an alternative claim under New York City’s Freelance Isn’t Free Act if he was found to be an independent contractor not protected by the FLSA.

Settlement Amount

The total settlement was $90,000. After attorneys’ fees and costs, $58,555.28 would go to the plaintiffs: $46,844.22 to Cortes and $11,711.06 to Mera.

The court calculated the plaintiffs’ alleged possible recovery, including liquidated damages, at least $274,366 in total: at least $231,886 for Cortes and at least $42,500 for Mera. The $90,000 settlement represented approximately 32.8% of that amount when attorneys’ fees and costs were included. The parties also identified factual and litigation risks, including documents that defendants said contradicted Cortes’s claimed hours and uncertainty about which defendants actually employed either plaintiff. The settlement required all defendants to contribute under a payment schedule, avoiding further litigation over those issues.

The court concluded that the settlement amount was reasonable in light of the case-specific concerns and the percentage of possible recovery.

Attorneys’ Fees and Costs

The settlement provided $29,277.64 in attorneys’ fees and $2,167.08 in costs. The costs included the initial filing fee, a process server, and expenses related to an earlier motion for default judgment that had become moot, including translation into the plaintiffs’ native Spanish. Plaintiffs’ counsel was entitled to one-third of the total recovery under the contingent-fee agreement. The court noted that the lodestar amount—the fees calculated from counsel’s documented time and rates—was $39,397 without any additional multiplier. It found the requested fees and costs fair and reasonable.

Ruling

Judge Vernon S. Broderick found the settlement fair and reasonable and approved it. He also found no other settlement term that made the agreement unreasonable. The Clerk of Court was directed to terminate the action.