Chavaloc Choror v. Abitino's Pizza 49th Street Corp.

Background

The plaintiffs brought this action under the Fair Labor Standards Act and the New York Labor Law. The parties consented to have the case decided by a magistrate judge and reached an agreement to resolve the action. They asked the court to approve the proposed settlement.

Federal courts in this district must review Fair Labor Standards Act settlements for fairness and reasonableness. In an earlier order, Judge Analisa Torres found that the original agreement satisfied the applicable fairness factors but denied approval without prejudice because its liability-release provision was too broad. The provision bound the plaintiffs and certain successors, released entities beyond the defendants, and gave the plaintiffs no corresponding releases.

Amended Agreement

The parties later submitted an amended agreement. The court found that the revised release properly bound only the plaintiffs and released only the defendants, rather than additional affiliated entities. The court nevertheless identified two remaining problems.

First, the release stated that it covered “Defendants, officers, owners, and agents.” The court directed the parties to revise that language to say “Defendants and Defendants’ officers, owners, and agents.” Second, the release needed to state that the defendants released the plaintiffs from all known claims and liabilities relating specifically to this litigation. The court cited authority stating that settlement releases must be mutual.

Disposition

The court did not approve the amended agreement in its current form. It stated that, after the parties submitted a revised settlement agreement reflecting the required changes, the court would approve the settlement as fair and reasonable. The opinion is a procedural order concerning judicial review of a settlement, not a decision on the underlying wage claims.

Judge

The order was signed by Valerie Figueredo, United States Magistrate Judge.