Fortuna v. Pepsi-Cola Bottling Company of New York, Inc.
- Lorna Schofield
- 1:22-cv-06892
- U.S. District Court · Southern District of New York
- 2
In Fortuna v. Pepsi-Cola, Judge Schofield approved Alejandro Fortuna’s voluntary dismissal with prejudice of his federal overtime claim.
Alejandro Fortuna’s federal overtime claim against Pepsi-Cola Bottling Company of New York, Inc., and the other defendants; the case was closed.
What happened
In Fortuna v. Pepsi-Cola Bottling Company of New York, Inc., Alejandro Fortuna claimed relief under the Fair Labor Standards Act, a federal wage-and-hour law. The parties reported reaching a settlement in principle, but Fortuna later said the settlement covered only claims brought in state court, not the federal claim in this case.
Fortuna asked to dismiss the federal claim with prejudice without receiving compensation for that dismissal. He submitted a declaration stating that about 90% of his work was in the field assisting distributors with sales, deliveries, and product displays. The court considered the possibility that he was exempt from federal overtime requirements as an outside salesperson.
Judge Lorna G. Schofield approved the voluntary dismissal with prejudice as fair and reasonable and directed the Clerk of Court to close the case. The court relied on the high likelihood that the federal claim would be dismissed, the lack of an unwarranted burden from further litigation, the apparent arms-length negotiation, and the low likelihood of fraud or collusion.
The detailed version
- Fortuna v. Pepsi-Cola Bottling Company of New York, Inc. · No. 1:22-cv-06892
- Lorna Schofield
- Nov. 14, 2022
Background
The parties notified the court that they had reached a settlement in principle. The court directed them to submit the settlement agreement and information needed to evaluate whether it was fair and reasonable under the Fair Labor Standards Act (FLSA), a federal wage-and-hour statute.
Fortuna then filed a notice of voluntary dismissal with prejudice and argued that court approval was unnecessary because the settlement covered claims asserted in state court, not the FLSA claim asserted in this case. The court agreed that it did not need to approve a settlement of non-FLSA claims that were not asserted in the same action. However, it directed Fortuna to support his position that dismissing the FLSA claim with prejudice without compensation was a fair and reasonable resolution.
Parties’ Explanation
Fortuna submitted a declaration stating that he had been told he was exempt from the FLSA’s overtime requirements. He alleged that approximately 90% of his time was spent in the field assisting distributors with sales, delivery, and in-store product displays. The court identified the FLSA exemption for an outside salesperson: an employee whose primary duty is making sales and who regularly performs that primary duty away from the employer’s place of business. Fortuna also clarified that the state-court settlement had been negotiated entirely without regard to the federal claims.
Ruling
The court approved the voluntary dismissal with prejudice of the FLSA claim as fair and reasonable. Its reasons included the high likelihood that the claim would be dismissed, the conclusion that the dismissal would not undermine the FLSA’s remedial purposes, the unnecessary burden and expense of litigating the claim, the apparent arms-length nature of the negotiations, and the little likelihood of fraud or collusion because Fortuna received no compensation for dismissing the claim. The Clerk of Court was directed to close the case.
The order approved the dismissal; it did not definitively decide whether Fortuna was in fact exempt from the FLSA’s overtime requirements.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.