Moody v. Inspire Summits LLC

Background

B. Moody and K. O’Brien brought a wage-and-hour case under the Fair Labor Standards Act against Inspire Summits LLC and Christopher P. Skroupa. The parties reached a settlement in principle and consented to the jurisdiction of Sarah L. Cave, a United States Magistrate Judge, for all purposes. They then filed a joint motion asking the court to approve their settlement agreement under the standard established in Cheeks v. Freeport Pancake House, Inc.

Court’s analysis

The court explained that there is generally a strong presumption favoring fair settlements in Fair Labor Standards Act cases because the parties are usually better positioned than the court to assess the settlement’s reasonableness. The court also considered potential collection problems. The plaintiffs agreed to a payment schedule, and the defendants provided confessions of judgment. The court stated that these provisions supported finding the settlement reasonable.

After reviewing the motion, agreement, and exhibits, the court found that all of the agreement’s terms—including the allocation of attorney’s fees and costs—appeared fair and reasonable under the totality of the circumstances and the factors identified in Wolinsky v. Scholastic Inc.

Ruling

Judge Sarah L. Cave approved the settlement agreement. The action was dismissed with prejudice and without costs except as provided in the agreement. The court retained jurisdiction to enforce the agreement, ruled that any pending motions were moot, directed the Clerk of Court to mark the settlement motion as granted, and directed the Clerk to close the case.