Nuez Caraballo v. Hamilton Pharmacy, Inc.

Background

The parties informed the court that they had reached a settlement in principle in an action brought under the Fair Labor Standards Act (FLSA) and New York Labor Law. The opinion explains that the FLSA requires an employer violating overtime-pay rules to pay the unpaid overtime and an equal amount as additional damages.

Because the parties contemplated resolving the FLSA claims through a settlement and dismissal under Federal Rule of Civil Procedure 41, the court stated that it must review the settlement—including any proposed attorney’s fee award—to determine whether it is fair and reasonable. The court had not yet approved the settlement.

Order

Judge Furman ordered the parties to submit the settlement agreement and a joint letter by June 9, 2023. The letter must explain the basis for the proposed settlement and address why the agreement should be approved as fair and reasonable, including the factors identified in the court’s cited authority. If applicable, the letter must also address any incentive payment to the plaintiff and any attorney’s fee award, with supporting documentation when appropriate.

The court reminded the parties that they could consent to proceed for all purposes before the assigned magistrate judge, who would then decide whether to approve the settlement. If they chose that option, they had to file a fully executed consent form by June 9, 2023.

Settlement provisions identified by the court

The court stated that it would not approve a settlement containing a confidentiality provision unless the parties showed case-specific reasons sufficient to overcome the public-access right that can apply to judicial documents. It likewise would not approve a release or waiver covering claims that had not accrued or claims unrelated to wage-and-hour matters without case-specific justification. It also would not approve a clause barring the plaintiff from making negative statements about a defendant unless the clause protected truthful statements about the plaintiff’s experience litigating the case, or the parties provided case-specific reasons justifying the broader restriction.

If the agreement contained any of those provisions, the parties were directed to say whether they wanted the court to consider approving the agreement with the provisions removed. The court noted, however, that it could approve or reject the agreement but could not modify the agreement itself.

Finally, the court adjourned the June 15, 2023 pretrial conference and all pending deadlines without setting a new date.