Velasquez Argueta v. Yisroel

Background

The action asserts claims under the Fair Labor Standards Act (FLSA), 29 U.S.C. § 201 et seq., and New York Labor Law. In a May 31, 2023 letter, the parties informed the court that they had reached a settlement in principle.

Court’s Order

The court ordered the parties to file, no later than June 30, a motion seeking:

- certification of the proposed class; - preliminary approval of the class-wide settlement; and - approval of the FLSA settlement.

The motion papers must include the proposed settlement, a proposed schedule for notifying class members, a deadline for class members to opt out, a date for preliminary approval, a settlement fairness hearing, and a proposal for how notice will be provided. The parties must also submit a proposed order as a separate docket entry and by email to chambers. That proposed order must address preliminary approval, notice, and scheduling of the fairness hearing.

If the parties intend to dismiss the FLSA claims under Rule 41 of the Federal Rules of Civil Procedure, their supporting memorandum must explain why the settlement is fair and reasonable under the factors identified by the court. The memorandum must also address any proposed incentive payments to the plaintiffs and any requested attorney’s fee award, with supporting documentation when appropriate.

Settlement Provisions Identified by the Court

The court advised that it generally will not approve a settlement containing a confidentiality provision unless the parties show case-specific reasons overcoming the public’s common-law right of access to judicial documents. It also generally will not approve a release or waiver covering claims that have not accrued or claims unrelated to wage-and-hour matters without case-specific justification. Finally, a provision barring a plaintiff from making negative statements about the defendant must include an exception for truthful statements about the plaintiff’s experience litigating the case, unless the parties provide case-specific reasons for omitting that exception.

If the proposed settlement contains any of those provisions, the parties must state whether they want the court alternatively to consider approving the agreement with the provisions removed. The court noted that it may approve or reject an FLSA settlement but may not rewrite the agreement.

Disposition and Effect

The court did not grant final approval of the settlement or decide the underlying wage claims. Instead, it set requirements and a deadline for the parties’ approval motion. The July 6, 2023 pretrial conference and all pending case deadlines were adjourned indefinitely. The parties were also reminded that they could consent to have the assigned magistrate judge decide settlement approval.