Ixcoy Perez v. Mechanical Service Corp. of New York
- Ona Wang
- 1:21-cv-02467
- U.S. District Court · Southern District of New York
- 2
In Ixcoy Perez v. Mechanical Service Corp. of New York, Judge Torres required approval before the FLSA settlement could support dismissal with prejudice.
The plaintiffs, Romeo Ixcoy Perez and Romeo Sontay, and the defendants, Mechanical Service Corp. of New York, Ralph DeRose, and Domenick DeRose, were affected by the settlement-approval requirements, the vacatur of conferences, and the ruling that pending motions were moot.
What happened
Romeo Ixcoy Perez and Romeo Sontay sued Mechanical Service Corp. of New York, Ralph DeRose, and Domenick DeRose in a Fair Labor Standards Act case, and the court was told that the parties had reached a settlement.
The court said the case could not be dismissed with prejudice based on that settlement unless the court or the Department of Labor approved it. The parties had until September 25, 2023, to file a joint request with the settlement agreement or documentation of Department of Labor approval, along with information about the settlement’s fairness, disputed wages, and requested attorney fees. The court also said pending motions were moot and canceled all conferences.
Judge Analisa Torres issued the order on August 24, 2023. The order set requirements for seeking settlement approval but did not itself approve the settlement or dismiss the case with prejudice.
The detailed version
- Ixcoy Perez v. Mechanical Service Corp. of New York · No. 1:21-cv-02467
- Ona Wang
- Aug. 24, 2023
Background
The court stated that the parties had reached a settlement in this Fair Labor Standards Act (FLSA) case. The opinion does not state the settlement amount or provide the settlement agreement’s terms.
Settlement-approval requirements
The court stated that the action would not be dismissed with prejudice based on the settlement unless the settlement was approved either by the court or by the Department of Labor. If the parties sought dismissal with prejudice, they had to file by September 25, 2023, either a joint letter motion asking the court to approve the settlement or documentation showing Department of Labor approval. The settlement agreement had to be filed with any court letter motion on the public docket.
The letter motion had to explain why the proposed settlement was fair and reasonable. The court identified factors including the plaintiffs’ possible recovery, the burdens and expenses the settlement would avoid, the parties’ litigation risks, whether the settlement resulted from arm’s-length bargaining between experienced counsel, and the possibility of fraud or collusion. The submission also had to address whether there was a genuine dispute about the hours worked or compensation owed and the amount of attorney fees the plaintiffs’ attorney would seek.
Any attorney-fee request had to include contemporaneous billing records showing, for each attorney, the date, hours worked, and nature of the work. The court also stated that, absent special circumstances, it would not approve a settlement filed under seal or in redacted form. Absent compelling circumstances, it would not approve a settlement containing sweeping nondisclosure provisions or broad releases of claims unrelated to FLSA issues.
Disposition
Judge Analisa Torres did not approve the settlement or dismiss the action with prejudice in this order. The court stated that any pending motions were moot and vacated all conferences. The order instead established the materials and approvals required before a settlement-based dismissal with prejudice could occur.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.