Perez v. Harlem 421 Food Corp.
- Sarah Netburn
- 1:22-cv-10191
- U.S. District Court · Southern District of New York
- 2
In Perez v. Harlem 421 Food Corp., Judge Rearden required the parties to submit their Fair Labor Standards Act settlement for fairness review but did not approve it.
Roberto Perez and the defendants, including Harlem 421 Food Corp. doing business as KeyFood Supermarket, were required to submit settlement materials and a joint explanation to the court.
What happened
In Perez v. Harlem 421 Food Corp., the parties told the court they had reached a settlement in Roberto Perez’s wage-and-hour case under the Fair Labor Standards Act. The opinion does not state the settlement’s terms.
The court ordered the parties to submit the settlement agreement and a joint explanation by November 13, 2023. The explanation must address why the settlement is fair and reasonable, along with any payment to the plaintiff for participating in the case and any attorneys’ fees.
Judge Rearden did not approve or reject the settlement in this order. The court also identified provisions it generally would not approve, including confidentiality terms, overly broad releases, and certain limits on truthful statements about the case.
The detailed version
- Perez v. Harlem 421 Food Corp. · No. 1:22-cv-10191
- Sarah Netburn
- Oct. 12, 2023
Background
The parties informed the court on October 11, 2023, that they had reached a settlement in this action brought under the Fair Labor Standards Act (FLSA), a federal law governing matters including overtime pay. The opinion does not provide the settlement amount or other settlement terms.
Court’s Analysis
The court explained that an FLSA settlement leading to dismissal under Federal Rule of Civil Procedure 41 must be reviewed to ensure that it is fair. The court also said that any proposed attorneys’ fee award must be examined for reasonableness. The parties could instead use an offer of judgment under Rule 68(a), which the court stated would not require judicial approval for resolution of the FLSA claims.
The court advised that it would not approve a settlement containing a confidentiality provision unless the parties showed case-specific reasons overcoming the public’s common-law right of access to court documents. It also would not approve an overly broad release or waiver covering claims that had not accrued or claims unrelated to wage-and-hour matters unless justified by case-specific reasons. Finally, it would not approve a clause barring the plaintiff from making negative statements about a defendant unless the clause allowed truthful statements about the plaintiff’s experience litigating the case, absent sufficient case-specific justification.
Order
The court ordered the parties to submit the settlement agreement and a joint letter by November 13, 2023. The letter must explain the basis for the proposed settlement and why it should be approved as fair and reasonable, referring to the factors identified in the cited authority. It must also address any incentive payment to Roberto Perez and any attorneys’ fee award to his counsel, including supporting documentation when appropriate.
If the settlement contains one of the provisions identified by the court, the joint letter must state whether the parties want the court to consider approval with that provision removed. The court noted that it could approve or reject the settlement but could not rewrite the agreement. The parties were also reminded that they could consent to proceed before the assigned magistrate judge, who would then decide whether to approve the settlement. The order did not approve or reject the settlement.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.