Nolau v. WSP USA Inc.

Background

Michael Nolau, individually and on behalf of others similarly situated, and WSP USA Inc. moved for entry of judgment under Federal Rule of Civil Procedure 68. The opinion identifies the case as arising under the Fair Labor Standards Act (FLSA), a federal wage-and-hour statute. The parties filed an offer and acceptance of judgment.

Settlement-approval rules

The court explained that, under Cheeks v. Freeport Pancake House, Inc., private settlement and dismissal of FLSA claims under Rule 41 generally require approval by the district court or the Department of Labor because FLSA settlements raise special policy concerns. The Second Circuit later held in Mei Xing Yu v. Hasaki Restaurant, Inc. that judicial approval is not required for Rule 68(a) offers of judgment settling FLSA claims.

Judge Broderick stated that he had repeatedly expressed concern that Mei Xing Yu can require courts to enter judgments that would not satisfy the review applied under Cheeks. In this case, the offer set the judgment at $5,000, inclusive of attorney fees, expenses, and costs, but did not identify the amount allocated to attorney fees or costs. The court said this made it impossible to determine whether the fees were reasonable and that the term was incompatible with what it would likely consider a reasonable FLSA settlement under Cheeks.

Ruling

Despite those concerns, the court held that Mei Xing Yu compelled it to sign the proposed judgment. The court ordered that judgment be entered in accordance with the parties’ Rule 68 offer and acceptance of judgment. It stated that the judgment would be filed simultaneously with the order.

Disposition

The court ordered entry of judgment under the parties’ Rule 68 offer and acceptance. The opinion does not state how the $5,000 would be divided between payment to Nolau and attorney fees, expenses, or costs.