Amparo v. BT Systems, LLC

Background

Leidy Amparo brought claims under the Fair Labor Standards Act and New York state law against BT Systems, LLC; Joseph Poveromo, in his individual and professional capacities; unidentified individuals; and unidentified corporations. BT Systems and Poveromo moved to compel arbitration.

On January 5, 2024, Amparo and BT Systems and Poveromo filed a stipulated agreement stating that the dispute had been amicably adjusted in favor of binding arbitration under American Arbitration Association rules. They asked the court to dismiss the action without prejudice and without costs under Federal Rule of Civil Procedure 41(a)(1)(A)(ii), while retaining jurisdiction over issues that might later arise concerning arbitration. The document was resubmitted twice because of filing issues, but its quoted language did not change.

Court’s Analysis

The court explained that Fair Labor Standards Act claims generally cannot be privately settled through a stipulated dismissal without approval from a court or the United States Department of Labor. But the court also noted that this rule is intended to ensure that in-court settlements are fair, not to guarantee that the dispute will be resolved in court. A court may therefore dismiss a case involving Fair Labor Standards Act claims so the parties can arbitrate, when no settlement has occurred.

Based on the parties’ representations, the court found that no Fair Labor Standards Act settlement presently existed. It therefore ordered the dismissal notice. The court rejected the parties’ request that it retain jurisdiction, explaining that a Rule 41(a)(1) dismissal notice automatically terminates the lawsuit. The court stated that the parties could have requested a stay instead of a voluntary dismissal if they wanted the court to retain jurisdiction, but they did not do so.

Disposition

The court ordered dismissal without prejudice and without costs under the parties’ stipulation. It did not retain jurisdiction over future arbitration issues. The court ruled that any pending motions were moot, canceled all conferences, and directed the Clerk of Court to close the case. The order did not decide the underlying Fair Labor Standards Act or New York-law claims on their merits.