Crawford v. Leeding Builders Group, LLC

Opinion

USDC SDNY UNITED STATES DISTRICT COURT DOCUMENT SOUTHERN DISTRICT OF NEW YORK ELECTRONICALLY FILED ALGI CRAWFORD, XAVIER HARRISON, DOC and KEVEEN GORIS on behalf of DATE FILED: 2/8/2024 themselves and all others similarly situated, Plaintiffs, -against- 23 Civ. 7290 (AT) LEEDING BUILDERS GROUP, LLC and ORDER AECOM, Defendants. ANALISA TORRES, District Judge: The complaint in this action alleges, among other things, that Defendants failed to pay overtime wages in violation of the Fair Labor Standards Act (FLSA). See Compl. § 5, ECF No. 1. On February 5, 2024, Plaintiffs submitted a notice of voluntary dismissal of this action without prejudice under Rule 41(a)(1)(A)(i) of the Federal Rules of Civil Procedure. See ECF No. 28. On February 7, 2024, the Court refused to so-order the stipulation, holding that “[w]here parties have reached a settlement of an FLSA claim, they cannot voluntarily dismiss the action under Rule 41(a) as doing so would amount to an end-run around the Court’s obligation to scrutinize the settlement for fairness.” ECF No. 29 at 1 (citing Samake v. Thunder Lube, Inc., 24 F.4th 804, 809-10 (2d Cir. 2022)). Rather, such settlements “require the approval of the district court or the [Department of Labor] to take effect.” Jd. (quoting Cheeks v. Freeport Pancake House, Inc., 796 F.3d 199, 206 (2d Cir. 2015)). Ina letter response to the Court, Plaintiffs’ counsel now argues that “dismissal is proper . . . because [Plaintiffs] are pursuing their claims in arbitration” and “[c ]oncurrent with the filing of the Notice of Voluntary Dismissal, [they] served counsel for the [D]efendants with [a] Notice of Arbitration Demand.” ECF No. 30. Not so. Although FLSA claims are arbitrable, Rodriguez-Depena v. Parts Auth., Inc., 877 F.3d 122, 123-24 (2d Cir. 2017), “[nJothing in Cheeks, Samake, or any post-Samake decision suggests that an FLSA settlement is exempt from judicial faimess review simply because it was reached while the case was stayed pending arbitration.” Melendez v. Cosan Constr. Corp., No. 21 Civ. 07426, 2023 WL 3336549, at *2 (S.D.N-Y. May 10, 2023). In fact, “district courts within our Circuit have uniformly held that” settlements reached when a case is stayed pending arbitration “must be reviewed [by the Court] for faimess like any other FLSA settlement.” Jd.; accord Brittle v. Metamorphosis, No. 20 Civ. 3880, 2021 WL 606244, at *2 (S.D.N-Y. Jan. 22, 2021). This matter has yet to be adjudicated through arbitration. As such, it remains possible that the parties will reach a private settlement outside the context of arbitration. Accordingly, the Court will not so-order the stipulation of dismissal, and the case remains open. All deadlines, however, are STAYED, and all conferences are VACATED pending the outcome of arbitration. By April 15,

2024, Plaintiffs shall file an update with the Court on the status of the arbitration and the adjudication of their claims. SO ORDERED. Dated: February 8, 2024 New York, New York ANALISA TORRES United States District Judge