Flood v. First Family Insurance, Inc.

CourtDistrict Court, M.D. Florida
DecidedJanuary 21, 2021
Docket2:20-cv-00623
StatusUnknown

This text of Flood v. First Family Insurance, Inc. (Flood v. First Family Insurance, Inc.) is published on Counsel Stack Legal Research, covering District Court, M.D. Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Flood v. First Family Insurance, Inc., (M.D. Fla. 2021).

Opinion

UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF FLORIDA FORT MYERS DIVISION

STEPHEN FLOOD, Plaintiff, v. FIRST FAMILY INSURANCE, INC., Case No. 2:20-cv-623-JLB-NPM and JASON MARRA, Defendants. _________________________________ ORDER Federal Rule of Civil Procedure 41(a)(1)(A)(ii) provides that the parties, “subject to . . . any applicable federal statute,” may voluntarily dismiss a lawsuit without a court order if the parties file a “stipulation of dismissal signed by all parties who have appeared.” Plaintiff Stephen Flood worked as an insurance agent for Defendant First Family Insurance, Inc. for approximately five years. He brought this claim to recover overtime compensation from Defendants pursuant to the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §§ 201-19. [Doc. 1.] Citing Rule 41(a)(1)(A)(ii), the parties have announced that they have settled Plaintiff’s FLSA claim “and agree to dismiss the above-styled case with prejudice.” [Docs. 15, 16.] The parties also represent that they “have separately negotiated their fees and costs incurred in connection with this action.” [Doc. 16.] Courts have grappled with whether the parties to a FLSA settlement can sidestep court approval by simply filing a voluntary dismissal under Rule 41(a)(1)(A)(ii). After a careful survey of the applicable statutes and case law, this Court holds that the parties to a FLSA settlement must submit their settlement agreement for court approval, even when the parties represent that the plaintiff’s FLSA claims have not been compromised by the settlement and the attorney’s fees have been negotiated separately. Because the parties here have not

submitted their settlement agreement for court approval, the parties’ Joint Stipulation of Dismissal With Prejudice is STRICKEN with leave to refile after they have presented the Court with a proposed settlement for review and the Court has determined the proposed settlement is reasonable and fair under the standards set forth in Lynn’s Food Stores, Inc. v. United States, 679 F.2d 1350 (11th Cir. 1982). BACKGROUND

Plaintiff filed a complaint alleging claims under the FLSA on August 19, 2020. Defendants filed and were granted two consecutive motions to extend the time to respond to the complaint. On October 12, 2020, before Defendants responded to the complaint, Plaintiff filed a notice of settlement. [Doc. 12.] On October 14, 2020, the assigned magistrate judge entered an order directing the parties, “[b]y November 11, 2020, to file any items necessary to terminate this action.” [Doc. 13.] The order did not reference the FLSA or specify what items were

“necessary to terminate this action.” [Id.] The next day, on October 15, 2020, the undersigned entered an order dismissing the case pursuant to Local Rule 3.08(b) subject to the right of any party within sixty days to either submit a stipulated form of final order or judgment, or alternatively, move to vacate the dismissal for good cause. [Doc. 14.] On October 23, 2020, the parties jointly filed two documents. The first document, a Notice of Settlement, states that “Plaintiff’s FLSA claim has been settled in full, without compromise, separately from attorney’s fees and costs,” and that, as a result, the Court “need not scrutinize the settlement any further.” [Doc. 15 at 1.] The second document, a Joint Stipulation of Dismissal with Prejudice,

which is signed by counsel for both parties, states that the parties dismiss the case pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(ii). [Doc. 16.] DISCUSSION For the past thirty-eight years, it has been the law of the Eleventh Circuit that, absent the Secretary of Labor’s supervision and employer’s agreement to pay in full for the lost wages, suits to recover back wages under the FLSA may be

settled only with the approval of the district court. See Lynn’s Food, 679 F.2d at 1352–53. Specifically, in Lynn’s Food, the Eleventh Circuit explained that “[t]here are only two ways in which back wage claims arising under the FLSA can be settled or compromised by employees.” Id. at 1352. The first is when the Secretary of Labor supervises an FLSA settlement and the employer “pays in full” the wages. Id. at 1353 (citing 29 U.S.C. § 216(c)). The second is when employees “bring a private action” under the FLSA, “present to the district court a proposed

settlement,” and successfully move the district court to “enter a stipulated judgment after scrutinizing the settlement for fairness.” Id. (citing 29 U.S.C. § 216(b)). The Eleventh Circuit pronounced these standards in light of the FLSA’s purpose of “protecting workers” and mitigating the “great inequalities in bargaining power between employers and employees.” Id. at 1352. The parties in this case have not achieved settlement in either of the two ways set out in Lynn’s Food. First, the parties have not negotiated the settlement before the Secretary of Labor. Second, the parties have not taken “[t]he only other route” to settlement: submitting their settlement agreement to the Court for approval. Id. at

1353. Instead, the parties contend their settlement is not subject to court approval because “Plaintiff’s FLSA claim has been settled in full, without compromise, separately from attorney’s fees and costs,” and, as a result, the Court “need not scrutinize the settlement any further.” [Doc. 15 at 1.] The Court is not convinced. A. Lynn’s Food requires judicial approval of all FLSA settlements, even those in which the parties represent that the plaintiff’s claims have not been “compromised.” The Eleventh Circuit has not directly rejected the parties’ contention that Lynn’s Food does not require judicial oversight of FLSA settlements that accord full payment of the plaintiff’s unpaid wages claim without compromise. While an argument to that effect was presented in Silva v. Miller, 307 F. App’x 349, 351 (11th Cir. 2009) (per curiam), the Eleventh Circuit declined to decide the issue because it determined that the settlement there involved a potential compromise notwithstanding payment of full withheld wages due to the plaintiff’s contingency fee

arrangement with his attorney: We do not say what, if any, judicial oversight applies under Lynn’s Food when full satisfaction of the FLSA claim is made; because FLSA directs the court to provide for payment of the employee’s attorney’s fees by the defendant, the $20,000 settlement as proposed by the parties—from which attorney’s fees were to be deducted—necessarily involved a compromise of the FLSA claim. Id. While the Silva court declined to decide the issue presented here, it noted in response to the argument that, “[o]n its face, Lynn’s Food suggests no exception to judicial oversight of settlements when the employee receives all wages due.” Id. (emphasis added). This Court agrees, and in fact, would go one step further by

saying that Lynn’s Food affirmatively suggests the opposite of the parties’ position here, namely that judicial oversight is required for settlements, even if they do not involve a compromise of the plaintiff’s claims. See Lynn’s Food, 679 F.2d at 1352 (stating that “[t]here are only two ways in which back wage claims arising under the FLSA can be settled or compromised by employees” (emphasis added)). In support of their position that a full compensation settlement does not

require court approval, the parties cite only two cases other than Lynn’s Food: Granger v.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Anago Franchising, Inc. v. SHAZ, LLC
677 F.3d 1272 (Eleventh Circuit, 2012)
Silva v. Miller
547 F. Supp. 2d 1299 (S.D. Florida, 2008)
Dees v. Hydradry, Inc.
706 F. Supp. 2d 1227 (M.D. Florida, 2010)
MacKenzie v. Kindred Hospitals East, L.L.C.
276 F. Supp. 2d 1211 (M.D. Florida, 2003)
Moreno v. Regions Bank
729 F. Supp. 2d 1346 (M.D. Florida, 2010)
Bonetti v. Embarq Management Co.
715 F. Supp. 2d 1222 (M.D. Florida, 2009)
Perez-Nunez v. North Broward Hospital District
609 F. Supp. 2d 1319 (S.D. Florida, 2009)
Luisa E. Silva v. Grant Miller
307 F. App'x 349 (Eleventh Circuit, 2009)
Mei Xing Yu v. Hasaki Restaurant, Inc.
944 F.3d 395 (Second Circuit, 2019)
Guerra v. Flores
139 F. Supp. 3d 1288 (N.D. Alabama, 2015)
Cheeks v. Freeport Pancake House, Inc.
796 F.3d 199 (Second Circuit, 2015)

Cite This Page — Counsel Stack

Bluebook (online)
Flood v. First Family Insurance, Inc., Counsel Stack Legal Research, https://law.counselstack.com/opinion/flood-v-first-family-insurance-inc-flmd-2021.