Khan v. Dunwoodie Gas Station, Inc.

District Court, S.D. New York·Decided July 29, 2021·No. 7:19-cv-05581·Unknown

Opinion

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

JAWAID I. KHAN,

Plaintiff, No. 19-CV-05581 (KMK)

v. OPINION & ORDER

YONKERS AUTO CENTER, INC. and RAYMOND ALBANO,

Defendants.

Appearances:

Raymond Nardo, Esq. Raymond Nardo, P.C. Mineola, NY Counsel for Plaintiff

Clifford H. Greene, Esq. Clifford H. Green & Associates New Rochelle, NY Counsel for Defendants

KENNETH M. KARAS, United States District Judge:

On June 14, 2019, Plaintiff Jawaid Khan (“Plaintiff”) brought this Action under the Fair Labor Standards Act, 29 U.S.C. § 201, et seq. (“FLSA”), and the New York Labor Law § 190, et seq. (“NYLL”), against Defendants Dunwoodie Gas Station, Inc. and Reyad Mussa (the “Dunwoodie Defendants”), and Yonkers Auto Center, Inc. and Raymond Albano (the “Yonkers Defendants” and, together with the Dunwoodie Defendants, “Defendants”). (See Compl. ¶¶ 1–2 (Dkt. No. 1).) Plaintiff and the Yonkers Defendants (“the Parties”) have jointly requested the approval of a proposed partial settlement resolving Plaintiff’s claims against the Yonkers Defendants (the “Proposed Settlement Agreement” or “PSA”). (Letter from Raymond Nardo, Esq., to Court (Apr. 26, 2021) (“Joint Letter”) Ex. 1 (“PSA”) (Dkt. Nos. 26, 26-1).).1 For the reasons that follow, the Parties’ Application is denied without prejudice. I. Background

Plaintiff was employed by Yonkers Defendants, earning minimum wage as a cashier, from approximately July 2016 to April 2018. (Joint Letter 2.) According to the Complaint, Plaintiff worked approximately 68 hours per week at a rate that ranged from $9 per hour to $11 per hour. (Compl. ¶¶ 9, 11.) Plaintiff alleges that, during this period, he was not paid premium overtime pay at the rate of time and a half, and that he was not permitted an uninterrupted half hour for required meal breaks. (Id. ¶¶ 9, 12.) Plaintiff filed his Complaint on June 14, 2019. (Dkt. No. 1.) Yonkers Defendants filed their Answer on November 18, 2019. (Dkt. No. 14). On November 25, 2019, Plaintiff and the Dunwoodie Defendants jointly requested approval for a proposed partial settlement agreement resolving all claims against the Dunwoodie Defendants, (Dkt. No. 15), and, on March 10, 2020,

the Court denied the request without prejudice, (Dkt. No. 16). On December 3, 2020, the Court so-ordered a stipulation dismissing the Action, pursuant to Rule 41 of the Federal Rules of Civil Procedure, as to the Dunwoodie Defendants only. (Dkt. No. 20.) On April 26, 2021, Plaintiff and the Yonkers Defendants submitted the instant Application and supporting settlement papers for the Court's approval pursuant to Cheeks v. Freeport Pancake House, Inc., 796 F.3d 199 (2d Cir. 2015). (See Joint Letter; PSA.)

1 The proposal for a partial settlement is with respect to the Yonkers Defendants only. (See Joint Letter 1.) II. Discussion A. Standard of Review Under Fed. R. Civ. P. 41(a)(1)(A), a plaintiff’s ability to dismiss an action without a court order is made “[s]ubject to . . . any applicable federal statute.” “Except as provided in Rule 41(a)(1), an action may be dismissed at the plaintiff’s request only by court order, on terms that the court considers proper.” See Fed. R. Civ. P. 41(a)(2). The Second Circuit has confirmed that the FLSA is an “applicable federal statute,” such that “Rule 41(a)(1)(A)(ii) stipulated dismissals settling FLSA claims with prejudice require the approval of the district court or the [Department of Labor] to take effect.” Cheeks, 796 F.3d at 206.2 Consequently, “the [P]arties must satisfy

the Court that their agreement is ‘fair and reasonable.’” Penafiel v. Rincon Ecuatoriano, Inc., No. 15-CV-112, 2015 WL 7736551, at *1 (S.D.N.Y. Nov. 30, 2015) (citation omitted); see also Velasquez v. SAFI-G, Inc., 137 F.Supp.3d 582, 584 (S.D.N.Y. 2015) (same). When assessing a proposed settlement for fairness, there is generally “a strong presumption in favor of finding a settlement fair, as the Court is generally not in as good a position as the parties to determine the reasonableness of an FLSA settlement.” Lliguichuzhca v. Cinema 60, LLC, 948 F. Supp. 2d 362, 365 (S.D.N.Y. 2013) (citation and quotation marks omitted); see also Matheis v. NYPS, LLC, No. 13-CV-6682, 2016 WL 519089, at *1 (S.D.N.Y. Feb. 4, 2016) (same); Souza v. 65 St. Marks Bistro, No. 15-CV-327, 2015 WL 7271747, at *4

2 Although not relevant here, the Second Circuit has explained the authority of the Department of Labor to approve settlements, noting that “the Secretary of Labor has the authority to ‘supervise the payment of the unpaid minimum wages or the unpaid overtime compensation owing to any employee or employees under’” certain portions of the FLSA, in which case “‘[t]he agreement of any employee to accept such payment shall upon payment in full constitute a waiver by such employee of any right he may have . . . to such . . . unpaid overtime compensation and’ liquidated damages due under the FLSA.” Cheeks, 796 F.3d at 201 n.1 (second alteration in original) (quoting 29 U.S.C. § 216(c)). (S.D.N.Y. Nov. 6, 2015) (same); Martinez v. Hilton Hotels Corp., No. 10-CV-7688, 2013 WL 4427917, at *1 (S.D.N.Y. Aug. 20, 2013) (same). As a number of courts have recognized, although a court should consider the totality of the circumstances, the most significant factors include:

(1) the plaintiff’s range of possible recovery; (2) the extent to which the settlement will enable the parties to avoid anticipated burdens and expenses in establishing their respective claims and defenses; (3) the seriousness of the litigation risks faced by the parties; (4) whether the settlement agreement is the product of arm’s-length bargaining between experienced counsel; and (5) the possibility of fraud or collusion.

Wolinsky v. Scholastic Inc., 900 F. Supp. 2d 332, 335 (S.D.N.Y. 2012) (citation and quotation marks omitted); see also Zamora v. One Fifty Fifty Seven Corp., No. 14-CV-8043, 2016 WL 1366653, at *1 (S.D.N.Y. Apr. 1, 2016) (same); Garcia v. Jambox, Inc., No. 14-CV-3504, 2015 WL 2359502, at *2 (S.D.N.Y. Apr. 27, 2015) (same). Conversely, factors which weigh against finding a settlement fair and reasonable include: (1) the presence of other employees situated similarly to the claimant; (2) a likelihood that the claimant’s circumstance will recur; (3) a history of FLSA non- compliance by the same employer or others in the same industry or geographic region; and (4) the desirability of a mature record and a pointed determination of the governing factual or legal issue to further the development of the law either in general or in an industry or in a workplace.

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Khan v. Dunwoodie Gas Station, Inc., (S.D.N.Y. 2021).

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