Peake v. City of Coronado

CourtDistrict Court, S.D. California
DecidedDecember 27, 2021
Docket3:21-cv-00820
StatusUnknown

This text of Peake v. City of Coronado (Peake v. City of Coronado) is published on Counsel Stack Legal Research, covering District Court, S.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Peake v. City of Coronado, (S.D. Cal. 2021).

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 PERRY PEAKE, individually and on Case No.: 21-cv-00820-AJB-KSC behalf of others similarly situated, 12 Plaintiffs, ORDER GRANTING PLAINTIFFS’ 13 MOTION FOR APPROVAL OF FLSA v. SETTLEMENT 14 CITY OF CORONADO, 15 Defendant. (Doc. No. 18)

16 Presently pending before the Court is the Motion for Approval of the Settlement 17 Agreement between Plaintiff Perry Peake, on behalf of himself and similarly situated 18 individuals who have consented to join the instant action (“Plaintiffs”), and Defendant City 19 of Coronado (“Defendant” or “City”) (collectively, “the Parties”). (Doc. No. 18.) Pursuant 20 to Civil Local Rule 7.1.d.1, the Court finds the instant matter suitable for determination on 21 the papers and without oral argument. For the reasons discussed below, the Court 22 GRANTS the Motion to Approve the Settlement Agreement. 23 I. BACKGROUND 24 This case involves an unpaid overtime collective action, wherein Plaintiffs are non- 25 exempt employees of the City of Coronado’s Fire Department who argue they are entitled 26 to compensation under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201 et seq., 27 and seek unpaid overtime compensation, liquidated damages, and reasonable attorneys’ 28 1 fees. (Complaint (“Compl.”), Doc. No. 1, ¶ 1.) Plaintiffs filed the Complaint on April 27, 2 2021. (See generally Compl.) They allege the City violated the FLSA by failing to pay 3 compensation for overtime hours worked at the rate of 1.5 times the regular rate of pay. 4 (Id. ¶ 2.) 5 On October 25, 2021, the Parties filed a notice of settlement. (See Doc. No. 15.) The 6 Settlement provides Defendant will pay $196,000 to Plaintiffs as the total amount of unpaid 7 overtime owed and liquidated damages, apportioned as follows: Plaintiff Peake will receive 8 an individual settlement payment of $51,433.26 for owed unpaid wages and a second check 9 totaling $51,433.26 for liquidated damages and all other damages or relief recoverable; 10 Plaintiff Summers will receive $27,314.74 for owed unpaid wages and a second check 11 totaling $27,314.74; and Plaintiff Scarboro will receive $19,252.00 for owed unpaid wages 12 and a second check totaling $19,252.00. (Doc. No. 18-1 at 10.) Defendant will additionally 13 pay reasonable attorney fees, not to exceed a total of $45,000. (Id. at 11.) Plaintiffs agree 14 to release Defendant from all overtime compensation claims against Defendant under the 15 FLSA that may exist or have existed as of and including the effective date of the Settlement 16 Agreement with prejudice. (Id. at 11–12.) 17 II. LEGAL STANDARD 18 The FLSA was enacted to protect covered workers from substandard wages and 19 oppressive working hours. See Barrentine v. Arkansas-Best Freight Sys., Inc., 450 U.S. 20 728, 739 (1981); 29 U.S.C. § 202(a) (characterizing substandard wages as a labor condition 21 that undermines “the maintenance of the minimum standard of living necessary for health, 22 efficiency and general well-being of workers”). “The FLSA places strict limits on an 23 employee’s ability to waive claims for unpaid wages or overtime . . . for fear that employers 24 may coerce employees into settlement and waiver.” Selk v. Pioneers Mem’l Healthcare 25 Dist., 159 F. Supp. 3d 1164, 1172 (S.D. Cal. 2016) (citing Lopez v. Nights of Cabiria, LLC, 26 96 F. Supp. 3d 170, 175 (S.D. N.Y. 2015)) (internal quotation marks and citation omitted). 27 FLSA claims for unpaid wages “may only be waived or otherwise settled if the settlement 28 is supervised by the Secretary of Labor or approved by a district court.” Id. (citing Lynn’s 1 Food Stores, Inc. v. United States ex rel. U.S. Dep’t of Labor, 679 F.2d 1350, 1352–53 2 (11th Cir. 1982)); McKeen-Chaplin v. Franklin Am. Mortg. Co., No. C 10-5243 SBA, 2012 3 WL 6629608, at *2 (N.D. Cal. Dec. 19, 2012) (same). 4 In reviewing a FLSA settlement, a district court must determine whether the 5 settlement represents a “fair and reasonable resolution of a bona fide dispute.” Lynn’s Food 6 Stores, 679 F.2d at 1355. A bona fide dispute exists when there are legitimate questions 7 about “the existence and extent of Defendant’s FLSA liability.” Ambrosino v. Home Depot. 8 U.S.A., Inc., No. 11cv1319 L(MDD), 2014 WL 1671489, at *1 (S.D. Cal. Apr. 28, 2014). 9 There must be “some doubt . . . that the plaintiffs would succeed on the merits through 10 litigation of their [FLSA] claims.” Selk, 159 F. Supp. 3d at 1172 (quoting Collins v. 11 Sanderson Farms, F. Supp. 2d 714, 719–20 (E.D. La. 2008)) (internal quotations omitted). 12 After a district court is satisfied that a bona fide dispute exists, it must then determine 13 whether the settlement is fair and reasonable. Id. To determine this, courts in this circuit 14 look to the totality of the circumstances, balancing such factors as: “(l) the plaintiff’s range 15 of possible recovery; (2) the stage of proceedings and amount of discovery completed; 16 (3) the seriousness of the litigation risks faced by the parties; (4) the scope of any release 17 provision in the settlement agreement; (5) the experience and views of counsel and the 18 opinion of participating plaintiffs; and (6) the possibility of fraud or collusion.” Id. at 1173. 19 A court will not approve a settlement of an action in which parties attempt to settle for less 20 than the FLSA-guaranteed amount because it would shield employers from the full cost of 21 complying with the statute. Id. at 1172. The Court addresses each of these factors in turn. 22 III. DISCUSSION 23 A. Bona Fide Dispute 24 The Court finds this case reflects a bona fide dispute between the Parties over 25 potential liability under the FLSA. Specifically, the Parties point to three disputes: 26 (1) whether the City is liable under the United States Department of Labor’s “First 27 Responder Regulation,” 29 C.F.R. § 541.3(b); (2) whether the City is liable for liquidated 28 damages; and (3) whether the FLSA’s two-year or three-year statute of limitations should 1 be applied. (Doc. No. 18 at 5–6.) These issues raise legitimate questions over whether the 2 City may be liable under the statute, particularly given the “inconsistent and intensely 3 factually driven” application of the First Responder Regulation to battalion chiefs. (Id.) In 4 light of these contending views on issues central to the case, and the fact that Plaintiffs are 5 not clearly entitled to the compensation they seek, the Court concludes there is a bona fide 6 dispute between the Parties. See Selk, 159 F. Supp. 3d at 1172. 7 B. Fair and Reasonable Resolution 8 The Parties contend the proposed Settlement Agreement is a fair and reasonable 9 resolution of the Parties’ disputes and in furtherance of the purposes of the FLSA. After 10 considering the six factors outlined above, the Court finds the Settlement Agreement is fair 11 and reasonable under the FLSA. 12 1. Plaintiff’s Range of Possible Recovery 13 In comparing the amount proposed in the settlement with the amount that plaintiffs 14 could have obtained at trial, the court must be satisfied that the amount left on the 15 settlement table is fair and reasonable under the circumstances presented. Selk, 159 F. 16 Supp. 3d at 1174.

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Bluebook (online)
Peake v. City of Coronado, Counsel Stack Legal Research, https://law.counselstack.com/opinion/peake-v-city-of-coronado-casd-2021.