United States District Court, M.D. Florida, Fort Myers Division
TAMERA GOERS and ASHLEY CRISTINE MULLIGAN, individually, and on behalf of all others similarly situated Plaintiffs,
L.A. ENTERTAINMENT GROUP, INC. and AMER SALAMEH, Defendants.
REPORT AND RECOMMENDATION 
MIRANDO United States Magistrate Judge.
matter comes before the Court upon review of the parties'
Joint Motion to Approve FLSA Settlement Agreement and
Memorandum of Law (Doc. 166) filed on October 13, 2017. The
parties provided a copy of the proposed Settlement Agreement
and Release of Claims. Doc. 166 at 17-34. The parties request
that the Court approve the parties' settlement of the
Fair Labor Standards Act (“FLSA”) claim and
dismiss the case with prejudice. Doc. 166. For the reasons
set forth herein, the Court recommends that the settlement be
APPROVED and the case be dismissed with
approve the settlement, the Court must determine whether it
is a “fair and reasonable resolution of a bona fide
dispute” of the claims raised pursuant to the FLSA.
Lynn's Food Store, Inc. v. United States, 679
F.2d 1350, 1355 (11th Cir. 1982). There are two ways for a
claim under the FLSA to be settled or compromised.
Id. at 1352-53. The first is under 29 U.S.C. §
216(c), providing for the Secretary of Labor to supervise the
payments of unpaid wages owed to employees. Id. at
1353. The second is under 29 U.S.C. § 216(b) when an
action is brought by employees against their employer to
recover back wages. Id. When the employees file
suit, the proposed settlement must be presented to the
district court for the district court to review and determine
that the settlement is fair and reasonable. Id. at
Eleventh Circuit has found settlements to be permissible when
the lawsuit is brought by employees under the FLSA for back
wages because the lawsuit provides
some assurance of an adversarial context. The employees are
likely to be represented by an attorney who can protect their
rights under the statute. Thus, when the parties submit a
settlement to the court for approval, the settlement is more
likely to reflect a reasonable compromise of disputed issues
than a mere waiver of statutory rights brought about by an
employer's overreaching. If a settlement in an employee
FLSA suit does reflect a reasonable compromise over issues,
such as FLSA coverage or computation of back wages that are
actually in dispute; we allow the district court to approve
the settlement in order to promote the policy of encouraging
settlement of litigation.
Id. at 1354. “Short of a bench trial, the
Court is generally not in as good a position as the parties
to determine the reasonableness of an FLSA settlement. . . .
If the parties are represented by competent counsel in an
adversary context, the settlement they reach will, almost by
definition, be reasonable. Bonetti v. Embarq Mgmt.
Co., 715 F.Supp.2d 1222, 1227 (M.D. Fla. 2009).
Nevertheless, the Court must scrutinize the settlement to
determine whether it is a “fair and reasonable
resolution of a bona fide dispute.” Lynn's Food
Store, Inc., 679 F.2d at 1355.
Tamara Goers and Ashley Christine Mulligan, individually and
on behalf of other similarly situated current and former
employees of L.A. Entertainment Group, Inc. d/b/a Babes of
Fort Myers (“Babes”), an adult entertainment
venue, brought this action against Defendants alleging
violations of the FLSA. See Doc. 1. Specifically,
Plaintiffs allege that Defendants misclassified them as
independent contractors, did not compensate them with
overtime pay in violation of the FLSA, and siphoned
Plaintiffs' tips to non-tip-eligible employees.
Id. at ¶¶ 2-5. Defendant L.A.
Entertainment Group, Inc. is a corporation engaged in
business in Florida. Id. at ¶ 11. Defendant
Amer Salameh is the president and manager of Babes and a
Florida resident. Id. at ¶¶ 17, 34. Goers,
Mulligan, and the opt-in plaintiffs (collectively,
“Plaintiffs”) are adult entertainers in the state
of Florida employed by Babes between 2010 and 2015.
Id. at ¶¶ 12-15.
August 25, 2016, the Court granted provisional certification
under Section 216(b) of the FLSA to the class of current and
former entertainers that had worked at Babes within the prior
three years. Doc. 72 at 7-8. On January 31, 2017, the Court
granted approval of the Proposed Class Action Notice (Doc.
77-1), and subsequently fifteen (15) putative class members
opted-in to the FLSA claim, not including Plaintiffs Goers
and Mulligan. Doc. 166 at 34.
formal mediations were held on April 22, 2016 and January 27,
2017 before Mediator Jim Nulman. Id. at ¶ 9.
Although the parties were not successful in reaching an
agreement at either mediation, they were able to reach an
agreement with regard to Plaintiffs' claims on July 28,
2017. Id. at ¶ 11. The parties then began to
negotiate attorneys' fees and costs. Id. at
¶ 12. The parties reached an agreement regarding fees
and costs on October 3, 2017. Id.
proposed Settlement Agreement, Defendants agree to pay Goers,
Mulligan, and all opt-in plaintiffs a settlement amount
totaling seventy-eight thousand dollars ($78, 000.00).
Id. at ¶ 15. The amount is to be divided
amongst Plaintiffs as set forth in the chart that the parties
have labeled “Exhibit A” to the settlement
agreement. Id. at 34. In addition, Defendants will
pay reasonable attorneys' fees and costs in the amount of
eight-five thousand dollars ($85, 000.00). Id. at
¶ 18. Due to Defendants' financial constraints, the
parties have agreed to structure payment of the settlement
and attorneys' fees and costs into equal monthly
installments to be paid over a period of eighteen (18)
months. Id. at ¶ 20.
party was independently represented by counsel with
experience in litigating claims under the FLSA, who
vigorously represented their clients' rights.
Id. at 10. The parties submit that the
“complexity, expense, and length of future litigation
militate in favor” of settlement. Id. at 11.
The parties state that they have performed significant
discovery, including “interrogatories, requests for
production, and request[s] for admissions, ” as well as
taken depositions and conducted extensive investigation into
liability and damages. Id. at ¶ 8. The parties
also note that, based on investigation into Defendants'
financial viability, there is a likelihood that Defendants
would not be able to satisfy a judgment obtained at trial.
Id. at 10. Thus, the parties propose that the
settlement represents a reasonable compromise of a disputed
claim. Id. at ¶ 21.
on the Court's review of the settlement agreements, the
parties' representations and the policy in this circuit
of promoting settlement of litigation, the Court recommends
the proposed settlement to be a fair and reasonable
compromise of the dispute. Other courts in this district
similarly have approved settlements for a compromised amount
in light of the stipulation of the parties, strength of the
defenses and the expense and length of continued litigation,
as the parties have recognized here. See e.g., Diaz v.
Mattress One, Inc., No. 6:10-CV-1302-ORL-22, 2011 WL
3167248, at *2 (M.D. Fla. July 15, 2011), report and
recommendation adopted, No. 6:10-CV-1302-ORL-22, 2011 WL
3166211 (M.D. Fla. July 27, 2011); see also
Dorismond, 2014 WL 2861483; Helms, 2006 WL
of the settlement, Defendants further agree to pay
Plaintiffs' attorneys' fees and costs in the amount
of eight-five thousand dollars ($85, 000.00). Doc. 166,
¶ 18. The parties state the amount of attorneys'
fees and costs is reasonable, given that the amount of
attorneys' fees payable to Plaintiffs' counsel
represents over a seventy-three percent (73%) fee reduction
from the amount Plaintiffs' counsel could have sought
using the Lodestar approach. Doc. 166 at 13. The
parties assert that the amount of attorneys' fees was
negotiated separately from Plaintiffs' recovery.
Id. at 12.
“FLSA requires judicial review of the reasonableness of
counsel's legal fees to assure both that counsel is
compensated adequately and that no conflict of interest
taints the amount the wronged employee recovers under a
settlement agreement.” Silva v. Miller, 307 F.