United States District Court, M.D. Florida, Fort Myers Division
DOROTHY JERNIGAN, on behalf of herself and others similarly situated, Plaintiff,
1ST STOP RECOVERY, INC and JUDITH MARRA-PTASHINSKI, Defendants.
REPORT AND RECOMMENDATION
MCCOY, UNITED STATES MAGISTRATE JUDGE.
before the Court are the parties' Joint Motion to Approve
Settlement Agreement and Joint Stipulation for Dismissal of
Lawsuit With Prejudice (Doc. 45) and the Settlement Agreement
and Release of FLSA Claims (Doc. 45-1) filed on April 16,
2018. Plaintiff Dorothy Jernigan and Defendants 1st Stop
Recovery, Inc. and Judith Marra-Ptashinski request that the
Court approve the parties' settlement of the Fair Labor
Standards Act (“FLSA”) claim. (Doc. 45 at 1). As
set forth below, the Court recommends that the Joint Motion
to Approve Settlement Agreement and Joint Stipulation for
Dismissal With Prejudice (Doc. 45) be granted.
approve the settlement of the FLSA claim, the Court must
determine whether the settlement is a “fair and
reasonable resolution of a bona fide dispute” of the
claims raised pursuant to the Fair Labor Standards Act
(“FLSA”). Lynn's Food Store, Inc. v.
United States, 679 F.2d 1350, 1355 (11th Cir. 1982); 29
U.S.C. § 216. 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's review and determination that the
settlement is fair and reasonable. Id. at 1353-54.
Eleventh Circuit has found settlements to be permissible when
employees bring a lawsuit under the FLSA for back wages.
Id. at 1354. The Eleventh Circuit held:
[A 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.
asserts that from approximately September 2015 to December
2016, she worked for Defendants as an office repossession
agent/office assistant. (Doc. 1 at 4 ¶ 24). Plaintiff
claims that Defendants required her to work off the clock
without receiving compensation. (Id. at 5 ¶
29). Further, Plaintiff claims that Defendants did not
compensate her for all of her overtime hours. (Id.
at 5 ¶ 30).
FLSA Settlement Agreement, Defendants deny any liability in
this action. (See Doc. 45-1 at 1). Thus, even though
a bona fide dispute exists between the parties, the
parties decided to settle this matter. (Doc. 45-1 at 1-2).
Defendants agree to pay Plaintiff $1, 545.39 for all unpaid
compensation and $1, 546.39 for liquidated damages and a
general release of any FLSA claim not alleged in the
Complaint. (Doc. 45-1 at 4 ¶
3(a)(i)-(ii)). The Court determines after review of the
Settlement Agreement that these terms are reasonable.
also agrees to pay $8, 909.22 in attorney's fees and
costs. (Doc. 45-1 at 4 ¶ 3(a)(iii)). The parties
negotiated the amount of attorney's fees and costs
separately, and without regard to the amount paid to
Plaintiff. (Doc. 45 at 2). As explained in Bonetti v.
Embarq Management Company, 715 F.Supp.2d 1222,
1228 (M.D. Fla. 2009), “the best way to insure that no
conflict [of interest between an attorney's economic
interests and those of his client] has tainted the settlement
is for the parties to reach agreement as to the
plaintiff's recovery before the fees of the
plaintiff's counsel are considered. If these matters are
addressed independently and seriatim, there is no reason to
assume that the lawyer's fee has influenced the
reasonableness of the plaintiff's settlement.” In
Bonetti, Judge Presnell concluded that:
[I]f the parties submit a proposed FLSA settlement that, (1)
constitutes a compromise of the plaintiff's claims; (2)
makes full and adequate disclosure of the terms of
settlement, including the factors and reasons considered in
reaching same and justifying the compromise of the
plaintiff's claims; and (3) represents that the
plaintiff's attorneys' fee was agreed upon separately
and without regard to the amount paid to the plaintiff, then,
unless the settlement does not appear reasonable on its face
or there is reason to believe that the plaintiff's
recovery was adversely affected by the amount of fees paid to
his attorney, the Court will approve the settlement without
separately considering the reasonableness of the fee to be
paid to plaintiff's counsel.
Id. In the instant case, the parties reached a
settlement and agreed upon the amount of attorney's fees
and costs without compromising the amount paid to Plaintiff.
The Settlement Agreement and Release of FLSA Claims (Doc.
45-1) appears reasonable on its face. Thus, the Court
recommends that the Settlement Agreement and Release of FLSA
Claims (Doc. 45-1) be approved.
IS RESPECTFULLY RECOMMENDED:
1) The Joint Motion to Approve Settlement Agreement and Joint
Stipulation for Dismissal of Lawsuit With Prejudice (Doc. 45)
2) The Settlement Agreement and Release of FLSA Claims (Doc.
45-1) be approved by the Court as a “fair and
reasonable resolution of a bona fide ...