United States District Court, W.D. Arkansas, Fort Smith Division
CATHERINE WHITE, individually and on behalf of all others similarly situated PLAINTIFF
THE GREGORY KISTLER TREATMENT CENTER, INC. DEFENDANT
OPINION AND ORDER
HOLMES, III CHIEF U.S. DISTRICT JUDGE
the Court is the parties' renewed joint motion (Doc. 64)
to approve settlement agreement and dismiss and a brief (Doc.
65) in support of their joint motion. The parties have also
filed a proposed settlement agreement (Doc. 64-1) for the
Court's review. The motion will be granted.
filed this lawsuit on November 7, 2016, claiming that
Defendant failed to pay minimum and overtime wages in
violation of the Fair Labor Standards Act
(“FLSA”) and the Arkansas Minimum Wage Act. On
July 11, 2017, the Court conditionally certified the case as
a collective action pursuant to 29 U.S.C. § 216(b) and
authorized notice to be sent to potential opt-in plaintiffs.
(Doc. 20). On August 28, 2018, the parties submitted a joint
motion to approve settlement agreement and dismiss. (Doc.
60). The Court denied the motion (Doc. 63). The parties now
seek Court approval of their amended settlement agreement and
a dismissal of all claims. The Court has reviewed the renewed
joint motion and the amended settlement agreement and will
now approve the amended settlement agreement and grant the
motion to dismiss.
are only two ways in which wage claims under the FLSA can be
settled or compromised by employees. First, under section
216(c), the Secretary of Labor is authorized to supervise
payment to employees of unpaid wages owed to them.”
Lynn's Food Stores, Inc. v. United States, 679
F.2d 1350, 1352-53 (11th Cir. 1982). Second, “[w]hen
employees bring private actions for back wages under the
FLSA, and present to the district court a proposed
settlement, the district court may enter a stipulated
judgment after scrutinizing the settlement for
fairness.” Id. at 1353; Beauford v.
ActionLink, 781 F.3d 396, 405 (8th Cir. 2015). The
parties here do not propose a stipulated judgement, but they
have set out in their settlement agreement the amounts due to
each opt-in Plaintiff for unpaid wages and the amounts of
liquidated damages agreed upon. The parties have also agreed
as to the amount of attorneys' fees that Defendants will
pay Plaintiffs' counsel. The parties have agreed that
Plaintiffs will voluntarily waive all wage or overtime
related claims for compensation, including FLSA claims.
district court may only approve a settlement agreement and
enter a stipulated judgment that includes a waiver of FLSA
claims after it determines that the litigation involves a
bona fide dispute and that the proposed settlement is fair
and equitable to all parties. Lynn's Food, 679
F.2d at 1353 n.8. The Court finds a bona fide dispute exists.
Plaintiffs argue they are entitled to certain unpaid wages
which Defendant failed to pay, and Defendant denies
Plaintiffs are entitled to such wages. Because a bona fide
dispute exists as to whether Plaintiffs are entitled to a
minimum wage and overtime for their work, the Court must
evaluate whether the settlement is fair.
factors a court should consider in evaluating the fairness of
a settlement depend on the unique circumstances of each case.
Lewis-Ramsey v. Evangelical Lutheran Good Samaritan
Soc'y, 3:16-cv-00026, 2017 WL 821656 *5 (S.D. Iowa,
Jan.10, 2017). Among the factors courts have considered are:
(1) the amount of overtime to which class members may be
entitled; (2) how close to full compensation of class
members' claims the proposed settlement provides; (3)
whether the proposed settlement includes or excludes
liquidated damages and/or attorney's fees and expenses;
(4) the likely complexity, expense, and duration of the
litigation if the settlement is not approved; and (5) what
additional claims class members must release in order to
receive compensation under the proposed settlement agreement.
See Lewis-Ramsey, 2017 WL 821656 at *4; Loseke
v. Depalma Hotel Corp., 4:13-cv-3191, 2014 WL 3700904
(D. Neb. July 24, 2014).
reviewing these factors in relation to the joint motion and
amended settlement agreement, the Court finds that the
agreement is fair and reasonable. The attorneys for each
party have considerable experience in wage litigation. The
agreement appears to adequately compensate Plaintiffs for the
amount of overtime pay which they allege was wrongfully
withheld. The agreement includes liquidated damages in
reduced amount, and the Court finds that the amount of
liquidated damages is reasonable because Defendant acted in
good faith and had reasonable grounds for believing it
complied with the FLSA. See Chao v. Barbeque Ventures,
LLC, 547 F.3d 938 (8th Cir. 2008) (quoting 29 U.S.C.
§ 260) (“[I]f the employer shows that its actions
were taken in ‘good faith' and with
‘reasonable grounds for believing' that [the
employer] complied with the FLSA, ‘the court may, in
its sound discretion, award no liquidated damages or award
any amount thereof not to exceed the amount specified in
§ 216 of this title.'”). Plaintiffs waive only
wage or overtime related claims and avoid an expensive and
time-consuming trial that would likely reach a similar result
to the settlement agreement.
the parties provide billing records for the proposed
attorneys' fees. A reasonable rate is requested, and in
light of the relief this settlement affords to each
Plaintiff, the Court finds that this requested fee of $15,
400.00 is reasonable. This revised settlement appears to be
the result of an arms-length negotiation between the parties
based on the merits of the case. It is informed by the facts
revealed during discovery; it provides a substantial recovery
to Plaintiffs when considered in light of the existing bona
fide disputes, the merits of their case, and the likelihood
of their success; and it contains no hallmarks of collusion.
THEREFORE ORDERED that the proposed amended settlement
agreement is approved in its entirety as fair and reasonable.
FURTHER ORDERED that the parties' renewed joint motion to
dismiss (Doc. 64) is GRANTED and this ...