United States District Court, E.D. Arkansas, Pine Bluff Division
WILLIAM KNIGHT, individually and on behalf of all others similarly situated PLAINTIFF
v.
IDAHO TIMBER OF CARTHAGE, LLC.; and IDAHO TIMBER, LLC DEFENDANT
ORDER
Kristine G. Baker, United States District Judge
Plaintiff
William Knight filed this action asserting claims under 29
U.S.C. § 216(b) of the Fair Labor Standards Act
(“FLSA”) and the Arkansas Minimum Wage Act
(“AMWA”), Arkansas Code Annotated §
11-4-201, et seq. Before the Court is the
parties' joint motion to dismiss with prejudice and for
approval of settlement agreement (Dkt. No. 15). Attached to
the motion as Exhibit A is a stipulation of settlement
agreement and release of claims (“Settlement
Agreement”) (Dkt. No. 15-1).
Settlement
agreements resolving FLSA claims are typically subject to
court approval. See Dillworth v. Case Farms Processing,
Inc., No. 5:08-cv-1694, 2010 WL 776933 at *2 (N.D. Ohio
Mar. 8, 2010) (citing 29 U.S.C. §216(b)). Before
approving a settlement, the Court must ensure that the
parties are not negotiating around the FLSA's
requirements and that the settlement represents a fair and
reasonable resolution of a bona fide dispute. See
Id. at *5; see also Int'l Union, United Auto.,
Aerospace, & Agric. Implement Workers of Am. v. Gen.
Motors Corp., 497 F.3d 615, 631 (6th Cir. 2007).
The
Eighth Circuit Court of Appeals has not directly addressed
the factors to be considered in deciding motions for approval
of FLSA settlements. However, other courts have examined such
settlements. “When employees bring a private action 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.” Lynn's Food, 679 F.2d at 1353.
After Lynn's Food was decided, other courts to
examine this issue have divided the “fairness”
determination into two steps:
First, the court should consider whether the compromise is
fair and reasonable to the employee (factors
“internal” to the compromise). If the compromise
is reasonable to the employee, the court should inquire
whether the compromise otherwise impermissibly frustrates
implementation of the FLSA (factors “external” to
the compromise). The court should approve the compromise only
if the compromise is reasonable to the employee and furthers
implementation of the FLSA in the workplace.
Dees v. Hydradry, Inc., 706 F.Supp.2d 1227, 1240-41
(M.D. Fla. 2010); see also Anthony v. Concrete Supply
Co., Inc., No. 3:16-cv-70-TCB, 2017 WL 5639933, at *1
(N.D.Ga. August 23, 2017) (applying the Dees
approach). This Court has previously applied the
Dees approach when analyzing settlement agreements
under FLSA. See Younger v. Centers for Youth and
Families, Inc., No. 4:16-cv-00170-KGB, 2017 WL 1652561
(E.D. Ark. April 27, 2017); Cruthis v. Vision's,
No. 4:12-cv-00244-KGB, 2014 WL 4092325 (E.D. Ark. August 19,
2014).
Having
reviewed the Settlement Agreement, the Court determines that
the Settlement Agreement both provides putative Collective
Class Members a reasonable recovery and furthers the
implementation of the FLSA in the workplace. In this case,
the Court has not yet certified a Collective Class. Instead
the parties represent that they “engaged in discovery
regarding Plaintiff's time records, compensation and
issues related to the underlying merit of Plaintiff's
claims and Defendants' defenses. The parties also
exchanged similar time and pay records for all other
non-exempt production workers referenced in Plaintiff's
Complaint, which totaled 225 other employees in the
three-year period prior to Plaintiff's Complaint”
(Dkt. No. 15, ¶ 3). The parties propose settling the
claims on behalf of plaintiff Mr. Knight and all putative
Collective Class Members by “issuing a Notice of
Settlement to the 225 production employees identified by
Plaintiff. . . .” (Id., ¶ 5). For good
cause shown, the Court grants the parties' joint motion
to dismiss with prejudice and for approval of settlement
agreement (Id.).
The
parties attached a proposed Notice of Settlement as Exhibit B
to the Settlement Agreement filed for the Court's
consideration (Dkt. No. 15-2). The Notice of Settlement fully
and accurately informs putative Collective Class Members of
all material elements of the litigation and the proposed
Settlement Agreement. The Notice of Settlement also advises
putative Collective Class Members of their payment under the
Settlement Agreement and that their claims will be dismissed
with prejudice if they accept payment by negotiating the
settlement check provided to them (Id., at 3). The
Notice of Settlement informs putative Collective Class
Members that, if they do not wish to participate in the
settlement, and want to pursue their claims on their own,
they can do so by not negotiating the settlement check within
90 days of the date specified on the notice (Id.).
As
stated in the Settlement Agreement, within 30 calendar days
after entry of this Order, defendants shall provide payment
to counsel for putative Collective Class Members and for
costs and attorneys' fees (Dkt No. 15-1, at 2).
The
action is dismissed with prejudice and without costs to any
party, except to the extent otherwise expressly provided in
the Settlement Agreement. The Court approves putative
Collective Class Member counsel's application for an
award for attorneys' fees and reimbursement of costs in
the amount set forth in the Settlement Agreement (Dkt. No.
15-1, at 2). Further, the Court approves of the enhancement
award to Mr. Knight, the named plaintiff, as set forth in the
proposed Settlement ...