United States District Court, E.D. Arkansas, Western Division
ERIELLE SIMS, individually and on behalf of all others similarly situated PLAINTIFF
GOODWILL INDUSTRIES OF ARKANSAS, INC. DEFENDANT
Kristine G. Baker United States District Judge
Erielle Sims, individually and on behalf of all others
similarly situated, filed this action against her former
employer, defendant Goodwill Industries of Arkansas, Inc.
(“Goodwill”), asserting claims under the Fair
Labor Standards Act (“FLSA”), 29 U.S.C. §
201 et seq., and the Arkansas Minimum Wage Act, Ark.
Code Ann. § 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). Also
before the Court is Goodwill's motion to enforce
settlement agreement and dismiss plaintiff's complaint
with prejudice (Dkt. No. 13), which the parties agree this
Court should dismiss as moot (Dkt. No. 15, ¶ 3).
parties represent that they have entered into a settlement
agreement and release of claims (“Settlement
Agreement”), a copy of which is attached as Exhibit 1
to the joint motion to dismiss with prejudice and for
approval of settlement agreement (Dkt. No. 15-1). The parties
now request that the Court approve the Settlement Agreement.
The Court notes that, to date, no motion has been made, or
granted, for certification of a class or collective action.
Accordingly, the Settlement Agreement, if approved by the
Court, will bind only the named parties.
outset, the Court recognizes that there is some disagreement
as to whether a private settlement of FLSA claims requires
court approval, at least in the absence of a certified class
or collective action. The first court to consider this
question was the Eleventh Circuit in the case of
Lynn's Food Stores, Inc. v. United States, 679
F.2d 1350 (11th Cir. 1982). In that case, the Eleventh
Circuit interpreted the FLSA to prohibit parties from
entering into private settlements of FLSA claims without
either the approval of the district court or the Department
of Labor. See Id. at 1352-53; but see Fernandez
v. A-1 Duran Roofing, Inc., No. 12-CV-20757, 2013 WL
684736, at *1 (S.D. Fla. Feb. 25, 2013) (“[T]he Court
finds that both Parties were represented by counsel and
therefore negotiated a settlement of this matter in an
adversarial proceeding. Therefore, the Court finds that
approval is not necessary.”) (internal citations
Court has previously endorsed the Lynn's Food
approach. See Knight v. Idaho Timber of Carthage,
LLC, No. 5:18-CV-00215-KGB, 2019 WL 4923151 (E.D. Ark.
Oct. 4, 2019); Younger v. Centers for Youth &
Families, Inc., No. 4:16-CV-00170-KGB, 2017 WL 1652561
(E.D. Ark. Apr. 27, 2017); Cruthis v. Vision's,
No. 4:12-CV-00244-KGB, 2014 WL 4092325 (E.D. Ark. Aug. 19,
2014). The Second Circuit has done so as well, requiring
judicial approval of all FLSA settlements. See Cheeks v.
Freeport Pancake House, Inc., 796 F.3d 199, 206 (2d Cir.
contrast, the Fifth Circuit has held that “a private
compromise of claims under the FLSA is permissible where
there exists a bona fide dispute as to liability.”
Martin v. Spring Break '83 Prods., L.L.C., 688
F.3d 247, 255 (5th Cir. 2012) (quoting Martinez v. Bohls
Bearing Equip. Co., 361 F.Supp.2d 608, 634 (W.D. Tex.
2005)); see also Carrillo v. Dandan Inc., 51
F.Supp.3d 124, 131 (D.D.C. 2014) (“[N]o binding caselaw
in this Circuit requires a district court to assess proposed
FLSA settlements ex ante.”)
Eighth Circuit acknowledged this circuit split in Melgar
v. OK Foods, 902 F.3d 775, 779 (8th Cir. 2018), but
specifically declined to weigh in on it. More recently, the
Eighth Circuit held that “any authority for judicial
approval of FLSA settlements in 29 U.S.C. § 216 does not
extend to review of settled attorney fees, ” but
stopped short of deciding whether private settlements
relating to FLSA claims require court approval. Barbee v.
Big River Steel, LLC, 927 F.3d 1024, 1027 (8th Cir.
2019). Nonetheless, because the parties have submitted a
proposed settlement agreement for the Court's review and
approval, and because declining to review the proposed FLSA
settlement ex ante would leave the parties in an
uncertain position, the Court will review the Settlement
Agreement's FLSA-related terms for fairness.
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
(citations omitted). District courts to apply the
Lynn's Food approach have typically 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, 1241
(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. Aug. 23, 2017) (applying the
Dees two-step approach). “In essence, the
Court must ensure that the parties are not, via settlement of
the plaintiffs' claims, negotiating around the clear FLSA
requirements of compensation for all hours worked, minimum
wages, maximum hours, and overtime.” Collins v.
Sanderson Farms, Inc., 568 F.Supp.2d 714, 719 (E.D. La.
2008) (citing 29 U.S.C. §§ 206-207)). “The
Court's review of a proposed FLSA settlement is properly
limited only to those terms precisely addressing the
compromised monetary amounts to resolve pending wage and
overtime claims.” Carrillo, 51 F.Supp.3d at
134 (citing Brumley v. Camin Cargo Control, Inc.,
No. CIV.A. 08-1798 JLL, 2012 WL 1019337, at *7-9 (D.N.J. Mar.
reviewed the Settlement Agreement, the Court determines that
it both provides a reasonable recovery to Ms. Sims and
furthers the implementation of the FLSA in the workplace. The
Settlement Agreement was reached by arm's length
negotiation, and all parties involved have been represented
by experienced counsel throughout the litigation (Dkt. No.
15, ¶ 5). Therefore, the Court grants the joint motion
to dismiss with prejudice and for approval of settlement
agreement and approves of the Settlement Agreement (Dkt. No.
15). The Court also dismisses as moot Goodwill's motion
to enforce settlement agreement and dismiss ...