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REICH v. BEST BUILT HOMES

May 26, 1995

ROBERT B. REICH, Secretary of Labor, United States Department of Labor, Plaintiff, -vs- BEST BUILT HOMES, INC. and DANIEL BELANDER, JR., Individually and as President of Best Built Homes, Inc., Defendants.


The opinion of the court was delivered by: JOHN T. ELFVIN

 This action is brought pursuant to the Fair Labor Standards Act of 1938 ("the Act"), 29 U.S.C. § 201 et seq., and presents allegations, inter alia, that the defendants, in violation of the Act, withheld overtime compensation due the corporation's employees and altered its records to disguise that such withholdings had occurred. The parties having advised this Court that they had settled their dispute, the action was dismissed without prejudice to its being reopened within thirty days if such settlement were not consummated. See Order filed August 9, 1993. Now before this Court is the plaintiff's motion to enforce the settlement agreement. The motion will be granted.

 On August 6, 1993 the plaintiff's attorney Janice Silberstein, Esq., and defendants' attorney R. Thomas Burgasser, Esq., advised this Court that they had settled their dispute. Later that day the parties, via a telephone conference call, put their settlement on the record. The relevant portions of the transcript of such settlement conference are as follows:

 
"The Court: [The lawyers] are going to call in and put a settlement on the record.
 
* * *
 
"Ms. Silberstein: Defendants Best Built Homes, Incorporated and Daniel Belanger, Jr. have agreed to execute a consent judgment in which they have agreed, among other things, to the following: that the defendant will be permanently enjoined from the withholding of the payment of back wages due to 30 employees listed on Exhibit A of the Complaint, in the amount of $ 21,434.00. It is further agreed that the defendants will pay $ 3,000.00 of these back wages by September 1st, 1993 in the manner indicated in the judgment. And that the balance of $ 18,434.00 will be paid in 36 monthly installments commencing October 1st, 1993 pursuant to the schedule attached and incorporated in the judgment. The defendants have further agreed to be permanently enjoined from violating Section 711C and 15A2 of the Fair Labor Standards Act.
 
"Mr. Burgasser: And this is Tom Burgasser. That is correct Your Honor.
 
"The Court: All right. Thank you. I will issue an Order which will dismiss the case, and will 30 days be sufficient time for the reopener, if necessary, or do you want more time? Obviously, I'm not going to run it for the 36 months but *** once you get the papers filed, if there's any violation of that, of course, then you come back to me, or some other way, on the basis of the agreement today.
 
Mr. Burgasser: Okay, 30 days should be enough. We should have this wrapped up in 10, shouldn't we?
 
Ms. Silberstein: Right, yes.
 
Mr. Burgasser: Or less. That will be enough. That will be sufficient Your Honor." Transcript of August 6, 1993 Settlement Conference Via Telephone Before the Honorable John T. Elfvin ("Tr.").

 What happened subsequent to this conference is partially disputed. Undisputed is the following: On August 12th Silberstein forwarded to Burgasser for execution a Consent Judgment that she had drafted that incorporated the above-mentioned terms. Having received no response, she "faxed" Burgasser a letter September 2nd stating that, if she did not receive the executed Consent Judgment by the 3rd, she would move this Court to enforce the settlement agreement. The attorneys then (on the 2nd and 3rd) engaged in further negotiations concerning the amount of the first installment payment. Burgasser informed Silberstein on the 3rd that he "expected" defendant Belanger to execute the Consent Judgment that afternoon. However, apparently because he was dissatisfied with the terms of the settlement, Belanger never signed it.

 Based on its questioning of defendant Belanger at the November 17, 1993 oral argument on the instant motion, this Court has factually determined that Burgasser had the authority to speak, act and enter into binding agreements on Belanger's behalf at all times relevant to this lawsuit.

 At issue is whether the oral, on-the-record recitation of the settlement agreement by Silberstein and Burgasser's assent thereto constituted an enforceable settlement agreement or was instead, as the defendants contend, merely part of on-going settlement negotiations between ...


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