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Pucciarelli v. Lakeview Cars, Inc.

United States District Court, E.D. New York

June 26, 2017

JAMES PUCCIARELLI; and SALVATORE ISOLDA, individually and on behalf of all others similarly situated, Plaintiffs,
LAKEVIEW CARS, INC. d/b/a CLOVE LAKE CARS; AFRIM TAHIROVIC; and GONI TAHIROVIC, jointly and severally, Defendants,


          ROSLYNN R. MAUSKOPF, United States District Judge.


         On August 24, 2016, plaintiff James Pucciarelli commenced this action pursuant to the Fair Labor Standards Act (the "FLSA"), 29 U.S.C. § 201 et seq., and the New York Labor Law (the "NYLL") alleging, inter alia, that defendants failed to pay an estimated $150, 000 in overtime wages. (Compl. (Doc. No. 1).) On October 3, 2016, Salvatore Isolda filed a ''Consent to Become Party Plaintiff letter. (Consent Letter (Doc. No. 11). On November 9, 2016, the parties appeared before Magistrate Judge Ramon E. Reyes, who referred the case for mediation. (See 11/09/2016 Minute Entry). Following mediation, the parties indicated that they settled this action, (See 1/05/2017 Report) The parties now ask that the Court approve their proposed settlement agreement (the "Agreement" (Doc. No. 18-1)) as "a reasonable compromise of disputed issues [rather] than a mere waiver of statutory rights brought about by an employer's overreaching." Le v. SIT A Info. Networking Computing, USA, Inc., No. 07-CV-86 (JS), 2008 WL 724155, at *1 (E.D.N.Y. Mar. 13, 2008) (internal quotation marks omitted); see also Cheeks v. Freeport Pancake House, Inc., 796 F.3d 199, 206 (2d Cir. 2015) ("Stipulated dismissals settling FLSA claims with prejudice require the approval of the district court. . . .")

         Under the FLSA, parties cannot settle claims without the approval of a district court or the Department of Labor. Cheeks, 796 F.3d at 206. The parties must satisfy the Court that their agreement is "fair and reasonable." Flores v. Food Express Rego Park, Inc., No. 15-CV-1410 (KAM) (SMG), 2016 WL 386042, at * I (E.D.N.Y.Feb. 1, 2016). Here, the parties have demonstrated that the Agreement "reflects a reasonable compromise over contested issues" and is fair and reasonable in all respects. Johnson v. Brennan, 10-CV-4712 (CM) 2011 U.S. Dist. LEXIS 105775 at *36 (S.D.N.Y. Sept. 16, 2011).


         I. Settlement Amount

         The parties represent in the Agreement that Pucciarelli and Isolda are receiving full compensation for the wages and liquidated damages to which they are entitled, and in a timelier manner than in the event of a trial. (Joint Mot. to Approve FLSA Settlement (Doc. No. 18) at 4.) Accordingly, the Court finds the total award to Pucciarelli and Isolda to be fair and reasonable.

         II. Attorney's Fees

         Courts calculate reasonable attorney's fees either by determining the so-called "lodestar" amount or by awarding a percentage of the settlement. See McDaniel v. Cnty. of Schenectady, 595 F.3d 411, 417 (2d Cir. 2010). The lodestar figure is the product of the attorney's reasonable hourly rate and the number of hours reasonably expended in the litigation. See Millea v. Metro-N. R. Co., 658 F.3d 154, 166 (2d Cir. 2011). "Once that initial computation has been made, the district court may, in its discretion, increase the lodestar by applying a multiplier based on other less objective factors, such as the risk of the litigation and the performance of the attorneys." Goldberger v. Integrated Res., Inc., 209 F.3d 43, 47 (2d Cir.2000) (internal quotation marks and citation omitted). Under the percentage method, counsel is awarded a reasonable percentage of the total funds recovered in the action. McDaniel, 595 F.3d at 417. In accordance with common practice, the Court employs the lodestar method as a "crosscheck'' on the percentage method. Id. at 50.

         Both Pucciarelli and Isolda agreed to pay one-third of all funds recovered in the lawsuit to Pelton Graham LLC. (Joint Mot. to Approve FLSA Settlement at 4.) Here, the Agreement calls for fees in the amount of one-third of the settlement. (Agreement at 3.) "Courts in this Circuit have often approved requests for attorneys' fees amounting to 33.3% of a settlement fund." See Karic v. Major Automotive Companies, Inc., 09 CV 5708 (CLP), 2016 WL 1745037 at *8 (E.D.N.Y. April 27. 2016) (citing cases). Therefore, based on the percentage method, the attorney's fees specified in the Agreement are reasonable.

         The lodestar method confirms that conclusion. "Recent decisions in the Eastern District of New York have determined that reasonable hourly rates in FLSA cases are approximately $300-5450 for partners, $200-$325 for senior associates, $100-$200 for junior associates, and $60-80 for legal support staff." Romero v. Westbury Jeep Chrysler Dodge, Inc., No. 15-CV-4145 (ADS) (SIL), 2016 WL 1369389, at *2 (E.D.N.Y. Apr. 6, 2016). In this case, plaintiffs' counsel billed for 67.57 hours of work at various hourly rates for a total lodestar of $21, 623.22. (See Affidavit in Support of Settlement (Doc. No. 18-2) at Ex. A.) Thus, plaintiffs' counsel billed at an average rate of approximately $320 per hour.

         When applying the lodestar method, courts generally "apply a multiplier to take into account the contingent nature of the fee, the risks of non-payment, the quality of representation, and the results achieved." In re Platinum & Palladium Commodities Litig., No. 10-CV-3617 (CCH), 2015 WL 4560206, at *3 (S.D.N.Y. July 7, 2015). A multiplier is also appropriate where, as here, the "fee award will not only compensate them for time and effort already expended, but for time that they will be required to spend administering the settlement going forward." Willix v. Healthfirst, Inc., No. 07-CV-l 143 (ENV) (RER) 2011 U.S. Dist. LEXIS 21102 at *7 (E.D.N.Y. Feb. 18, 2011). Courts have routinely found that doubling the lodestar yields a reasonable fee in the context of FLSA settlements. See e.g. I fall v. Prosource Techs., LLC, No. H-cv-2502 (SIL) 2016 U.S. Dist. LEXIS 53791 at *53-55 (E.D.N.Y. Apr. 11, 2016) ("This award represents a 2.08 multiplier of the modified lodestar, which is reasonable in light of the Goldberger factors, and is in line with other cases in the Second Circuit.); Gattinetta v. MichaelKors (USA), Inc., No. 14-CV-5731 (WHP), 2016 U.S. Dist. LEXIS 20419 at *2 (S.D.N.Y. Feb. 9, 2016) (applying 1.94 lodestar multiplier); Fujiwara v. Sushi Yasuda Ltd., 58 F.Supp.3d 424 (S.D.N.Y. Nov. 12, 2014) (holding that "a multiplier near 2 should, in most cases, be sufficient compensation for the risk associated with contingent fees in FLSA cases, " and applying multiplier of 2.28 to the modified lodestar). Here, the Agreement calls for attorney's fees that amount to a 1.31 multiplier of the loadstar - well below the multipliers found reasonable in the Second Circuit. Accordingly, both the lodestar method and the percentage method confirm that the billing rate in this case is reasonable.

         The number of hours billed is reasonable, as well. Courts in this district have found fault with billing practices due to, inter alia, vague time entries, time billed for unnecessary or redundant tasks, block-billing (i.e., grouping multiple tasks into a single time entry), and over-billing for travel time. See, e.g., Marshall v. Deutsche Post DHL, No. 13-CV-1471 (RJD)(JO), 2015 WL 5560541, at *11 (E.D.N.Y. Sept. 21, 2015) (reducing attorney's fees where counsel submitted vague time entries and "the time entries submitted for the two most senior partners .. .indicate[d] that they spent the majority of their time reviewing the work of other attorneys and conferring with each other, " finding that "[t]his top heavy approach could have been reduced or avoided"); Sheet Metal Workers' Nat. Pension Fund v. Coverex Corp. Risk Sols., No. 09-CV-0121 (SJF) (ARL), 2015 WL 3444896, at* 12 (E.D.N.Y. May 28, 2015) ("[B]lock-billing makes it difficult if not impossible for a court to determine the reasonableness of the time spent on each of the individual services or tasks provided."); Flares, 2016 WL 386042, at *3 (reducing attorney's fees where counsel "billed a not-insubstantial amount of travel time"). In this case, counsel submitted time entries explaining in sufficient detail the work that was done, billed only for time spent on critical tasks such as client communication and drafting the complaint, did not engage in block-billing for ...

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