United States District Court, E.D. New York
ORDER ADOPTING REPORT AND RECOMMENDATION
KIYO
A. MATSUMOTO, UNITED STATES DISTRICT JUDGE
On May
22, 2017, plaintiff David Gomez (“plaintiff”)
commenced this action by filing a complaint
(“Compl.” or the “complaint, ” ECF
No. 1) against defendants Midwood Lumber and Millwork, Inc.
and Pine Sash, Door & Lumber Co., Inc. (collectively,
“defendants”), pursuant to the Fair Labor
Standards Act (“FLSA”), 29 U.S.C. §§
201 et seq., the New York Labor Law, and title 12 of
the New York Codes, Rules and Regulations. (Compl. ¶ 1.)
On September 14, 2017, the parties submitted a letter motion
(“Mot.” or the “approval motion, ”
ECF No. 17) seeking approval of the parties' settlement
agreement (“Settlement Agreement”) resolving this
action. (See Mot. at 1; see also Settlement
Agreement, ECF No. 17-1.)
Presently
before the court is a report and recommendation
(“R&R” or the “Report and
Recommendation, ”) issued on September 20, 2017 by the
Honorable James Orenstein, United States Magistrate Judge,
recommending that the court approve the Settlement
Agreement.[1]
For the reasons set forth herein, the court adopts and
supplements Judge Orenstein's Report and Recommendation
and approves the Settlement Agreement.
Background
In the
complaint, plaintiff alleges, inter alia, that
defendants, both of which are “engaged in the building
material and supply distribution business” (Compl.
¶¶ 8-9), employed him as a truck driver “from
approximately July 2016 through February 2017.”
(Id. ¶ 7.) Plaintiff further alleges that from
May 2011 onward, defendants “engaged in a policy and
practice of requiring [plaintiff] and putative class members
to regularly work in excess of forty (40) hours per week,
without providing overtime compensation” as required
under applicable law.[2] (Id. ¶ 2.)
According
to the complaint, plaintiff “typically worked a total
of approximately 54.5 hours per week.” (Id.
¶ 25.) Plaintiff's “regular rate of pay was
approximately $20.00 per hour, ” although plaintiff
alleges that defendants structured his payments “in an
effort to avoid paying . . . overtime at time and one half of
[plaintiff's] regular rate of pay and to avoid certain
withholdings.” (Id. ¶ 26.) Specifically,
plaintiff asserts that defendants paid him
“approximately $9.00 per hour for the first forty (40)
hours he worked in a week by check, with the remaining
balance of $11.00 per hour in cash, and $20.00 per hour for
all hours worked over forty (40) in cash.”
(Id.) Plaintiff alleges that he “never
received overtime pay at time and one-half of his regular
rate of pay.” (Id.)
Defendants
answered plaintiff's complaint on June 5, 2017 (see
generally Answer, ECF No. 8), and the parties
subsequently engaged in settlement negotiations. (See Letter
Requesting Adjournment of Deadlines, ECF No. 14.) On August
15, 2017, the parties informed the court that they had
reached a settlement in principle. (See Letter
Regarding Settlement, ECF No. 16.)
On
September 14, 2017, plaintiff filed the approval motion,
which attached the Settlement Agreement as an exhibit. In
support of the approval motion, on September 15, 2017,
plaintiff filed a letter supplementing the approval motion
(“Supp.” or the “supplement, ” ECF
No. 19), which attached as an exhibit an invoice setting
forth contemporaneous time and billing records from the law
firm that represented plaintiff. (“Inv.” or the
“invoice, ” ECF No. 19-1.) The approval motion
asserts that plaintiff's “possible recovery is, at
the very most, approximately $14, 826.43 for alleged overtime
violations and violations of the notice requirements of [the
New York Labor Law].” (Mot. at 2.) The approval motion
does not set forth the basis for this assertion.
The
Settlement Agreement provides, in relevant part, that the
parties will settle the action for a total sum of $19, 000,
of which $6, 270 is payable to plaintiff's counsel.
(Settlement Agreement § 1.) The remaining $12, 730 is
payable to plaintiff. (Id.) Both the approval motion
and the supplement indicate that the amount payable to
plaintiff's counsel represents attorneys' fees and
expenses. (Mot. at 1; Supp. at 1.) Although neither the
approval motion nor the supplement set forth a dollar amount
specifically attributable to fees and a separate dollar
amount attributable to expenses, the invoice indicates that
plaintiff's counsel incurred expenses of $541.60,
consisting of a $400 filing fee, a $140 fee for service of
process, and $1.60 in PACER fees. (Inv. at 2-3.)
In
addition to its monetary provisions, the Settlement Agreement
includes a non-disparagement clause that prohibits plaintiff
from making “comments that will disparage [defendants]
or any of [their] past or present employees, ” which
“may include comments concerning the working conditions
at the [defendants] or any other communications which might
otherwise impair the reputation of [defendants].”
(Settlement Agreement § 7.) The Settlement Agreement
also states that “[n]othing contained herein is
intended to limit [plaintiff's] communication rights
under the FLSA.” (Id.) The Settlement
Agreement's release provision applies only to “wage
and hour claims . . . based upon any conduct occurring up to
and including the date of [p]laintiff's execution of
th[e] [Settlement] Agreement, ” and expressly carves
out “any claims arising out of alleged acts occurring
after the effective date of th[e] [Settlement]
Agreement.” (Settlement Agreement § 3.)
On June
12, 2017, Judge Orenstein issued the Report and
Recommendation in which he “conclude[d] that [the
Settlement Agreement] is fair and reasonable, ” and
recommended “that the court grant the motion and
approve the settlement.” (R&R.) The Report and
Recommendation directed that any objections be made no later
than October 4, 2017. (Id.) No. objections were
filed.
Legal
Standard
I.
Review of R&R
A
district judge may designate a magistrate judge to hear and
determine issues arising before trial. 28 U.S.C. § 636.
In reviewing a magistrate judge's report and
recommendation, the district court “may accept, reject,
or modify, in whole or in part, the findings or
recommendations made by the magistrate judge.” 28
U.S.C. § 636(b)(1)(C). Where no objection to a report
and recommendation has been filed, the district court
“need only satisfy itself that that there is no clear
error on the face of the record.” Urena v. New
York, 160 F.Supp.2d 606, 609-10 (S.D.N.Y. 2001) (quoting
Nelson v. Smith, 618 F.Supp. 1186, 1189 (S.D.N.Y.
1985)).
II.
Cheeks Review
Federal
Rule of Civil Procedure (“Rule”) 41, in relevant
part, that:
Subject
to Rules 23(e), 23.1(c), 23.2, and 66 and any applicable
federal statute, the plaintiff may dismiss an action
without a court order by filing:
(i) a notice of dismissal before the opposing party serves
either an answer or a motion ...