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Martinez v. Chestnut Holdings of New York, Inc.

United States District Court, S.D. New York

January 9, 2020

JESUS MARTINEZ, Plaintiff,
v.
CHESTNUT HOLDINGS OF NEW YORK, INC., et al. Defendants.

          OPINION & ORDER

          ONA T. WANG, United States Magistrate Judge

         Plaintiff brings this action against Chestnut Holdings of New York, Inc. (“Chestnut”), 219 LLC, and Prana Real Estate Equity Funds, LLC (“Prana”) in accordance with the Fair Labor Standards Act (“FLSA”), the Family Medical Leave Act (“FMLA”), the New York Labor Law (“NYLL”), and New York City Human Rights Law (“NYCHRL”) for alleged unpaid overtime compensation, failure to pay minimum wage, failure to provide wage statements, unlawful retaliation, unlawful interference, and unlawful disability discrimination. (ECF 1). Plaintiff and Prana reached a settlement in January 2019, which was subsequently approved by the Honorable Gregory H. Woods. (ECF 52). The remaining parties now submit their proposed settlement agreement to the Court for approval under Cheeks v. Freeport Pancake House, Inc., 796 F.3d 199 (2d Cir. 2015). All parties have consented to my jurisdiction in accordance with 28 U.S.C. § 636(c). (ECF 68). For the reasons below, the Court APPROVES the settlement.

         I. Background

         Plaintiff was hired by then-owner 219 Valentine Associates, LLC as a residential superintendent in 2007 and, as a condition of his employment, lived with his family in a basement apartment within Defendants' five-story walk up apartment building. (ECF 1 ¶ 26). He alleges he worked seven days and approximately sixty-seven hours per week and performed various cleaning tasks and repair work. (Id. ¶ 28-30). Plaintiff was paid a flat rate of $375 per week, which was later raised to $426.50 per week, based on a forty-hour work week. (Id. ¶ 35). Despite several changes in the building's ownership and its management companies, Plaintiff continued working as a superintendent and performing the same duties.[1] (Id. ¶¶ 27, 33-34).

         In 2016, the building was sold to Chestnut, and soon thereafter, Plaintiff began receiving disciplinary warnings despite never having been disciplined in his job before. (Id. ¶¶ 48-50). The warnings were related to his occupancy of the basement apartment and not to his job performance. (Id. ¶¶ 49-50).

         In September 2016, Plaintiff suffered a knee injury while walking down a set of steps to check the building's boiler. (Id. ¶51). Plaintiff continued with his job duties and asked his two adult sons to assist him with his work until visiting the doctor and being advised to take three days off from work. (Id. ¶¶ 54-59). Plaintiff received a doctor's note, informed his supervisor that he would need time off, and faxed the note to his supervisor. (Id. ¶ 59-60). Plaintiff also asked his sons to complete his work during his time off. (Id. ¶ 62). Shortly thereafter, Plaintiff was terminated. (Id. ¶ 64). Plaintiff did not receive a reason for his termination. (Id.) Approximately two weeks later, Chestnut sought to evict Plaintiff from his apartment. (Id. ¶ 67).

         Plaintiff filed his complaint on August 3, 2018. (Id.) Plaintiff settled with Prana in January 2019. (ECF 52).

         II. Discussion

         Fed. R. Civ. P. 41(a)(1)(A) permits the voluntary dismissal of an action brought in federal court, but subjects that grant of permission to the limitations imposed by “any applicable federal statute.” The Second Circuit has held that “in light of the unique policy considerations underlying the FLSA, ” this statute falls within that exception, and that “stipulated dismissals settling FLSA claims with prejudice require the approval of the district court or the [Department of Labor] to take effect.” Cheeks, 796 F.3d at 206. This Court will approve such a settlement if it finds it to be fair and reasonable, employing the five non-exhaustive factors enumerated in Wolinsky v. Scholastic Inc.:

(1) the plaintiff's range of possible recovery; (2) the extent to which the settlement will enable the parties to avoid anticipated burdens and expenses in establishing their respective claims and defenses; (3) the seriousness of the litigation risks faced by the parties; (4) whether the settlement agreement is the product of arm's-length bargaining between experienced counsel; and (5) the possibility of fraud or collusion.

900 F.Supp.2d 332, 335 (S.D.N.Y. 2012) (internal quotations omitted).

         a. Range of Recovery

         Plaintiff alleges a maximum recovery against Chestnut under FLSA to be approximately $40, 484 ($20, 242 in unpaid wages plus $20, 242 in liquidated damages). (ECF 75 at 4). The proposed settlement amount is $31, 483.72. (ECF 75 at 3). Of the total settlement amount, Plaintiff would receive $25, 000 and Plaintiff's counsel would then take $6, 483.72 in fees and costs. (Id.) The Plaintiff's settlement amount thus represents approximately 61% of Plaintiff's alleged maximum damages and is greater than the alleged amount of unpaid wages.[2] Given the risks of litigation as noted below, the Court finds this amount reasonable.

         b. Burden and ...


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