Collingsworth v. Dania Montejo DDS PA

UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF FLORIDA ORLANDO DIVISION DANIELLE COLLINGSWORTH, Plaintiff, v. Case No: 6:20-cv-327-Orl-37GJK DANIA MONTEJO DDS PA, SOSA DENTAL P.A., and DR. DANIA SOSA, individually, Defendants.

REPORT AND RECOMMENDATION This cause came on for consideration without oral argument on the following motion: MOTION: JOINT MOTION TO APPROVE SETTLEMENT AGREEMENT AND DISMISS THE CASE WITH PREJUDICE (Doc. No. 77) FILED: September 17, 2021 THEREON it is RECOMMENDED that the motion be GRANTED.

On February 25, 2020, Plaintiff filed a Complaint against Defendants for failure to pay overtime and minimum wages in violation of the Fair Labor Standards Act (“FLSA”). Doc. No. 1. Plaintiff claimed she did not receive wages for hours worked in excess of 40 hours per week and that she did not receive payment for time worked that resulted in the failure to pay her a minimum wage.

Doc. No. 1 at 3-4.

On September 17, 2021, the parties filed a “Joint Motion to Approve Settlement Agreement and Dismiss the Case with Prejudice” (the “Motion”). Doc.

No. 77. The parties state that Plaintiff will be fully compensated for her alleged unpaid wages. Id. at ¶ 6. In the pretrial statement, Plaintiff asserted damages claims totaling $2,368.17, consisting of “$131.88 in on-the-clock overtime, $312.00 in off-the-clock overtime, and $443.88 in liquidated damages associated with the Overtime claim [and] . . . $1,480.41 in common law, unpaid wages.”1 Doc. No. 72 at 3. Under the settlement agreement, Plaintiff will receive $796.60 for unpaid wages, an additional $1,127.69 for unpaid wages, and $443.88 in liquidated damages, which totals $2,368.17. Doc. No. 77-1 at 3. Plaintiff’s counsel will receive $12,131.83 in attorney’s fees and costs that were separately negotiated from Plaintiff’s payments. Id.; Doc. No. 77 at ¶ 7. The parties ask the Court to approve the settlement agreement and dismiss the case with prejudice. Doc. No. 77 at 6.

In Lynn’s Food Stores, Inc. v. United States Department of Labor, 679 F.2d 1350, 1352-53 (11th Cir. 1982), the Eleventh Circuit addressed the means by which an FLSA settlement may become final and enforceable:

There are only two ways in which back wage claims arising under the FLSA can be settled or compromised by employees.

First, under section 216(c), the Secretary of Labor is authorized to supervise payment to employees of unpaid wages owed to them . . . . The only other route for compromise of FLSA claims is provided in the context of suits brought directly by employees against their employer under section 216(b) to recover back wages for FLSA violations. When 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.

Thus, unless the parties have the Secretary of Labor supervise the payment of unpaid wages owed or obtain the Court’s approval of the settlement agreement, the parties’ agreement is unenforceable. Id.; see also Sammons v. Sonic-North Cadillac, Inc., No. 6:07-cv-277-PCF-DAB, 2007 WL 2298032, at *5 (M.D. Fla. Aug. 7, 2007) (noting that settlement of FLSA claim in arbitration proceeding is not enforceable under Lynn’s Food because it lacked Court approval or supervision by the Secretary of Labor). Before approving an FLSA settlement, the Court must scrutinize it to determine if it is a fair and reasonable resolution of a bona fide dispute. Lynn’s Food Store, 679 F.2d at 1354-55. If the settlement reflects a reasonable compromise over issues that are actually in dispute, the Court may approve the settlement. Id. at 1354.

In determining whether the settlement is fair and reasonable, the Court should consider the following factors: (1) the existence of collusion behind the settlement; (2) the complexity, expense, and likely duration of the litigation; (3) the stage of the proceedings and the amount of discovery completed; (4) the probability of plaintiff’s success on the merits; (5) the range of possible recovery; and (6) the opinions of counsel.

Leverso v. SouthTrust Bank of Ala., Nat’l Assoc., 18 F.3d 1527, 1531 n.6 (11th Cir. 1994); Hamilton v. Frito-Lay, Inc., No. 6:05-cv-592-ACC-JGG, 2007 WL 328792, at *2 (M.D.

Fla. Jan. 8, 2007), report and recommendation adopted, 2007 WL 219981 (M.D. Fla. Jan.

26, 2007). The Court should be mindful of the strong presumption in favor of finding a settlement fair. See Cotton v. Hinton, 559 F.2d 1326, 1331 (5th Cir. 1977).2 In FLSA cases, the Eleventh Circuit has questioned the validity of contingency fee agreements. Silva v. Miller, 307 F. App’x 349, 351 (11th Cir. 2009) (citing Skidmore v. John J. Casale, Inc., 160 F.2d 527, 531 (2d Cir. 1947) (“We have considerable doubt as to the validity of the contingent fee agreement; for it may well be that Congress intended that an employee’s recovery should be net[.]”)). In Silva, the Eleventh Circuit stated: That Silva and Zidell entered into a contingency contract to establish Zidell’s compensation if Silva prevailed on the FLSA claim is of little moment in the context of FLSA. FLSA requires judicial review of the reasonableness of counsel’s legal fees to assure both that counsel is compensated adequately and that no conflict of interest taints the amount the wronged employee recovers under a settlement agreement. FLSA

Silva, 307 F. App’x at 351-52.3 For the Court to determine whether the proposed settlement is reasonable, counsel for the plaintiff must first disclose the extent to which the FLSA claim has or will be compromised by the deduction of attorney’s fees, costs, or expenses pursuant to a contract between the plaintiff and her counsel, or otherwise. Id. When a plaintiff receives less than a full recovery, any payment (whether or not agreed to by a defendant) above a reasonable fee improperly detracts from the plaintiff’s recovery.4 Thus, a potential conflict can arise between counsel and their client regarding how much of the plaintiff’s total recovery should be allocated to attorney’s fees and costs.5 It is the Court’s

An alternate means of demonstrating the reasonableness of attorney’s fees and costs was set forth in Bonetti v. Embarq Management Co., 715 F. Supp. 2d 1222 (M.D. Fla. 2009). In Bonetti, the Honorable Gregory A. Presnell held: In sum, if the parties submit a proposed FLSA settlement that, (1) constitutes a compromise of the plaintiff’s claims; (2) makes full and adequate disclosure of the terms of settlement, including the factors and reasons considered in reaching same and justifying the compromise of the plaintiff’s claims; and (3) represents that the plaintiff’s attorneys’ fee was agreed upon separately and without regard to the amount paid to the plaintiff, then, unless the settlement does not appear reasonable on its face or there is reason to believe that the plaintiff’s recovery was adversely affected by the amount of fees paid to his attorney, the Court will approve the settlement without separately considering the reasonableness of the fee to be paid to plaintiff’s counsel.

Bonetti, 715 F. Supp. 2d at 1228 (emphasis added). Judge Presnell maintained that if the matter of attorney’s fees is “addressed independently and seriatim, there is recovery could become somewhat arbitrary. no reason to assume that the lawyer’s fee has influenced the reasonableness of the plaintiff’s settlement.” Id. The undersigned finds this reasoning persuasive.

Lynn’s Foods requires a court to determine whether a plaintiff’s compromise of her claims is fair and reasonable. Lynn’s Food Stores, 679 F.2d at 1354-55. In this case, however, Plaintiff has not compromised her FLSA claim. Doc. No. 77 at ¶ 6.

Therefore, the agreement is necessarily a “fair and reasonable resolution of a bona fide dispute over FLSA provisions.” Lynn’s Food, 679 F.2d at 1354. Accordingly, it is recommended that the Court find the consideration being paid to Plaintiff to resolve Plaintiff’s FLSA claim is fair and reasonable.

Because the parties represent that Plaintiff will receive all the FLSA compensation due, the Court need not consider whether the attorney’s fees paid under the settlement agreement are reasonable because they did not “taint” the amount Plaintiff agreed to accept to settle the case. See Granger v. Water Sports Mgmt., Inc., Case No. 6:08-cv-1283-GAP-KRS, 2009 WL 1396286, at *2 (M.D. Fla. May 18, 2009). Even if the Court were to consider the reasonableness of the attorney’s fees, the parties represent that they were negotiated separately from Plaintiff’s recovery. Doc. No. 77 at ¶ 7. The settlement is reasonable on its face, and the parties’ representation adequately establishes that the issue of attorney’s fees and costs was agreed upon separately and without regard to the amount paid to Plaintiff. See Bonetti, 715 F. Supp. 2d at 1228.

Accordingly, it is RECOMMENDED that the Court enter an order GRANTING the Motion (Doc. No. 77) and DISMISSING the case with prejudice.

NOTICE TO PARTIES A party has fourteen days from the date the Report and Recommendation is served to serve and file written objections to the Report and Recommendation’s factual findings and legal conclusions. Failure to serve written objections waives that party’s right to challenge on appeal any unobjected-to factual finding or legal conclusion the district judge adopts from the Report and Recommendation. 11th Cir. R. 3-1. To expedite the final disposition of this matter, if the parties have no objections to this report and recommendation, they may promptly file a joint notice of no objection.

RECOMMENDED in Orlando, Florida, on November 1, 2021.

iy / tk "GREGORY J.KELLY UNITED STATES MAGISTRATE JUDGE Copies furnished to: Counsel of Record Unrepresented Parties -g-