United States District Court, D. New Jersey
before the Court is a joint motion for approval of the
parties' settlement and for dismissal of this action with
prejudice. (D.E. No. 39). The Court decides this motion after
taking into consideration the parties' unopposed
submissions and without oral argument pursuant to Federal
Rule of Civil Procedure 78(b). For the reasons set forth
below, the joint motion is GRANTED.
The Court presumes that the parties are familiar with the
underlying factual and procedural history of this action. In
brief, Plaintiff alleges, among other things, violations of
the Fair Labor Standards Act (“FLSA”), 29 U.S.C.
§ 201, et seq. (D.E. No. 15 ¶¶
103-13). On July 11, 2017, the parties entered into a
Settlement Agreement and Limited Release of Claims
(“Settlement Agreement”). (See D.E. No.
39-1). The Settlement Agreement resolves all of
Plaintiff's claims against all Defendants in exchange for
valuable consideration. (See Id. at 2-6). On August
2, 2017, the parties filed the instant motion. (D.E. No. 39).
“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.” Lynn's Food Stores, Inc. v. United
States, 679 F.2d 1350, 1353 (11th Cir. 1982); see
also Morales v. PepsiCo, Inc., No. 11-6275, 2012 WL
870752, at *1 (D.N.J. Mar. 14, 2012). “Although the Third
Circuit has not addressed whether [FSLA] actions claiming
unpaid wages may be settled privately without first obtaining
court approval, district courts within the Third Circuit have
followed the majority position and assumed that judicial
approval is necessary.” Bettger v. Crossmark,
Inc., No. 13-2030, 2015 WL 279754, at *3 (M.D. Pa. Jan.
22, 2015). “[A] district court may enter a stipulated
judgment if it determines that the compromise reached
‘is a fair and reasonable resolution of a bona fide
dispute over FLSA provisions.'” Brumley,
2012 WL 1019337, at *2 (citing Lynn's Food
Stores, 679 F.2d at 1354). Accordingly, courts must
determine whether (i) the settlement concerns a bona fide
dispute; (ii) the settlement is fair and reasonable to the
on the record, the terms and conditions of the settlement,
and the applicable law, the Court finds that the Settlement
Agreement reflects a fair and reasonable resolution of a bona
fide dispute of Plaintiff's FLSA claims. First,
the Settlement Agreement resolves a bona fide dispute as to
Plaintiff's ability to recover for unpaid wages.
Plaintiff alleges (among other things) that Defendants failed
to pay him an overtime premium as required by the FLSA. (D.E.
No. 15 ¶¶ 103- 13). Notably, Defendants moved to
dismiss Plaintiff's claims (see D.E. No. 20),
which is currently pending before the Court. They argue that
Plaintiff “was exempt from overtime pay entitlement,
and that they were not Plaintiff's employers.”
(D.E. No. 39 at 2). So, there is a bona fide dispute between
the parties as to whether Plaintiff has a viable FLSA claim.
the Settlement Agreement is fair and reasonable to Plaintiff.
The Court notes that Plaintiff was adequately represented by
counsel from the inception of this litigation until the
settlement was reached. Moreover, under the terms of the
settlement, Plaintiff will receive $15, 400, which is more
than Plaintiff's calculated “$6, 151.25 in unpaid
overtime pay during the relevant timeframe.”
(Id.). After the disbursement of attorneys' fees
and costs, Plaintiff will receive $9, 743.50 (D.E. No. 39-1
at 3), which still reflects an amount higher than his
calculated unpaid overtime pay. For these reasons, the Court
is satisfied that the Settlement Agreement reflects a fair
and reasonable resolution of a bona fide dispute of
Plaintiff's FLSA claim.
joint motion for approval of the parties' settlement and
for dismissal of this action with prejudice is GRANTED. An
appropriate Order accompanies this Memorandum Opinion.
 District courts in the Third Circuit
have held that FLSA claims can be settled in two ways: (i)
with the Department of Labor supervising the payment of
unpaid minimum wages or overtime compensation pursuant to
§ 29 U.S.C. 216(c); or (ii) with the district
court's approval of a settlement under 29 U.S.C. §
216(b). Gabrielyan v. S.O. Rose Apartments LLC, No.
15-1771, 2015 WL 5853924, at *1 (D.N.J. Oct. 5, 2015);
Brumley v. Camin Cargo Control, Inc., No. 08-1798,
2012 WL 1019337, at *1 (D.N.J. Mar. 26, 2012); In re
Chickie's & Pete's Wage & Hour Litig.,
No. 12-6820, 2014 WL 911718, at *2 (E.D. Pa. Mar. 7,
 The Court is also mindful of the
strong presumption in favor of settlement. See Farris v.
J.C. Penney Co., 176 F.3d 706, 711 ...