United States District Court, D. New Jersey
JAVIER ESPINAL, XAVIER ROSARIO, LUIGI DORTONO, SABUHAN AIROV, AND MANUEL DELGADO, and all others similarly situated, Plaintiffs,
LEONID POGORILER, PETER CREUS, ONE OF KIND TRANSPORTATION, INC., ALL AROUND MANAGEMENT, INC., ALL POINTS TRANSPORTATION GROUP, INC., YAN MOSHE, NAZAR NIKSON, MNBT CORP., EXCEL SURGERY CENTER, LLC, HEALTH PLUS SURGERY CENTER, LLC AND JOHN DOE DEFENDANTS 1-10, Defendants.
McNulty United States District Judge
matter comes before the Court on plaintiffs' motion for
an order approving a settlement agreement under the Fair
Labor Standards Act ("FLSA"), 29 U.S.C. § 201
et seq., between plaintiffs, and defendants Leonid
Pogoriler; One of Kind Transportation, Inc. ("One of
Kind"); All Around Management, Inc. ("All
Around"); and All Points Transportation Group, Inc.
("All Points") (collectively, "Pogoriler
defendants"). Defendants Yan Moshe; Excel Surgery
Center, LLC ("Excel"); Health Plus Surgery Center,
LLC ("Health Plus"); Nazar Nikson; and MNBT
Corporation ("MNBT) oppose the motion.
reasons explained below, plaintiffs' motion is denied.
Background and Proposed Settlement
I write primarily for the parties, who are familiar with the
facts and procedural history, I recount only the essential
facts. On April 6, 2018, plaintiffs filed their first amended
complaint, a prospective collective action lawsuit. (DE no.
11). Plaintiffs, drivers and patient escorts for surgery
centers, claim that they, and other similarly situated
drivers, were not paid overtime and minimum wages in
violation of the FLSA, the New Jersey Wage and Hour Law, and
the New York Labor Law. (Id.). Plaintiff Espinal
also has individual claims. He asserts that he was retaliated
against in violation of the FLSA, New York Labor Law, and the
New Jersey Conscientious Employee Protection Act.
claim that Moshe operated two surgical centers through Excel
and Health Plus. They further allege that Moshe and the
surgical centers employed plaintiffs through transportation
companies, including All Points, All Around, One of Kind, and
MNBT, which were operated by Pogoriler, Creus and Nikson.
Plaintiffs claim that they were misclassified as independent
contractors, and as a result, were underpaid.
13, 2018, plaintiffs and the Pogoriler defendants agreed to a
settlement. (DE nos. 59-1, at 4; 59-5). On that same date,
Leonid Pogoriler submitted a declaration in opposition to
Moshe, Excel, and Health Plus's pending motion to dismiss
the amended complaint. (DE no. 40). The declaration asserted
that the Pogoriler defendants were joint employers, and that
plaintiffs routinely worked more than forty-hour work weeks.
(DE no. 40).
settlement was not executed by the Pogoriler defendants until
July 23, 2018. (DE no. 59-5, at 5). The settlement agreement
is a non-monetary settlement. (DE no. 59-5). Under the terms
of the agreement, the Pogoriler defendants agreed to the
"[f]ull, complete and truthful cooperation with
Plaintiffs' prosecution of the action; to produce all
documents related to this action; and to be available for
trial preparation and trial, depositions, and post-trial
proceedings. (DE no. 59-5). In exchange, plaintiffs agreed to
dismiss the Pogoriler defendants without prejudice, and to
execute releases at the conclusion of the action. After
execution of the settlement agreement, this motion to approve
the settlement was filed.
employees bring a private right of 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 Rabbenou v. Dayan Foods, Ltd., 2017 WL 3315263, at
*1 (D.N.J. Aug. 3, 2017); Morales v. PepsiCo, Inc.,
2012 WL 870752, at *1 (D.N.J. Mar. 14, 2012). The court is
obligated to scrutinize the settlement to ensure it
represents a fair and reasonable resolution of a bona fide
dispute rather than a "mere waiver of statutory rights
brought about by an employer's overreaching."
Lynn's Food Stores, 679 F.2d at 1354.
scrutinizing an agreement for reasonableness and fairness,
courts engage in a two-step process. Singleton v. First
Student Mgmt. LLC, 2014 U.S. Dist. LEXIS 108427, at *21
(D.N.J. Aug. 6, 2014) (citation omitted). In the first step,
court analyze whether the agreement is fair and reasonable
under the so-called Girsh factors. Id.
Although a class has not yet been certified, it is clearly
contemplated; the plaintiffs seemingly concede that the
Girsh factors are relevant and proffer an analysis
of the settlement in light of them.
Girsh v. Jepson, 521 F.2d 153, 156-157 (3d Cir.
1975), the Third Circuit identified nine factors that a court
should consider in evaluating whether a proposed class action
settlement is "fair, reasonable, and adequate." The
nine Girsh factors are as follows:
(1) the complexity, expense and likely duration of the
litigation; (2) the reaction of the class to the settlement;
(3) stage of the proceedings and the amount of discovery
completed; (4) risks of establishing liability; (5) risks of
establishing damages; (6) risks of maintaining the class
action through the trial; (7) ability of the defendants to
withstand a greater judgment; (8) the range of reasonableness
of the settlement fund in light of the best possible
recovery; and (9) the range of reasonableness of the
settlement fund to a possible recovery in light of all the
attendant risks of litigation.
(citation omitted). "Once the settlement is found to be
fair and reasonable, the Court proceeds to the second step to
determine whether the agreement furthers the purpose of the
FLSA." Singleton, ...