Aboumrad v. Borrego Springs Fire Protection District ( 2021 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 MIKE ABOUMRAD et al., Case No.: 20cv933-L-KSC 12 Plaintiffs, ORDER GRANTING JOINT 13 v. MOTION FOR APPROVAL OF SETTLEMENT AGREEMENT AND 14 BORREGO SPRINGS FIRE DISMISSING ACTION WITH PROTECTION DISTRICT, 15 PREJUDICE Defendant. 16 (ECF NO. 18) 17 18 Pending before the Court in this collective action alleging violation of the Fair 19 Labor Standards Act, 29 U.S.C. § 201 et seq. (“FLSA”), is a Renewed Joint Stipulation 20 for Approval of Settlement Agreement and Dismissal of Case with Prejudice (ECF No. 21 18, “Joint Motion”). For the reasons stated below, the Joint Motion is granted, and this 22 action is dismissed with prejudice. 23 This action was filed pursuant to 29 U.S.C. § 216(b) by Defendant’s employees. 24 (See ECF no. 1 (“Compl.”).) They alleged Defendant used an unlawful compensation 25 computation method which undercounted Plaintiffs’ “regular rate of pay.” (Id. at 2.) 26 This, in turn, resulted in an alleged violation of 29 U.S.C. § 207 by underpayment for 27 overtime. (Id.) Plaintiffs sought unpaid overtime with interest, an equal amount of 28 liquidated damages, and attorneys’ fees as provided by 29 U.S.C. § 216(b). (Id. at 13.) 1 They also requested a finding that Defendant’s conduct was an intentional, knowing, and 2 willful FLSA violation so as to entitle them to a longer statute of limitations. (Id.) 3 Finally, they requested injunctive relief ordering Defendants to change their 4 compensation policies. (Id.) The Court has jurisdiction pursuant to 28 U.S.C. § 1331. 5 The FLSA allows for a private action against an employer for violations of 29 6 U.S.C. § 207 “by any one or more employees for and on behalf of himself or themselves 7 and other employees similarly situated.” 29 U.S.C. § 216(b). However, “[n]o employee 8 shall be a party plaintiff to any such action unless he gives his consent in writing to 9 become such a party.” Id. 10 Twenty-five of Defendant’s employees (“Employees”) filed a Consent to Be 11 Included as an Individual Plaintiff. (ECF Nos. 3, 17 (“Consent”).) With the Joint 12 Motion, the parties request the Court to approve the Settlement Agreement and Release 13 of Claims (ECF No. 18-3, “Settlement”) between Defendant and Employees. (Joint 14 Motion at 9.) “FLSA claims may not be settled without approval of either the Secretary 15 of Labor or a district court.” Seminiano v. Xyris Enter., Inc., 602 Fed. Appx. 682 (2015). 16 In exchange for a release, Defendant agrees to pay each Employee the sum listed 17 on Exhibit A to the Settlement. (Settlement ¶2, Ex. A.) The individual sums amount to 18 $100,000, and range from $17,316.78 to $109.15, depending on the number of overtime 19 hours each Employee worked during the settlement period. (ECF No. 18-1 (Decl. of 20 David E. Mastagni, Esq. (“Mastagni Decl.”) ¶12.) In addition, Defendant agrees to pay 21 Employees’ attorneys’ fees and costs in the sum of $35,000. (Settlement ¶2(c).) 22 Attached to the Settlement is each Employee’s Acknowledgment Form, acknowledging 23 his understanding of, and agreement with, the Settlement. (Settlement Ex. B.) 24 The amount awarded to the Employees under the Settlement represents a 25 compromise between the maximum award available if Employees prevailed at trial on all 26 their claims, and numerous disputed issues which could delay final resolution of this 27 action and render its outcome uncertain. (See Mastagni Decl. ¶¶ 15-16; ECF No. 18-2 28 (Decl. of Alison D. Alpert, Esq. (“Alpert Decl.”)) ¶¶9-12.) The compromise was reached 1 || after informal investigation and discovery to arrive at the potential value of each 2 ||Employee’s claim and evaluation of Defendant’s defenses. (Mastagni Decl. ¥ 14; see 3 Alpert Decl. §8.) Based on the nature of this action and the work and expertise 4 ||necessary to reach the Settlement, the Court finds that the sum of $35,000 for attorneys’ 5 || fees and costs is reasonable. (See Mastagni Decl. 992-6, 17-22.) The Settlement 6 || represents a reasonable compromise, and is therefore approved as fair, adequate, and 7 || reasonable. 8 Accordingly, it is hereby ordered as follows: 9 1. The Joint Motion is granted. 10 2. The parties shall discharge their duties and obligations in accordance with 11 || the terms of the Settlement. 12 3. This action is dismissed with prejudice. 13 IT IS SO ORDERED. 14 || Dated: May 11, 2021 (fee oop 16 H . James Lorenz, 7 United States District Judge 18 19 20 21 22 23 24 25 26 27 28