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reducing Seelig's rate to $200 per hour where she was second-most senior attorney on team
Summary of this case from Martinez v. Gulluoglu LLCOpinion
13 Civ. 6071 (KBF)
05-20-2014
JOYCE AGUILERA, Plaintiff, v. COOKIE PANACHE BY BETWEEN THE BREAD, LTD., et al., Defendants.
MEMORANDUM DECISION & ORDER
:
On August 28, 2013, plaintiff Joyce Aguilera, on behalf of herself, FLSA collective plaintiffs, and the Class, filed this action against defendants Cookie Panache by Between the Bread, Ltd., Ricky Eisen, and Sean Martin, alleging violations of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 201, et seq., and the New York Labor Law ("NYLL"). (Compl. ¶¶ 1-2, Aug. 28, 2013, ECF No. 1.) On November 11, 2013, defendants answered the Complaint. (ECF No. 13.)
On November 13, 2013, plaintiff filed a motion to certify the class pursuant to 29 U.S.C. § 216(b). (ECF No. 14.) On November 14, 2013, an initial pretrial conference was held. On March 5, 2014, plaintiff filed a motion for class certification pursuant to Rule 23 of the Federal Rules of Civil Procedure. (ECF No. 38.) On March 10, 2014, plaintiff filed an amended Complaint (ECF No. 51), and on March 11, 2014, plaintiff filed a motion for summary judgment. (ECF No. 53.) On March 17, 2014, plaintiff Martha Patricia Diaz filed a consent to sue under the FLSA. (ECF No. 63.) On March 19, 2014, defendants answered the amended Complaint. (ECF No. 68.)
On April 1, 2014, the parties informed the Court that they reached a settlement. (ECF No. 70.) On May 12, 2014, plaintiffs submitted papers to support the fairness of the proposed settlement. (ECF No. 74.)
The proposed settlement is for a total of $87,000. (See Pl.'s 5/12 Ltr. at 2.) Terms of the settlement provide that plaintiff Aguilera shall receive $25,000, which represents 100% of back wages (including liquidated damages) from 2011 onward; plaintiff Diaz shall receive $5,000; and $57,000 shall be awarded for attorneys' fees, costs, and expenses. (Id. at 2, 4.) The Court APPROVES the settlement pursuant to modifications set forth below. I. DISCUSSION
Plaintiffs explain that plaintiff Diaz's claim is considerably weakened by a recent district court decision, Maldonado v. BTB Events & Celebrations, Inc., No. 12 Civ. 5968 (S.D.N.Y. 2013). (Pl.'s 5/12 Ltr. at 3.) Pursuant to that decision, plaintiffs contend defendants likely would assert plaintiff Diaz is entitled to no back wages at all, and accordingly, they believe $5,000 is an "outstanding" settlement. (Id.)
"[B]efore a district court enters judgment, it must scrutinize the settlement agreement to determine that the settlement is fair and reasonable." Wolinsky v. Scholastic, Inc., 900 F. Supp. 2d 332, 335 (S.D.N.Y. 2012) (citations omitted). In making such a determination, courts look to the totality of the circumstances, including the following factors:
But see Lliguichuzcha v. Cinema 60, LLC, No. 11 Civ. 4486, 2013 WL 2436526, at *1 (S.D.N.Y. 2013) (suggesting that "it is not clear that judicial approval of an FLSA settlement is legally required") (citing cases). --------
(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.Id. (quoting Medley v. American Cancer Soc., No. 10 Civ. 3214, 2010 WL 3000028, at *1 (S.D.N.Y. July 23, 2010) (other citations omitted)).
Generally, "[c]ourts approve FLSA settlements when they are reached as a result of contested litigation to resolve bona fide disputes." Diaz v. Scores Holding Co., No. 07 Civ. 8718, 2011 WL 6399468, *2 (S.D.N.Y. 2011) (citations omitted); see also Lynn's Food Stores, Inc. v. U.S., 679 F.2d 1350, 1353-54 (11th Cir. 1982) (explaining that courts usually regard the adversarial nature of a litigated FLSA case to be a sufficient indicator of a settlement's fairness). "The standard for approval of an FLSA settlement is lower than for a Rule 23 settlement because an FLSA settlement does not implicate the same due process concerns as does a Rule 23 settlement." Massiah v. MetroPlus Health Plan, Inc., No. 11 Civ. 5669, 2012 WL 5874655, at *5 (E.D.N.Y. Nov. 20, 2012) (citations omitted).
In this case, the Court finds that the proposed settlement was reached as a result of arm's-length negotiations. The litigation was contested and was reached after several months of negotiations. (Pl.'s 5/12 Ltr. at 3.)
"Under the FLSA and the [NYLL], a prevailing plaintiff is entitled to reasonable attorneys' fees and costs." Anthony v. Franklin First Fin., Ltd., 844 F. Supp. 2d 504, 506 (S.D.N.Y. 2012) (citing 29 U.S.C. § 216(b); N.Y. Lab. Law § 663(1)). Attorneys' fees are intended "to encourage members of the bar to provide legal services to those whose wage claims might otherwise be too small to justify the retention of able, legal counsel." Sand v. Greenberg, No. 08 Civ. 7840, 2010 WL 69359, at *3 (S.D.N.Y. Jan. 7, 2010) (explaining that "[b]ut for the separate provision of legal fees, many violations of the [FLSA] would continue unabated and uncorrected"); see also Braunstein v. Eastern Photgraphic Labs., Inc., 600 F.2d 335, 336 (2d Cir. 1978) (explaining that the FLSA "should be given a liberal construction" because of its "broad remedial purpose"); Estrella v. P.R. Painting Corp., 596 F. Supp. 2d 723, 727 (E.D.N.Y. 2009) ("The fee provisions contained in the FLSA and the [NYLL] were designed in part to secure legal representation for plaintiffs whose wage and hour grievances were too small, in terms of expected recovery, to create a financial incentive for qualified counsel to take such cases under conventional fee arrangements.") (citing cases); Diaz, 2011 WL 6399468, at *4 (citing cases discussing the rationale for the fee provisions in the FLSA and the NYLL).
Attorneys' fees in FLSA settlements are subject to the court's approval, however. See 29 U.S.C. § 216(b); Miesiewicz v. D'Onofrio General Contractors Corp., No. 08 Civ. 4377, 2010 WL 2545439, at *5 (E.D.N.Y. 2010) (citing cases), report & recommendation adopted by 2010 WL 2545472 (E.D.N.Y. June 18, 2010). Plaintiffs "bear[ ] the burden of documenting the hours reasonably spent by counsel, and the reasonableness of the hourly rates claimed." Allende v. Unitech Design, Inc., 783 F. Supp. 2d 509, 512 (S.D.N.Y. 2011) (quoting General Elec. Co. v. Compagnie Euralair, S.A., No. 96 Civ. 0884, 1997 WL 397627, at *4 (S.D.N.Y. July 3, 1997)).
In order to determine the appropriate fee award, courts typically start with a determination of the lodestar amount, which is "the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate." Healey v. Leavitt, 458 F.3d 63, 71 (2d Cir. 2007) (citing Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)); see also Anthony, 844 F. Supp. 2d at 506 (explaining that "[t]he Supreme Court recently approved the lodestar approach over the more discretionary approach that had been adopted by the 5th Circuit in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714, 717-19 (5th Cir. 1974)). Counsel for the prevailing party must submit evidence in support of their proposed figures, and "should make a good faith effort to exclude from a fee request hours that are excessive, redundant, or otherwise unnecessary." Hensley v. Eckerhart, 461 U.S. at 433-34.
"A reasonable hourly rate is 'the rate a paying client would be willing to pay . . . bear[ing] in mind that a reasonable paying client wishes to spend the minimum necessary to litigate the case effectively.'" Costello v. Flatman, No. 11 Civ. 287, 2013 WL 1296739, at *4 (E.D.N.Y. Mar. 28, 2013) (discussing fees with respect to the Americans with Disabilities Act) (quoting Arbor Hill Concerned Citizens Neighborhood Ass'n v. County of Albany, 522 F.3d 182, 190 (2d Cir. 2008) (other citation omitted)). A reasonable hourly rate is based on "the [current] prevailing market rate for lawyers in the district in which the ruling court sits." Anthony, 844 F. Supp. 2d at 507.
Here, the proposed fees are more than plaintiffs' total recovery - plaintiffs stands to recover $30,000 while counsel seeks approval of an amount almost twice that, $57,000. (Pl.'s 5/12 Ltr. at 4.) While this is not itself improper, see Estrella, 596 F. Supp. 2d at 727 (explaining that in taking into account the underlying purposes of the FLSA and NYLL fee provisions "courts have rejected the notion that fee awards should be proportionately tied to a plaintiff's recovery"); see also Chen v. TYT E. Corp., No. 10 Civ. 5288, 2013 WL 1903735, at *2 (S.D.N.Y. May 8, 2013), it is notable nonetheless.
Moreover, plaintiffs' counsel's hourly rates are unacceptably high: $550 per hour for partners, $350 per hour for counsel, $200 per hour for second year associates, $175 per hour for first year associates, and $125 per hour for paralegals. (Pl.'s 5/12 Ltr., Ex. C.) These rates exceed those ordinarily provided for in this district for similar such matters. See, e.g., Agudelo v. E & D LLC, No. 12 Civ. 960, 2013 WL 1401887, at *2 (S.D.N.Y. Apr. 4, 2013) (awarding lead counsel $350 per hour, the second most senior attorney $250 per hour, the junior associate $200 per hour, and the paralegal $100 per hour); Carrasco v. West Village Ritz Corp., No. 11 Civ. 7843, 2012 WL 2814112, at *7 (S.D.N.Y. July 11, 2012) ("Courts in this [d]istrict have determined in recent cases that the range of appropriate fees for experienced civil rights and employment law litigators is between $250 and $450."); Wong v. Hunda Glass Corp., No. 09 Civ. 4402, 2010 WL 3452417, at *3 (S.D.N.Y. Sept. 1, 2010) (stating that the reasonable hourly rate for "employment law litigators with approximately ten years' experience is between $250 per hour and $350 per hour") (citations omitted); Allende, 783 F. Supp. 2d at 514 (awarding $450 to a partner who graduated in 2001 and $300 for a senior associate who graduated that same year); Kahlil v. Original Old Homestead Rest., Inc., 657 F. Supp. 2d 470, 475 (S.D.N.Y. 2009) (awarding $400 to a senior lawyer who had 25 years of experience and $150 for an associate).
Based on the prevailing rates in this district for employment law cases, the Court hereby decreases the requested hourly rates to the following:
- C.K. Lee (partner): $300;
- Anne Sellig (counsel): $200;
- Diana Smithens and Shanshan Zheng (associates): $125; and
- Jasmin Perez and Luis Arnaud (paralegals): $75.
Additionally, a review of the billing records provided reveals that counsel's number of hours billed is excessive. Quarantino v. Tiffany & Co., 166 F.3d 422, 425 (2d Cir. 1997) (explaining that in determining the proper number of hours, "the district court should exclude excessive, redundant[,] or otherwise unnecessary hours, as well as hours dedicated to severable unsuccessful claims"). For example, Mr. Lee spent 6.3 hours on January 2, 2014 on a call with defendant's counsel regarding a discovery dispute. (Pl.'s 5/12 Ltr., Ex. C at 2.) He spent 6.4 hours preparing his client for a deposition (and engaging in some correspondence about the scheduling of a deposition), and spent 6.2 hours revising the calculations of class settlement. (Id. at 3.)
The Court has engaged in an itemized review of the billing statements submitted by counsel and finds the following number of hours acceptable:
- C.K. Lee: 75.9 hours (reduced by 27.3 hours);
- Anne Sellig: 36 hours (reduced by two hours);
- Diane Smithens: 35.9 hours (not reduced);
- Shanshan Zheng: 43.8 hours (not reduced);
- Jasmin Perez: 26.5 hours (not reduced); and
- Luis Arnaud: 24.7 hours (not reduced).
In sum, plaintiffs' counsel may recover the following fees in connection with this action:
- C.K. Lee: 75.9 hours at an hourly rate of $300 per hour: $22,770.00;
- Anne Sellig: 36 hours at an hourly rate of $200 per hour: $7,200.00;
- Diane Smithens: 35.9 hours at an hourly rate of $125 per hour: $4,487.50;
- Shanshan Zheng: 43.8 hours at an hourly rate of $125 per hour: $5,475.00;
- Jasmin Perez: 26.5 hours at an hourly rate of $75 per hour: $1,987.50; and
- Luis Arnaud: 24.7 hours at an hourly rate of $75 per hour: $1,852.50.
As for the requested costs, which total $1,554.50, the Court approves of such costs as reasonable. II. CONCLUSION
For the reasons set forth above, the Court APPROVES of the proposed settlement, with the certain modifications explained herein. Pursuant to the terms of the settlement, plaintiff Aguilera shall recover $25,000; plaintiff Diaz shall receive $5,000; and plaintiffs' counsel shall recover $43,772.50 in fees and $1,554.50 in expenses.
The Court does note, however, that, "counsel and his colleagues at the employment law bar [are urged] to focus on the fact that the FLSA and related legislation were enacted to help disadvantaged employees, not their lawyers." Agudelo v. E & D LLC, No. 12 Civ. 960, 2013 WL 1401887, at *3 (S.D.N.Y. Apr. 4, 2013.)
The Clerk of Court is hereby directed to terminate this action.
SO ORDERED. Dated: New York, New York
May 20, 2014
/s/_________
KATHERINE B. FORREST
United States District Judge