Mashel Law Settles Class Claim for $4.25 Million

We are pleased to inform Mashel Law settled a wage and hour claim against a nationwide financial institution (hereafter identified as “the Company” because its name cannot be disclosed due to confidentiality requirements). Final approval of this settlement has been granted by the United States District Court for the District of New Jersey. The lawsuit alleged the Company violated the federal Fair Labor Standards Act (“FLSA”) and various state laws due to its failure to pay all overtime and unpaid straight-time wages earned by a designated class of its employees. These claims arose from the failure of the Company to pay for all hours worked by allegedly encouraging and accepting off-the-clock work. The lawsuit also sought an award of unpaid wages as well as liquidated damages, attorney’s fees, and costs. The payment of $4,250,000 resolves all such claims. The Company denied these claims and its payment of the settlement does not serve as an admission of liability.

Under the FLSA, an employee who has been denied overtime compensation may bring an action "for and in behalf of himself or themselves and other employees similarly situated" who were affected by their employer's common policy. Because the term "similarly situated" is not defined in the FLSA, "district courts have developed a test consisting of two stages of analysis." Kronick v. Bebe Stores, Inc., Civil No. 07-4514, 2008 WL 4546368, *1 (D.N.J. Oct. 2, 2008). These two stages consist of a conditional certification and final certification determination. Garcia v. Freedom Mortg. Corp., Civil Action No. 09-2668, 2009 WL 3754070, *2 (D.N.J. Nov. 2, 2009). See also Ruehl v. Viacom, Inc., 500 F.3d 375, 388 n. 17 (3d Cir.2007) (recognizing two stage certification process in FLSA cases).

The law favors compromise and settlement of collective and class action suits. Ehrheart v. Verizon Wireless, 609 F.3d 590, 594-595 (3d Cir. 2010); In re Warfarin Sodium Antitrust Litig., 391 F.3d 516, 535 (3d Cir. 2004) (“there is an overriding public interest in settling class action litigation, and it should therefore be encouraged”); Wal-Mart Stores, Inc. v. Visa U.S.A. Inc., 396 F.3d 96, 116 (2d Cir. 2005) (noting the “strong judicial policy in favor of settlements, particularly in the class action context”) (internal quotations omitted); Officers for Justice v. Civil Serv. Comm’n, 688 F.2d 615, 625 (9th Cir. 1982) (“[V]oluntary conciliation and settlement are the preferred means of dispute resolution. This is especially true in complex class action litigation”); Speed Shore Corp. v. Denda, 605 F.2d 469, 473 (9th Cir. 1979) (“It is well recognized that settlement agreements are judicially favored as a matter of sound public policy. Settlement agreements conserve judicial time and limit expensive litigation.”); see also Newberg On Class Actions § 11.41 (4th ed. 2002) (“The compromise of complex litigation is encouraged by the courts and favored by public policy.”).

The approval of a proposed class action settlement is a matter of discretion for the trial court. Girsh v. Jepson, 521 F.2d 153, 157 (3d Cir. 1975); Churchill Village, LLC v. Gen. Elec. Co., 361 F.3d 566, 575 (9th Cir. 2004); Maywalt v. Parker & Parsley Petroleum Co., 67 F.3d 1072, 1079 (2d Cir. 1998). In exercising this discretion, courts should give “proper deference to the private consensual decision of the parties.” Hanlon v. Chrysler Corp., 150 F.3d 1011, 1027 (9th Cir. 1988).

Stephan T. Mashel, Esquire of the law firm of Mashel Law, L.L.C was gratified by the Court’s decision to grant approval of the class settlement, “We are very pleased the Court found the proposed settlement to be fair and reasonable because we believe it will equitably serve to compensate the class for the unpaid wages they allegedly sustained.”

At Mashel Law LLC located in Monmouth County, New Jersey, we are dedicated to representing the interests of employees who are unlawfully deprived of their lawful rights. If you have not been paid for all time worked and/or are not being paid an overtime rate for all hours worked in excess of 40 hours in a workweek, call the attorneys at Mashel Law (732) 536-6161 or fill out the contact form on this page for immediate help.