379 F. Supp. 3d 1244
M.D. Fla.2019Background
- Plaintiff Michael Ashworth sued Glades County Board of County Commissioners under the FLSA for unpaid wages and liquidated damages; Count II (state-law retaliation) was previously dismissed with prejudice by the presiding judge.
- Parties filed a Joint Stipulation for Dismissal With Prejudice and a Motion for Approval of Settlement Agreement seeking court approval of an FLSA settlement.
- The Magistrate Judge reviewed the proposed Agreement and General Release and recommended denial without prejudice due to multiple deficiencies; the District Judge adopted that Report and Recommendation and denied the motions without prejudice.
- Major procedural requirements: under Lynn’s Food Stores an FLSA settlement brought by employees must be approved by the district court as a fair and reasonable resolution of a bona fide dispute.
- The Magistrate identified six primary defects in the proposed settlement: (1) unsigned release and a post-approval revocation window, (2) unexplained disparity between claimed damages and settlement amount, (3) no allocation to unpaid wages vs. liquidated damages, (4) non-cash concessions/general release without allocated consideration, (5) unclear attorney-fee treatment, and (6) conflicting statements about the retaliation claim and potential appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Validity of settlement while release unsigned and revocable | Settlement is agreed in principle; plaintiff allowed time to execute and may revoke | County treated the agreement as binding enough to seek dismissal | Court: Denied approval; unsigned and revocable agreement prevents final judicial review and undermines judicial economy |
| Disparity between claimed damages and settlement amount | Parties did not explain the reduction from damages claimed under interrogatories to lump-sum settlement | County offered lump-sum $33,500 but provided no rationale | Court: Denied approval; parties must explain discrepancy so fairness can be evaluated |
| Allocation to unpaid wages vs. liquidated damages | Parties treated $33,500 as total consideration without specifying allocation | County did not allocate or justify waiver of liquidated damages | Court: Denied approval; must allocate or justify non-inclusion of liquidated damages under FLSA or show good-faith basis to waive them |
| Non-cash concessions and general release consideration | Plaintiff agreed to general mutual release, no-apply/no-rehire, and neutral reference but parties claim fees negotiated separately | County provided no specific allocation or separate consideration for non-cash terms; inconsistent statements about attorneys’ fees | Court: Denied approval; non-cash concessions and general release require specific consideration allocation and clarity on attorneys’ fees |
Key Cases Cited
- Lynn’s Food Stores, Inc. v. United States, 679 F.2d 1350 (11th Cir. 1982) (district court must approve FLSA settlements as fair and reasonable)
- Williams v. Wainwright, 681 F.2d 732 (11th Cir. 1982) (magistrate report review standard)
- Garvey v. Vaughn, 993 F.2d 776 (11th Cir. 1993) (deference to magistrate factual findings absent specific objections)
- Cooper-Houston v. Southern Ry. Co., 37 F.3d 603 (11th Cir. 1994) (district court reviews legal conclusions de novo)
- Morgan v. Family Dollar Stores, Inc., 551 F.3d 1233 (11th Cir. 2008) (liquidated damages may be reduced if employer shows good faith belief and conduct)
- Moreno v. Regions Bank, 729 F. Supp. 2d 1346 (M.D. Fla. 2010) (general releases in FLSA settlements can be unfair and require careful scrutiny)