Rios v. I.S. Enterprises, Inc.
113 F. Supp. 3d 283
D.D.C.2015Background
- Plaintiffs (four workers) sued I.S. Enterprises under the FLSA; defendant moved to approve and enforce a settlement.
- Two plaintiffs (Cifuentes and Ramos) signed a written settlement agreement; defendant sought court approval for that agreement.
- Defendant also sought to enforce the same settlement against the other two plaintiffs (Rios and Lopez), who did not sign, arguing they were bound by their counsel’s oral statements and conduct.
- Record before the court consisted primarily of counsel email exchanges and filings; after briefing, plaintiffs’ counsel withdrew for Rios and Lopez and those two did not respond to the motion.
- The court found the written agreement reasonable and approved it as to Cifuentes and Ramos, but found the record insufficient to conclude by clear and convincing evidence that Rios and Lopez had entered an enforceable oral agreement.
- The court deferred ruling on enforcement against Rios and Lopez and ordered an evidentiary hearing to resolve whether they (or their counsel) intended to be bound.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the written settlement is fair and should be approved | Cifuentes and Ramos: agreement resolves disputes | I.S. Enterprises: settlement is reasonable and should be approved | Approved as to Cifuentes and Ramos |
| Whether Rios and Lopez are bound by an oral settlement | Rios and Lopez: (no signed agreement; no clear assent shown) | I.S. Enterprises: counsel’s emails and conduct show an oral agreement binding clients | Not proven; record insufficient under clear-and-convincing standard; hearing ordered |
| Standard of proof to enforce alleged oral settlement | Plaintiffs: (challenge enforcement absent clear evidence) | Defendant: must show binding oral agreement | Court: defendant must prove by clear and convincing evidence |
| Whether counsel had authority to bind Rios and Lopez absent signatures | Rios and Lopez: counsel lacked authority without client signatures/approval | I.S. Enterprises: counsel’s statements and negotiations bound clients | Court: unresolved on record; authority issue to be addressed at evidentiary hearing |
Key Cases Cited
- Carrillo v. Dandan, Inc., 51 F.3d 124 (D.D.C.) (approving FLSA settlement as reasonable)
- Blackstone v. Brink, 63 F. Supp. 3d 68 (D.D.C. 2014) (party seeking to enforce oral settlement must prove it by clear and convincing evidence)
- Duffy v. Duffy, 881 A.2d 630 (D.C. 2005) (oral contracts enforceable only if parties agreed on material terms and intended to be bound)
- Steven R. Perles, P.C. v. Kagy, 473 F.3d 1244 (D.C. Cir. 2007) (contemplation of a later writing indicates lack of intent to be bound orally)
- Greene v. Rumsfeld, 266 F. Supp. 2d 125 (D.D.C. 2003) (enforced oral settlement where client authorized counsel and later expressed assent)