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Tommey v. Computer Sciences Corp.

United States District Court, D. Kansas

April 13, 2015

JENNIFER TOMMEY, individually, and on behalf of a class of all others similarly situated, Plaintiffs,
v.
COMPUTER SCIENCES CORPORATION, Defendant.

MEMORANDUM AND ORDER

ERIC F. MELGREN, District Judge.

Plaintiff Jennifer Tommey brings suit against Computer Sciences Corporation, on behalf of herself and others similarly situated, seeking unpaid overtime and related penalties and damages under the Fair Labor Standards Act ("FLSA"), 29 U.S.C. ยงยง 201 et seq. There is no motion pending before the Court. However, the parties have submitted for the Court's approval a Settlement Agreement and Release (the "Settlement Agreement") and a proposed Order Granting Approval of FLSA Settlement (the "Order"). As explained below, these documents do not provide sufficient information for the Court to scrutinize the settlement for fairness, and the parties must submit additional information before the Court can approve the settlement.

I. Legal Standard

A settlement of claims under the FLSA must be presented to the Court for review and determination of whether the settlement is fair and reasonable.[1] To approve an FLSA settlement, "the Court must find that the litigation involves a bona fide dispute and that the proposed settlement is fair and equitable to all parties concerned."[2] The Court may enter a stipulated judgment only after scrutinizing the settlement for fairness.[3] The settlement agreement must also contain an award of attorneys' fees.[4] Furthermore, when parties settle FLSA claims before the Court has made a final certification ruling, the Court must make some final class certification finding before it can approve a collective action settlement.[5]

II. Analysis

A. Notice of Settlement to Class Members and Opportunity to Object

The parties have not requested a fairness hearing on the settlement of Plaintiff's claims. Section 216(b) of the FLSA does not require a fairness hearing like that required for settlements of class actions brought under Fed.R.Civ.P. 23.[6] However, when a hearing is not requested, the plaintiff, at the very least, must notify the court that the opt-in plaintiffs had notice of the settlement and an opportunity to object.[7] Here, neither the Settlement Agreement nor the Order states whether opt-in Plaintiffs were notified of the settlement and given an opportunity to object. Therefore, the Court finds that notice of the settlement and an opportunity to file a written objection should be provided as to all opt-in Plaintiffs. The Court cannot approve the settlement until the parties inform it that such action has been taken.

B. Final Collective Action Certification

Although the Court has conditionally certified a collective action for purposes of providing notice, the Court has not made a final collective action determination in this case. "When parties settle FLSA claims before the Court has made a final certification ruling, the court must make some final class certification finding before it can approve a collective action settlement."[8] Here, the parties appear to ignore this issue and do not address it in either the Settlement Agreement or the proposed Order. Therefore, the parties are required to provide information regarding whether plaintiffs are "similarly situated" for purposes of final collective action certification before the Court will approve the settlement.[9]

C. Proposed Settlement

Even if the Court had already determined that the case should proceed as a collective action, the parties have not provided sufficient information for the Court to approve the proposed settlement. To approve an FLSA settlement, the court must find that the litigation involves a bona fide dispute and that the proposed settlement is fair and equitable to all parties.[10]

1. Bona Fide Dispute

The parties requesting review of an FLSA settlement must provide enough information for the court to determine whether a bona fide dispute exists.[11] To meet this obligation, the parties should provide the following:

(1) a description of the nature of the dispute (for example, a disagreement over coverage, exemption or computation [*19] ...

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