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Temi Bamgbose, Individually and On Behalf of All Others v. Delta-T Group

December 9, 2011


The opinion of the court was delivered by: McLaughlin, J.


This case is a putative collective action under the Fair Labor Standards Act ("FLSA"). A related action, brought as a class action under Fed. R. Civ. P. 23, exists in the United States District Court for the Southern District of California, captioned Norris-Wilson, et al. v. Delta-T Group, Inc., et al., Civ. No. 09-916 (the "California Action"). The parties exchanged term sheets reaching an agreement in principle for both actions in March 2011. In the California Action, a dispute exists over the scope of the settlement class as defined in the term sheet for that action; the Norris-Wilson plaintiffs filed a motion to enforce the settlement agreement in that court.

The plaintiffs also moved to enforce the settlement agreement in this case. The defendants contend that the existence of an enforceable settlement in this action is contingent on a settlement in Norris-Wilson, and the plaintiffs argue that the term sheet in this action is separately enforceable. Accepting as true the defendant's assertions in opposition to the plaintiffs' motion, the Court will grant the plaintiffs' motion.

I. Background

This case was filed in February 2009 as a nationwide

FLSA collective action seeking to include a class of healthcare professionals whom the plaintiffs alleged were misclassified as independent contractors and paid inappropriately under the FLSA. The Court denied the plaintiffs' motion for conditional certification of a plaintiff class without prejudice. ECF No. 143. The plaintiffs filed a second amended complaint in July 2010. After a discovery schedule was entered and the plaintiffs were given a deadline by which they again could seek conditional certification, the Court suspended all deadlines so that the parties could pursue a settlement. The stay was extended multiple times. ECF Nos. 207, 215, 224, 226. On March 8, 2011, the Court granted the parties' joint motion to stay proceedings pending approval of a settlement. ECF No. 231. The defendants then unilaterally moved to continue the stay, citing a dispute over the scope of the settlement class in Norris-Wilson; the Court granted that motion. ECF Nos. 235, 236. The plaintiffs here then filed the instant motion to enforce the settlement agreement.

In the California Action, the parties dispute the meaning of a paragraph in that action's term sheet defining the scope of the settlement class. The relevant provision states that the settlement class would be modified prior to the filing of settlement papers "to only include those who have alleged damages under records produced by Defendants." Norris-Wilson Term Sheet ¶ 6, Decl. of Gerald L. Maatman, Jr., Def. Opp. Ex. 2-A ("Maatman Decl."). The plaintiffs in the California Action have argued that the paragraph provides for the exclusion of parties from the settlement class who have no recorded overtime hours under the defendants' records; the defendants argue that it does not exclude those individuals because the settlement there also resolves claims under California law for wage statement and "waiting time" penalties. In that action, either party disputes that a settlement was reached. See Def. Opp. 5-8, Norris-Wilson (S.D. Cal. No. 09-916 ECF No. 87).

II. Facts*fn1

The parties pursued a settlement of both this action and Norris-Wilson with the assistance of a private mediator who conducted two full-day mediation sessions in Philadelphia on December 3, 2010 and January 4, 2011. During this period the defendants retained James Boudreau as special settlement counsel to negotiate with the plaintiffs' counsel. Mr. Boudreau recalls that "Delta-T was always very clear that the Norris-Wilson and Bamgbose cases must both be settled or neither would settle." Decl. of James Boudreau ¶ 6, Def. Opp. to Pl. Mot. Ex. 1 ("Boudreau Decl.") (filed under seal).

After the mediation sessions failed to resolve the matter, the parties continued to discuss a settlement both with and without the mediator's assistance. Throughout February and March 2011, Rebekah Bailey, counsel for the plaintiffs, continued to discuss the possibility of settlement with Mr. Boudreau.

On February 11, 2011, Bailey sent an email to Boudreau seeking to confirm that the parties had settled this action. The email stated: "By my calculations, we appear to have come to an agreement in the Bamgbose matter. I have attached a signed term sheet specific to this case. If your clients agree please sign and return." Boudreau responded by stating that his impression was that both this action and Norris-Wilson had been settled, and added that "Delta-T has always conditioned the settlement of one case on the settlement of all, so I doubt they see it your way if you contend that Norris-Wilson is not resolved. Regardless, I'll forward your email and someone will be in touch." Bailey replied, "If your clients are interested in settling them together, I've attached two alternative term sheets for Norris- Wilson for their review."*fn2 Boudreau Decl. ¶ 7.

On March 2, 2011, Gerald Maatman, counsel for Delta-T, sent a letter to Bailey stating:

To confirm our discussion earlier today, my client Delta-T Group, Inc., agrees to a settlement in principle of the above-referenced matters in accordance with the material terms set forth in the most recent term sheets exchanged by the Parties.

I have attached copies of those most recent term sheets, to which we agree in principle, except that the joint motions for preliminary approval should be filed on March 23 instead of March 4. We will incorporate these terms into a ...

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