Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Schwartz v. Pennsylvania State University

United States District Court, M.D. Pennsylvania

April 18, 2017

GIDEON L. SCHWARTZ, TIMOTHY THOMPSON, MICHAEL J. RUSCA, MARK S. HAY, MICHAEL LLOYD SCHRECENGOST, JOHN JAKOB KAPINUS, and CHARLES JONES, Plaintiffs,
v.
THE PENNSYLVANIA STATE UNIVERSITY, Defendant.

          MEMORANDUM

          Matthew W. Brann United States District Judge

         Before the Court for disposition is Defendant The Pennsylvania State University's (“Penn State”) Motion to Approve Settlement of claims brought under the Fair Labor Standards Act (“FLSA”) in this action. The Court will grant Penn State's Motion.

         I. BACKGROUND

         On February 2, 2016, Plaintiffs Gideon L. Schwartz, Timothy L. Thompson, Michael J. Rusca, Mark S. Hay, Michael Lloyd Schrecengost, John Jakob Kapinus, and Charles Jones (“Plaintiffs”) filed an Amended Complaint to recover unpaid overtime compensation, liquidated damages, attorneys' fees and costs under Section 16(b) of the FLSA, codified at 29 U.S.C. § 216(b).[1] The allegations contained within the Amended Complaint are as follows.

         Plaintiffs, employees within the meaning of Section 3(e)(2)(C) of the FLSA, work as Airport Attendants for Defendant Penn State.[2] In that capacity, Plaintiffs allege that Penn State knowingly takes the benefit of their work during their meal periods and does not compensate them for the time spent for their benefit.[3] Plaintiffs specifically state that they perform the following tasks during their meal periods:

(1) Testing gas and jet fuel; (2) Operating fuel-service vehicles; (3) Fueling aircraft; (3) Directing incoming aircraft; (4) Taxiing aircraft; (5) Parking aircraft; (6) Cleaning aircraft; (7) Loading baggage; (8) Unloading baggage; (9) Performing lavatory services on aircraft; (10) Monitoring weather, traffic, field, and airport surface conditions; (11) Recording information in traffic logs; (12) Responding to in-flight emergencies; (13) Maintaining walks, parking lots, ramps, aprons, taxiways, and runways; (14) Maintaining and repairing vehicles and support equipment; (15) Maintaining and repairing airport equipment and facilities; (16) Inspecting equipment, runway, taxiway, lighting; (17) Deicing aircraft; (18) Testing and accepting or rejecting deliveries of supplies; (19) Observing and reporting weather conditions; (20) Logging weather information and maintaining weather systems; (21) Responding to fire or emergency incidents involving crashes or requiring rescue; (22) Fire-fighting; (23) Patrolling perimeter road, checking for security breaches, ensuring that safes, gates, and doors are locked, and aircraft secured; (24) Escorting contractors or third parties who are performing work or providing services on airport property; (25) Driving Pennsylvania State University vehicle to transport students and other personnel to and from airport or as directed by University-employed supervisor; (26) Operating the reception desk and sales counter; (27) Greeting guests; (28) Answering questions and arranging for transportation; (29) Answering telephone; (30) Performing general housekeeping to maintain airport facilities in a clean and habitable condition; (31) Cleaning and washing aircraft; (32) Placing, retrieving, and maintaining barricades, flags, reflectors, and lighted flashers to mark obstructions and hazardous or unserviceable areas; (32) Observing wildlife and taking any required action to mitigate interference by wildlife on airport operations; (33) Monitoring in- and out-bound radio communications; and (34) Directing and assisting work of part-time personnel.[4]

         Owing to these tasks performed during their meal time, Plaintiffs assert that they actually work a 42 or 42.5 hour work week. Therefore, because they are compensated for only 40 hours of work, Penn State has violated Section 7 of the FLSA, or 29 U.S.C. § 207.[5]

         Defendant Penn State filed an Answer on February 16, 2016, and the parties thereafter engaged in factual discovery.[6] On April 4, 2017, Defendant Penn State filed a Motion to Approve Settlement, a supporting brief, and a Joint Declaration of both parties indicating support for this settlement.[7] Because the parties jointly request that the Court approve this settlement, this matter is ripe for disposition.

         II. DISCUSSION

         The FLSA was enacted for the purpose of protecting all covered workers from substandard wages and oppressive working hours.[8] Congress recognized that “due to unequal bargaining power as between employer and employee, certain segments of the population required federal compulsory legislation to prevent private contracts on their part which endangered national health and efficiency and as a result the free movement of goods in interstate commerce.”[9] The provisions of the statute are mandatory and not subject to negotiation and bargaining between employers and employees because allowing waiver by employees or releases of employers would nullify the purposes of the act.[10]

         Although the United States Court of Appeals for the Third Circuit has not addressed the issue, its district courts have taken the position stated by the Eleventh Circuit in Lynn's Food Stores, Inc. v. United States Dept. of Labor that court approval is required for proposed settlements in a FLSA lawsuit brought under 29 U.S.C. § 216(b).[11] Accordingly, this Court must scrutinize the proposed settlement of the parties and determine if it is “a fair and reasonable resolution of a bona fide dispute over FLSA provisions.”[12] Court review of a proposed settlement agreement therefore proceeds in two stages: first, the court assesses whether the parties' agreement is fair and reasonable to the plaintiff employee; second, it determines whether the settlement furthers or “impermissibly frustrates” implementation of the FLSA in the workplace.[13]

         Having reviewed the Settlement Agreement reached by parties, I am satisfied that it is both a “fair and reasonable resolution of a bona fide dispute over FLSA provisions, ” and does not impermissibly frustrate implementation of the FLSA in the workplace. My reasoning is as follows.

         A. The Settlement Agreement is a Fair and Reasonable Settlement of a Bona Fide Dispute.

         As threshold matter, I must first address whether the proposed settlement resolves a bona fide factual dispute, or one in which “there is some doubt as to whether the plaintiff would succeed on the merits at trial.”[14] Having reviewed the pleadings within this matter, I am satisfied that proposed settlement agreement meets that threshold. Specifically, the parties dispute, in good faith, (1) the amount of work performed by Plaintiffs during the meal periods, [15] (2) whether this work was actually for the benefit of the Penn State, [16] and (3) whether Penn State knew or should have known of the work allegedly performed.[17]

         Having found the existence of a bona fide dispute, the Court must next examine whether the settlement agreement represents a fair and reasonable resolution of that dispute. To make that determination, district courts have considered the factors outlined in Girsh v. Jepson, [18] concerning the fairness of a proposed class action settlement.[19] In Girsh v. Jepson, the Third Circuit set out the following nine factors:

(1) the complexity, expense and likely duration of the litigation; (2) the reaction of the class to the settlement; (3) the stage of the proceedings and the amount of discovery completed; (4) the risks of establishing liability; (5) the risks of establishing damages; (6) the risks of maintaining the class action through the trial; (7) the ability of the defendants to withstand a greater judgment; (8) the range of reasonableness of the settlement fund in light of the best possible recovery; and (9) the range of reasonableness of the settlement fund to a possible recovery in light of all the attendant risks of litigation.[20]

         Consideration of these above Girsh factors dictates that the terms of the settlement agreement are both fair and reasonable. First, the parties have expressed and the Court agrees that, because Penn State has put at issue whether the alleged tasks performed were for their primary benefit, continued litigation and discovery in this case has the potential to be quite costly and complex.[21] Second, I note that the individual employees to this suit have expressed their assent to the terms of the Settlement Agreement, and said assent has been memorialized in Joint Declaration of the parties.[22] Third, per the Court's Order of March 17, 2016, the parties have completed factual discovery and thus are found to have an “adequate appreciation of the merits of the case before negotiating.”[23] Fourth, and again owing to the complexity of the case, there is some risk that Plaintiffs would be unable to establish liability and damages for what they allege are tasks performed for the primary benefit of Penn State. Fifth, I find that the eighth and ninth factors - the range of both the reasonableness of the settlement fund in light of the best possible recovery and the attendant risks of litigation- weigh in favor of settlement approval. Penn State has agreed to pay the total amount which Plaintiffs claim they are owed. While Plaintiffs could recover additional damages, this settlement of full payment is unquestionably reasonable given the risks attendant in progressing the case toward trial.[24]

         B. The Settlement Agreement Does Not Impermissibly Frustrate the Implementation of the FLSA in the Workplace.

         I must now consider whether the terms of the settlement agreement impermissibly frustrate implementation of the FLSA in the workplace. In this analysis, I must examine both the release of claims and the confidentiality provisions of the settlement agreement.[25]

         Section 2 of the settlement agreement, entitled “Limited Release of Claims, ” states:

“[t]he employees hereby irrevocably and unconditionally release . . . any and all charges, complaints, claims, liabilities . . . that fall within the ambit of the Fair Labor Standards Act and the Equal Pay Act and arise from the facts of the Claim that they now have or hereinafter may have by reason of any matter occurring prior to the effective date of this Agreement.”[26]

         In reviewing settlement agreements, courts may “may require litigants to limit the scope of waiver and release provisions to ‘claims related to the specific litigation' in order to ensure equal bargaining power between the parties.”[27] Here, I find that the instant release provision is limited in scope and duration to claims arising from facts of the instant wage and hour claim which occurred prior to the date of the agreement. This release of claims is therefore properly cabined to the FLSA claim and thus does not frustrate the implementation of the FLSA.[28]

         Section 6 of the settlement agreement, entitled “Confidentiality, ” states:

“[t]he employees agree that . . . they will not disclose the terms of this Agreement to any persons . . . The Employees may, without violating this provision, disclose to others in substance that the matter has been resolved confidentially . . . The University recognizes that confidentiality provisions in resolution of claims under the FLSA are disfavored and accordingly, if this provision is breached, the University will not ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.