United States District Court, N.D. Alabama, Western Division
MEMORANDUM OPINION 
H. ENGLAND, III UNITED STATES MAGISTRATE JUDGE
Cory Smitherman, Jose Rico, and nineteen other persons who
have filed consents in this putative collective action (the
“Plaintiffs”) and Defendant Iguana Grill, Inc.
have jointly requested approval of their settlement
agreement, (doc. 60),  which represents the resolution of a
disputed matter under the Fair Labor Standards Act, 29 U.S.C.
§ 201, et seq. (“FLSA”).
(Id.). For the reasons set forth below, the court
approves the parties' settlement.
September 17, 2014, Smitherman and Rico filed this action on
behalf of themselves and all similarly situated servers
employed by Defendant, alleging they were deprived of a
lawful minimum wage and overtime compensation for hours
worked in violation of the FLSA. (Doc. 1). Specifically,
Plaintiffs contend (1) the tip pool in which they
participated was invalid because non-tipped employees
participated in it; (2) they were not paid minimum wage for
hours in which they performed non-tip-producing work; and (3)
Defendant altered its time records to avoid paying servers
minimum wage and overtime compensation. (See id.).
Defendant answered the complaint, (doc. 7), and Plaintiffs
moved for conditional collective action certification, (doc.
9). The undersigned entered a report and recommendation that
the class be conditionally certified, (doc. 20), and, after
review, District Judge L. Scott Coogler adopted and accepted
that recommendation, (doc. 24). Nineteen additional
plaintiffs have consented to join the class. (Docs. 9-3, 9-4,
13, 27, 29, & 30). The parties have engaged in written
discovery, mediation, and further settlement discussions
following mediation, and reached a settlement on September
26, 2017. The terms of the settlement are contained in the
parties' Supplemental Joint Notice of Settlement and
Request for Approval (the “Agreement”). (Doc. 60
at 7-11, ¶¶ E 1-10; doc. 60-1). The undersigned has
reviewed the Agreement.
the Agreement, Defendant has agreed to pay each plaintiff a
specified amount to settle his or her FLSA claims regarding
the tip pool, unpaid minimum wage for non-tip-producing work,
and altered time records resulting in unpaid minimum wage and
overtime. Three plaintiffs have agreed to compensation in the
amount of $0.00. (Doc. 60-1). Six plaintiffs are to be
compensated in an amount representing 50% of Defendant's
non-liquidated liability under a three-year liability period.
(Doc. 60 at 9, ¶ E 8a; doc. 60-1). Smitherman is to be
compensated in an amount representing the average
Defendant's last settlement offer and the three-year
non-liquidated liability amount. (Doc. 60 at 10, ¶ E 8c;
doc. 60-1). The remaining twelve plaintiffs are to be
compensated in an amount representing 80% of the average of
Defendant's last settlement offer and the three-year
non-liquidated liability amount. (Doc. 60 at 9-10, ¶ E
8b; doc. 60-1). Defendant has also agreed to pay the fees and
costs charged by the mediator and $32, 116.00 to
plaintiffs' counsel in attorney's fees and costs.
(Doc. 60 at 10-11, ¶¶ E 9, 10b-c). The parties
stipulate and agree the terms set forth in the Agreement
constitute a fair and reasonable resolution of a bona
fide dispute. (Doc. 60 at 11-12, ¶¶ F 1-4).
employee proves his employer violated the FLSA, the employer
must remit to the employee all unpaid wages or compensation,
liquidated damages in an amount equal to the unpaid wages, a
reasonable attorney's fee, and costs. 29 U.S.C. §
216(b). “FLSA provisions are mandatory; the
‘provisions are not subject to negotiation or
bargaining between employer and employee.'”
Silva v. Miller, 307 Fed.Appx. 349, 351 (11th Cir.
2009) (quoting Lynn's Food Stores, Inc. v. U.S.
Dep't of Labor, 679 F.2d 1350, 1352 (11th Cir.
1982)). “Any amount due that is not in dispute must be
paid unequivocally; employers may not extract valuable
concessions in return for payment that is indisputably owed
under the FLSA.” Hogan v. Allstate Beverage Co.,
Inc., 821 F.Supp.2d 1274, 1282 (M.D. Ala. 2011).
Consequently, parties may settle an FLSA claim for unpaid
wages only if there is a bona fide dispute relating to a
material issue concerning the claim.
Lynn's Food Stores, Inc. v. United States, 679 F.2d
1350, 1355 (11th Cir. 1982), the Eleventh Circuit stated
there is only one context in which compromises of FLSA back
wage or liquidated damage claims may be allowed: a stipulated
judgment entered by a court which has determined that a
settlement proposed by an employer and employees, in a suit
brought by the employees under the FLSA, is a fair and
reasonable resolution of a bona fide dispute over FLSA
provisions. The primary focus of a court's inquiry in
determining whether to approve an FLSA settlement is to
ensure that an employer does not take advantage of its
employees in settling their claim for wages and other damages
due under the statute. Collins v. Sanderson Farms,
Inc., 568 F.Supp. 714, 719 (E.D. La. 2008).
parties' dispute as to the merits of the case is
legitimate. Specifically, Plaintiffs allege Defendant
violated the FLSA by claiming a tip credit while requiring
employees to contribute a portion of their tips to non-tipped
employees, failing to pay them the minimum wage for periods
of time in which they were not tipped, and altering its
records to avoid paying them minimum wage and overtime;
Defendant denies all of this. (Doc. 60 at 2, ¶¶ B
2-3). The parties additionally dispute the period for which
Defendant would be liable for any alleged FLSA violations.
(Id. at 6-7, ¶¶ C 1-6). The settlement, as
described above, is appropriate for the disputed unpaid
wages. The formulas used to reach the settlement amounts for
each plaintiff reflect the parties' disputes as to the
applicable liability period and, in the case of named
Plaintiff Rico, the potential his claims are time-barred due
to his failure to consent to class membership. (Id.
at 7-10, ¶¶ E 1-8). Plaintiffs' attorney's
fee was negotiated after the parties agreed on formulas for
each plaintiff's settlement amount. (Doc. 60 at 10,
¶ E 9). “Where the attorney's fee was agreed
upon separately, without regard to the amount paid to the
plaintiff, then ‘unless the settlement does not appear
reasonable on its face or there is reason to believe that the
plaintiffs recovery was adversely affected by the amount of
fees paid to his attorney, the Court will approve the
settlement without separately considering the reasonableness
of the fee to be paid to plaintiffs counsel.'”
Davis v. The Filta Group, Inc., 2010 WL 3958701, *2
(M.D. Fla. Sept. 20, 2010) (quoting Bonetti v. Embarq
Mgmt. Co., 2009 WL 2371407, *5 (M.D. Fla. Aug. 4,
2009)). Because the parties represent the attorney's fee
was separately negotiated, (doc. 60 at 10, ¶ E 9), the
court concludes Plaintiffs' recoveries were not affected
by the amount of the attorneys' fee. The court has
considered the amount of the fee and finds it to be
court finds plaintiffs' FLSA claims represent a bona fide
dispute over FLSA provisions and the parties' settlement
is a fair and reasonable resolution of these bona fide
disputes. Therefore, the parties' Supplemental Joint
Notice of Settlement and Request for Approval, (doc. 60), is
GRANTED, and the settlement is
APPROVED. A separate order will be entered.
 In accordance with the provisions of
28 U.S.C. § 636(c) and Federal Rule of Civil Procedure
73, the parties have voluntarily consented to have a United
States Magistrate Judge conduct any and all proceedings,