yes we cheated you out of a trip to new orleans but it's been a bad had to be here with you this morning jeff may please the court my name is charles starr and i'm pleased to represent the appellant's in this case there are two issues i'd like to visit with the use morning about the first is whether the release at issue in this case waived appellants claims to over time and second issue of course whether the prior state court lawsuit filed by t x l precluded the appellant's from bringing their later federal case like to start with the first issue the supreme court the fifth circuit and all agree with the following proposition of law i'm going to quote from he excels brief for this court quote the supreme court has repeatedly held that a covered employees substantive rights  are not waive a bill and then to excel itself cites five supreme court cases that stand for that proposition the last it was only one exception to that that's not applicable here that's exactly right none of ours that's exactly right so the only exception as as the court is aware is a martin rees bring great case spring break case which follow the reasoning and martinez of the polls which says that if you look at all of these supreme court cases in the legislative history we can discern a exception to that general rule that if there is a bona fide dispute about overtime that is whether the employees are actually intitled to overtime and including the number of overtime hours that they were are the amount of compensation for the overtime and those are the facts and both martina's and in martin v spring break and those are not the facts in this case the  as a hook that there was a bona fide dispute in the first a court case about regular wages he's employees were not paid their regular salary and they were not paid some commission which totaled about one hundred twenty thousand dollars and those claims were raised and we can see that they were released in the state court lawsuit and that the palettes received consideration for those claims but it is also undisputed that the plaintiffs never raised an overtime case never said that they were entitled to overtime or that they had powers that they were that they had worked for overtime or that they were to compensation for their overtime that fact is not in dispute even the district court agreed with that fact the district court itself noted that that was quote it was a difference between regular wages and overtime wages and agreed that no dispute no bona fide dispute existed as to overtime wages in the state court also i can't find it in front of the church but there it's in the brief but in both of those cases one of the western district of k texas case and both of those cases the court said we agree in both those cases there was a release signed by the employees and the the district court said yes i release can be effective to release over time claims but there has to be a bona fide dispute about the number of overtime hours are the amount due and in those cases even though the plaintiffs were represented by a lawyer because there was no discussion with the defendant employer about how over time that the general release and those cases were not effective to release the critical distinction and look we can see if we had raised over time in the state court lawsuit even though it wasn't pled the lawsuit was from the excel against our  violations or alleged violations or they're not complete agreement we agree if we would have said hey there's salary and commissions and there's also some overtime claims they worked overtime they were paid even if the release didn't say that they were being compensated for overtime for the relief the same release that we have here that didn't mention the overtime claim if there was an actual bona fide dispute about the number of hours that they work for overtime and the amount of compensation they were due for overtime then their claims would have been released and we would concede that we should lose under the holding of martin be spring break or not targeting on appeal that martin rees brings great was decided in correctly that it should be ignored of course it can't received no consideration in the settlement for their overtime claims that's also undisputed i also want to raise i think what the practical effect of the district court's opinion is if it's not reversed the district court said i'm going to quote one sentence from it's opinion it talks about the fact that there were these negotiations between the employees in the employer and that the employees knew that they had overtime claim and there's no evidence that the employer knew but we must presume as they were represented by fulbright one of the best in the country that they also knew about potential overtime claims that the plaintiffs didn't tell the defendants that they intended to sue for the overtime violation and in fact they sign their consent before they sign the release in the district or so quote it was bogle and beeches prerogative to either carve claims for overtime wages from the settlement agreement or to raise such claims during the goshi ations prior to executing the settlement agreement so the district court says if an employee is handed a general release where no one has discussed over time claims no one has discussed how much might be due whether there is a dispute about over time if the release is silent then it is the obligation of the employee to tell the defendant that they might bring an overtime claim and to carve it out of the general release or it is a wait and that one sentence should demonstrate the fallacy of the reasoning of the district court because if that is true then first of all the supreme court case or the say an employee can't waive and that the lessee claim cannot also be true but here's the practical effect of torts congress's intent in the f l to say to guarantee a minimum wage and overtime to employees because here's what happens in the normal case i'm going to employment lawyer i do this almost exclusively an employee gets fired the employee goes to the player goes to the employee and says hey we're letting you go we'd like to give you maybe a couple weeks severance sign this general release they're under forty so there's no twenty one day waiting period as they would be for an older worker and the employee if the employee does not and then tell the employer hey employer even if the employee doesn't know that they have a claim i we must carve out of this general release my ability to sue you later for overtime and if the employee doesn't do that because the district court says in that circumstance it's the employee's burden then the employee cannot sue later over time and that means their substantive rights under the fair labor standards act will have been waived and so that obligation stated by the district court is totally at odds with the legislative history of the fair labor standards act in the five supreme court cases cited by excel and it's brief they can't both be true it can't both be true that an employee cannot wave their fair labor standards act rights and an employee must tell the employer before signing a general release that they intend to sue and carve it out of a release or it's waived because both premises are totally at odds with each other and i think that senate's demonstrates the flawed rationale of the district court's opinion in this case but i also want to mention i think something as the sort of pink elephant in the room or in the case the and that is the conduct of the appellant in their counsel in this case in obviously having an intent to sue under the fair labor standards act before they sign the release and i want to bring it up because i think it demonstrates or it sort of shows the rationale and maybe some of the motive in this case behind the district court's opinion to excel made a big deal in the district court about this fact and they said it was shameful and outrageous including the lawyers they personally attacked the lawyers that the lawyers would have their clients sign a release and tell them that their release was not effective for the fair labor standards act case and then not tell the defendants and i'd like to respond to that here and i also think the district court was somewhat persuaded by that argument is not for the courts to rescue people from their mistakes and both sides are represented by capable lawyers as i said excel was represented by fulbright board certified labor employment lawyers the employees in this case didn't pull the rule to pull the wool over to yourselves eyes they had they had the same knowledge as the employees did the law was very clear when this release happened i remember this release was signed before the spring break was decided about two weeks but we were still aware of the martina's people's opinion the district court case even though that at the time was a minority opinion it was not followed by the majority of other courts around the country and in the fifth circuit we were still aware of that rationale and we were still comfortable with that because even under that opinion of course you had to have a bona fide dispute about overtime hours worked or amount due for overtime and there was no dispute in this case about that in fact when the excel found out that these are not the lawyers that represented them in the district court but when t x l found out about the sign the consent being signed before the release  signed they protested they wrote nasty letters to the plaintiff's lawyers and then they also attempted to go to the state court and remove their consent for the judgment they felt like they had been tricked and then we at the plaintiff's lawyers in this case told and they said look you should have known we're not pulling the wool over your eyes we never discussed a claim for overtime in this case the plaintiffs in this case were not compensated for over time there was no consideration given to it because we can see consideration does it mean that the employer has to pay that money if the employer had lessened some of their demands in the settlement that would have been consideration we can see that would have been different but we told them you shouldn't feel tricked because you knew that we didn't you didn't give anything in the settlement for the overtime claim and then after receiving that letter they went to the state court and said ok let's go forward with the it's not wrong to use the law to your client's advantage the law is filled with examples where releases are not a general release is not effective and good lawyers should know that so for example under the older worker benefit protection act if someone over forty and the employer gives them a general release it's not effective to waive their claims for age discrimination and this court would have no sympathy for a employer that came before it and said we felt tricked because we had the employees sign a general release we didn't follow the law that was very clear at the time we gave them or their release and then they went ahead and sued us and that's wrong well it's not wrong they knew the lawyer had the opportunity to know the law just like the plaintiffs did and if they didn't follow the law then they should lose and there's nothing wrong with the lawyer that represents the employee from counseling the employee that to follow the law and to rely on the law and i see that my time is up or almost up and i will save the rest of my time from about oh yeah first point i want to make is that there is a second part of the court's holding in martina's versus spring break which it issued in two thousand and twelve parties may compromise f l s a claims where there is a bona fide dispute as to the amount of hours worked yes but the rest of the sentence is or compensation do and that's the part of the holding in more teen is that applies here it's the only part that can apply here because there could never be a dispute in this case about hours worked or the amount of hours worked because these work hourly employees they were salaried employees so that's the second part of martinez's the part that applies here that's where the bona fide dispute was it was over compensation due in that regard the parties went back and forth and completely agree this is not mr starman his farm or me and my farm but the underlying lawyers for the for the plaintiff in the defendants in this case they went back and forth and there are e mails are in the record about wages and that was the term that both those lawyers he used what we're talking about is wages commissions certainly salary certainly but the global terms of wages now in that regard majesty will determine or compensation do is such a broad term it's perfectly proper for you to exactly right in a in a case like this when the parties go back and forth and they talk globally about wages i think that's right i think you're f l s a rights in a situation like that under cases like martin  can be waived and the district court explained why in a particularly perceptive senate so a lot the district court but the magistrate magistrate johnson in a particularly perceptive senate said this is on page two forty of the record that wages for commissions and salary are not the same as wages for overtime does not alter the fact that each constitutes a form of wages and that's exactly right that's why when these parties are negotiating back and forth and each giving up valuable consideration to the other ultimately in the form of a mutual release that's why f l s a rights were definitely at stake here and there's no question that the plaintiffs knew about those rights because they had signed a consent agreement to be parties plaintiff in an f l s a lawsuit when the negotiations were going forward there's no question they knew about their f l a say rights and they were represented by counsel at every stage of the litigation was there any which in the defense with your honor that's not reflected in the record but i agree with mr starr and that the answer is probably yes fulbright in jaworski employment lawyers are going to know about the f l a site would certainly be my presumption and again quickly reiterate that's not in the record but i think it's a safe assumption that they knew the f l s a rights and the underlying laws that in this case he had to do with nine governments that was part of it yes you are only part of it but that was certainly part of it so and of course the other key is they did have the opportunity the defendants didn't know the defendants didn't know that this is undisputed that the other side was contemplated contemplating bringing in f l us a lawsuit the plaintiffs had already signed consent agreements it's undisputed the live well your honor well and that's what happened because the release says the release specifically refers to in this is a quote from it any federal law statute or regulation it uses the word any now that might sound very broad and that's what it was intended to be because the next sentence in the release says this is meant to be and shall be construed as a broad release a broad release any federal law statute or regulation in the context of the parties going back and forth negotiating over wages it's no wonder magistrate johnson foundation did f l s a rights were at issue well mr starr and correctly points out but they weren't specifically mentioned and they want but they didn't have to be not only for judge johnson's reason or magistrate johnson's reason ok that their wages like the other wages but also because of what the martinez court said the same thing was true in martina's which is the opinion that this court adopted in indorsed and martin versus spring break in martine is that and this is a the judge judge rodriguez was very careful to point this out the document signed by the plaintiffs contains no language directly addressing the f l s a or any statutory rights there under the release of that case didn't say anything about the f l s either but judge rodriguez went on to cite this court strozier opinion from one thousand nine hundred eighty one which was a title seven case and judge rodriguez said in other contexts a release of statutory rights need not specifically addressed the statutory strozier that's exactly what this court held in structure so judge rodriguez concluded the june second two thousand and three document is therefore not invalid because of the failure to specifically address the f l essay or other rights under the if they claim you could waive booklet i think under brooklyn savings bank versus o'neal your honor that's correct but the difference is the law has changed dramatically since that case since of neil i don't disagree under o'neill that's exactly right under o'neill and i'll go one step further undergone gee that's exactly right there's a a there's a fascinating passage not several paragraphs actually more than a passage in martina's where judge rodriguez sets out the sort of how did we get to where we are today part of f l i say and one of the points he made was rock was gandhi and o'neill was sort of like those are the bad old days ok those are the bad old days where these claims couldn't be settled and as a result there was a litigation people sued their employers employer sued their employees congress wa unhappy with that so in one nine hundred forty seven they went back and they tried to amend or they did i'm in f l essay and they passed what became known as the portal to portal act of one nine hundred forty seven they said this will clear it up of course it did not judge rodriguez described the reaction to the portal to portal act as quick and vocal and he didn't mean that in a positive way it didn't it didn't help because the language that were in the amendments was confusing enough that we had the same stalemate employers never self reported even when they were wrong and there had been under payments and employees quickly sued because they didn't have any other choice so we lurched along to nine hundred forty nine in and the courts opinion said the nine hundred forty nine amendments they're not great they're not crystal clear but we discern the congressional intent to be private parties can settle these claims and so we're going to start saying private parties under the right circumstances can settle these claims finally a court this court said we're going to we're going to let private party settle even though it's f l so we go along to two thousand and twelve and this court issues martin versus spring break and says if there's a bona fide dispute over hours worked or compensation due there can be a settlement we're looking for what judge judge rodriguez pointed out in martina's we're looking for a bona fide dispute that's what magistrate johnson says we have here and the record supports or this is the second part of martin it is a compensation do case it is a martinez case where the settlement agreement does not specify f l s a and judge rodriguez correctly said relying on this court's precedent so you may doesn't have  johnson said the key was and of course and again that it brings me right back to martinez where the where the court said the release doesn't even have to say f l a say it doesn't even have to mention it based on this court's strozier opinion when you have a release that says what this one does any federal statute or regulation and the very next sentence this is intended to be a broad release that released f l s a claims it released them it wouldn't be true said this court in martin if they didn't know about those rights but they did having signed the consent agreement during settlement negotiations and they had a lawyer and they had the opportunity to carve circuit arguably that's the only circuit left that still filenames on private parties releasing f l s a claims and says no we're queasy about it most of the other circuits have come in line with allegheny ludlum since  five and said you can do it if there's a bona fide to speed as in this case and so it is a it is a martin versus spring break case it is a martinez case now i will say there's another line of cases out there and it culminates in this court's opinion and pepsi americas where the court says you you can't do this you can't have private parties settling these cases but those are set off cases and they're only set off cases i'm talking about heard in senior and gagnon and then ending with pepsi americas but of course no party in this case is trying to set anything off in pepsi americas this court said you can't have a set off unless the money that you're trying to set off can be considered prepaid wages in other words the employer accidentally overpaid and now is saying ok we want some of our money back as far as overtime but we're not saying that we're not alleging set off there is no set off theory in this case so it doesn't fall within pepsi americas it comes within martin versus spring break and  martina's i'll conclude by by going back to a thought provoking question that judge smith asked in the previous case if this court were going to write an opinion favoring your position counsel what would that opinion say or a great question well as applied to this case here's what respectfully your honour's i think it would say i think it would say what the court said toward the conclusion in martin versus spring break where judge higginson wrote f l s a rights were not waived but instead validated through a settlement of a bona fide dispute which appellant excepted and were compensated for the very facts that occurred here for these reasons we asked the court to a farm judge lake's judge implication and modifier that's missing from that sentence is compensation due for overtime when the court wrote compensation due in martin v spring break and martinez v bowles it was very clear from the discussion of the legislative history the amendments to the fair labor standards act all of the supreme court cases and all of the arguments about why there we should allow private settlements in some circumstances in all of those discussions the clear implication was it was compensation do not in the abstract not compensation due for regular wages not compensation due for a discrimination claim not compensation due for reimbursement of expenses from the company not just any compensation it was very clear when you look at the cases that it was compensation due for overtime and in the facts of heartiness of evils and in martin the spring break it's very clear those are the facts we're talking bowles the employer even though the release was silent the employer had the employee sign a document that said i employee know that i'm due over time so on the facts of that case it's very clear there was a bona fide dispute about over time either the number of hours due for overtime are the amount of compensation to for overtime that's all be i think we'd have to be very disingenuous to say that this case fits in the rubric of martin v spring break because we were we had a bona fide dispute about regular wages to be clear if the court affirms the district court's opinion the only way to do so  to expand the holding of martin v spring break and say that it applies to exactly what they're arguing that it is any compensation to you and i think that's contrary to the entire legislative history of the fair labor standards act and all of the five supreme court cases that are  case in the one nine hundred forty s as recently as one thousand nine hundred one the supreme court reiterated the general legal proposition that an overtime claim cannot be abridged by contract or by weight and if that's not enough were thirty years ago sure a judge but even in martin v spring break justice in it the panel in that case said we agreed with parenting and you cannot wave and f l s a claim that it cannot be abridged by contract but they said they accepted that as a lot but they said that it's not a waiver here because we had a negotiated settlement with a bona fide dispute about over time and therefore it's not a waiver that's not what happened here so the law hasn't changed law i want to repeat the argument i made earlier about how important this case is if it's not reverse and the effect that it will have the example i gave earlier of an employee being  a general one page waiver when they're being terminated does not have counsel or even if they do but does not know maybe not all large know about over time and if they don't affirmatively raise and carve out the f l s klein from their employer then the release is effective to to terminate their for labor standards act rights i think that is so clearly contrary to all of the supreme court cases and mark martin the spring break and martinez people's  definitely requires reversal the district court's holding cannot be reconciled with martin be spring break our martina's peoples and therefore we ask that the district court's opinion be reversed picture