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PIEKARSKI & BRELSFORD, P.C.

2633 E. INDIAN SCHOOL RD., STE. 460

Phoenix, AZ 85016

Phone: (602) 956-1161

Email: chris@pb-lawfirm.com

Fax: (602) 956-1161

Christopher J. Piekarski (AB# 019251)

Nathan J. Brelsford (AB# 024853)

Attorneys for Plaintiff

DECONCINI MCDONALD YETWIN & LACY, P.C.

2525 EAST BROADWAY BLVD., SUITE 200

TUCSON, AZ 85716-5300

(520) 322-5000

Gary F. Urman (AZ # 11748)

gurman@dmyl.com

SESSIONS, FISHMAN, NATHAN & ISRAEL, L.L.C.

3850 N. Causeway Blvd., Suite 200

Metairie, la 70002

(504) 828-3700

Kevin G. Barreca (pro hac vice)

kbarreca@sessions.legal

Attorneys for Defendant EGS Customer Care,

Inc.

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Douglas Wilkerson, et al.,

Plaintiffs,

vs.

EGS Customer Care, Inc.

Defendant.

NO. 2:15-cv-01656-DJH

RESPONSE TO 12/15/16 ORDER (DOC.

27) AND RENEWED JOINT MOTION

FOR APPROVAL OF SETTLEMENT

AGREEMENT AND STIPULATION TO

DISMISS ALL CLAIMS WITH

PREJUDICE

MAY IT PLEASE THE COURT:

Plaintiffs Douglas Wilkerson, Joshua Luna and Ryan Adverderada (“Plaintiffs”),

through undersigned counsel, respectfully offer this response to the Court’s December 15,

2016 Order (Doc. 27) and, together with Defendant EGS Customer Care, Inc. (“EGS”), renew

Case 2:15-cv-01656-DJH Document 30 Filed 01/09/17 Page 1 of 9
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their joint motion for approval of settlement agreement and stipulation to dismiss all claims

with prejudice.

BACKGROUND & PROCEDURAL HISTORY

Plaintiffs filed this action on August 24, 2015 against Expert Global Solutions, Inc.

seeking unpaid wages under the Fair Labor Standards Act. On September 8, 2015, Plaintiffs

amended their complaint to substitute EGS Customer Care, Inc., for Expert Global Solutions,

Inc., which was incorrectly named in the original Complaint. EGS has denied any

wrongdoing and that any wages are due.

On January 5, 2016, the Court entered a Scheduling Order requiring, among other

things, the parties to engage in good faith settlement talks by October 19, 2016 and to report

to the Court on those talks within 5 days thereafter. See 1/5/16 Scheduling Order (Doc. 17)

at ¶ 8. The Court also instructed Plaintiffs to notify the Court that the parties were ready for

a Final Pretrial Conference within 10 days after a November 23, 2016 dispositive motion

deadline, i.e., Monday, December 5, 2016. Id. at ¶¶ 7 and 10.

In compliance with the Scheduling Order, the parties engaged in discovery including

depositions, and conducted several settlement negotiations sessions by phone and also in

person. On October 11, 2016, the parties reported to the Court that further settlement

discussions would continue. See Doc. 23. Eventually, those discussions produced a

settlement, and Plaintiffs each signed a settlement agreement of the material terms on

November 7, 2016. EGS signed the settlement on November 17, 2016.

Following the settlement, the parties worked diligently to work through procedural

issues and finalize a motion seeking Court approval. In the midst of these efforts, the Court’s

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December 5, 2016 deadline for Plaintiffs to disclose the parties’ readiness for pretrial

conference came and passed without notice. As a result, the Court issued its December 13,

2016 Order instructing Plaintiffs to show cause by December 19, 2016 why this lawsuit

should not be dismissed for failing to file a Notice of Readiness for Pretrial Conference (Doc.

24).

The following day, Plaintiffs filed a Motion to Approve Consent Judgment along with

a proposed Order (Docs. 25 and 26) with the belief and intention that the filing would serve

to respond to the Court’s December 13th Order, and place the disposition of the parties’

settlement within the Court’s consideration.

On December 15, 2016, the Court denied the motion. See 12/15/16 Order (Doc. 27).

In its order, the Court (1) requested clarification as to the meaning of certain language

contained in the motion papers, (2) observed a blank line in the parties’ settlement agreement

establishing the “Effective Date” of the agreement, and (3) noted that the settlement

agreement was inadvertently filed while the proposed order submitted with the motion

indicated that the agreement would be filed under seal.

In response to the Court’s 12/15/16 Order, Plaintiffs submitted another joint motion

on December 19, 2016 (Doc. 28). The submission addressed the Court’s observation

regarding the inadvertently filed settlement agreement and included an argument seeking

approval to file the settlement agreement under seal. Unfortunately, the settlement agreement

was again filed into the record and not under seal. Also, rather than explain the language that

caused the confusion for which this Court had requested clarification, the confusing language

was simply deleted. Lastly, the settlement agreement again failed to include/clarify the

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“Effective Date” in the agreement. The same day, the Court denied that motion as

inappropriately filed, but without written reasons. See 12/19/16 Order (Doc. 29).

The parties gather from the Court’s sua sponte denial that a detailed response to the

Court’s 12/15/16 Order (Doc. 27) is expected. With that understanding, the parties address

the Court’s concerns now:

1. Clarification of Motion Language

The Court raised concern with the following language at page 2, lines 21-24 of the

parties original joint motion, and sought clarification thereon:

Following the logic of [other precedent], such a settlement

agreement could reasonably be found binding upon the parties

even without court approval”).

This language was taken directly from Hon. Judge Frederick Martone’s ruling in

Smith v. Tri-City Transmission Serv., 2012 U.S. Dist. LEXIS 119428 (D. Ariz. Aug. 23,

2012), which was cited and quoted in the parties’ original motion, in the paragraph

immediately preceding the language at issue. Regrettably, a short form citation to the Smith

decision was not provided, which may be responsible in part for the Court’s concerns. To

clarify, the pinpoint citation to this passage is Smith v. Tri-City Transmission Serv., 201 U.S.

Dist. LEXIS 119428, 2:12-cv-01254-FJM, *2 (D. Ariz. Aug. 23, 2012). That case involved

circumstances similar to the matter presently under review; there, the court recognized that

when parties to an FLSA case settle their disagreements within the context of a pending

lawsuit, as the present parties have done, “such a settlement could reasonably be found

binding upon the parties even without court approval.” Id. The parties believe that holding

is pertinent here, although, out of an abundance of caution and a desire to remove any doubt

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that their settlement agreement has binding res judicata effect, the parties present the

settlement agreement to this Court for consideration and approval.

2. The Effective Date of the Settlement Agreement

The Court also expressed concern with a blank space on page 1 of the settlement

agreement concerning the “Effective Date” of the agreement. The Effective Date of the

settlement agreement is intended to be the date by which all parties have signed the

settlement. Plaintiffs signed the settlement on November 7, 2016, and EGS signed the

agreement on November 17, 2016. The November 17, 2016 date should have been inserted

in the blank space in the settlement agreement. This oversight has been corrected in the

redacted settlement agreement filed herewith.

3. The Filing of the Settlement Agreement

The parties had originally intended to file the settlement agreement under seal; by an

oversight, Plaintiffs filed the settlement agreement into the record on multiple occasions. The

Court has since stricken those filings. See 12/19/16 Order (Doc. 29). The parties have since

acknowledged and agreed with one another that filing a redacted settlement agreement in the

record is not inconsistent with the confidentiality bargained for under the settlement.

Consequently, for purposes of this motion, the parties will file and refer to a settlement

agreement in which only the amounts due under the settlement have been redacted. To be

clear, the parties do not request this settlement agreement be filed under seal.

Subject to the foregoing, the parties now jointly renew their motion for approval of

settlement agreement and stipulation to dismiss all claims with prejudice, as follows:

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The above-captioned Fair Labor Standards Act (“FLSA”) lawsuit has been settled.

EGS and Plaintiffs respectfully move the Court to: (1) approve the redacted settlement

agreement that is attached as Exhibit A as fair and reasonable; and (2) for an Order approving

the settlement agreement and dismissing with prejudice all of the claims that are alleged in

this matter. The parties respectfully submit that this Motion should be granted because the

settlement agreement was reached in an adversarial context and represents a fair and

reasonable resolution of a bona fide dispute.

The parties bring this Motion to the Court out of an abundance of caution as, in the

context of suits brought directly by employees against their employer under Section 216(b)

to recover back wages for alleged FLSA violations, there is precedent indicating that the

parties should present any proposed settlement to the district court, which may enter a

stipulated judgment after reviewing the settlement for fairness. Lynn’s Food Stores, Inc. v.

United States, 679 F.2d 1350, 1353 (11th Cir. 1982); see also Brooklyn Savings Bank v.

O’Neil, 324 U.S. 697 (1945). Though the Ninth Circuit has yet to offer any guidance to this

regard, there is precedent from this district that indicates, where parties are represented by

counsel and aware of their relevant rights, their settlement of FLSA claims should be

permitted binding effect even without court approval. See Smith v. Tri-City Transmission

Serv., 2012 U.S. Dist. LEXIS 119428 (D. Ariz. Aug. 23, 2012) (holding that “[i]t is no longer

clear that settlement of FLSA claims must be approved by the court to be binding, especially

in a case such as this . . . . Plaintiffs were represented by counsel when they filed their

complaint . . . and throughout the course of this litigation. They alleged violations of the

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FLSA in their complaint, therefore they were obviously aware of their rights under this

statute.

The parties settled their disagreements within the context of a pending lawsuit.

Accordingly, especially where the parties are represented by competent counsel and where

settlement is arrived at in the context of adversarial proceedings already underway, at least

some deference should be given to the parties’ decision to settle the matter and to the terms

of that settlement.

In this case, both Plaintiffs and EGS are, and have been, represented by competent and

accomplished attorneys who are well aware of the law at issue in this matter and who have

apprised their clients of that law in relation to their clients’ interests. The parties, recognizing

the various countervailing considerations at issue and being fully apprised by counsel, have

reached a compromise to resolve this action, including attorneys’ fees for Plaintiffs.

More specifically, as this Court is certainly already aware, the law governing wage

disputes, especially those involving overtime exemptions under the Fair Labor Standards Act

(“FLSA”) as in this litigation, often presents ambiguity and the circumstances surrounding

such claims often permit reasonable parties to present differing views as to the viability of

the wage claims asserted. As this Court is also aware, litigation is a costly and demanding

process for which the result is often uncertain to a very high degree. The parties, knowing

the claims at issue and their attendant circumstances, the law governing the dispute, and the

risks, uncertainties, and costs of further litigation, as well as being fully advised by legal

counsel of their choosing, have, in the context of ongoing adversarial proceedings, agreed

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that the settlement agreement represents a fair resolution and reasonable compromise to

Plaintiffs’ claims.

I. Approval of Settlement and Dismissal

1. This matter concerns a claim by Plaintiffs that they were improperly compensated

under the FLSA.

2. EGS denies Plaintiffs are due any wages, and denies that Plaintiffs were not properly

compensated and denies any liability to Plaintiffs.

3. The parties, through their counsel and designated representatives, reached a

compromise to resolve this action, including attorneys’ fees for Plaintiffs, pursuant to the

terms set forth in the settlement agreement attached as Exhibit A. The settlement agreement

provides for a specific settlement amount to be paid to Plaintiffs, and an amount to be paid to

Plaintiffs’ attorney. The settlement agreement also includes a release of claims by Plaintiffs

and a confidentiality provision.

4. The parties agree that the settlement agreement represents a fair and equitable

resolution and reasonable compromise.

5. The settlement agreement is in the best interests of all the parties and has been accepted

by the parties. The parties have executed the settlement agreement.

6. The parties, through their respective counsel, hereby move for approval of this

settlement and dismissal of this action with prejudice, on the merits and without awarding

additional fees or costs to either party, as set forth in the proposed order accompanying this

joint motion.

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7. Neither this joint motion nor the proposed order is intended to constitute an admission

or concession by EGS of any liability or wrongdoing.

8. The parties respectfully request that the Court approve the terms of the settlement

agreement because it represents a fair and reasonable resolution of bona fide disputes over

alleged unpaid overtime wages under the FLSA.

9. All the parties have been represented by competent counsel.

WHEREFORE, the parties request that the Court review the settlement agreement and

issue an Order approving it as fair and reasonable. A copy of the proposed order is attached.

DATED: this 9th day of January, 2017.

PIEKARSKI & BRELSFORD, P.C.

By: /s/ Christopher J. Piekarski

Christopher J. Piekarski

2633 E. INDIAN SCHOOL RD., STE. 460

Phoenix, AZ 85016

Attorneys for Plaintiffs

And

SESSIONS, FISHMAN, NATHAN & ISRAEL

By: /s/ Kevin G. Barreca

Kevin G. Barreca

3850 N. Causeway Blvd., Suite 200

Metairie, LA 70002

Attorneys for Defendant, EGS Customer

Care, Inc.

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