Opinion
CV-22-02014-PHX-DWL
06-11-2024
Nickeisha Rainford, Plaintiff, v. Freedom Financial Network LLC, Defendant.
ORDER
DOMINIC W. LANZA UNITED STATES DISTRICT JUDGE
This is a collective action under the Fair Labor Standards Act (FLSA). (Doc. 1.) The Court previously granted the parties' stipulation regarding conditional certification. (Doc. 34.) The parties have now settled and have filed a joint motion to approve their settlement agreement. (Doc. 80.) The settlement agreement would resolve the FLSA claims of “46 individuals, including Plaintiff, [who] maintain live claims.” (Id. at 2.)
In Part I of the joint motion, the parties state that “[e]mployees cannot waive claims for unpaid wages under the FLSA without court approval” and that “Arizona courts” follow the practice of providing such approval. (Id. at 4-5.) Although some Arizona courts do follow that practice, the Court recently issued an order in a different action in which it acknowledged that it had “previously engaged in the process of approving settlements in individual FLSA actions” but explained that, upon careful reflection, it now “join[ed] the growing number of courts that have concluded that judicial approval is neither authorized nor necessary in this circumstance.” Evans v. Centurion Managed Care of Arizona LLC, 686 F.Supp.3d 880, 881 (D. Ariz. 2023). Additionally, although Evans only involved an individual FLSA action, and thus did not address whether settlement approval is required in an FLSA collective action, other courts have concluded that approval is not required in the collection-action context, either. See, e.g., Walker v. Marathon Petroleum Corp., 684 F.Supp.3d 408, 412-13 (W.D. Pa. 2023) (“This Court . . . finds nothing in the text of the FLSA . . . that requires or even authorizes court approval for private-party FLSA settlement agreements. The Court pauses though to consider whether the analysis is any different where, as here, the settlement agreement involves more than just the named plaintiff, and instead involves other opt-in plaintiffs. After careful consideration, the Court concludes that there is no reason to treat an opt-in settlement agreement differently, for at least two reasons. First, whether a settlement agreement is only between the named plaintiff and the employer or between a number of opt-in plaintiffs and the employer, there remains no basis in the text of the FLSA to require judicial approval. . . . Second, there doesn't seem to be any great reason-based in statute, policy, or otherwise-to treat an ‘opt-in settlement agreement' differently, as though it were a Rule 23 classwide settlement. In fact, an opt-in collective action and a class action differ in fundamental respects.”); Askew v. Inter-Cont'l Hotels Corp., 620 F.Supp.3d 635 (W.D. Ky. 2022) (concluding that, under Rule 41(a)(1)(A)(ii), a settled FLSA collective action must be dismissed without judicial approval of the settlement); Kennedy v. El Centro Reg lMed. Ctr., 2024 WL 1361838, *4 (S.D. Cal. 2024) (“[T]he Parties have stipulated to dismissal of this [collective] action. As neither precedent nor the FLSA's statutory text bar this course of action, Rule 41(a)(1)(A) prevents the Court from standing in the Parties' way.”). The Court finds these cases persuasive, such that its analysis in Evans is equally applicable in the collective-action context.
Thus, the parties may stipulate to dismissal of this action-in which case, this case will be over-or, if any party wishes to challenge the reasoning set forth in Evans and this order, it may do so.
Accordingly, IT IS ORDERED that the parties' joint motion to approve settlement agreement (Doc. 80) is denied without prejudice.
IT IS FURTHER ORDERED that within 14 days of the issuance of this order, the parties shall file one of the following: (1) a stipulation of dismissal pursuant to Rule 41(a)(1)(A)(ii); (2) a renewed motion for approval of their settlement; or (3) a status report otherwise informing the Court as to the status of this action.