Employers who are sued for nonpayment of overtime work under the Fair Labor Standards Act can now avoid paying attorney's fees and costs simply by tendering the full amount claimed and then moving for dismissal based on mootness grounds.
That's the law according to the 11th Circuit's recent opinion in Dionne v. Floormasters Enterprises, Inc., No. 09-15405, 2011 WL 318977 (11th Cir. July 28, 2011). The case offers an interesting lesson on how employers might cut their losses and avoid lengthy and costly litigation.
In Dionne, plaintiff Perry Dionne sued his employer, Floormasters Enterprises Inc., pursuant to 29 U.S.C. § 216(b) of the FLSA to recover unpaid overtime wages, damages and reasonable attorney's fees and costs. In the interests of resolving the case quickly (and cheaply), Floormasters paid Dionne the overtime wages and damages sought ? $3,000 ? and then moved to dismiss the case with prejudice, denying liability and arguing that Dionne's claim had been rendered moot. The trial court granted Floormaster's motion.
After the dismissal, Dionne moved for an award of attorney's fees and costs on the basis that he was the "prevailing party" in the action. The trial court denied his motion, holding that he was not entitled to such an award pursuant to § 216(b) because there had been "no judicial determination . . . that [Floormasters] had violated the FLSA's overtime compensation provisions." Dionne appealed.
On appeal, Dionne argued that under the "catalyst test" he was the prevailing party in the action against Floormasters. The catalyst test states that a plaintiff should be found to be the prevailing party if (1) his ends are accomplished as a result of the litigation, even without formal judicial recognition; (2) there is a causal connection between his lawsuit and the defendant's actions providing him relief; and (3) the defendant's actions were required by law.
The 11th Circuit Court of Appeals disagreed and instead affirmed the trial court decision. In reaching this holding, the 11th Circuit noted that the U.S. Supreme Court had expressly rejected the catalyst test in Buckhannon Board & Care Home Inc. v. West Virginia Department of Health & Human Resources, 532 U.S. 598, 605-10 (2001).
The 11th Circuit also noted that the FLSA requires that a plaintiff receive a judgment in his favor to be entitled to attorney's fees and costs. Dionne, it was clear, received no such judgment, and therefore was not a "prevailing party" entitled to attorney's fees and costs.
In short, Floormasters resolved what could have been a lengthy and costly lawsuit by simply rendering payment for the amount claimed and then filing a motion to dismiss, all the while denying liability.
? Leonard J. Dietzen III and Brian Hayden are attorneys at law firm Rumberger, Kirk and Caldwell. Contact them at ldietzen@rumberger.com and bhayden@rumberger.com.
Source: http://www.tallahassee.com/article/20110918/BUSINESS/109180340/Cut-losses-save-attorney-s-fees
albuquerque bankruptcy lawyer albuquerque bankruptcy lawyers bankruptcy lawyers albuquerque
No comments:
Post a Comment