Humble v. Harrah's NC Casino Company, LLC

THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF NORTH CAROLINA

ASHEVILLE DIVISION

CIVIL CASE NO. 1:17-cv-00262-MR-WCM

CHARLOTTE HUMBLE, SHARON )

ISACKSON, JUSTIN HUMBLE, )

TREVOR SIMMONS, MARGARET )

HOOVER, BELINDA KING, and )

JENNIFER SPAYTH BROWNING, )

individually and on behalf of all )

others similarly situated, )

)

Plaintiffs, )

)

vs. ) O R D E R

)

HARRAH’S NC CASINO COMPANY, )

LLC, d/b/a Harrah’s, Harrah’s )

Cherokee Valley River Casino, )

and Harrah’s Cherokee Casino )

Resort )

)

Defendant. )

_______________________________ )

THIS MATTER is before the Court on the Defendant’s Unopposed

Motion to File Confidential Settlement Agreement Under Seal [Doc. 76].

On September 18, 2017, the Plaintiffs brought FLSA claims against the

Defendant. [Doc. 1]. In February 2020, the parties agreed to settle those

claims. [Doc. 77 at 4-5]. On March 27, 2020, the Defendant filed an

Unopposed Motion to File Confidential Settlement Agreement Under Seal,

seeking to file the settlement agreement under seal so that the Court could

subsequently approve the parties’ settlement. [Doc. 76]. The Court granted

that Motion in a text order. [See Text-Only Order entered March 27, 2020].

On March 31, the parties filed a Joint Motion for an Order Indicating Approval

of a Confidential Settlement and Dismissal of the Case with Prejudice. [Doc.

77].

Upon review of that Motion, the Court became aware that the motion

to seal the FLSA settlement agreement may have been improvidently

granted. [See Doc. 80 at 2-3]. As such, the Court ordered supplemental

briefing addressing: “the strong presumption of public access that applies to

FLSA settlement agreements; whether the parties can show a compelling

interest that justifies sealing or redacting the settlement agreement; and

whether sealing or redacting the document can be narrowly tailored to serve

such a compelling interest.” [Id. at 4]. The Court noted that the settlement

agreement would remain under provisional seal pending the receipt of the

parties’ supplemental briefing and further instruction from the Court. [Id.].

On April 15, 2020, the Plaintiffs filed their supplemental brief stating

that they did not oppose the Defendant’s motion because of the terms of the

settlement agreement and that the Defendant “neither sought Plaintiffs’ input

on its motion to seal nor provided Plaintiffs with a courtesy copy before filing

its motion.” [Doc. 81 at 1-2]. On April 21, 2020, the Defendant filed its

supplemental brief. [Doc. 82].

“There is a strong presumption in favor of keeping the settlement

agreements in FLSA wage-settlement case unsealed and available for public

review.” Bartelloni v. DeCastro, No. 05-80910-CIV-COHN, 2007 WL

2155646, at *1 (S.D. Fla. July 26, 2007). An “overwhelming majority of

district courts” have found that a stipulation to seal an FLSA settlement

agreement “does not outweigh the strong presumption of public access to an

FLSA settlement agreement.” Hens v. Clientlogic Operating Corp., No. 05-

CV-381S, 2010 WL 4340919, at *3 (W.D.N.Y. Nov. 2, 2010). The Eastern

District of North Carolina and the Middle District of North Carolina both fall

within that “overwhelming majority.” Tabor v. Fox, No. 5:09-CV-338-BR,

2010 WL 2509907, at *2 (E.D.N.C. June 17, 2010) (“interests in

confidentiality do not outweigh the interests favoring access to the settlement

agreement.”); Browne v. The Pantry, Inc., No. 1:11-CV-587, 2011 WL

5119263, at *2 (M.D.N.C. Oct. 28, 2011) (“the parties' own agreement has

routinely been held to be insufficient to overcome the presumption of public

access[.]”). Indeed, “the overwhelming consensus of district courts that have

considered the issue” have held “that an FLSA settlement cannot be sealed

absent some showing that overcomes the presumption of public

access.” Joo v. Kitchen Table, Inc., 763 F. Supp. 2d 643, 647 (S.D.N.Y.

2011); see also Browne, 2011 WL 5119263, at *1 (“Courts in recent years

have been virtually unanimous in finding that settlements under the FLSA

should not be sealed in the ordinary course.”). “‘This presumption of access,

however, can be rebutted if countervailing interests heavily outweigh the

public interests in access,’ and ‘[t]he party seeking to overcome the

presumption bears the burden of showing some significant interest that

outweighs the presumption.’” Virginia Dep't of State Police v. Washington

Post, 386 F.3d 567, 575 (4th Cir. 2004) (quoting Rushford v. New Yorker

Magazine, Inc., 846 F.2d 249, 253 (4th Cir. 1988)).

In its supplemental brief, the Defendant claims that this case is

distinguishable from other requests to seal FLSA settlement agreements

because this case involves “no public interest in the settlement agreement in

question[.]” [Doc. 82 at 4].1 To support that assertion, the Defendant argues

1 The Defendant also explains that its failure to mention in its original motion that the

“overwhelming majority” of courts have denied motions to seal FLSA settlement

agreements was not due to a lack of candor. [Id. at 2]. Instead, the Defendant appears

to argue that it had no obligation to mention that fact because the Fourth Circuit and this

Court have not explicitly joined that overwhelming majority. [Id.]. The Defendant is

correct that neither the Fourth Circuit nor this Court have explicitly ruled on the issue.

That is why the Court’s order requesting supplemental briefing did not cite to North

Carolina Rule of Professional Conduct 3.3, which requires lawyers to “disclose to the

tribunal legal authority in the controlling jurisdiction known to the lawyer to be directly

adverse to the position of the client . . . .” N.C. R. Prof. Conduct 3.3 (emphasis added).

Nevertheless, the better practice would have been for the Defendant to have mentioned

in its motion that the “overwhelming majority” of courts have rejected its position or to

have distinguished this case from those cases.

that the statute of limitations has run on the potential violations raised in this

suit, which vitiates any public interest in the settlement agreement. [Id. at 3-

4]. The Defendant also notes that no objection to the motion to seal has

been filed. [Id. at 3].

The Defendant’s first argument misapprehends the public interest in

FLSA settlements. The Supreme Court has recognized that employee rights

under the FLSA are of a “private-public character.” Brooklyn Savings Bank

v. O'Neil, 324 U.S. 697, 708 (1945). “This public character is based on ‘an

intent on the part of Congress to protect certain groups of the population from

substandard wages and excessive hours which endangered the national

health and well-being and the free flow of goods in interstate commerce.’”

Stalnaker v. Novar Corp., 293 F. Supp. 2d 1260, 1264 (M.D. Ala. 2003)

(quoting Brooklyn Savings Bank, 324 U.S. at 708). “Although judicial

approval of FLSA settlements is an important step in ensuring that the

statute's terms and purposes are not frustrated by private agreements, the

public's right of access to judicial records regarding such approval adds an

additional, important safeguard in this respect.” Miles v. Ruby Tuesday, Inc.,

799 F. Supp. 2d 618, 623 (E.D. Va. 2011).2 As such, the public has its own

substantial interest in assessing “whether the settlement is consistent with

the statute's terms and purposes.” Id. The public also has an interest in

ensuring that employees are aware of their FLSA rights and confirming that

the FLSA is fully implemented in every workplace. Dees, 706 F. Supp. 2d at

1245. The public has an additional interest in determining whether the Court

is properly fulfilling its duties in approving FLSA settlement agreements.

Boone v. City of Suffolk, VA., 79 F.Supp.2d 603, 609 (E.D. Va. 1999).

While the statute of limitations might bar other parties from bringing

similar FLSA claims against the Defendant, the public interest in access to

FLSA settlements goes far beyond the claims and parties involved in this

lawsuit.3 Accordingly, the expiration of the statute of limitations has little

2 For example, the FLSA’s minimum wage provision could be undermined if employees

could simply waive their rights to the minimum wage or if employers could simply settle

any wage claims at an amount below the statutory minimum. Taylor v. Progress Energy,

Inc., 493 F.3d 454, 460 (4th Cir. 2007) (“Any wage settlement that gave the employee

less than the statutory minimum would frustrate Congress's objective of imposing uniform

minimum pay requirements.”). Likewise, the FLSA’s overtime provisions could be

undermined if employees could waive their rights or employers could settle any claims

related to overtime payment.

3 “[W]hile an individual court's decision to approve a settlement between an employee

and an employer regarding FLSA violations may not excite the interest of the public at

large, aggregating this information with records from other courts' FLSA settlement

approval decisions might well disclose significant information concerning FLSA

enforcement nationwide.” Miles, 799 F. Supp. 2d at 623.

bearing on the question of whether the settlement agreement should be

sealed. As such, the Defendant’s first argument is without merit.

Likewise, the Defendant’s argument related to the lack of an objection

is without merit. The filing of an objection to a motion to seal does not

determine whether the public has a right to access an FLSA settlement

agreement. Stalnaker, 293 F. Supp. 2d at 1263 (“The fact that no third party

has objected to the sealing of the settlement here is “inconsequential,”

because the presumption of openness does not depend on the media's being

interested in a particular case.”) (citing In re Estate of Martin Luther King, Jr.

v. CBS, 184 F. Supp. 2d 1353, 1363 (N.D. Ga. 2002)). As such, the fact that

no objection has been filed says little about the public interest in question. 4

While the Defendant acknowledges that its interest in confidentiality

does not warrant sealing of the settlement agreement, the Defendant has

not provided any other interest, much less a compelling one, to support

sealing such agreement. The Defendant’s failure to provide any interest that

overrides the strong presumption of public access leads the Court to

conclude that no such interest exists. That fact alone counsels against

granting the motion to seal the agreement. Dees v. Hydradry, Inc., 706 F.

4 Moreover, less than a month has passed since filed the motion to seal was filed and the

Court’s Order granting the motion to seal may have had a chilling effect on anyone who

wished to file such an objection.

Supp. 2d 1227, 1246 (M.D. Fla. 2010) (“Absent an ‘overriding interest’ in the

preservation of some ‘higher value,’ the court should not abide the parties'

request for a seal.”). Accordingly, the Defendant has failed to carry its

burden to show that “countervailing interests heavily outweigh the public

interests in access[.]” Virginia Dep't of State Police, 386 F.3d at 575 (citing

Rushford, 846 F.2d at 253). As such, the presumption of public access

applies to the FLSA settlement agreement and the agreement cannot be

sealed.

The Court’s order requesting supplemental briefing also gave the

parties a chance to “show a compelling interest that justifies . . . redacting

the settlement agreement; and whether . . . redacting the document can be

narrowly tailored to serve such a compelling interest.” [Doc. 80 at 4]. Neither

party argued that any redactions were appropriate here.5 As such, no

redactions to the settlement agreement are appropriate.

For these reasons, the Court’s March 27, 2020 Order [Text-Only Order

entered March 27, 2020] will be vacated. Since the parties did not express

5 The Defendant acknowledged in its motion to seal that the “information being kept

confidential primarily consists of the amount and distribution of the settlement proceeds

for now expired claims.” [Doc. 76 at 4]. That type of information is precisely the type of

information in which the public may have an interest.

any intent to redact any portion of the document, the Clerk will be directed to

unseal the settlement agreement.

ORDER

IT IS, THEREFORE, ORDERED that the Court’s March 27, 2020 Order

[Text-Only Order entered March 27, 2020] is VACATED. The Clerk is

directed to unseal the settlement agreement [Doc. 78].

IT IS SO ORDERED.

Signed: April 27, 2020

2 Reidinger ie Re

United States District Judge Aas