FLSA Defendant Fails to Moot Case By Money Tender

Employers who are sued for overtime violations sometimes attempt to resolve the case by tendering money to the plaintiff and claiming that, since the Plaintiff has been paid, the case is now moot and should be dismissed.  A federal court in Dallas was faced with this issue and recently denied the defendant’s motion to dismiss the overtime case.  The case, styled Ramirez v. Lone Star Pediatrics, involved a claim by a worker under the Fair Labor Standards Act, or FLSA, in which the plaintiff sought unpaid overtime, liquidated damages, and attorney’s fees and expenses.  Four months after the case was filed, the defendant tendered $3,437.62 to the plaintiff, and then moved to dismiss the case, claiming that the Plaintiff had received all relief requested, and thus the case should be dismissed.  The Court first looked at the remedies available to unpaid overtime claimants under the FLSA.  The FLSA requires that non-exempt workers be paid one-and-a-half times their regular rate of pay for each hour worked above forty in a given week.  Employees are also entitled to liquidated damages in an equal amount of the unpaid overtime if they prevail on their FLSA claim.  Successful FLSA plaintiffs are also entitled to a mandatory award of reasonable attorney’s fees and costs.

The Court noted that in the Fifth Circuit, an offer of judgment under Federal Rule of Civil Procedure 68, even if rejected, can moot a plaintiff’s FLSA claim if the offer of settlement provides the plaintiff with full relief that the plaintiff sought if he had prevailed on the merits.  However, the amount tendered by the defendant in this case did not include an amount for attorney’s fees or costs, and thus did not provide the plaintiff with complete relief, and therefore did not moot the plaintiff’s overtime claim.  Thus, the Court denied the defendant’s motion to dismiss.  In a subsequent order, the Court directed the plaintiff to provide the Court with specific and detailed information regarding the following matters: (1) whether and when Plaintiff accepted Defendant’s prior tender of $3,437.62 or another amount; (2) whether Plaintiff cashed the checks tendered by Defendant; and (3) the amount and specific bases for the additional damages, if any, that Plaintiff is seeking (other than the amounts previously tendered by Defendant).  The plaintiff responded that it had not accepted the checks and that it had in fact returned the checks to the defendant, and that plaintiff claimed $7,500 in attorney’s fees.  Shortly thereafter, the parties announced that they had settled the case, and it was administratively closed on May 6, 2014.  This case illustrates that a defendant seeking to tender payment and moot an unpaid overtime case under the FLSA must include reasonable attorney’s fees incurred by the plaintiff at the time of the tender.  Additionally, while this was not at issue in this case, it is doubtful that the defendant’s tendering of the money, rather than formally using an offer of judgment under Rule 68, would or could have mooted the case.  Other courts have held that merely tendering the money, rather than using an offer of judgment, does not moot the case, as without a judgment the court has no power to compel the defendant to satisfy the promised payment.  See, e.g. Zinni v. ER Solutions, Inc., 692 F.3d 1162, 1166-67 (11th Cir. 2012).

Josh Borsellino represents workers to get them the overtime pay they deserve.  If you have questions about unpaid overtime, complete this online form or call 817-908-9861 or 432-242-7118 for a free consultation.