Doe v. Deja Vu Consulting, Inc.

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A class of 28,177 exotic dancers alleged that dance clubs violated the Fair Labor Standards Act and state wage-and-hour laws by “intentionally misclassif[ying] class members as independent contractors, refus[ing] to pay minimum wage, unlawfully requir[ing] employees to split gratuities, and unlawfully deduct[ing] employee wages through rents, fines, and penalties.” The Agreement required that every club provide its dancers with an assessment to determine whether they should be classified as employees or an Independent Professional Entertainers and limited the control that the clubs may exercise over the Independent Entertainers. The Agreement also addresses tip-pooling, commissions, reimbursement for license and permit fees required to perform at the club, and provision of logo costumes; it divides a total award of $6.55 million into a Net Cash Payment Settlement Fund, Secondary Pool Remuneration, and attorneys’ fees. The district court approved a settlement over the objections of four class members. The Sixth Circuit affirmed, considering: the “high risk of continued litigation and the uncertain likelihood of success on the merits” and that the Agreement “offers value to the class in the form of cash, rent-credit or dance-fee payments, and long-term structural changes to Defendants’ business practices, all of which directly benefit class members.” The court rejected an argument that the settlement violated the procedural requirements of Federal Rule of Civil Procedure 23 because the class release was impermissibly broad and the class notice failed to adequately apprise the class members of their rights. View "Doe v. Deja Vu Consulting, Inc." on Justia Law