U.S. Department of Labor Office of Administrative Law Judges
800 K Street, N.W.
Washington, D.C. 20001-8002
Date issued: NOV 25 1996
Case No. 96-ERA-5
In the Matter Of
TRACY A. JAMES, Complainant,
vs.
PRITTS-MC ENANY ROOFING, INC., Respondent.
ORDER REGARDING PROPOSED SETTLEMENT
This matter is before the undersigned Administrative Law Judge for a
recommendation regarding the parties' proposed settlement agreement. Tracy A. James filed her
complaint pursuant to the employee protection provisions of the Energy Reorganization Act of 1974,
as amended, 42 U.S.C. § 5851. The case proceeded to hearing April 16, 1996. A
Recommended Decision and Order finding in favor of complainant issued on August 22, 1996, from
which the employer took an appeal. The case is now pending before the Administrative Review
Board. Counsel for the parties have notified the undersigned that they have settled the case, and
have submitted a settlement agreement signed by all parties and their counsel, a copy of which is
attached. The purpose of the instant decision and order is to evaluate the proposed settlement to
determine whether it is reasonable, fair and adequate.
I. Terms of Settlement Agreement
The terms of the settlement agreement, in summary, are:
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1.That Respondent will pay the sum of $25,000.00 to Complainant on or before
November 11, 1996, a payment personally guaranteed by Respondent's president,
Michael McEnany. The agreement does not provide for the payment of attorneys' fees.
2. In exchange, Complainant agrees to waive all causes of action, statutory
and common law, federal, state and local, against Respondent (1) arising from her
employment with Respondent with or separation from that employment and (2) arising
after the date of the settlement agreement, except for certain vested rights to benefit or
compensation plans.
3. Respondent also agrees to waive all causes of action against Complainant.
4. Complainant agrees not to seek re-employment with Respondent.
II. Discussion
Regarding the proposed payment of $25,000.00, 1 find this sum fair, adequate
and reasonable, in that it is identical to the sum that the undersigned recommended be awarded to
Ms. James. However, the settlement agreement does not discuss the question of attorneys' fees.
Normally, a prevailing complainant in a whistleblower case has the burden of establishing the
reasonableness of the fees by submitting a fee petition detailing the work performed, time spent, and
the hourly rate. The fee arrangement between complainant and her counsel is not controlling.
Delcore v. W.J. Barney Corp., et al., 89-ERA-38 (Sec'y June 9, 1995) (Secretary's D&O
of April 19, 1995 affirmed at 85 F.3d 89 (2d Cir. 1996). If the parties agree, it is not necessary for
the Secretary to review the fee petition with the specificity required under the lodestar method, but
it is nevertheless necessary that the amount be disclosed. Carter v. Electrical District No. 2 of
Pinal County, 92-TSC-11 (Sec'y April 24, 1996). Here, it is possible that the parties have
agreed that Ms. James will be responsible for fees from the $25,000.00 payment under an
arrangement not disclosed by the agreement itself If this is the case, it is not possible to determine
the amount Ms. James will actually receive. The Secretary must know the amount Complainant will
receive in order to determine if the agreement is fair, adequate and reasonable. The disposition of
the $25,000.00 affects not only Ms. James' individual interests, but the public interest as well, in that
if the amount she actually receives is not fair, adequate and reasonable, other employees may be
discouraged from reporting safety violations. Id.
I find no error in the agreement regarding the mutual waivers of claims, though
the provisions for waiver could possibly be misinterpreted to frustrate the purposes of the Energy
Reorganization Act. I recommend approval of those provisions based on an interpretation that they
waive only the right to seek damages in the future, as the agreement itself recites, based on claims
or causes of action arising out of facts occurring before the date of the agreement, and restrict in no
way the ability of Ms. James to participate as, for example, a witness in the claims of other persons
who have been or may in the future be subjected to retaliatory acts for having raised safety concerns.
Pace v. Kirschenbaum Investment, 92-CAA-8 (Sec'y, December 2, 1992).
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The parties have requested that the undersigned speed the approval process
for this settlement agreement. Therefore this Order is being telefaxed to counsel for both parties
with direction that as soon as possible and not later than ten days of the date of this Order, they file
a joint response providing clarifying information about the disposition of the $25,000.00 and
payment of attorneys' fees.
