In billed remarkable settlement valued at $6.5-million settlement, up to 28,000 exotic dancers at adult entertainment clubs run by Deja Vu Services Inc. and related companies stand to get some $200 each in cash award. This followed the decision last June 19 of a federal judge in Detroit approving the settlement deal proposed by Déjà vu.
U.S. District Judge Stephen Murphy wrote in a 25-page opinion that “The proposed settlement 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.”
Murphy reportedly said there is no guarantee the dancers will win the lawsuit if the case went to trial. In approving the deal, he overruled the objections filed last May by several exotic dancers against the Déjà vu-proposed settlement. At least six exotic dancers opposed in court the then $6.5-million proposed settlement of a class action filed against the Déjà vu chain of strip clubs due to its alleged unfair labor practices.
The dancers said the settlement deal was inadequate, unfair and unreasonable. But reports quoted some lawyers as saying the U.S. District Judge Stephen Murphy can’t modify the proposed settlement – he can only accept it or reject it as is.
Lawyer Jason T. Brown of JTB Group, a wage and hour law office that handles similar FLSA class action suits, commented that, “This is a fair settlement considering the risks involved. When there are widespread allegations of misclassifying exotic dancers as independent contractors and thereby depriving them of their proper wages under the Fair Labor Standards Act (FLSA) then it make dollars and sense to try to resolve this via compromise rather than have to do individualized inquiries regarding which dancer was an employee, and which, if any, potentially actually were an independent contractor. One thing is clear though, all employees are entitled to be paid for their work, and no one should be afraid to come forward.”
Under the settlement, Déjà vu will use an agreed set of criteria to determine whether each dancer is an employee or an independent contractor.
But in the first place, the case (filed as Doe v. Deja Vu Servs., Inc., E.D. Mich., No. 16-10877, preliminary injunction granted 2/9/17), centered on whether the dancers are employees or independent contractors. The classification will decide if the clubs should pay the dancers a minimum hourly wage or if they can charge the dancers for doing business inside the clubs.
The class suit alleges that the dancers are not paid their wages but required to pay rent to the clubs, plus 30% or more of their tips. Monetary penalties also await the dancers who left early or showed up late.
More than just a Lap Dance & Lip Service
Lawyer Jason T. Brown of JTB Law Group says the way the settlement funds are grouped together shows there is a potential benefit to the class of 6.5 million dollars. Much of the $6.5 million will be like coupons which the dancers can draw from to offset the fees being charged by the club, for those that are indeed independent contractors.
The 6.5 million deal provides just $920,000 in cash payments for Â more than 28,000 dancers who worked at 64 different clubs in 18 states, including 11 in Michigan, Bosto. The settlement also provides for more than $1 million in attorney fees.
The dancers who won’t opt for cash and wish to continue as independent contractors will share in a $4.5 million pool of credits to offset the fees the clubs charged them to perform.
Those deemed employees will be paid minimum wage, plus bonuses including commissions of at least 20% on their private dances and drink sales, and receive club support to pay for employment-related expenses such as the purchase and cleaning of costumes and payment of required local license fees.
Notices are now being sent to class members who would opt into the settlement, in which case they stand to get either $100 or credits to pay rent to Déjà vu. They can also choose to opt out or file objections.