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Both workers, company happy to resolve litigation
By Margaret Cronin Fisk
Bloomberg News
Published on Wednesday, Nov 04, 2009
A lawsuit settlement in a Walmart case involving alleged unpaid wages made both worker groups and the company happy.
''We're going to see some real money distributed to people,'' said workers' attorney Carolyn Beasley Burton. ''Hundreds of thousands of people will get a check in the next few months of $150 to $1,000. It's a nice little stimulus package.''
Wal-Mart Stores Inc. won final approval Monday of a settlement paying as much as $85 million to hourly workers who sued.
U.S. District Judge Philip M. Pro in Las Vegas approved the settlement and awarded one-third of the recovery in fees to the workers' lawyers, up to about $28 million depending on the claims made. Walmart is to pay at least $65 million and as much as $85 million.
The workers claimed that Walmart violated wage-and-hour laws by denying them rest breaks and manipulating time cards to reduce their pay. The accord is part of a global $640 million resolution of wage-and-hour claims reached in December between Walmart and workers.
''Resolving this litigation is in the best interest of our company, our shareholders and our associates,'' said Tom Mars, Walmart general counsel, in December in announcing the global settlement. ''Many of these lawsuits were filed years ago and the allegations are not representative of the company we are today.''
Walmart will also pay $5 million to the retirement plans of its workers in these states, Burton said. This is beyond the $85 million allotted for the class actions, she said.
The settlement covers more than 30 lawsuits in federal courts brought by workers and combined before the judge. Walmart also faced lawsuits by workers in multiple state courts, most of which were resolved by the global settlement. Pro said only 14 objections were made by Walmart workers out of more than 3 million class members.
Daphne Moore, a company spokeswoman, declined on Monday to comment beyond the December 2008 statement.
The retailer lost a $78 million jury verdict in Pennsylvania in 2006 over rest breaks and unpaid work and a $172 million verdict in California in 2005 over meal breaks. Walmart is appealing the Pennsylvania judgment.
The company announced in a regulatory filing in September that it settled the California lawsuit, agreeing to pay at least $77 million and as much as $152 million, depending on the number and amount of claims.
A Minnesota judge in 2008 ordered the company to pay hourly workers there $6.5 million, finding the company broke labor laws more than 2 million times.
The ruling left Walmart vulnerable to a possible $2 billion judgment. Walmart settled the case for $54 million, before the global resolution.
The federal settlement approved Monday is ''fair, adequate and reasonable to those it affects, and resulted from vigorously contested litigation,'' the judge said. ''This case was incredibly risky from inception and the result exceptionally favorable to the class.''
The benefits of settling the federal cases ''far outweigh'' the probable
outcome of a trial, Pro said at an Oct. 19 hearing. ''The parties were prudent in their decision to resolve this.''
Under the agreement, Pro said at the hearing, Walmart will provide better measurements to assure that hourly employees are paid for all hours worked. This was the ''most important'' part of the settlement, he said.
The suits before Pro were filed as class-action, or group, lawsuits on behalf of all hourly workers in individual states.
In 2008, Pro ruled out class actions for lawsuits brought by workers in four states, finding the plaintiffs failed to prove common issues predominated, a standard for such treatment. The decision would have been applied to the other suits, workers' lawyers said at the time.
This denial ''made the chance for the class members to obtain any redress slim'' Pro said.
''Class counsel have achieved an exceptionally favorable result for the members of the settlement class by diligently pursuing this complex litigation for years despite the substantial risk of no recovery,'' Pro said in granting the attorneys' fee request.
The cases are combined in In Re Wal-Mart Wage and Hour Employment Practices Litigation, MDL 1735, U.S. District Court, District of Nevada (Las Vegas).
A lawsuit settlement in a Walmart case involving alleged unpaid wages made both worker groups and the company happy.
''We're going to see some real money distributed to people,'' said workers' attorney Carolyn Beasley Burton. ''Hundreds of thousands of people will get a check in the next few months of $150 to $1,000. It's a nice little stimulus package.''
Wal-Mart Stores Inc. won final approval Monday of a settlement paying as much as $85 million to hourly workers who sued.
U.S. District Judge Philip M. Pro in Las Vegas approved the settlement and awarded one-third of the recovery in fees to the workers' lawyers, up to about $28 million depending on the claims made. Walmart is to pay at least $65 million and as much as $85 million.
The workers claimed that Walmart violated wage-and-hour laws by denying them rest breaks and manipulating time cards to reduce their pay. The accord is part of a global $640 million resolution of wage-and-hour claims reached in December between Walmart and workers.
''Resolving this litigation is in the best interest of our company, our shareholders and our associates,'' said Tom Mars, Walmart general counsel, in December in announcing the global settlement. ''Many of these lawsuits were filed years ago and the allegations are not representative of the company we are today.''
Walmart will also pay $5 million to the retirement plans of its workers in these states, Burton said. This is beyond the $85 million allotted for the class actions, she said.
The settlement covers more than 30 lawsuits in federal courts brought by workers and combined before the judge. Walmart also faced lawsuits by workers in multiple state courts, most of which were resolved by the global settlement. Pro said only 14 objections were made by Walmart workers out of more than 3 million class members.
Daphne Moore, a company spokeswoman, declined on Monday to comment beyond the December 2008 statement.
The retailer lost a $78 million jury verdict in Pennsylvania in 2006 over rest breaks and unpaid work and a $172 million verdict in California in 2005 over meal breaks. Walmart is appealing the Pennsylvania judgment.
The company announced in a regulatory filing in September that it settled the California lawsuit, agreeing to pay at least $77 million and as much as $152 million, depending on the number and amount of claims.
A Minnesota judge in 2008 ordered the company to pay hourly workers there $6.5 million, finding the company broke labor laws more than 2 million times.
The ruling left Walmart vulnerable to a possible $2 billion judgment. Walmart settled the case for $54 million, before the global resolution.
The federal settlement approved Monday is ''fair, adequate and reasonable to those it affects, and resulted from vigorously contested litigation,'' the judge said. ''This case was incredibly risky from inception and the result exceptionally favorable to the class.''
The benefits of settling the federal cases ''far outweigh'' the probable
outcome of a trial, Pro said at an Oct. 19 hearing. ''The parties were prudent in their decision to resolve this.''
Under the agreement, Pro said at the hearing, Walmart will provide better measurements to assure that hourly employees are paid for all hours worked. This was the ''most important'' part of the settlement, he said.
The suits before Pro were filed as class-action, or group, lawsuits on behalf of all hourly workers in individual states.
In 2008, Pro ruled out class actions for lawsuits brought by workers in four states, finding the plaintiffs failed to prove common issues predominated, a standard for such treatment. The decision would have been applied to the other suits, workers' lawyers said at the time.
This denial ''made the chance for the class members to obtain any redress slim'' Pro said.
''Class counsel have achieved an exceptionally favorable result for the members of the settlement class by diligently pursuing this complex litigation for years despite the substantial risk of no recovery,'' Pro said in granting the attorneys' fee request.
The cases are combined in In Re Wal-Mart Wage and Hour Employment Practices Litigation, MDL 1735, U.S. District Court, District of Nevada (Las Vegas).
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