Best Buy 2011 Annual Report Download - page 118

$ in millions, except per share amounts or as otherwise noted
13. Contingencies and Commitments
Contingencies
In December 2005, a purported class action lawsuit captioned, Jasmen Holloway, et al. v. Best Buy Co., Inc., was filed
against us in the U.S. District Court for the Northern District of California. This federal court action alleges that we
discriminate against women and minority individuals on the basis of gender, race, color and/or national origin in our
stores with respect to our employment policies and practices. The action seeks an end to alleged discriminatory policies
and practices, an award of back and front pay, punitive damages and injunctive relief, including rightful place relief for all
class members. The plaintiffs have filed a class certification motion which we have opposed. All proceedings have been
stayed pending a decision by the U.S. Supreme Court in Dukes, et al. v. Wal-Mart Stores, Inc., a gender discrimination
class action lawsuit.
In February 2011, a purported class action lawsuit captioned, IBEW Local 98 Pension Fund, individually and on behalf of
all others similarly situated v. Best Buy Co., Inc., et al., was filed against us and certain of our executive officers in the U.S.
District Court for the District of Minnesota. This federal court action alleges, among other things, that we and those
officers violated Sections 10(b) and 20A of the Exchange Act and Rule 10b-5 under the Exchange Act in connection with
press releases and other statements relating to our fiscal 2011 earnings guidance that had been made available to the
public. Additionally, in March 2011, a similar purported class action was filed by a single shareholder, Rene LeBlanc,
against us and certain of our executive officers in the same court.
The plaintiffs in the above actions seek damages, including interest, equitable relief and reimbursement of the costs and
expenses they incurred in the lawsuits. We believe the above allegations are without merit, and we intend to defend these
actions vigorously. Based on our assessment of the facts underlying the claims in the above actions, their respective
procedural litigation history (including the status of class certification in the Holloway lawsuit), and the degree to which we
intend to defend our company in these matters, we are unable to provide meaningful quantification of how the final
resolution of these claims may impact our future consolidated financial position or results of operations.
We are involved in various other legal proceedings arising in the normal course of conducting business. We believe the
amounts provided in our consolidated financial statements are adequate in light of the probable and estimable liabilities.
The resolution of those other proceedings is not expected to have a material effect on our results of operations or
financial condition.
Commitments
We engage Accenture LLP (‘‘Accenture’’) to assist us with improving our operational capabilities and reducing our costs in
the information systems, procurement and human resources areas. We expect our future contractual obligations to
Accenture to range from $165 to $215 per year through 2016, the end of the periods under contract.
We had outstanding letters of credit and bankers’ acceptances for purchase obligations with an aggregate fair value of
$516 at February 26, 2011.
At February 26, 2011, we had commitments for the purchase and construction of facilities valued at approximately $32.
Also, at February 26, 2011, we had entered into lease commitments for land and buildings for 27 future locations. These
lease commitments with real estate developers provide for minimum rentals ranging from 3 to 20 years, which if
consummated based on current cost estimates, will approximate $15 annually over the initial lease terms. These minimum
rentals are reported in the future minimum lease payments included in Note 9, Leases.
14. Sale of Business
During the second quarter of fiscal 2011, we completed the sale of our Speakeasy business to Covad Communications
Group, Inc. (‘‘Covad’’). Prior to this sale, Covad had merged with Megapath Inc. The three combined businesses operate
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