Dollar General 2006 Annual Report Download - page 75

April 26, 2006, this action was conditionally transferred to the Northern District of Alabama and
consolidated with the Brown case. The Company opposed the transfer and consolidation of this
matter, and on August 11, 2006, the conditional transfer order was vacated.
On August 7, 2006, a lawsuit entitled Cynthia Richter, et al. v. Dolgencorp, Inc., et al.
was filed in the United States District Court for the Northern District of Alabama (Case No.
7:06-cv-01537-LSC) in which the plaintiff alleges that she and other current and former Dollar
General store managers were improperly classified as exempt executive employees under the
FLSA and seeks to recover overtime pay, liquidated damages, and attorneys’ fees and costs. On
August 15, 2006, the Richter plaintiff filed a motion in which she asked the court to certify a
nationwide class of current and former store managers. The Company has opposed the plaintiff’ s
motion. On March 23, 2007, the Court conditionally certified a nationwide class of individuals
who worked for Dollar General as Store Managers since August 7, 2003. The Court further
ordered the parties to jointly file a proposed Notice to the class and a plan to facilitate the
transmission of that Notice within 10 days. The number of persons to whom Notice will be sent
has not been determined. Following the close of the discovery period in this case, the Company
will have an opportunity to seek decertification of the class, and the Company expects to file
such a motion.
The Company believes that its store managers are and have been properly classified as
exempt employees under the FLSA and that the actions described above are not appropriate for
collective action treatment. The Company intends to vigorously defend these actions. However,
at this time, it is not possible to predict whether the courts will permit these actions to proceed
collectively, and no assurances can be given that the Company will be successful in its defense
on the merits or otherwise. If the Company is not successful in its efforts to defend these actions,
the resolution or resolutions could have a material adverse effect on the Company’s financial
statements as a whole.
On May 18, 2006, the Company was served with a lawsuit entitled Tammy Brickey,
Becky Norman, Rose Rochow, Sandra Cogswell and Melinda Sappington v. Dolgencorp, Inc.
and Dollar General Corporation (Western District of New York, Case 6:06-cv-06084-DGL,
originally filed on February 9, 2006 and amended on May 12, 2006 (“Brickey”)). The Brickey
plaintiffs seek to proceed collectively under the FLSA and as a class under New York, Ohio,
Maryland and North Carolina wage and hour statutes on behalf of, among others, individuals
employed by the Company as assistant store managers who claim to be owed wages (including
overtime wages) under those statutes. At this time, it is not possible to predict whether the court
will permit this action to proceed collectively or as a class. However, the Company believes that
this action is not appropriate for either collective or class treatment, and believes that its wage
and hour policies and practices comply with both federal and state law. The Company plans to
vigorously defend this action; however, no assurances can be given that the Company will be
successful in its defense on the merits or otherwise, and, if it is not, the resolution of this action
could have a material adverse effect on the Company’ s financial statements as a whole.
On March 7, 2006, a complaint was filed in the United States District Court for the
Northern District of Alabama (Janet Calvert v. Dolgencorp, Inc., Case No. 2:06-cv-00465-VEH
(“Calvert”)), in which the plaintiff, a former store manager, alleged that she was paid less than
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