Dollar General 2010 Annual Report Download - page 160

10-K
DOLLAR GENERAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
9. Commitments and contingencies (Continued)
parties are awaiting a ruling. The Company’s motion to decertify the Equal Pay Act class was denied as
premature. The Company expects to file a similar motion in due course.
The parties have agreed to mediate this action, and the mediation is scheduled to begin on
March 24, 2011. The court has stayed the action during the period in which the parties attempt to
resolve the matter.
The Company has tendered the matter to its Employment Practices Liability Insurance (‘‘EPLI’’)
carrier for coverage under its EPLI policy. At this time, the Company expects that the EPLI carrier will
participate in any resolution of some or all of the plaintiffs’ claims.
At this time, it is not possible to predict whether the court ultimately will permit the Calvert action
to proceed collectively under the Equal Pay Act or as a class under Title VII. Although the Company
intends to vigorously defend the action, no assurances can be given that it will be successful in the
defense on the merits or otherwise. Similarly, at this time the Company cannot estimate either the size
of any potential class or the value of the claims raised in this action. For these reasons, the Company is
unable to estimate any potential loss or range of loss; however, if the Company is not successful in
defending this action, its resolution could have a material adverse effect on the Company’s financial
statements as a whole.
On June 16, 2010, a lawsuit entitled Shaleka Gross, et al v. Dollar General Corporation was filed in
the United States District Court for the Southern District of Mississippi (Civil Action
No. 3:10CV340WHB-LR) in which three former non-exempt store employees, on behalf of themselves
and certain other non-exempt Dollar General store employees, alleged that they were not paid for all
hours worked in violation of the FLSA. Specifically, plaintiffs alleged that they were not properly paid
for certain breaks and sought back wages (including overtime wages), liquidated damages and
attorneys’ fees and costs.
Before the Company was served with the Gross complaint, the plaintiffs dismissed the action and
re-filed it in the United States District Court for the Northern District of Mississippi, now captioned as
Cynthia Walker, et al. v. Dollar General Corporation, et al. (Civil Action No. 4:10-CV119-P-S). The Walker
complaint was filed on September 16, 2010, and although it adds approximately eight additional
plaintiffs, it adds no substantive allegations beyond those alleged in the Gross complaint. The Company
filed a motion to transfer the case back to the Southern District of Mississippi and a motion to dismiss
for lack of personal jurisdiction over two corporate defendants and for failure to state a claim as to
Dollar General Corporation, all of which are pending. The court stayed the matter pending resolution
of the motion to dismiss. To date, no other individuals have opted into the Walker matter, and the
plaintiffs have not asked the court to certify any class.
On August 26, 2010, a lawsuit containing allegations substantially similar to those raised in the
Walker matter was filed by a single plaintiff in the United States District Court for the Eastern District
of Kentucky (Brenda McCown v. Dollar General Corporation, Case No. 210-297 (WOB)). On
December 22, 2010, the court entered an order establishing certain deadlines, including the deadline
for discovery related to certification issues (June 1, 2011) and for plaintiff’s certification motion, if any
(June 30, 2011). No trial date has been set. To date, approximately three other individuals have opted
into the McCown matter. The plaintiff has not asked the court to certify any class.
At this time, it is not possible to predict whether the courts will permit the Walker or McCown
actions to proceed collectively. However, the Company believes that those actions are not appropriate
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