Foot Locker 2011 Annual Report Download - page 89

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FOOT LOCKER, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
21. Share-Based Compensation − (continued)
The Company recorded compensation expense related to restricted shares, net of estimated forfeitures, of
$10 million, $8 million, and $8 million for 2011, 2010, and 2009, respectively. At January 28, 2012, there
was $14 million of total unrecognized compensation cost net of estimated forfeitures, related to nonvested
restricted stock awards. Restricted share and unit activity is summarized as follows:
Number of Shares and Units
2011 2010 2009
(in thousands)
Outstanding at beginning of year 1,759 1,680 844
Granted 686 651 1,115
Vested (327) (492) (279)
Cancelled or forfeited (50) (80) —
Outstanding at end of year 2,068 1,759 1,680
Aggregate value (in millions) $ 30 $ 20 $ 23
Weighted-average remaining contractual life 1.19 years 1.44 years 1.50 years
The weighted-average grant-date fair value per share was $20.18, $13.75, and $9.90 for 2011, 2010, and
2009, respectively. The total fair value of awards for which restrictions lapsed was $4 million, $10 million,
and $5 million for 2011, 2010, and 2009 respectively.
22. Legal Proceedings
Legal proceedings pending against the Company or its consolidated subsidiaries consist of ordinary,
routine litigation, including administrative proceedings, incidental to the business of the Company or
businesses that have been sold or disposed of by the Company in past years. These legal proceedings
include commercial, intellectual property, customer, and labor-and-employment-related claims.
Certain of the Company’s subsidiaries are defendants in a number of lawsuits filed in state and federal
courts containing various class action allegations under federal or state wage and hour laws, including
allegations concerning unpaid overtime, meal, and rest breaks, and uniforms.
The Company is a defendant in one such case in which plaintiff alleges that the Company permitted unpaid
off-the-clock hours in violation of the Fair Labor Standards Act and state labor laws. The case, Pereira v.
Foot Locker, was filed in the U.S. District Court for the Eastern District of Pennsylvania in 2007. In his
complaint, in addition to unpaid wage and overtime allegations, plaintiff seeks compensatory and punitive
damages, injunctive relief, and attorneys’ fees and costs. In 2009, the Court conditionally certified a
nationwide collective action. During the course of 2010, notices were sent to approximately 81,888 current
and former employees of the Company offering them the opportunity to participate in the class action, and
approximately 5,027 have opted in.
The Company is a defendant in additional purported wage and hour class actions that assert claims similar
to those asserted in Pereira and seek similar remedies. With the exception of Hill v. Foot Locker filed in
state court in Illinois in 2011, and Cortes v. Foot Locker filed in federal court of New York, all of these
actions were consolidated by the United States Judicial Panel on Multidistrict Litigation with Pereira. The
consolidated cases are in the discovery stages of proceedings. In Hill v. Foot Locker, in May 2011, the court
granted plaintiffs’ motion for certification of an opt-out class covering certain Illinois employees only. The
Company’s motion for leave to appeal was denied. The Company is currently engaged in mediation with
plaintiff in Pereira and his counsel in an attempt to determine whether it will be possible to resolve the
consolidated cases and Hill. Meanwhile, the Company is vigorously defending them. Due to the inherent
uncertainties of such matters, including the early stages of certain matters, the Company is currently
unable to make an estimate of the range of loss.
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