Nordstrom 2000 Annual Report Download - page 38

Cyan Mag Yelo Blk
20100444 Nordstrom
2001 Annual Report • 44pgs. + 4 covers pg. 36
8.375 x 10.875 • PDF • 150 lpi
PMS
5773
PMS
5503
36
NORDSTROM, INC. AND SUBSIDIARIES
West/Jones Apparel, and the Federal Trade Commission and
the states, separately reached tentative agreements on
settlements and consent decrees under which all fifty states
and certain possessions of the United States exercised their
right under federal law and filed suit against Nine West, but
not the Company, in Federal District Court in New York on
behalf of a class of persons who purchased Nine West
footwear during the period January 1, 1988 through July 31,
1999, alleging violations of federal and state antitrust and
related laws. Pursuant to the settlement agreements, Nine
West paid $34 million in damages to the states and
submitted to certain injunctive relief.
In December 2000, the Federal District Court in New York
gave final approval to the settlement agreement between
Nine West and the states, and the Federal Trade Commission
approved its settlement and consent decree with Nine West.
As a result, the court entered a final judgment dismissing
the suit filed by the fifty states and certain possessions of
the United States against Nine West. The period for appeal
from the court’s decision approving the settlement with the
states has expired and that settlement and judgment have
become final. Neither settlement admitted any violation of
the law or liability by Nine West, the Company or any other
defendant in the putative private class actions. Nor did the
settlements require any payment by the Company.
The plaintiffs who filed the putative private class actions
against Nine West, the Company and other retailers agreed
that the suit instituted by the states against Nine West took
precedence over those actions, which were never certified as
class actions, and that the final judgment dismissing the
states’ proceeding also conclusively and preclusively resolved
all claims alleged in plaintiffs’ consolidated complaint
against the Company and the other defendants, which have
likewise been dismissed.
Credit Fees.The Company’s subsidiary, Nordstrom fsb, has
been named a defendant in a purported class action in the
Federal District Court for the Eastern District of
Pennsylvania. The case purports to be brought under the
National Bank Act and the Arizona Consumer Loan Act of
1997. Plaintiff, a resident of Pennsylvania and a user of
Nordstrom's credit through Nordstrom fsb, claims to
represent all customers of Nordstrom who have been
extended credit by Nordstrom fsb under revolving credit
accounts for consumer purchases at Nordstrom stores.
Plaintiff claims that Nordstrom fsb has been paid principal,
interest and late fees in violation of said statutes on account
of which plaintiff seeks recovery or forfeiture thereof.
Nordstrom fsb has moved to dismiss the complaint and a
hearing on that motion was held on February 21, 2001.
The court has not yet ruled on that motion. Counsel to
Nordstrom fsb has advised the Company that in their
opinion, plaintiff’s claim is meritless.
Bar Code. The Company is named as one of 135 retailer
defendants in a lawsuit filed in the United States District
Court for the District of Arizona. Plaintiff claims that the
Company and the other defendants have infringed certain
patents held by it related to methods of scanning production
markings (bar codes) placed on work pieces or merchandise.
The complaint seeks from each defendant an award of
damages for past infringement, to be trebled because of
alleged willful and deliberate infringement. In February
2001, the Company was dismissed without prejudice
pursuant to an agreement and stipulation intended to resolve
a potential judicial conflict of interest. The agreement
confirms that if the potential conflict is for any reason
resolved, plaintiff can amend its complaint to add the
Company as a defendant.
Saipan. The Company has reached a settlement, which is of
an immaterial amount, in its previously described lawsuits
relating to its sourcing of clothing products from
independent garment manufacturers in Saipan
(Commonwealth of Northern Marina Islands). The settlement
is subject to court approval. No hearing has been set to
date.
Other. The Company is also subject to other ordinary routine
litigation incidental to its business and with respect to which
no material liability is expected.