Pizza Hut 2011 Annual Report Download - page 196

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uniform claims but, in addition to the federal FLSA claims, asserts state-law class action claims under the laws of sixteen different
states. Pizza Hut filed a motion to dismiss the amended complaint, and plaintiffs sought leave to amend their complaint a second
time. On August 9, 2010, the court granted plaintiffs' motion to amend. Pizza Hut filed another motion to dismiss the Second
Amended Complaint. On July 15, 2011, the Court granted Pizza Hut's motion with respect to plaintiffs' state law claims, but
allowed the FLSA claims to go forward. Plaintiffs filed their Motion for Conditional Certification on August 31, 2011 to which
Pizza Hut filed its opposition on October 5, 2011. A decision on plaintiffs' Motion for Conditional Certification is expected during
2012.
Pizza Hut denies liability and intends to vigorously defend against all claims in this lawsuit. However, in view of the inherent
uncertainties of litigation, the outcome of these cases cannot be predicted at this time. Likewise, the amount of any potential loss
cannot be reasonably estimated.
On August 6, 2010, a putative class action styled Jacquelyn Whittington v. Yum Brands, Inc., Taco Bell of America, Inc. and Taco
Bell Corp. was filed in the United States District Court for the District of Colorado. The plaintiff seeks to represent a nationwide
class, with the exception of California, of salaried assistant managers who were allegedly misclassified and did not receive
compensation for all hours worked and did not receive overtime pay after 40 hours worked in a week. The plaintiff also purports
to represent a separate class of Colorado assistant managers under Colorado state law, which provides for daily overtime after 12
hours worked in a day. The Company has been dismissed from the case without prejudice. Taco Bell filed its answer on September
20, 2010, and the parties commenced class discovery, which is currently on-going. Taco Bell moved to compel arbitration of
certain employees in the Colorado class. The court denied the motion as premature because no class has yet been certified. On
September 16, 2011, the plaintiffs filed their motion for conditional certification under the FLSA. The plaintiffs did not move for
certification of a separate class of Colorado assistant managers under Colorado state law. Taco Bell opposed the motion. The
court heard the motion on January 10, 2012, granted conditional certification and ordered the notice of the opt-in class be sent to
the putative class members. Taco Bell expects the notices to be sent by the end of February 2012. Putative class members will
have 90 days in which to elect to participate in the lawsuit. After further discovery, Taco Bell plans to seek decertification of the
class.
Taco Bell denies liability and intends to vigorously defend against all claims in this lawsuit. However, in view of the inherent
uncertainties of litigation, the outcome of this case cannot be predicted at this time. Likewise, the amount of any potential loss
cannot be reasonably estimated.
We are engaged in various other legal proceedings and have certain unresolved claims pending, the ultimate liability for which,
if any, cannot be determined at this time. However, based upon consultation with legal counsel, we are of the opinion that such
proceedings and claims are not expected to have a material adverse effect, individually or in the aggregate, on our consolidated
financial condition or results of operations.
Form 10-K