Plantronics 2011 Annual Report Download - page 33

ITEM 3. LEGAL PROCEEDINGS
Six class action lawsuits have been filed against the Company alleging that our Bluetooth headsets may cause noise-induced
hearing loss. Shannon Wars et al. vs. Plantronics, Inc. was filed on November 14, 2006 in the U.S. District Court for the Eastern
District of Texas. Lori Raines, et al. vs. Plantronics, Inc. was filed on October 20, 2006 in the U.S. District Court, Central District
of California. Kyle Edwards, et al vs. Plantronics, Inc. was filed on October 17, 2006 in the U.S. District Court, Middle District
of Florida. Ralph Cook vs. Plantronics, Inc. was filed on February 8, 2007 in the U.S. District Court for the Eastern District of
Virginia. Randy Pierce vs. Plantronics, Inc. was filed on January 10, 2007 in the U.S. District Court for the Eastern District of
Arkansas. Bruce Schiller, et al vs. Plantronics, Inc. was filed on October 10, 2006 in the Superior Court of the State of California
in and for the County of Los Angeles. The complaints state that they do not seek damages for personal injury to any
individual. These complaints seek various remedies, including injunctive relief requiring the Company to include certain additional
warnings with its Bluetooth headsets and to redesign the headsets to limit the volume produced, or, alternatively, to provide the
user with the ability to determine the level of sound emitted from the headset. Plaintiffs also seek unspecified general, special,
and punitive damages, as well as restitution. The federal cases have been consolidated for all pre-trial purposes in the U.S. District
Court for the Central District of Los Angeles before Judge Fischer. The California State Court case was dismissed by the
plaintiffs. The parties agreed in principle to settle their claims. The U.S. District Court for the Central District of Los Angeles
signed an order approving the final settlement of the lawsuit entitled In Re Bluetooth Headset Products Liability Litigation brought
against Plantronics, Inc., Motorola, Inc. and GN Netcom, Inc. alleging that the three companies failed to adequately warn consumers
of the potential for long term noise induced hearing loss if they used Bluetooth headsets. The companies contested the claims of
the lawsuit but settled the lawsuit on a nationwide basis for an amount which we believe is less than the cost of litigating and
winning the lawsuit. On September 25, 2009, the Court signed a judgment in the case resolving all matters except the issue of
outstanding attorneys’ fees, which will be split among the three defendants. On October 22, 2009, the Court issued an order setting
the class counsel’s attorneys’ fees and costs and the incentive award at the maximum amounts agreed to by the parties in their
settlement. The objectors to the settlement have filed a notice of appeal, and the appeal is in process. We believe that any loss
related to these proceedings would not be material and have adequately reserved for these costs in the consolidated financial
statements.
In addition, we are presently engaged in various legal actions arising in the normal course of our business. We believe that it is
unlikely that any of these actions will have a material adverse impact on our operating results; however, because of the inherent
uncertainties of litigation, the outcome of any of these actions could be unfavorable and could have a material adverse effect on
our financial condition, results of operations or cash flows.
ITEM 4. (REMOVED AND RESERVED)
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