Tyson Foods 2003 Annual Report Download - page 60

Minimum Wage Act, RCW chapter 49.46, Industrial
Welfare Act, RCW chapter 49.12, and the Wage
Deductions-Contribution-Rebates Act, RCW chapter
49.52. The Chavez lawsuit alleges IBP and/or the
Company required employees to perform unpaid work
related to the donning and doffing of certain personal
protective clothing, both prior to and after their shifts, as
well as during meal periods. Plaintiffs further allege that
similar prior litigation entitled Alvarez, et al. vs. IBP
(Alvarez), which resulted in a $3.1 million final judgment
against IBP, supports a claim of collateral estoppel and/or
is res judicata as to the issues raised in this new litigation.
Plaintiffs are seeking reimbursement for an unspecified
amount of damages, exemplary damages, liquidated
damages, prejudgment interest, attorney fees and costs.
IBP filed a timely Notice of Appeal in Alvarez and plain-
tiffs filed a timely notice of Cross-Appeal. On August 5,
2003, the Ninth Circuit Court of Appeals affirmed the
lower court’s decision in part and reversed the lower
court’s decision in part, and remanded the case to the
lower court for recalculation of damages. If the ruling of
the Ninth Circuit Court of Appeals is upheld in its entirety,
IBP will have additional exposure in Alvarez of approxi-
mately $5 million. IBP filed a petition for rehearing by the
panel of the Ninth Circuit Court of Appeals that heard
Alvarez or, in the alternative, a rehearing en banc, which
was denied on December 2, 2003. It also filed a petition
to certify state law claims to the Washington Supreme
Court, which was denied on September 23, 2003. On
December 5, 2003, IBP filed a Petition to Stay the
Mandate indicating that it will be filing a Petition for a
Certiorari with the U.S. Supreme Court seeking the
Court’s review of the Ninth Circuit’s adverse opinion.
Chavez initially was pursued as an opt-in, collective
action under 29 U.S.C. 216(b), but the U.S. District Court
for the Eastern District of Washington granted plaintiff’s
motion seeking certification of a class of opt-out, state
law plaintiffs under Federal Rule of Civil Procedure 23
and notice has been sent to potential state law claim
class members. A trial date of September 7, 2004, in
Chavez has been set by the court.
58 Tyson Foods, Inc.
notes to consolidated financial statements
TYSON FOODS, INC. 2003 ANNUAL REPORT
former employees of the poultry processing plant in New
Holland, Pennsylvania, and plaintiffs seek reimbursement
for an unspecified amount of unpaid wages, liquidated
damages, attorney fees and costs. Currently, there are
approximately 500 additional current or former employees
who have filed consents to join the lawsuit. The court, on
January 30, 2001, ordered that notice of the lawsuit be
issued to all potential plaintiffs at the New Holland facili-
ties. On July 17, 2002, the court granted the plaintiffs’
motion to certify the state law claims. On September 23,
2002, the Third Circuit Court of Appeals agreed to hear
the Company’s petition to review the court’s decision to
certify the state law claims. On September 8, 2003, the
Court of Appeals reversed the district court’s certification
of a class under the Pennsylvania Wage Payment &
Collection Law, ruling that those claims could not be pur-
sued in federal court. The appellate court further ruled
that the Company must reissue notice of their potential
FLSA claims to approximately 1,500 employees who did
not previously receive notice. The Court of Appeals
remanded the matter to the district court to proceed
accordingly on September 30, 2003.
Substantially similar suits have been filed against several
other integrated poultry companies. In addition, organiz-
ing activity conducted by representatives or affiliates of
the United Food and Commercial Workers Union against
the poultry industry has encouraged worker participation
in Fox v. Tyson and the other lawsuits.
On November 5, 2001, a lawsuit entitled Maria Chavez,
et al. vs. IBP, Lasso Acquisition Corporation and Tyson
Foods, Inc. (Chavez) was filed in the U.S. District Court
for the Eastern District of Washington against IBP, inc.
(IBP; now known as Tyson Fresh Meats, Inc.) and the
Company by several employees of IBP’s Pasco,
Washington, beef slaughter and processing facility alleg-
ing various violations of the FLSA, 29 U.S.C. Sections
201–219, as well as violations of the Washington State