Albertsons 2007 Annual Report Download - page 116

SU
PERVAL
U
IN
C
. and
S
ubsidiaries
N
OTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
I
n September 2000, an a
g
reement was reached and court approval
g
ranted to settle ten purported class o
r
collective actions that were consolidated in March 1996 in the United States District Court in Boise, Idaho
(
Barton et a
l
.v.A
lb
ertson’s, Inc.) an
d
w
hi
c
h
ra
i
se
d
var
i
ous
i
ssues
i
nc
l
u
di
ng “o
ff
-t
h
e-c
l
oc
k
” wor
k
a
ll
egat
i
ons an
d
a
lle
g
ations re
g
ardin
g
certain salaried
g
rocer
y
mana
g
ers’ exempt status. Under the settlement a
g
reement, curren
t
a
nd former employees who met eligibility criteria have been allowed to present their off-the-clock work claims to
a
c
l
a
i
ms a
d
m
i
n
i
strator. A
ddi
t
i
ona
ll
y, current an
df
ormer grocery managers emp
l
oye
di
nt
h
e State o
f
Ca
lif
orn
i
a
h
ave been allowed to
p
resent their exem
p
t status claims to a claims administrator. The claims administrator ha
s
a
ssigned values to claims. The value of these claims can be challenged by either party. The parties have agreed to
reso
l
ve a
ll
outstan
di
ng c
l
a
i
ms an
d
t
h
e Court grante
dfi
na
l
approva
l
o
f
t
h
at agreement on Marc
h
22, 2007.
M
ana
g
ement does not believe that the settlement will have a material adverse effect on the Compan
y
’s financial
condition, results of o
p
erations or cash flows
.
On October 13, 2000, a complaint was filed in Los Angeles County Superior Court (Joanne Kay Ward et al. v
.
A
lb
ertson’s, Inc. et a
l
.) a
ll
eg
i
ng t
h
at A
lb
ertsons, Luc
k
y Stores an
d
Sav-on Drug Stores prov
id
e
d
term
i
nat
i
n
g
emplo
y
ees their final pa
y
checks in an untimel
y
manner. The lawsuit seeks statutor
y
penalties. On Januar
y
4,
2
00
5
, the case was certified as a class action. The Company is vigorously defending this lawsuit. Although this
l
awsu
i
t
i
ssu
bj
ect to t
h
e uncerta
i
nt
i
es
i
n
h
erent
i
nt
h
e
li
t
i
gat
i
on process,
b
ase
d
on t
h
e
i
n
f
ormat
i
on present
l
y
a
vailable to the Compan
y
, mana
g
ement does not expect that the ultimate resolution of this lawsuit will have
a
material adverse effect on the Company’s financial condition, results of operations or cash flows
.
On February 2, 2004, the Attorney General for the State of California filed an action in Los Angeles federal court
(
Ca
lif
orn
i
a, ex re
l
Loc
k
yer v. Sa
f
eway, Inc.
db
a Vons, a Sa
f
eway Company, A
lb
ertson’s, Inc. an
d
Ra
l
p
h
s
Grocer
y
Compan
y
, a division of The Kro
g
er Co., United States District Court Central District of California, Case
N
o. CV04-0687) claiming that certain provisions of the agreements (the “Labor Dispute Agreements”) betwee
n
A
lb
ertsons, T
h
e Kroger Co. an
d
Sa
f
eway Inc. (t
h
e “Reta
il
ers”), w
hi
c
h
prov
id
e
df
or “
l
oc
k
-outs”
i
nt
h
e event t
h
a
t
a
n
y
Retailer was struck at an
y
or all of its Southern California facilities durin
g
the 2003-2004 labor dispute in
Southern California when the other Retailers were not and contained a provision designed to prevent the union
f
rom p
l
ac
i
ng
di
sproport
i
onate pressure on one or more Reta
il
er
b
yp
i
c
k
et
i
ng suc
h
Reta
il
er(s)
b
ut not t
h
eot
h
e
r
R
etailer(s) durin
g
the labor dispute violate Section 1 of the Sherman Act. The lawsuit seeks declarative
,
injunctive and other legal and equitable relief. The Retailers’ motion for summary judgment was denied o
n
M
ay 26, 2005 and the Retailers’ appeal of that decision was dismissed on November 29, 2005. On December 7
,
2
00
6
, the Attorne
y
General’s motion for Summar
y
Jud
g
ment was denied, and the Attorne
y
General’s motion t
o
certify an appeal of the decision was denied on March
5
, 2007. The Company continues to believe it has strong
d
e
f
enses aga
i
nst t
hi
s
l
awsu
i
tan
di
sv
i
gorous
l
y
d
e
f
en
di
ng
i
t. A
l
t
h
oug
h
t
hi
s
l
awsu
i
t
i
ssu
bj
ect to uncerta
i
nt
i
e
s
inherent in the liti
g
ation process, based on the information presentl
y
available to the Compan
y
, mana
g
ement does
not expect that the ultimate resolution of this action will have a material adverse effect on the Company’s
fi
nanc
i
a
l
con
di
t
i
on, resu
l
ts o
f
operat
i
ons or cas
hfl
ows.
I
n Marc
h
2004, a
l
awsu
i
t see
ki
ng c
l
ass act
i
on status was
fil
e
d
aga
i
nst A
lb
ertsons
i
nt
h
e Super
i
or Court o
f
t
h
e
State of California in and for the Count
y
of Alameda, California (Dunbar v. Albertson’s, Inc.) b
y
a
g
rocer
y
manager seeking recovery including overtime pay based upon plaintiff’s allegation that he and other grocery
managers were improperly classified as exempt under California law. Class certification was denied in June 2005
a
nd the Court
g
ranted plaintiffs’ motion to consolidate trial of approximatel
y
sixt
y
claims. The claims have bee
n
resolved and all com
p
laints dismissed.
I
n August 2004, Sally Wilcox and Dennis Taber filed a complaint, later certified as a class action, in Californi
a
Super
i
or Court
i
nan
df
or t
h
e County o
f
San D
i
ego, a
ll
eg
i
ng t
h
at A
lb
ertson’s Inc.
f
a
il
e
d
to pay wages
f
or t
i
me
w
orked durin
g
meal breaks to its non-exempt emplo
y
ees emplo
y
ed in ke
y
carrier positions. The lawsuit furthe
r
a
lleges that Albertson’s failed to provide itemized wage statements as required by California law and that
F-
50