Big Lots 2009 Annual Report Download - page 186

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BIG LOTS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 10 — Commitments, Contingencies and Legal Proceedings
In November 2004, a civil collective action complaint was filed against us in the United States District Court
for the Eastern District of Louisiana (“District Court in Louisiana”), alleging that we violated the Fair Labor
Standards Act by misclassifying assistant store managers as exempt employees (“Louisiana matter”). The
plaintiffs sought to recover, on behalf of themselves and all other individuals who are similarly situated,
alleged unpaid overtime compensation, as well as liquidated damages, attorneys’ fees and costs. On July 5,
2005, the District Court in Louisiana issued an order conditionally certifying a class of all then-current and
former assistant store managers who worked for us since November 23, 2001. As a result of that order, notice
of the lawsuit was sent to approximately 5,500 individuals who had the right to opt-in to the Louisiana matter.
Approximately 1,100 individuals opted to join the Louisiana matter. We filed a motion to decertify the class and
the motion was denied on August 24, 2007. The trial began on May 7, 2008 and concluded on May 15, 2008. On
June 20, 2008, the District Court in Louisiana issued an order decertifying the action and dismissed, without
prejudice, the claims of the opt-in plaintiffs. After this ruling, four plaintiffs remained before the District Court in
Louisiana. On January 26, 2009, three of the plaintiffs presented their respective cases before the District Court
in Louisiana. Since then, the claims of one of the plaintiffs in the January 2009 action and the fourth plaintiff
(who did not participate in the January 2009 action) were dismissed with prejudice. On April 2, 2009, the District
Court in Louisiana awarded the two remaining plaintiffs an aggregate amount of approximately $0.1 million
plus attorneys’ fees and costs, which, on June 25, 2009, were determined to be $0.4 million. We appealed both of
these decisions. Subsequent to the District Court in Louisiana’s April 2, 2009 decision, approximately 172 of the
opt-in plaintiffs filed individual actions in the District Court in Louisiana. On August 13, 2009, we filed a writ of
mandamus challenging the District Court in Louisiana’s jurisdiction to hear these cases. This writ was denied on
October 20, 2009. On January 12, 2010, the Louisiana matter was settled for $4.0 million.
In April 2009, a civil collective action complaint was filed against us in the United States District Court for
the Western District of New York, alleging that we violated the Fair Labor Standards Act by misclassifying
assistant store managers as exempt employees (“New York matter”). In addition, the plaintiff seeks class action
treatment under New York law relating to those assistant store managers working in the State of New York.
The plaintiff seeks to recover, on behalf of himself and all other individuals who are similarly situated, alleged
unpaid overtime compensation, as well as liquidated damages, attorneys’ fees and costs. On January 21, 2010,
a stipulation was filed and Order rendered limiting this action to current and former assistant store managers
working in our New York stores. We intend to vigorously defend ourselves against the allegations levied in this
lawsuit. We cannot make a determination as to the probability of a loss contingency resulting from this lawsuit
or the estimated range of possible loss, if any; however, we currently believe that such claims asserted in the
New York Matter, both individually and in the aggregate, will be resolved without a material adverse effect on
our financial condition, results of operations, or liquidity.
In September 2006, a class action complaint was filed against us in the Superior Court of California, Los
Angeles County, alleging that we violated certain California wage and hour laws by misclassifying California
store managers as exempt employees (“Seals matter”). The plaintiffs seek to recover, on their own behalf and
on behalf of all other individuals who are similarly situated, damages for alleged unpaid overtime, unpaid
minimum wages, wages not paid upon termination, improper wage statements, missed rest breaks, missed meal
periods, reimbursement of expenses, loss of unused vacation time, and attorneys’ fees and costs. On October 29,
2009, the Court denied plaintiffs’ class certification motion, with prejudice. On January 21, 2010, the plaintiffs
filed a Notice of Appeal. We cannot make a determination as to the probability of a loss contingency resulting
from this lawsuit or the estimated range of possible loss, if any. We intend to vigorously defend ourselves
against the allegations levied in this lawsuit; however, the ultimate resolution of this matter could have a
material adverse effect on our financial condition, results of operations, and liquidity.