Big Lots 2010 Annual Report Download - page 142

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BIG LOTS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 10 — Commitments, Contingencies and Legal Proceedings (Continued)
August 25, 2009, the Court denied, without prejudice, the plaintiffs’ class certification motion. On April 21,
2010, the Court granted, with prejudice, our motion to deny class certification. Accordingly, the claims of one
plaintiff remain before the Court. We cannot make a determination as to the probability of a loss contingency
resulting from the Caron matters or the estimated range of possible loss, if any. We intend to vigorously defend
ourselves against the allegations levied in these lawsuits; however, the ultimate resolution of these matters could
have a material adverse effect on our financial condition, results of operations, and liquidity.
In June 2010, a representative enforcement action was filed against us in the Superior Court of California,
Alameda County, alleging that we violated certain California wage and hour laws for missed meal and rest
periods and other wage and hour claims (“Sample matter”). The plaintiff seeks to recover, on her behalf and
on behalf of a California statewide class consisting of all other individuals who are similarly situated, damages
resulting from allegedly unpaid overtime, unpaid meal period premiums, unpaid rest period premiums, unpaid
business expenses, non-payment of wages at termination, untimely payment of wages, noncompliant wage
statements, failure to providing seating, and attorneys’ fees and costs. In July 2010, we answered the plaintiff’s
complaint and filed a notice of removal to the United States District Court, Northern District of California.
On August 25, 2010, the plaintiff filed a motion requesting that the United States District Court, Northern
District of California remand this lawsuit to the Superior Court of California, Alameda County. We have
opposed the plaintiff’s motion to remand. On November 30, 2010, the United States District Court, Northern
District of California granted the plaintiff’s motion to remand the Sample matter to the Superior Court of
California, Alameda County. We are in the preliminary stages of discovery. The Sample matter is similar in
nature to the actions comprising the Caron matters. We cannot make a determination as to the probability of a
loss contingency resulting from the Sample matter 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.
In 1998, an action was filed against us in the District Court, 224th Judicial District, in Bexar County, Texas
(“State Court”) by a plaintiff claiming she was injured when she fell in one of our stores (“Rivera matter”).
The Rivera matter was removed to the United States District Court for the Western District of Texas (“Federal
Court”) and the claim was fully litigated. Ultimately, the Federal Court granted summary judgment in our
favor in January 2000. The plaintiff re-filed the same complaint in April 2000 in the State Court and then
obtained a default judgment against us on June 20, 2000 in the amount of approximately $1.5 million plus
post-judgment interest, which brings the total claim against us to approximately $3.4 million. No effort was
made to collect on this judgment by the plaintiff until February 2009, when we were served with a writ of
execution of judgment. We have filed a petition for a bill of review with the State Court. Since that time, the
Federal Court issued an order reflecting that the January 2000 order was a summary judgment with prejudice
in our favor. Notwithstanding the Federal Court’s order, the State Court rendered a summary judgment
decision in the plaintiff’s favor. We appealed the State Court’s decision and asked the Federal Court to issue
an injunction against the State Court’s proceedings. Oral arguments in the appeal of the State Court’s decision
were heard on June 22, 2010. On November 3, 2010, the Fourth Court of Appeals District of Texas affirmed
the state court ruling. On March 25, 2010, the Federal Court denied our motion for an injunction and denied
the plaintiff’s motion to reconsider the Federal Court’s order confirming that it granted summary judgment
with prejudice. On April 6, 2010, the plaintiff appealed the Federal Court’s ruling to the U.S. Court of Appeals
for the Fifth Circuit. Briefing has been completed for the Federal Court appeal and oral arguments have been
scheduled for late April 2011. On November 3, 2010, the Texas Court of Appeals affirmed the State Court’s
decision. On December 17, 2010, we filed a petition for review with the Texas Supreme Court. We cannot
make a determination as to the probability of a loss contingency resulting from the Rivera matter; however,
we currently believe that the Rivera matter will be resolved without a material adverse effect on our financial
condition, results of operations, or liquidity.