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FOOT LOCKER, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
21. Share-Based Compensation − (continued)
The total fair value of awards for which restrictions lapsed was $14 million, $9 million, and $8 million for 2014,
2013, and 2012, respectively. At January 31, 2015, there was $12 million of total unrecognized compensation
cost net of estimated forfeitures, related to nonvested restricted stock awards.
22. Legal Proceedings
Legal proceedings pending against the Company or its consolidated subsidiaries consist of ordinary, routine
litigation, including administrative proceedings, incidental to the business of the Company or businesses that
have been sold or disposed of by the Company in past years. These legal proceedings include commercial,
intellectual property, customer, environmental, and employment-related claims.
Certain of the Company’s subsidiaries are defendants in a number of lawsuits filed in state and federal courts
containing various class action allegations under federal or state wage and hour laws, including allegations
concerning unpaid overtime, meal and rest breaks, and uniforms.
The Company is a defendant in one such case in which plaintiff alleges that the Company permitted unpaid
off-the-clock hours in violation of the Fair Labor Standards Act and state labor laws. The case, Pereira v. Foot
Locker, was filed in the U.S. District Court for the Eastern District of Pennsylvania in 2007. In his complaint, in
addition to unpaid wage and overtime allegations, plaintiff seeks compensatory and punitive damages,
injunctive relief, and attorneys’ fees and costs. In 2009, the Court conditionally certified a nationwide collective
action. During the course of 2010, notices were sent to approximately 81,888 current and former employees of
the Company offering them the opportunity to participate in the class action, and approximately 5,027 have
opted in.
The Company is a defendant in additional purported wage and hour class actions that assert claims similar to
those asserted in Pereira and seek similar remedies. With the exception of Hill v. Foot Locker filed in state court
in Illinois, Kissinger v. Foot Locker filed in state court of California, and Cortes v. Foot Locker filed in federal
court in New York, all of these actions were consolidated by the United States Judicial Panel on Multidistrict
Litigation with Pereira under the caption In re Foot Locker, Inc. Fair Labor Standards Act and Wage and Hour
Litigation. In Hill v. Foot Locker, in May 2011, the court granted plaintiffs’ motion for certification of an opt-out
class covering certain Illinois employees only. The Company and plaintiffs have entered into a proposed
settlement agreement to resolve the consolidated cases, Hill and Cortes, that is subject to court approval. The
court recently granted preliminary approval of the proposed settlement agreement.
The Company and the Company’s U.S. retirement plan are defendants in a purported class action (Osberg v.
Foot Locker, filed in the U.S. District Court for the Southern District of New York) in which the plaintiff alleges
that, in connection with the 1996 conversion of the retirement plan to a defined benefit plan with a cash balance
formula, the Company and the retirement plan failed to properly advise plan participants of the ‘‘wear-away’’
effect of the conversion. Plaintiff’s current claims are for breach of fiduciary duty under the Employee Retirement
Income Security Act of 1974 and violation of the statutory provisions governing the content of the Summary
Plan Description. The district court issued rulings certifying the class. The Company sought leave to appeal the
class certification rulings to the U.S. Court of Appeals for the Second Circuit, but these applications were
denied. Trial is scheduled for June 22, 2015.
Management does not believe that the outcome of any such legal proceedings pending against the Company
or its consolidated subsidiaries, including In re Foot Locker, Inc. Fair Labor Standards Act and Wage and Hour
Litigation,Hill, Cortes, Kissinger, and Osberg, as described above, would have a material adverse effect on the
Company’s consolidated financial position, liquidity, or results of operations, taken as a whole. Litigation is
inherently unpredictable, and judgments could be rendered or settlements entered that could adversely affect
the Company’s operating results or cash flows in a particular period.
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