Western Digital 2011 Annual Report Download - page 66

Employment Litigation
On March 20, 2009, plaintiff Ghazala H. Durrani, a former employee of the Company, filed a putative class action
complaint in the Alameda County (California) Superior Court. The complaint alleged that certain of the Company’s
engineers had been misclassified as exempt employees under California state law and were, therefore, due unspecified
amounts for unpaid hourly overtime wages and other amounts, as well as penalties for allegedly missed meal and rest
periods. By court order dated April 24, 2009, the case was transferred to the Orange County (California) Superior Court.
On or about June 16, 2009, the Company was dismissed from the case without prejudice by stipulation, leaving WDTI
as the sole remaining defendant. On or about June 4, 2009, WDTI filed its answer to the complaint, denying the
substantive allegations thereof and raising several affirmative defenses. The parties participated in a mediation of the case
on June 3, 2010, which led to a proposed settlement of the case. The proposed settlement, which was ultimately approved
by the court, resolved the case on a class-wide basis for an immaterial amount that was accrued by the Company in the
fourth quarter of fiscal 2010. The court granted final approval of the settlement and entered judgment on February 7,
2011. A final accounting hearing took place on July 11, 2011, at which the court confirmed that the settlement amount
was fully paid in accordance with the settlement agreement.
On February 26, 2010, and as thereafter amended on August 23, 2010 and December 22, 2010, plaintiff Tariq
Sadaat, a former employee of the Company, filed a putative class action complaint in the Orange County (California)
Superior Court against the Company, WDTI, Kelly Services, Inc., a Delaware corporation (“Kelly Services”), and certain
other unnamed individuals. Plaintiff sought to represent certain hourly employees who were assigned to work at certain
of the Company’s facilities by Kelly Services, a temporary staffing agency. In this regard, the complaint alleged that the
hourly employees were due unspecified sums for unpaid overtime wages and other amounts, as well as penalties for
allegedly missed meal and rest periods. The complaint sought unspecified damages including lost wages, penalties under
the California Labor Code and other statutes, compensatory and punitive damages, declaratory relief, injunctive relief,
interest, attorneys’ fees and costs. The Company’s response to the complaint was filed and served in January 2011. The
parties participated in a mediation of the case, which led to a proposed settlement of Sadaat’s individual claims for an
immaterial amount. The Court approved the proposed settlement on July 26, 2011, and dismissed the complaint in its
entirety, with prejudice as to Sadaat’s individual claims and without prejudice as to the alleged class claims.
Other Matters
In the normal course of business, the Company is subject to other legal proceedings, lawsuits and other claims.
Although the ultimate aggregate amount of probable monetary liability or financial impact with respect to these other
matters is subject to many uncertainties and is therefore not predictable with assurance, management believes that any
monetary liability or financial impact to the Company from these other matters, individually and in the aggregate, would
not be material to the Company’s financial condition, results of operations or cash flows. However, there can be no
assurance with respect to such result, and monetary liability or financial impact to the Company from these other matters
could differ materially from those projected.
Note 6. Business Segment, Geographic Information and Major Customers
Segment Information
The Company operates in one reportable operating segment, the hard drive business.
60
WESTERN DIGITAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)