Rite Aid Managers Can Collect on Overtime Suit

(CN) - Rite Aid can pay former assistant store managers $20.9 million to settle a series of class actions concerning overtime, a federal judge ruled.

U.S. District Judge Jon Jones III said that more than 7,000 received notices identifying them as potential class members, and that more than 1,961 class members have submitted claims forms since the settlement was entered in June 2012.

He is managing the settlement of a series of lawsuits filed suit in federal and state courts across the country against Rite Aid Corp. and Eckerd Corp.

Lead plaintiff Shirley Craig represents employees who once worked as assistant managers or co-managers for the pharmacy chain. They say Rite Aid denied them overtime in violation of the Fair Labor Standards Act and state law.

The class filed an unopposed motion for final approval of class and collective action settlement, attorneys' fees, and incentive awards to class representatives in September 2012.

Class representative Jennifer Hearn filed an objection in October, asserting that the settlement does not adequately compensate New Jersey class members and fails to reflect differences in New Jersey law.

Judge Jones held a fairness hearing in December, attended by class counsel, counsel for Rite Aid and Hearn's attorney.

He approved the proposed settlement and awarded attorneys' fees and incentive awards on Monday.

"This settlement is the result of years of daily communication between class counsel and counsel for Rite Aid and is the product of arms-length bargaining and well-informed negotiations and mediations undertaken with the able and excellent guidance of U.S. Magistrate Judge Martin C. Carlson," Jones wrote. "The parties assert, and the individual dockets reflect, that substantial discovery, including but not limited to hundreds of depositions and requests for documents, has been undertaken in many of the cases subject to this omnibus settlement. Finally, only one objection has been filed, and thus the number of objectors is but an infinitesimal fraction of the total population of the settlement class, weighing in favor of applying the fairness presumption."

The complexity, expense and likely duration of the litigation easily favor approval of the settlement, according to the ruling.

"Discovery disputes would abound in many of these individual cases resulting in additional and unnecessary delay and expense," Jones wrote. "Not only would continued litigation of these cases result in a massive expenditure of class counsel's resources, it would likewise place a substantial drain on judicial resources."

The reasonableness of the settlement fund also supports approval, he said.

"The $20.9 million proposed settlement will result in an average payment of $1,845 to each of the 7,342 class members, and each class member will receive an award proportional to his or her unpaid overtime worked during the applicable limitations period. Faced with substantial litigation risks as to the remaining (and dispositive) questions of law, these proportionate settlement awards are indeed fair and reasonable," the 35-page opinion states.

The court awarded class counsel more than $6.9 million in attorneys' costs and fees. Craig received an incentive award of $7,500, and 20 other class representatives will each get $5,000.

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