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LITIGATION MATTERS
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3 Months Ended |
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May 04, 2013
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| Commitments and Contingencies Disclosure [Abstract] | |
| LITIGATION MATTERS |
LITIGATION MATTERS
In 2006, a former store manager filed a collective action against the Company in Alabama federal court claiming that she and other store managers should have been classified as non-exempt employees under the Fair Labor Standards Act and received overtime compensation. The Court preliminarily allowed nationwide (except California) certification. The Company filed a motion to decertify on February 29, 2012 and that motion was granted on November 2, 2012. The individual claims of the four named plaintiffs proceeded to trial and on March 1, 2013, the jury returned verdicts in all four cases in favor of the Company. The individual claims of the remaining 261 opt-in plaintiffs were dismissed without prejudice and approximately 61 of these plaintiffs have filed individual suits in various federal courts throughout the country. Plaintiffs have appealed the decertification Order and the jury verdicts to the U.S. Court of Appeals for the 11th Circuit.
In April 2011, a former assistant store manager, on behalf of himself and those similarly situated, instituted a class action in a California state court primarily alleging a failure by the Company to provide meal breaks, to compensate for all hours worked, and to pay overtime compensation. The Company removed the case to federal court which denied plaintiffs' motion for remand of the case to state court. Discovery in this case is at an early stage. No trial date has been set.
In June 2011, Winn-Dixie Stores, Inc. and various of its affiliates instituted suit in federal court in Florida alleging that the Company, in approximately 48 shopping centers in the state of Florida and five other states where Dollar Tree and Winn-Dixie are both tenants, was selling goods and products in Dollar Tree stores in violation of an exclusive right of Winn-Dixie to sell and distribute such items. It sought both monetary damages and injunctive relief. At approximately the same time, Winn-Dixie also sued Dollar General, Inc. and Big Lots, Inc. making essentially the same allegations against them and seeking the same relief. The Court consolidated the three cases and they proceeded to trial, without a jury, in May of 2012. On August 10, 2012, the Court issued its Findings of Fact and Conclusions of Law. The ruling denied Winn-Dixie's claim for monetary damages, either compensatory or punitive, and, of the original 48 Dollar Tree stores at issue, granted plaintiff's request for injunctive relief with respect to just one store. A final Order incorporating these findings and conclusions was entered and Winn-Dixie has appealed to the U.S. Court of Appeals for the 11th Circuit.
In the summer and fall of 2011, five collective action lawsuits were filed against the Company in federal courts in Georgia, Colorado, Florida, Michigan and Illinois by different assistant store managers, each alleging he or she was forced to work off the clock in violation of the federal Fair Labor Standards Act (FLSA). Plaintiffs also assert various state law claims for which they seek class treatment. The Michigan case is currently stayed. The Florida case has been transferred to the U.S. District Court for the Eastern District of Virginia and has been stayed. The Georgia suit sought statewide class certification. Those state law claims were ultimately dismissed prior to the case also being transferred to the U.S. District Court for the Eastern District of Virginia. The Colorado case is farthest along in terms of litigation. Although the statewide class claims were dismissed, the Court did conditionally certify under the FLSA a class of all assistant store managers who worked for Dollar Tree from July 16, 2008 to the present. Approximately 2,200 plaintiffs have opted-in to the collective action and discovery is on-going. The trial is scheduled to commence in March 2014. The Illinois case, in addition to assistant store managers, also included a putative class of all other hourly store associates and made the same allegations on their behalf. The Illinois case was transferred to the Eastern District of Virginia in June 2012 and the Virginia federal judge ruled that all claims made on behalf of assistant store managers under both the FLSA and state law should be dismissed. The court, however, did conditionally certify under the FLSA a class of all sales associates who worked for Dollar Tree from October 2, 2009 to the present. Notice to the putative class was issued and approximately 6,280 plaintiffs opted into the case. Certification discovery is under way and no trial date has been set.
In July 2012, a former non-exempt hourly associate who alleges his primary duty was to work the cash register, on behalf of himself and those similarly aggrieved, filed a Complaint under the California Private Attorneys General Act, in a California state court, alleging the Company failed to provide suitable seating as allegedly required by state law. The Company removed the case to federal court and filed its Answer to the Complaint. After discovery and the filing by the Company of its expert witness report, the parties agreed to a settlement in the first quarter of 2013 for an immaterial amount which has been accrued in the accompanying condensed consolidated financial statements.
In July 2012, a former assistant store manager, on behalf of himself and those similarly situated, filed a class action Complaint in a California state court, alleging the Company failed to provide paid, duty-free 10 minute rest breaks to assistant store managers who worked for periods in excess of three and one-half hours. The alleged relevant time period is July 13, 2008 to the present. The Company removed the case to federal court, however, it was remanded to state court when plaintiff indicated the damages sought were less than $5.0 million, the jurisdictional amount under the federal Class Action Fairness Act. No trial date has been set.
In August 2012, two former store managers, under California's Private Attorney General Act, instituted suit in a California state court, on behalf of themselves and others similarly aggrieved in the state of California, alleging they were misclassified by the Company as exempt employees. The Company removed the case to federal court. Discovery has commenced; no trial date has been set.
In February 2013, a former assistant store manager on behalf of himself and those similarly aggrieved filed a representative claim under California's Private Attorney General Act, alleging the Company failed to provide meal and rest periods; failed to pay minimum, regular and overtime wages; failed to maintain accurate time records and wage statements; and failed to pay wages due upon termination of employment. The Company removed the case from a California state court to federal court. Discovery will commence in the near future. No trial date has been set.
The Company will vigorously defend itself in these matters. The Company does not believe that any of these matters will, individually or in the aggregate, have a material effect on its business or financial condition. The Company cannot give assurance, however, that one or more of these lawsuits will not have a material effect on its results of operations for the period in which they are resolved. Based on the information available to the Company, including the amount of time remaining before trial, the results of discovery and the judgment of internal and external counsel, the Company is unable to express an opinion as to the outcome of those matters which are not settled and cannot estimate a potential range of loss.
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