What is this case about?
On April 19, 2012, we filed a nationwide collective action and an Ohio class action against RadioShack for unpaid overtime compensation on behalf of RadioShack's non-exempt Store Managers. We filed the case in the U.S. District Court for the Northern District of Ohio. We also filed parallel class actions in New York and New Jersey.
The Store Managers were paid according to RadioShack's "Non-Exempt Store Manager Compensation Plan" for "Non-California Stores." Compensation Plan. Pursuant to the Compensation Plan, the Store Managers were paid a base salary in addition to bonuses. However, their overtime was calculated at the rate of one-half (0.5) times their regular rate of pay instead of one-and-one-half (1.5) times their regular rate of pay. This reduced the overtime compensation paid to Store Managers by over 73%.
Plaintiffs alleged that RadioShack's method of paying overtime violated the law. Specifically, a Final Rule issued by the Department of Labor stating that the half-time method may only be used in limited circumstances, and that employers cannot use the half-time method while also paying bonuses. Final Rule. RadioShack asked the Court to dismiss Plaintiffs' case, arguing that its Compensation Plan complied with the law.
On March 11, 2013, the U.S. District Court in Ohio denied RadioShack's motion to dismiss, and ruled that RadioShack's Compensation Plan violated the law subsequent to May 5, 2011, the effective date of the Department of Labor's Final Rule. Court Order.
Plaintiffs, however, did not succeed in New York. The U.S. District Court in New York came to the opposite conclusion and dismissed Plaintiffs' case.
Plaintiffs appealed the New York decision to the Second Circuit Court of Appeals, and RadioShack appealed the Ohio decision to the Sixth Circuit Court of Appeals.
On February 5, 2015, while the appeals were pending, RadioShack filed for Chapter 11 bankruptcy protection. As a result, the appeals were stayed.
On September 15, 2015, Plaintiffs filed a motion to certify the class within RadioShack's bankruptcy. Motion for Class Certification.
What does the settlement provide?
We settled the case on behalf of the class for a general unsecured claim of $41 million. The settlement was reached within RadioShack's bankruptcy with the RadioShack Liquidating Trustee. Joint Stipulation of Settlement.
On July 27, 2016, the Bankruptcy Court preliminarily approved the settlement. Preliminary Approval Order.
We issued notice to over 6,000 RadioShack Store Managers on August 10, 2016. Notice.
If final approval is granted, the claim will be among many unsecured claims against RadioShack. The amount that will actually be paid to the class will not be known until later in the case, and will be based on the percentage payout made by the Trustee to holders of unsecured claims.
Am I part of the class?
The class consists of all current and former non-exempt store managers of RadioShack retail stores with an annual sales volume of less than $750,000 at any time after May 5, 2011 in all states except Pennsylvania and California.
Who represents the class?
Plaintiffs and the Class are represented by Anthony J. Lazzaro of The Lazzaro Law Firm, LLC, Jason R. Bristol of Cohen Rosenthal & Kramer LLP, and Thomas W. Coffey of Tucker Ellis LLP. Anthony J. Lazzaro can be reached at 216-696-5000.
How do I get involved?
All class members will receive a notice that explains how they will receive a payment.
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