Wal-Mart Class Action Litigation

On February 6, 2001, THE FURTH FIRM LLP filed a class action lawsuit in Alameda County Superior Court against Wal-Mart Stores, Inc. and Sam’s West, Inc. (Sam's Club) seeking statutory penalties and punitive damages for meal and rest break violations, as well as equitable relief under California’s Unfair Competition Law. In November 2003, the Superior Court certified the case to proceed to trial on behalf of 115,919 hourly workers. Wal-Mart petitioned the California Court of Appeal and the California Supreme Court to overturn the trial court’s decision. However, on February 25, 2004, the California Supreme Court declined to consider Wal-Mart’s petition for review.

In a further attempt to avoid trial, Wal-Mart engaged in a “scorched earth” policy by filing numerous motions in which it asked the court to dismiss the workers’ claims. When these motions were denied, Wal-Mart then sought to further delay the case by petitioning the Court of Appeal and the California Supreme Court—five petitions in all—to reverse the trial court’s decisions. The appellate courts refused to consider any of Wal-Mart’s requests.

The case proceeded to trial on September 6, 2005 in Oakland, California. The evidence presented to the jury primarily consisted of Wal-Mart’s own documents and time records, both of which unequivocally showed that for years, Wal-Mart knew that it had a pervasive and systemic meal break problem throughout California. The evidence further demonstrated that Wal-Mart’s executives were aware of these illegalities but did not take any meaningful steps to correct the problem. Following a three and a half month trial and three days of deliberation, the jury unanimously found that Wal-Mart violated California’s meal break laws. The jury awarded $57,268,673 in statutory penalties and $115 million in punitive damages.

The jury’s verdict has been described by legal commentators as “stunning,” “ground-breaking,” “important,” “influential” and “significant.”

The second phase of the trial, involving injunctive relief under the Unfair Competition Law, took place from June 26-29, 2006. On September 27, 2006, the Court found that during the class period, Wal-Mart failed to provide class members with millions of rest breaks as required by California law. The Court also concluded that Wal-Mart does not currently have a corporate strategy or plan to ensure rest break compliance. Accordingly, the Court issued a permanent injunction against Wal-Mart that requires the company to implement various policies and practices designed to secure its compliance with California's rest break laws.

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