The Dakota County District Court in Minnesota has ruled that Wal-Mart violated Minnesota's Fair Labor Standards Act over 2 million times, and awarded 6.5 million dollars in damages to approximately 56,000 current and former employees who claimed Wal-Mart had failed to provide them with breaks and forced them to work off the clock.
"Whenever you take on Wal-Mart for 7 years, it's a big case," says Justin Perl, an experienced litigation and trial lawyer with a quarter century of experience under his belt.Perl and his colleagues at Maslon, Edelman, Borman and Brand, LLP in Minneapolis began the case against Wal-Mart on behalf of the employees in September of 2001. Perl specializes in complex business litigation, but says he has never seen a case like this before.
"I've had many, many big cases where hundreds of millions of dollars have been on the table, but I have never had one that has taken 7 years to get to trial," says Perl relaxing in his office and discussing the court decision.
The District Court Judge, Robert King, found that Wal-Mart was aware that their employees were not receiving their rest breaks, and found that the retailer had violated the meal break law alone some 73,864 times, according to Perl's firm. Altogether, the judge found that there were 2 million violations of state labor law in the case against Wal-Mart.
And, the case is far from over.
"What happens in the second phase, starting on October 20ieth," says Perl "we will seek both statutory penalties for the roughly 2 million violations Wal-Mart has committed, and there can be a penalty of up to 1000 per violation plus the jury's finding of punitive damages."
It means Wal-Mart could potentially be looking at 2 billion dollars in fines. "Given the gravity of the violations and the size of Wal-Mart, 2 billion dollars we think is justified to get Wal-Mart to stop and to punish it," says Perl.
LAS: Why did the case take so long to come to court?
JP: We needed to look at Wal-Mart's time records, because it is the time records that help to show that breaks were being missed on a widespread basis, as opposed to an individualized basis. Then we also had to obtain records, such as audits and surveys to show that Wal-Mart knew that the problem had been occurring for a long time, and had done nothing, or as Judge King said 'put their head in the sand.'"
LAS: How difficult was it too look at those records and establish those patterns?
JP: Well, that is certainly one reason it took so long. Before one piece of paper was produced by Wal-Mart, they (as I recall) objected to production of the documents. We needed to bring a motion to compel those documents; the judge had to order the documents to be produced. Then once they were produced, they (Wal-Mart's lawyers) argued they were confidential, and then we needed to have another process in place to protect their reported confidentiality.
Then there were of course, years and years of depositions, I think we had over a hundred depositions that had to be taken across the country, hundreds of motions and then the trial, of course, was three months long.
LAS: What were the critical parts of the trial?
JP: I think we called about 14 class members, they spoke of how they missed breaks, missed meals, worked off the clock, they spoke about the chronic understaffing.
I think there was a significant piece of the testimony that showed Wal-Mart knew it was failing to provide breaks and meals.
And, I think the third piece, would be the quantification of this, and we had experts on the stand who had looked at the millions and millions of pieces of data and counted up how many breaks and meals were missed.
Justin Perl joined the firm of Maslon, Edelman, Borman and Brand 25 years ago, and specializes in complex business litigation. Perl represents plaintiffs, businesses, defendant businesses in a variety of areas including breach of contract disputes, business torts, business fraud, non-compete litigation, employment and whistle blower claims. He graduated from the University of Michigan Law School in 1983.