SUPERIOR COURT OF CALIFORNIA, COUNTY OF MARIN Case No. CV
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1 JANINE PERRY, et al., SUPERIOR COURT OF CALIFORNIA, COUNTY OF MARIN Case No. CV Plaintiffs, vs. VITAMIN SHOPPE INDUSTRIES INC., dba THE VITAMIN SHOPPE, et al., Defendant. Assigned for all purposes to the Honorable Lynn M. Duryee, Department L NOTICE OF PENDENCY OF CLASS ACTION, PROPOSED SETTLEMENT AND HEARING DATE FOR FINAL APPROVAL UNOTICE OF SETTLEMENT IF YOU WERE EMPLOYED BY THE VITAMIN SHOPPE IN CALIFORNIA AT ANY TIME FROM AUGUST 12, 2001 TO APRIL 14, 2006 AS A STORE MANAGER, ASSISTANT STORE MANAGER, KEY CARRIER OR EQUIVALENT, YOU MAY BE ENTITLED TO RECEIVE COMPENSATION FROM A CLASS ACTION SETTLEMENT This is not an ad and you are not being sued. A state court permitted this Notice. Please read this notice carefully. Your legal rights are affected whether you act or not. 1. Why Should You Read This Notice?... Page 1 2. What is the Case About?... Page 2 3. What is the Class Action Settlement?... Page 2 4. Who Are the Parties in This Class Action?... Page 2 5. Why Did The Vitamin Shoppe Join in this Notice?... Page 2 6. Who Are the Attorneys Representing the Parties?... Page 2 7. What Are My Rights? How Will My Rights Be Affected?... Page 3 8. Excluding Yourself from the Settlement... Page 3 9. Objecting to the Settlement... Page Effect of the Settlement... Page How Much Can I Expect to Receive?... Page How Will the Attorneys for the Class and the Claims Administrator be Paid?... Page Release... Page Questions?... Page 6 1. Why Should You Read This Notice? A Settlement has been reached between the parties in the above-captioned lawsuit. This Notice tells of your rights to share in the settlement or your ability to opt-out of it. The Settlement was preliminarily approved at a hearing on April 14, 2006 at 9:00 a.m. in the Superior Court of the State of California in and for the County of Marin. Accordingly, Judge Lynn M. Duryee, Department L, directed that you receive this Notice. You have received this Notice because records indicate that you are a Class Member, as defined below. The Settlement will resolve all Class Members claims described below. 1
2 The Court will hold a Final Fairness Hearing concerning the proposed settlement on November 26, 2007, at 9:00 a.m., in Department L of the Marin County Superior Court, located at 3501 Civic Center Drive, San Rafael, California What is the Case About? On August 12, 2005, plaintiff Janine Perry, et al. ( Plaintiffs ), filed a complaint in Marin County Superior Court against defendant Vitamin Shoppe Industries Inc. dba The Vitamin Shoppe, et al. (the Lawsuit ). Plaintiffs brought the Lawsuit on behalf of all current and former employees who were or have been employed by The Vitamin Shoppe as Store Managers, Assistant Store Managers, Key Carriers or the equivalent between August 12, 2001 and April 14, 2006 (the Class and/or Class Members ). Plaintiffs allege in the Lawsuit that The Vitamin Shoppe misclassified the Store Manager position as exempt and thereby failed to pay Store Managers overtime compensation as required by California law. Plaintiffs further allege that The Vitamin Shoppe also violated California law by failing to provide full, duty free meal and rest periods to its Store Managers, Assistant Store Managers, Key Carriers or equivalents ( Covered Positions ). Plaintiffs further allege that, with respect to the Class Members, The Vitamin Shoppe violated other provisions of the California Labor Code, California Code of Regulations, and the California Business and Professions Code, and California common law, and engaged in other allegedly unlawful conduct. Based on these claims, Plaintiffs sought damages, restitution, attorney fees, interest and penalties on behalf of the Class. The Vitamin Shoppe denies the allegations of the Lawsuit, and asserts that it did not violate the law and also contends that it has no liability for any of Plaintiffs or the Class Members claims under any statute, wage order, common law or equitable theory. 3. What is the Class Action Settlement? You may be entitled to receive compensation from the Settlement that has been reached in the Lawsuit. The Court must approve the terms of the settlement described below as fair and reasonable to the class. The Settlement will affect all members of the Class. Class Members may receive compensation from the class action settlement to the extent they submit valid and timely Claim Forms, as instructed below. This Notice will explain the terms of the Settlement and the amount of compensation you may get. 4. Who are the Parties in this Class Action? Ms. Perry and Tom Vitrano are the Plaintiffs and class representatives. They are acting on behalf of themselves and all individuals employed in Covered Positions during the time period August 12, 2001 to April 14, The Vitamin Shoppe is the defendant. 5. Why Did The Vitamin Shoppe Join in this Notice? The Vitamin Shoppe does not admit to any of the claims alleged in the Lawsuit. The Vitamin Shoppe further denies that it misclassified Store Managers or failed to pay them overtime as required by law; denies that it failed to provide employees with rest breaks or meal periods in violation of applicable law; denies that it required employees to work off-the-clock; denies that it failed to pay employees reporting time pay; and denies that it failed to provide employees with legally adequate wage statements, among other claims. The Vitamin Shoppe is settling the Lawsuit as a compromise, and it reserves the right to object to any claim if the Settlement fails for any reason. The Court file has more information regarding the Lawsuit and Settlement. 6. Who Are the Attorneys Representing the Parties? UAttorneys for Plaintiffs & the Class are: Edward J. Wynne, Esq. J.E.B. Pickett, Esq. WYNNE LAW FIRM 100 Drakes Landing Road, Suite 275 Greenbrae, California Telephone: (415) Facsimile: (415) UAttorneys for The Vitamin Shoppe are:u John P. Zaimes, Esq. Hardy Ray Murphy, Esq. John H. Lien, Esq. REED SMITH LLP 355 South Grand Avenue, Suite 2900 Los Angeles, California Telephone: (213) Facsimile: (213)
3 7. What are My Rights? How Will My Rights Be Affected? To receive compensation from the Settlement, you UmustU complete the Claim Form that accompanies this Notice, sign the Claim Form under penalty of perjury, and promptly mail all parts of the Claim Form to the Claims Administrator. Importantly, the Claim Form must be postmarked no later than November 12, If you submit a Claim Form that is not postmarked by November 12, 2007, submit a Claim Form that is not completely filled out, or do not submit all parts of the Claim Form, you will not receive any payment, but you will be bound by the class release and all other settlement terms. Send the Claim Form by United States regular mail or the equivalent to: Perry v. The Vitamin Shoppe Claims Administrator c/o The Garden City Group, Inc. P.O. Box Seattle, WA (888) The Claim Form states the dates and number of weeks that you were employed with The Vitamin Shoppe as a Store Manager and/or as an Assistant Store Manager, Key Carrier or equivalent during the Settlement Class Period. Your individual settlement claim payment will be based on the information shown in the Claim Form. If you believe that the information shown in the Claim Form is incorrect, you should explain your disagreement on the Claim Form, and return it along with any documentation supporting your disagreement by the specified deadline. The Claims Administrator will review The Vitamin Shoppe s records and your records in an attempt to resolve the dispute. As necessary, Class Counsel will represent you. If you are a current The Vitamin Shoppe employee, your decision as to whether or not to submit a Claim Form will not affect your employment with The Vitamin Shoppe. The Vitamin Shoppe cannot and will not retaliate against you in any way for submitting a claim. 8. Excluding Yourself from the Settlement. If you Udo notu wish to take part in the Settlement, you must complete and sign the Request for Exclusion form that also accompanies this Notice and promptly mail it to the Claims Administrator. The Request for Exclusion form must be postmarked by no later than November 12, If you choose to send the Request for Exclusion Form, you will receive no compensation from the Settlement. Importantly, if you have commenced legal action by filing a lawsuit in the State of California in a federal or state court, or a complaint with the United States Department of Labor or the California Division of Labor Standards Enforcement, or a claim, complaint or charge in any other legal, administrative or arbitral proceeding, regarding work performed by you in the State of California, you must submit a Request for Exclusion form to continue that legal action. If you do not submit a Request for Exclusion form, you will be deemed a member of the Settlement Class and, after the final settlement is approved, your prior legal action will be deemed dismissed. If you submit a Request for Exclusion form that is not postmarked by November 12, 2007, your exclusion form will be rejected and you will be bound by the class release and all other Settlement terms. Send the Request for Exclusion form by United States regular mail or the equivalent to: Perry v. The Vitamin Shoppe Claims Administrator c/o The Garden City Group, Inc. P.O. Box Seattle, WA (888) The judgment following approval of the Settlement by the Court will bind all Class Members who do not request exclusion from the class action settlement. Any member who does not request exclusion may, if they wish, enter an appearance through his or her own lawyer. 3
4 9. Objecting to the Settlement. If you wish to UobjectU to the Settlement, you may file an objection with the Court on or before November 12, Your objection must state your full name, address, and telephone number, and state why you object to the Settlement. The objection should be mailed, postmarked by November 12, 2007, to both of the following: 1. Perry, et al. v. Vitamin Shoppe Industries Inc., et al. Case No. CV Marin County Superior Court, Department L 3501 Civic Center Drive San Rafael, California Perry v. The Vitamin Shoppe Claims Administrator c/o The Garden City Group, Inc. P.O. Box Seattle, WA You may also appear at the Final Fairness Hearing (discussed above) to state your objections. Notwithstanding the foregoing, if you intend to object to the Settlement, but wish to receive your share of the settlement amount, you Umust timelyu file your Claim Form as stated below. If the court approves the settlement despite any objections and you have not returned your Claim Form, you will not receive any settlement proceeds. 10. Effect of the Settlement. If the proposed settlement is approved by the Court, a Judgment will be entered by the Court that will dismiss with prejudice the Lawsuit against The Vitamin Shoppe, et al., and each of their present and former parent companies, subsidiary companies, related or affiliated companies, shareholders, partners, owners, officers, directors, employees, agents, attorneys, insurers, successors and assigns or any individual or entity that could be held jointly liable with them ( Released Parties ). The Judgment will resolve the Settled Claims to the extent provided in the Settlement and permanently bar all Class Members from prosecuting any and all Settled Claims against the Released Parties. If the Settlement is approved and you submit a valid Claim Form, you may receive compensation and will be forever barred from asserting any claims related to the California Labor Code, California Code of Regulations, California Business & Professions Code, and common law claims and requests for damages, penalties, attorney fees and interest brought by the Plaintiffs. If the Settlement is approved and you have done nothing, you will not receive any of the settlement compensation and you will be forever barred from asserting any claims alleged in or related to the allegations of the Lawsuit. 11. How Much Can I Expect to Receive? The Vitamin Shoppe will pay $351,000 total to settle claims by Class Members and to pay Class Counsel s attorney fees and costs and settlement administration fees and costs. After deducting the amounts of attorney fees/costs and settlement administration fees/costs, what remains of the settlement ( Net Settlement Amount ) will be available to pay all valid Class Member claims. The Net Settlement Amount will be apportioned, pursuant to an agreed formula, to pay Class Member claims for overtime; Class Member claims for missed meal and rest periods; and Class Member claims for violation of the California Labor Code s Private Attorney General Act ( PAGA ) as follows: 1. The portion of the settlement payable for overtime claims will be divided by the total number of work weeks worked by all California Store Managers who were classified as overtime exempt during the time period (August 12, 2001 to December 31, 2003) (the Overtime Settlement Period ). (The number of nonexempt work weeks worked by California Store Managers during the Overtime Settlement Period will not be included in this total.) This will yield an amount to be paid per overtime work week. Each eligible Store Manager who submits a valid claim will be paid an overtime settlement award based on the number of work weeks that he or she worked as a Store 4
5 Manager during the Overtime Settlement Period. The pay rate is estimated to be approximately $ for each such overtime week, before deductions for Claims Administration expenses, Attorneys Fees and costs incurred. Because there is no reversion of any unclaimed funds in this Settlement, any monies not claimed by any Class Member will be divided up equally to all participating Class Members on a pro rata basis. In other words, because it is highly unusual in any class action to have 100% participation of all class members, those Class Members who do participate will see an increase in the amount they ultimately receive. 2. The portion of the settlement payable for meal and rest period claims will be divided by the total number of work weeks worked by all employees employed in California in Covered Positions from February 25, 2004 to September 1, 2005 (the Meal/Rest Break Settlement Period ). This will yield an amount to be paid per meal/rest period work week. Each eligible individual who was employed in a Covered Position and who submits a valid claim will be paid a meal/rest break settlement award based on the number of work weeks that he or she worked in a Covered Position during the Meal/Rest Break Settlement Period. The pay rate is estimated to be approximately $31.75 for each such meal/rest period week, before deductions for Claims Administration expenses, Attorneys Fees and costs incurred. Because there is no reversion of any unclaimed funds in this Settlement, any monies not claimed by any Class Member will be divided up equally to all participating class members on a pro rata basis. In other words, because it is highly unusual in any class action to have 100% participation of all Class Members, those class members who do participate will see an increase in the amount they ultimately receive. 3. A sum of $1,000 will be paid for alleged violations of the California Labor Code s private attorney general act (Sections 2698 to ) and other related claims, and will be apportioned as follows: 75 percent ($750) will be paid to the California Labor and Workforce Development Agency, and 25 percent ($250) will be shared equally by all Class Members. 4. Class Members who worked for Vitamin Shoppe only before February 25, 2004, or only between September 1, 2005 and April 14, 2006, and who were never classified as overtime exempt, will also be entitled to make a claim under this Settlement. The additional amount that can be claimed will be calculated based on the number of weeks the particular Class Member worked before February 25, 2004, or between September 1, 2005, and April 14, 2006, using the same net rate used for the Meal/Rest Break Claims Period for all Class Members. The additional award paid to any such Class Member shall not be subject to deductions for attorneys fees, costs, or administration fees. Approximately 260 individuals worked in Covered Positions for The Vitamin Shoppe in California at various times during the Class Period. Most of those employees are eligible to receive compensation out of the Net Settlement Amount. Therefore, if, for example, you were employed for 10 exempt weeks as a Store Manager during the Overtime Settlement Period and for 50 weeks in a Covered Position during the Meal/Rest Break Settlement Period, you may receive approximately $3, gross. However, that amount will be reduced for all applicable withholdings, as explained below. All amounts you receive under this settlement will be treated as wages and thus subject to normal payroll taxes. Accordingly, withholdings for your share of taxes will be deducted from your overtime payment pursuant to state, federal law and local law. An IRS Form W-2 will be issued to you for the portion of the settlement amount payable to you. The Claims Administrator has provided your total number of weeks worked in each applicable Covered Position. Again, if you dispute the information provided, please follow the procedure detailed above for timely submitting your dispute to the Claims Administrator. It is your responsibility to ensure that the Claims Administrator has timely received your Claim Form. You may contact the Claims Administrator at the toll-free number provided in this Notice to ensure that it has received your Claim Form. It is also your responsibility to keep a current address on file with the Settlement Claims Administrator to ensure receipt of your Settlement Claim Payment. 5
6 12. How Will the Attorneys for the Class and the Claims Administrator be Paid? The attorneys for the Class will be paid from the settlement of $351,000 (the total settlement amount ). The attorneys will ask for fees up to 30% of the total settlement amount, or a maximum of $105,300. The attorneys will also ask the Court to reimburse them for their costs, which are estimated not to exceed $7,500. The attorneys for the Class will also ask the Court to pay the Claims Administrator $7,500 for its fees and costs incurred in connection with its administration of the claims process. The actual fees and costs awarded to Class Counsel and/or to the Claims Administrator will be determined by the Court and payable out of the total settlement amount. Payments for the additional award referenced in numbered sub-paragraph 4 in Section 11, above, will be paid entirely by Vitamin Shoppe in addition to the $351,000 settlement. The additional award compensation will not be subject to attorneys fees or claims administration fees, and will be subject to payroll taxes. 13. Release. Upon the final approval by the Court of the Settlement, each Class Member who receives compensation pursuant to the Settlement and each Class Member who has not opted out of this Class Action, shall fully release and discharge The Vitamin Shoppe and each of its present and former parent companies, subsidiary companies, related or affiliated companies, shareholders, partners, owners, officers, directors, employees, agents, attorneys, insurers, successors and assigns, and any individual or entity which could be jointly liable with The Vitamin Shoppe or any of them, from any and all claims, debts, liabilities, demands, obligations, guarantees, costs, expenses, attorney fees, interest, damages, action or causes of action for, or which relate to, the nonpayment of wages or overtime under any federal, state or local law, reporting time pay, split-shift pay, expense reimbursements, vacation pay, meal or rest periods, itemized wage statements, waiting time penalties and any other related penalties under the California Labor Code (including, without limitation, penalties under Labor Code , 226, and 558 and under Wage Order 7 of the Industrial Welfare Commission), claims or causes of action under the California Labor Code, including, but not limited to, California Labor Code , unfair, fraudulent and/or unlawful business practices, misclassification, and/or any other claims alleged in this case, including, without limitation, all claims for restitution or other equitable relief, liquidated damages, punitive damages, waiting time penalties, related penalties of any nature whatsoever, retirement or deferred compensation benefits claimed on account of unpaid overtime, interest, attorney fees and costs, from August 12, 2001 through the April 14, 2006, arising from the employment of said current or former employees by Defendant in the State of California. 14. Questions? If you need more information or have any questions, you may call or Class Counsel, or you may contact the Claims Administrator, using the contact information provided in this Notice. Please refer to The Vitamin Shoppe Class Action Settlement when calling. Please do not telephone the court for information about this Settlement or the claims process. Please do not contact The Vitamin Shoppe s attorneys for information about this Settlement or the claims process. However, you may contact The Vitamin Shoppe s management. 6
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