HAGENS BERMAN

Date Filed: May 27, 2003
Court: Los Angeles Superior Court
Location: California
Ticker Symbol: NASDAQ:COST

On May 27, 2003, Hagens Berman filed a class action and representative action in the Los Angeles Superior Court on behalf of all California residents who, at any time between May 1999 and May 2003, were employed or are employed as department managers of Costco Wholesale Corporation (Costco), and who did not receive overtime compensation, as required by California law.

The Class Action and Representative Action Complaint, which was filed by former Costco department manager Greg Randall, alleges violations of the California Unfair Competition Law, the California Labor Code, and the California Unfair Practices Act.

Costco owns and operates approximately 80 retail warehouse distribution centers in California, and approximately 10 department managers are employed at each warehouse, according to the complaint. Each warehouse employs at least one person who is classified as a manager at each of its warehouse departments, and each manager works at least 50 hours per week.

California law requires the payment of overtime wages equal to 1-1/2 times an employee's regular rate of pay for all hours worked over eight hours per day, and for payment of overtime wages equal to double the employee's regular rate of pay for all hours worked in excess of 12 hours in any work day and for all hours worked in excess of eight hours on the seventh day of work in any one work week.

The complaint alleges that Costco has intentionally and improperly designated department managers as "exempt" managers for its warehouses in order to avoid payment of overtime wages and other benefits.

The proposed class action and representative action has been assigned to Judge Victoria G. Chaney. In August 2003, Judge Chaney designated the case as a "complex" case, which means that she will preside over it until it has been completed. In October 2003, Hagens Berman and Costco's counsel filed a Joint Initial Status Conference Report, which provides an overview of this case.

Costco filed a motion seeking to have the case dismissed. In January 2004, Judge Chaney issued a written ruling on that motion. The court dismissed two of the claims asserted by Randall (for violations of certain provisions of the Labor Code and the Unfair Practices Act); however, the court refused to dismiss Randall's claim that Costco had violated the Unfair Competition Law.

Since the spring of 2004, the plaintiffs and Costco have engaged in fact discovery. Two more Costco managers -- Cynthia Peterson and Terry Head - have stepped forward to join Greg Randall as plaintiffs in this case.

On October 22, 2004, these plaintiffs filed a First Amended Class Action Complaint for violations of the Labor Code and Unfair Competition Law. This filing reinstates the Labor Code claims that had earlier been dismissed by the Court.

Counsel for the plaintiffs and Costco have been working with each other, and with the Court, to devise a survey form that can be disseminated to current and former Costco store managers throughout the state of California to collect facts concerning the number of hours worked per week and the types of tasks performed by Costco managers.

        

Related Documents

	Costco Managers Overtime Pay Complaint
	Costco Joint Initial Status Conference Report
	Costco Ruling on Motion to Dismiss
	First Amended Class Action Complaint