Via Bloomberg comes this story of how Wal-Mart tried an end-around strategy to settle an unpaid wage class action in Massachusetts. Apparently, Wal-Mart was unhappy with the high settlement demand received from lawyers representing the workers. According to the news report, Wal-Mart simply located other lawyers who were not actively involved in the case and engineered a settlement that was far below the demand provided by the named plaintiffs.
The Superior Court Judge Murtagh apparently described the settlement as “tainted.” Judge Murtagh refused to approve the settlement.
So this raises interesting questions. Class actions on behalf of consumers and employees are widely condemned for all sorts of reasons. Charges of abuse are almost always heaped upon those of us who represent consumers. But here, it’s clear that Wal-Mart tried to pull a fast one by failing to make settlement offers to the named plaintiffs–the people responsible for prosecuting the lawsuit. Wal-Mart acted inapprorpiately in trying to settle the case.
So maybe we should all to expect to hear criticism from the talking heads who are awfully quick to criticize consumers and trial lawyers. That would be the right thing because Wal-Mart engaged in lawsuit abuse here. But I’m not holding my breath.
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