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On March 8, 2004, Ryan Walsh and Graham Wiseman filed a class action lawsuit against their former employer, IKON Office Solutions, Inc. (IKON) seeking to recover unpaid overtime and commissions on behalf of themselves and similarly situated IKON employees. The lawsuit, Walsh, et. al. v. IKON Office Solutions, Inc, filed in San Francisco Superior Court, alleges that IKON violated wage and hour laws by misclassifying sales representatives as exempt employees, failed to provide employees with mandatory rest and meal period breaks, failed to properly calculate regular rate of pay, unlawfully deducted expenses from earned commissions, and failed to pay earned commissions, including earned commissions to sales representatives after termination of employment. In February, 2005, the Court granted class certification of Plaintiffs claims.

On December 17, 2005, the Court granted IKON's request to decertify the LDS account manager overtime pay subclass. Plaintiffs filed an appeal from this order in January, 2006.

On January 21, 2006, trial began of Plaintiffs' claims based upon IKON's expense reimbursement cap policy. On April 6, 2006, jury returned special verdicts and answers to special interrogatories in the trial of the expense reimbursement claim. The jury found that IKON's expense reimbursement cap policy to be in violation of California law and in violation of the right to reimbursement of each class member. The jury also found that Plaintiffs did not prove class wide damages based upon statistical sampling evidence. As a result of these verdicts, Plaintiffs requested the Court to appoint a Special Master to conduct proceedings to determine loss sustained by each individual member of the expense reimbursement subclass. Plaintiffs also requested the Court to enter an injunction baring IKON's expense reimbursement cap policy. These requests are currently under consideration by the Court.

On April 18, 2006, the parties reached a settlement regarding the DSO, regular rate of pay, and the direct payroll deduction claim in the Business Expense deduction subclass. The settlement is subject to final approval by the Court following notice to class members. Class members are requested to monitor this webpage periodically for further case developments.developments.

David A. Dudash was hired by Varnell, Struck & Associates (VSA) on February 15, 2002, as a service specialist, a position he held until his resignation in November, 2004. Mr. Dudash worked in the VST service group until, July, 2004, when VSA combined the VST and VAST electrical and lighting product groups. Mr. Dudash worked in assigned Lowes Home Improvement Stores (Lowes) located in California.

Mr. Dudash job duties entailed stocking, pricing, and shelving merchandise, erecting and cleaning merchandize displays per Lowes specifications and instructions, resetting product placement, stacking-out products, processing product rebates, and resetting product placements. Mr. Dudash spent the majority of his time during a work week or pay period performing manual labor.

VSA required Mr. Dudash to work a minimum of 8.5 hours per day on Lowes store premises, five days per week. Mr. Dudash periodically worked in excess of 10 hours per day stocking and shelving electrical products in Lowes stores. Mr. Dudash typically worked between 47 and 52 hours per week.

Mr. Dudash was paid a salary by VSA. VSA did not pay Dudash overtime pay.

Mr. Dudash’s Complaint

July 8, 2004. Mr. Dudash filed a Complaint For Damages in the United States District Court in California seeking payment of overtime wages.

Mr. Dudash’s Complaint alleges that VSA (1) failed to pay employees overtime in violation of the federal Fair Labor Standards Act of 1947 (FLSA) and the California Labor Code. Mr. Dudash contends that work performed by him as a service specialists, and tasks performed by other VSA service specialists, were such that Mr. Dudash and other VSA service specialists are non-exempt employees and are therefore entitled to overtime pay. As a result, Mr. Dudash contends that VSA paid him and other VSA service specialists wages significantly less than that required by law. Mr. Dudash also contends that he was paid a salary does not allow VSA to avoid paying him ,and other VSA service specialists.

In December, 2004, VSA changed its nearly 20 year policy regarding payment of overtime wages to service specialists. December, 2004, VSA began for the first time to pay service specialists hourly wages and overtime pay. It is Mr. Dudash’s belief that VSA changed its long-standing no-overtime pay policy in December, 2004, as a result of Mr. Dudash’s Complaint filed five months earlier in July, 2004. Mr. Dudash’s Complaint seeks, among other things, payment of overtime wages due himself and similarly situated service specialists earned before December, 2004.

Mr. Dudash’s Complaint seeks payment of overtime wages under the FLSA on behalf of a VSA service specialists employed by VSA between July 8, 2000, and the present comprised of two groups of VSA employees:

  1. Service specialists employed by VSA in the United States (excluding California) between
    July 8, 2001 and the present;

  2. Service specialists employed by VSA in California between July 8, 2000 and the present.


On May 5, 2005, the Court ordered VSA to provide Mr. Dudash with the names and addresses of all VSA service specialist employed by VSA between July 8, 2000, to the present.

On March 7, 2006, the Court granted Mr. Dudash's request to certify a class of VSA California employees and for permission to proceed as a collection action on behalf of similarly situated VSA employees nationwide for violation of overtime requirements under the federal Fair Labor Standards Act.

Former VSA California employees who wish participate in the class action proceedings based upon Mr. Dudash's overtime pay and rest and meal period claims arising under the California Labor Code are not required to file a Consent To Join Form. No action is required of former VSA California employees to participate in this class action proceeding.

Former VSA employees who wish to participate in the FLSA proceeds are required to sign and file a Consent To Join form by a deadline to be set by the Court shortly. Notice of this filing deadline will be provided to former VSA employees by mail addressed to their last known address as provided by Defendant VSA. A copy of the Consent To Join Form is available by clicking on the case documents icon at the top of this section. The Consent To Join Form must be signed and sent to our offices to be filed with the Court before the deadline date for filing of Consent To Join Forms.

CURRENT STATUS

We have been informed by the California State Franchise Tax Board that Cigarettes Cheaper’s retail tax license was revoked by the Franchise Tax Board in July, 2004. As such, Cigarettes Cheaper! is no longer an operating business in the State of California.

The Settlement Agreement provides that a substantial portion of the settlement payment will be made upon successful completion of a lawsuit by Cigarettes Cheaper against RJ Reynolds, Inc. At the time the settlement was reached in 2003, it was hoped that a successful resolution of Cigarettes Cheaper’s claims against RJ Reynolds would provide the means to fund the class settlement. In October, 2004, a jury returned its verdict in the RJ Reynolds case in favor of RJ Reynolds and against Cigarettes Cheaper.

On December 10, 2004, we filed an application with the Court for an order to show cause for contempt against Cigarettes Cheaper for failure to comply with the Settlement Agreement. The Court granted our application, and scheduled a contempt hearing for January 14, 2005. The Court also granted our application for permission to conduct financial discovery to ascertain the true financial condition of Cigarettes Cheaper. We intend to complete this discovery by January 14, 2005.

While we continue to hope for a positive outcome in this case, we would be less than candid if we did not advise class members that is highly unlikely that Cigarettes Cheaper will make any payments under the Settlement Agreement. We share your disappointment with this outcome. As many of you are aware, our office, like every class member, has not received any payment from Cigarettes Cheaper to date, including reimbursement of expenses advanced by our firm in excess of $60,000.

As always, please to no hesitate to contact us if you have any further questions regarding the status of the case.

If you have any questions regarding these documents, you can email our firm.