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Wednesday, July 2, 2008

Contingency cases: easy come, easy go

Just as Faegre & Benson absorbed a bitter blow last week when the U.S. Supreme Court reduced its original damages award in Exxon v. Baker by 90 percent, a pair of Twin Cities law firms could stand to benefit greatly from a case decided in Dakota County this week.

In Braun v. Wal-Mart, District Court Judge Robert King, Jr. found that Wal-Mart violated Minnesota’s Fair Labor Standards Act on more than 2 million occasions. More than seven years ago, Maslon Edelman Borman & Brand, along with Schwebel Goetz & Sieben, took the case, which resulted in a class of about 65,000 current and former hourly workers at Wal-Mart’s Minnesota stores seeking compensation for off-the-clock work, and for missed mandatory meal and rest breaks.

King already has awarded more than $6.5 million in damages to about 56,000 current and former Minnesota Wal-Mart employees, but that could be just a beginning. He has ordered a second phase of the trial to begin in October, when a jury will determine punitive damages and the amount of statutory penalties to be imposed against Wal-Mart. Minnesota’s wage and hour laws allow for a penalty of up to $1,000 for each violation, meaning that if the jury awards the full penalty for each, the award could be in excess of $2 billion.

Maslon wouldn’t confirm that it took the Wal-Mart case on contingency, though unofficial sources say they did. Regardless, the fact remains that when firms of their size take on such cases, it can mean stretching resources and risking a lot. In those cases, decisions like this one can be extra gratifying.

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