Lawyers get big cut in call center class action settlement

By Steve Korris | Jul 15, 2011

MARTINSBURG – Hundreds who lost jobs when AB&C call centers closed without warning will share a $726,000 class action settlement on a fairly random basis.

MARTINSBURG – Hundreds who lost jobs when AB&C call centers closed without warning will share a $726,000 class action settlement on a fairly random basis.

Class counsel David Hammer of Martinsburg wrote that "it is impossible to distribute the settlement fund in a way that precisely pays class members exactly what they are due."

An average class member will receive less than $2,000.

Hammer and three other Martinsburg lawyers will share almost $350,000 in fees.

U. S. District Judge John Bailey approved the settlement on June 27.

On March 14, 2008, AB&C closed call centers in Jefferson County, Berkeley County, and Orange County, Va.

At the West Virginia locations, about 375 workers lost jobs.

Hammer sued AB&C on behalf of two of them in Berkeley Circuit Court five days later, seeking unpaid wages and liquidated damages under West Virginia wage law.

The next day, Hammer sued AB&C in federal court on behalf of those two and two others, alleging violation of federal law that requires employers to notify workers before shutting down.

Five days after that, local lawyer Paul Taylor sued AB&C in Jefferson Circuit Court on behalf of five workers, seeking unpaid wages and damages for fraud and emotional distress.

AB&C entered involuntary bankruptcy, and plaintiffs in all three suits amended their complaints to sue Reliant Equity Investors, other businesses, and former AB&C managers.

Mediation led to apparent settlement in 2009, but Hammer and Taylor began to bicker.

At a hearing last December, Taylor associate Steven Sprenger told Bailey his clients didn't sign off on the settlement.

"We have been totally shut out of the process," Sprenger said.

He said Hammer tried to shove the settlement down the throats of his clients.

Taylor asked Bailey to order mediation of the dispute.

Bailey asked if he intended to quantify the emotional distress of each plaintiff.

Taylor said, "I think that would be difficult to do, your honor."

Bailey said, "I would think."

Hammer associate Robert Schiavoni said, "He only has four or five clients that he now wants to take a pot of money and give them something for emotional distress damages."

Hammer later wrote that Taylor asserted emotional distress rather than wage claims to escape income tax, and called the tactic "tantamount to tax fraud."

Bailey approved Hammer's settlement and rejected emotional distress claims.

Defendants agreed to pay West Virginia class members $350,000 on wage claims under state law, and $350,000 to West Virginia and Virginia class members on failure to warn under federal law.

They agreed to pay about $26,000 in unpaid overtime under federal wage law.

They agreed to pay $400,000 in legal fees and costs.

Bailey awarded $139,475 to Hammer, $103,635 to Schiavoni, $37,450 to their associate Garry Geffert, and $8,795 to paralegals.

He awarded $42,287.74 to reimburse their costs.

He awarded Taylor $68,357.26.

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