Pepperidge Farm Reaches $22.5M Settlement to Resolve Independent Contractor Lawsuit

Plaintiffs from three states could benefit from a proposed $22.5 million settlement to resolve claims Pepperidge Farm Inc. broke labor laws when it misclassified employees as independent contractors.

Last week, a California federal judge said he needs more information before he will agree to approve the settlement that will affect product distributors in California, Massachusetts, and Illinois.

U.S. District Judge John A. Kronstadt requested clarification on the laws in Massachusetts and Illinois, more information on the lawyers’ hours and fees, and more details regarding the work done by the lead plaintiffs.

Attorneys for the named plaintiffs say that since the original independent contractor lawsuit was filed in 2013, the named plaintiffs have worked hundreds of hours and traveled extensively for litigation purposes. The named plaintiffs each are seeking $25,000 incentive awards.

The proposed settlement requests about $5.6 million for attorney fees.

The Pepperidge Farm lawsuit was first filed in Massachusetts back in October 2013. Plaintiff Edmund S. and former plaintiff Marc A. filed the wage and hour lawsuit alleging Pepperidge Farm had denied the workers employment benefits by misclassifying distributors as independent contractors.

The case was filed in the Superior Court of the Commonwealth of Massachusetts, Suffolk County, but was moved to a Massachusetts federal court in November 2013. Marc A. died in December 2016.

In the meantime, California plaintiffs Raymond A. and Marvin B. alleged that they, too, were misclassified as independent contractors and denied employee benefits when they worked as Pepperidge Farm distributors. The men filed their independent contractor lawsuit in August 2014 in the Superior Court of California in Los Angeles.

Raymond and Marvin alleged federal and California labor laws were violated because they missed out on overtime pay, meal and rest break premium pay, and reimbursement for business-related expenses.

The plaintiffs also sought statutory penalties and civil penalties under the Private Attorneys General Act, according to filings with the court. That lawsuit was moved to a California federal court.

In Illinois in February 2016, yet another Pepperidge Farm lawsuit was filed by two more distributors who alleged they were misclassified as independent contractors and were owed back benefits. Plaintiffs Daniel M. and Matthew J. filed their employee misclassification lawsuit in an Illinois federal court in February 2016.

Daniel claimed that he often worked 55 to 70 hours a week as a sales development associate for Pepperidge Farm for 19 years.

Read more: Am I an Independent Contractor or an Employee?

Division of Proposed Pepperidge Farm Labor Laws Settlement

Successful mediation enabled the proposed settlement among all three cases. If approved by the judge, Class Members will be divided into subclasses based on their state.

The motion explains that every Class Member will receive a preliminary individual settlement amount based on their state and the amount of time they spent working for Pepperidge Farm within the class-specific liability period.

If the proposed settlement is approved, the motion divides it up as follows:

• Approximately $12.52 million will be awarded to California’s subclass, which means class members will each receive approximately $6,000 for each year they were a Pepperidge Farm distributor between Aug. 7, 2010 and the date of the settlement’s preliminary approval.
• About $6 million will be awarded to the Massachusetts subclass. The motion says each eligible class member will receive approximately $4,000 for every year they were a Pepperidge Farm distributor between Oct. 2, 2010 and the present.
• About $4 million will be awarded to the Illinois subclass, whose members will receive about $1,300 for each year they were a Pepperidge Farm distributor between Feb. 12, 2006 and Feb. 11, 2013; they also will receive about $3,900 for each year they were a distributor between Feb. 12, 2013 and the present.

Pepperidge Farm was founded in 1937 and was acquired by Campbell Soup Company in 1961.

The Pepperidge Farm Labor Laws Lawsuit is Case No. 2:14-cv-07086, in the U.S. District Court for the Central District of California.

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Even if you are classified as an independent contractor, you may be entitled to minimum wage, overtime pay, reimbursement for expenses, and meal and rest breaks, among other employee benefits.

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This article is not legal advice. It is presented 
for informational purposes only.