Chindarah

FACTS

In February 2003, two former employees of Pick Up Stix, Inc. (Stix), filed a complaint against their former employer alleging claims for unpaid overtime, penalties and interest due to the misclassification of their jobs as exempt from overtime pay. The complaint was amended in July 2003 to allege a proposed class action to recover unpaid overtime on behalf of the plaintiffs and all other current and former general managers, assistant managers, and lead cooks employed by Stix between February 28, 1999, through September 2003.

Stix’s attempt to settle the lawsuit through mediation failed. Stix then decided to attempt settlement with as many putative class members as possible. It offered each of them an “amount. . . based upon a figure . . . Stix had previously offered at the mediation.” Over 200 former and current employees accepted the offer and signed a settlement agreement, which included a general release. By signing the agreement, the employee acknowledged that he or she had spent more than 50 percent of the time performing managerial duties, released Stix from all claims for unpaid overtime and any other Labor Code violations during the relevant time period,…