Thursday, November 01, 2012

$19 Million Settlement Approved in ADA Class Action Against Burger King

This posting was written by Jeffrey May.

The federal district court in San Francisco has approved a $19 million settlement in an action filed on behalf of a class of approximately 620 mobility-impaired customers of 86 California Burger King restaurants against the fast food franchisor for violations of the Americans with Disabilities Act and California disabilities laws (Vallabhapurapu v. Burger King Corp., October 26, 2012, Alsup, W.).

The settlement agreement, which is purported to include the largest total recovery amount ever obtained in a disability access case, was found to be in the best interests of the class and fair, reasonable, and adequate.

According to the plaintiffs, Burger King pursued discriminatory policies or practices that resulted in unlawful architectural or design barriers at 86 California restaurants leased to franchisees. These practices allegedly denied customers who use wheelchairs or scooters access to services at these Burger King restaurants.

The action followed an action called Castaneda v. Burger King Corp., 3:08-cv-04262-WHA. In Castaneda, an order certified 10 classes, one for each of 10 restaurants at which plaintiff mobility-impaired customers had visited and encountered access barriers, and a settlement was thereafter reached concerning the 10 restaurants (CCH Business Franchise Guide ¶14,419). This case involves the remaining 86 Burger King restaurants in California for which classes were not certified in Castaneda. Counsel are the same.

The current settlement provides for a cash payment of $19 million to satisfy and settle all claims for damages, as well as any attorney fees and costs. It will provide monetary damages of over $14 million.

Monetary awards to each claimant in the settlement class will be distributed pro rata based on the total number of visits by each damages claimant to one of the 86 restaurants where he or she encountered a barrier, the court explained. The maximum number of visits for which each damages claimant can obtain recovery is six.

Attorney Fees, Costs

The court also approved a request for reimbursement of $230,776.77 in litigation costs and expenses, and $4,592,305.81 in attorney fees. Using the lodestar method for calculating attorney fees (reasonable number of hours multiplied by a reasonable hourly rate), class counsel came up with a possible award of $3,546,721.60. That figure was based on rates ranging from $335 to $825 for the attorneys, and from $225 to $275 for paralegals and other staff. On top of that amount, the court applied a multiplier of 1.29, based on the quality of representation and benefit to the class, to reach the $4,592,305.81 figure.

Injunctive Relief

In addition to monetary relief, the settlement grants injunctive relief. This would include all of the measures agreed to in the Castaneda litigation, such as agreements to eliminate all accessibility barriers and to use mandatory checklists with specific accessibility items for remodeling, alterations, repairs, and maintenance.

The court pointed out an additional remedial measure that goes beyond those imposed by the Castaneda settlement. Burger King will now include in its manual to its franchisees the recommendation that franchisees check the force required to open public exterior and restroom doors twice per month. Franchise operators will need to check that the doors do not require more than five pounds of pressure to open. Of the 86 restaurants originally at issue, the injunctive relief applies to the 77 Burger King restaurants that are still in business and are leased by Burger King to franchisees in California.

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