Judge grants preliminary approval of $13M deal to settle Vail Resorts class action lawsuits

Attorneys in similar proposed class action lawsuit filed in Colorado continue efforts to block settlement deal

Kenneth Zakzesky chips away snow at Lower Beaver Creek Express on Monday, Dec. 12, 2017, in Beaver Creek.
Chris Dillmann/Vail Daily archive

A judge has granted preliminary approval of a $13.1 million deal offered by Vail Resorts to settle five wage and labor lawsuits in California, likely quashing a similar class action lawsuit filed in Colorado.

The settlement deal, which was unveiled in court filings at the start of January, was granted preliminary approval by a judge in California state court on Feb. 1, according to court documents obtained by the Vail Daily. The settlement does not just apply to the plaintiffs of the five California cases directly involved in the deal — it would settle any and all allegations that the company failed to reimburse employees for equipment or pay employees for all hours worked over the last three to four years.

The deal offers $13.1 million spread over a “class” of about 100,000 Vail Resorts employees nationwide. However, this amount quickly dwindles to $8.24 million after the deduction of administrative costs and $4.36 million in legal fees – a number that the California plaintiffs’ attorneys say is “appropriate” and “in line with market rates.”

If the remaining $8.24 million were to be distributed evenly across the 100,000 “class members,” it would shake out to about $82 per person. The settlement funds will not be doled out evenly across class members, though, and instead will use an “allocation formula” to determine how much each employee should receive based on how long they have worked for Vail Resorts, when and where they worked and the position or positions they worked in, giving twice as many “points” to people who work or worked in “snow positions.”

Any employee who cashes the settlement check they will receive in the mail gives up their right to bring similar legal action against Vail Resorts for the specified time period of three to four years depending on the state they work in.

“We do not comment on settlement details, and Vail Resorts believes the settlement is appropriate and fair,” Jamie Alvarez, director of corporate communications for Vail Resorts, said in a written statement provided to the Vail Daily in early October. “Moreover, it is being submitted to a judge who will be asked to ensure that it is fair and reasonable to everyone affected.”

“We dispute the accuracy of the claims raised by the plaintiffs, however, to avoid the time-consuming and costly nature of further litigation, the parties involved have negotiated a tentative settlement and will seek court approval to finalize and ensure the outcome is a fair resolution to all,” Alvarez said.

Vail Resorts and its attorneys have not responded to requests for comment on the ongoing lawsuits since this statement issued Oct. 5.

“Obviously it’s low, I mean, from my perspective,” said Matt Elston, a part-time ski instructor for Vail Resorts who is also an inactive member of the California bar association. “It really depends on how they view some of this stuff going forward. Are they going to be paying for what they really should be paying for going forward?”

“A hundred bucks or less for past underpayment really doesn’t cover the damages,” Elston said in a January interview. “To me, the damages would be more than that, but I think a lot of (ski) instructors would probably feel like, ‘Hey, if we improve things going forward, that’s acceptable.'”

The fate of the Colorado case

Two attorneys who represent employees at the heart of a similar proposed class action lawsuit filed in Colorado have continued efforts to block the settlement deal, saying they would have pushed for a higher settlement amount and, more importantly, for changes to Vail Resorts’ compensation policies.

The fate of the case filed in Colorado — known as the Quint et al. case — hangs upon whether the $13.1 million deal is granted final approval by the California state judge, a decision that will be made in the coming weeks.

Vail Resorts employees work to get ready for Beaver Creek's opening day in November of 2018.
Chris Dillmann/Vail Daily archive

The Quint et al. case has been stalled since Vail Resorts announced that it was beginning settlement proceedings in the California cases last summer as the company argued that it did not make sense to continue litigation in a case that could be settled as part of the $13.1 million deal.

A federal judge granted this request by Vail Resorts, known as a “motion to stay,” in the fall of last year for a period of 90 days. The stay on the case was recently extended for another 60 days as the California settlement deal is on the brink of final approval.

The attorneys for the plaintiffs in the Quint et al. case have argued that the complaints brought forward in their case are broader and more comprehensive than those brought forward in any of the five California cases, according to their response to the federal judge’s decision to postpone their case. Given this — coupled with the fact that their case was filed first and was filed in the judicial district where Vail Resorts is headquartered — the attorneys said that their case should be allowed to move forward.

The attorneys, Edward Dietrich and Benjamin Galdston, have declined to comment on the progression of the lawsuits.

Their case is similar to the California cases, which were combined under one case for the purposes of negotiating a settlement, as both allege that Vail Resorts violated the federal Fair Labor Standards Act as well as state labor laws in a number of states across the country.

Both complaints allege that the company failed to pay employees for all hours worked as well as for overtime hours, meals, rest periods and training. They also allege that the company does not properly reimburse employees for the equipment needed to perform the basic functions of their jobs like skiing/snowboarding gear and cell phone costs.

However, the complaint filed in the Quint et al. case was 167 pages long and contained 22 very specific and well-documented grievances with the company, Dietrich and Galdston argued.

But an amended complaint filed in August once the five California cases had been combined into one shows that their claims are quite extensive as well. The document cites 33 claims ranging from “failure to pay for all hours worked” and “failure to pay overtime wages” under the federal Fair Labor Standards Act to violations of state labor laws in 16 different states where Vail Resorts operates. The amended complaint also brings forward claims of “breach of contract” and “unjust enrichment” against the company, according to the document.

Pushing back

With their case effectively stuck, the two Colorado-based attorneys filed a motion to intervene in the California case in December with the explicit intent to try to block the settlement proceedings.

In the motion, the attorneys argued that the settlement deal cannot truly “resolve all claims” against Vail Resorts if the claims of their plaintiffs are sidelined and left out of the proceedings. The attorneys claimed that Vail Resorts did not give them enough notice that similar proposed class action lawsuits had been filed in California as is required by law.

Vail Resorts did not file a notice alerting Dietrich and Galdston about the California cases until Aug. 12, according to court documents filed in the Quint et al. case. By this point, the company had already extended an initial settlement offer and the notice was filed alongside the motion to stay the Quint et al. case.

“…Vail deliberately avoided disclosing even the existence of the later-filed (California lawsuits), let alone its secret settlement negotiations, in order to secure a sweetheart deal with compliant plaintiffs in the California actions,” Dietrich wrote in a legal brief supporting the motion to intervene. “Once the Colorado plaintiffs discovered this deception and gamesmanship, they took swift action to intervene before any settlement approval motion was filed.”

Dietrich and Galdston also highlighted Vail Resorts’ decision to pull the settlement proceedings out of federal court and into state court in the “eleventh hour” of the proceedings when the California cases were originally being litigated in the Eastern District of California, calling this “highly suspicious.” For these reasons, “mandatory intervention” in the California case “is warranted,” they argued in the brief.

“This forum shopping, flip-flopping and procedural machinations only confirm that the (two parties) have colluded to give Vail a cheap escape route from the massive liability it faces in the (Quint et al. case),” the attorneys said.

Beaver Creek Ski Patrol Chris Johnson, right, and avalanche dog, Luna, practice rescuing a potential victim during avalanche training in Vail's Back Bowls Wednesday, Jan. 23, 2019, in Vail.
Chris Dillmann/Vail Daily archive

Their motion to intervene in the case was denied by the California state judge, Michael J. McLaughlin, but they filed a motion to appeal that decision on March 7.

The two attorneys also filed an objection to the preliminary approval of the settlement on Jan.18, in which they were quite blunt in stating what they thought of the deal.

“…Hamilton fails to satisfy applicable legal standards for preliminary approval because the motion lacks the data and other factual and legal support required to show the settlement is fair, reasonable, and adequate,” the attorneys argued in the objection.

Two days later, Judge McLaughlin granted a request from Vail Resorts to have the objection “stricken” or removed from the court’s official record of the case.

Judge McLaughlin granted preliminary approval of the settlement deal less than two weeks later.

What comes next

Elston said he does not plan to cash his settlement check if and when the time comes that he receives it in the mail.

Vail Resorts employees across the country will soon find themselves in this position of deciding whether to rip up their settlement checks or cash it and give up their legal rights to bring claims against Vail Resorts for past mistreatment regarding wage and labor laws.

Some class action settlements require class members to “opt in” to receive settlements, but this one requires that class members “opt out” by filling out a form or by choosing not to deposit the check they receive. This method of opting into a settlement is known as a “back-of-check release.”

“This approach will provide greater total compensation to the class because participation rates are typically much higher with back-of-check releases than when settlements are claims-made,” Jennifer Liu, lthe ead attorney for the California plaintiffs, said in the request for preliminary approval of the settlement filed in January.

Liu and Rebecca Peterson-Fisher, the attorneys who filed the preliminary approval papers on behalf of the California plaintiffs, also did not respond to a request for comment.

The settlement deal is currently being litigated in a California state court in El Dorado County, home to Heavenly Mountain Resort, which is owned by Vail Resorts. The two parties are now working through a third-party “settlement administrator” to coordinate the logistical details of the settlement as they prepare to ask the court for final approval of the deal in a hearing tentatively set for June, according to a motion requesting to extend the original timeline set for the settlement proceedings.

The settlement administrator has already begun the work of sending out “notice packets” with information about the deal to Vail Resorts employees, a process which they now aim to have finished on Tuesday. The final date for employees to “opt out of or object to the settlement” is set for May 21.

Both parties will then take a few weeks to “review the substance of any objections that are received” and to give responses to said objections ahead of the hearing for final approval of the settlement deal, which is set to be held on either June 17 or June 24.

Meanwhile, the extended stay on the Quint et al. case will expire on Friday, but it is still unclear what, if anything, will come of that lawsuit.

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