Viacom Inc. has agreed to pay about $7.2 million to resolve a putative class action brought by two former interns who claimed they were unlawfully denied minimum wage. The named Plaintiffs, Casey Ojeda and Karina Reynaga, last month filed a motion for preliminary approval of a class action deal that would resolve both federal and state wage claims following nine months of settlement negotiations, according to court documents. The interns said in a memorandum:
Further litigation here would cause additional expense and delay. If the court denied the motions, a fact-intensive trial would necessarily follow. A trial would be lengthy and complex and would consume tremendous time and resources for the parties and the court. … The settlement, on the other hand, makes monetary relief available to class members in a prompt and efficient manner.
Under terms of the settlement, each intern in the 12,500-strong class would be paid $577 while ex-Viacom interns Ojeda and Reynaga would receive $5,000 each for services rendered on behalf of the class. Opt-ins Nicole Rosinsky, a former MTV human resources intern, and Nikhil Kasbekar, a former Viacom marketing intern, would receive $2,500 and $1,500 respectively. Ojeda filed the lawsuit in 2013, targeting Viacom and MTV Networks Enterprises Inc. under the Fair Labor Standards Act as well as New York law.
Ojeda and others were misclassified as exempt from minimum wage requirements, the complaint alleged. The plaintiffs sought collective action certification in January 2014, saying Viacom “engaged in an unlawful scheme to require Plaintiffs to provide free labor that undeniably benefited defendants.” The court granted certification in April 2014.
The proposed settlement is similar to other settlements agreed to by other big companies including NBCUniversal Media Inc. and Conde Nast Publications. In 2014, Conde Nast settled for $5.8 million with an estimated 7,500 former interns, and disbanded its internship program altogether. The same year, NBCUniversal settled with a class of nearly 8,000 former unpaid interns at “Saturday Night Live” and MSNBC for $6.4 million. The proper standard for determining whether an individual is an intern or an employee covered by wage law is currently before the Second Circuit in appeals involving the Hearst Corp. and Fox Entertainment Group Inc. The case is in the U.S. District Court for the Southern District of New York.
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