$37.25M SETTLEMENT IN LAWSUIT OVER 2008 LAYOFF AT LAWRENCE LIVERMORE LAB
- $2,728,327.00 in Phase One trial on May 10, 2013, plus prejudgment interest
- Case Type
- Settlement after two trials
- Case Name
- Alameda County Superior Court
- 20 – Judge Robert Freedman
- J. Gary Gwilliam, Randall E. Strauss, and Robert J. Schwartz
Gwilliam, Ivary, Chiosso, Cavalli & Brewer
1999 Harrison Street, Suite 1600
Oakland, CA 94612
Fax: (510) 832-1918
- (1) Phil Allman, Ph.D. – economist; (2) Paul Berg, Ph.D. – emotional distress; (3) Jay Finkelman, Ph.D. – human resources; and (4) William Lepowsky – statistics.
- Patricia K. Gillette, Andrew R. Livingston, and Warrington S. Parker III
Orrick, Herrington and Sutcliffe LLP
The Orrick Building
405 Howard Street
San Francisco, CA 94105
Fax: (415) 773-5759
- (1) G. Edward “Ted” Anderson, Ph.D. – economist; (2) John Zeitz, M.D. – emotional distress; (3) Rhoma Young – human resources; (4) Ali Saad, Ph.D. – statistics.
- This was a consolidated action – not a class action – with 130 plaintiffs, all of whom worked at Lawrence Livermore National Laboratory (“the Lab”), a U.S. Department of Energy national security laboratory in Livermore, California. The plaintiffs were laid off in May 2008, only months after the Lab was privatized by defendant Lawrence Livermore National Security, LLC (“LLNS”), which is led by Bechtel Corporation and the University of California (“UC”). All of the plaintiffs had claims for age discrimination and breach of contract, along with other individual claims (retaliation, disability discrimination, etc.).
The plaintiffs contended that the layoff resulted from a corporate takeover of the Lab led by Bechtel. Indeed, the new LLNS contract to manage the Lab was over $40 million more than the not-for-profit UC had previously charged. Moreover, LLNS added approximately 40 new employees in executive and management positions, primarily from Bechtel, significantly increasing the overhead costs.
At the same time, LLNS promised the federal government that it would save $50 million annually by “improving operations and efficiency.” To accomplish this, LLNS targeted its oldest and most experienced employees for layoff, in violation of its layoff policies, under which the majority of employees were to be laid off in inverse order of seniority. The average age of the 130 plaintiffs was 54 years, with an average of nearly 20 years of seniority.
The case was heavily litigated for more than 7 years. Approximately 300,000 pages of documents were produced. More than 100 individuals were deposed. There were two 60-day jury trials, and both sides filed appeals. Attorneys’ fees and costs are estimated at $10-15 million for each side.
Throughout the case, LLNS’s strategy was to delay the proceedings at all costs. LLNS twice removed the case to federal court. The court found that LLNS “lacked any objective basis” for the second removal, noting that it was “not a close call.” The court awarded the plaintiffs $39,624 in attorneys’ fees for the “improper removal,” approving Gary Gwilliam’s hourly rate of $750, Randy Strauss’s hourly rate of $585, and Rob Schwartz’s hourly rate of $300.
Likewise, after the court selected five “test” plaintiffs for trial, LLNS filed four motions for summary judgment/adjudication. As the trial approached, LLNS argued that additional discovery was required, convincing the court to bifurcate the plaintiffs’ claims into the Phase One and Two trials. LLNS also filed four writ petitions and a petition for review in the California Supreme Court, each time attempting to further delay the proceedings.
LLNS’s aim in all of this was clear – drag things out and force the plaintiffs to settle cheap. This was a particularly cynical strategy given the advanced age of the plaintiffs.
The case finally settled on September 30, 2015, after several long days of mediation and four months of post-mediation negotiations. There had been no serious offer prior to that time. LLNS agreed to pay $37.25 million to settle the claims of 129 plaintiffs; one plaintiff decided not to settle. LLNS had demanded confidentiality, but the plaintiffs refused because the settlement was to be paid solely with federal funds. Therefore, the plaintiffs contended that confidentiality was against public policy.
- $37,245,343.77 settlement on September 30, 2015