A former employee of a coupon magazine filed a suit against the owner of the company, the OpenGate Capital. The plaintiff claimed that the company has violated the law when the administration suddenly closed the business, terminating about 680 employees without any notice.
On Tuesday, the lawsuit was filed at the county superior court, which represents Luann Benton. The plaintiff worked for the company for around 34 years now, before she was laid off. The suit is seeking class action status, which will be identified later by a judge. There were other affected employees who joined the lawsuit as plaintiffs, while others have approached and negotiating with other law firms with the same complaints.
The complaint boils down to the lack of notice, which alleges, the company failed to provide notice ahead of the closure of the company. The complaint also claims that it violated the state labor laws. The employees have also reported that they have received bad checks during their final pay, as there was no compensation for accumulated vacation.
However, those elements were not included in the lawsuit, but could be added later on in the case, according to Richard McCune, the attorney representing Benton and the other employees.
The coupon magazine has abruptly ceased its operations and then 678 employees were laid off on Friday, just at the end of the work day. The company suddenly closed after 50 years of classified ad magazine and coupon production.
The company was established in 1962, while its most recent headquarters is located in Brea. The company has been providing coupons, alongside the promotion of goods and services, personal ads, and job openings. Just in 2013, the OpenGate Capital purchased the company for 22.5 million dollars.
The companies claimed that their lender has cut off funding suddenly, forcing them to shut down immediately on Friday afternoon. However, McCune said that claim remains to be seen whether untrue or otherwise. The plaintiff’s attorney also admitted they were being skeptical about the same claim from the company, saying that it is clear to them that the company has set up this loan, which was pulled out from under them during the last minute. OpenGate declined to give any comment on the ongoing litigation.
The lawsuit that was filed on Tuesday argued that the coupon magazine failed to give their workers with a 60-day notice, which is mandatory under federal and state labor laws. The suit also points out that employees deserved back pay and other benefits; hence, it is seeking over $25,000 in damages.
Other law companies are searching employees to file suits of their own. According to attorney Marcus J. Bradley of a certain law firm, he said over 100 employees have sought help from his office, complaining about not receiving their final wages, including accumulated vacation pay. Bradley said he might file a suit in the state superior court as soon as possible.
Attorney Rene S. Roupinian from another law firm said her company has been contacted by previous employees, although it has not been decided upon if the firm will file a suit.