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$5M Strip Club Settlement Causes New FLSA Class Action

This is a settlement for the California Employment lawsuit.

San Francisco, CA: A $5 million settlement deal has been finalized, amid strenuous objections by the exotic dancers who filed an employment class action pending against a group of stripclubs in San Francisco.

The settlement approval brings an end to the putative class action filed by dancers in August 2014 against SFBSC Management LLC, which manages strip clubs in the San Francisco Bay Area. At the heart of the complaint were claims of Fair Labor Standards Act violations and misclassification of dancers as independent contractors.

Under the deal’s terms, the nightclubs agreed to change their business practices so that dancers can choose to be either employees or independent professional entertainers, who are entitled to an hourly rate of $15 plus 20 percent commissions for sales of private dances that cost more than $150. Additionally, the settlement contains provisions allowing dancers to choose their clothing, prohibiting tip-sharing and requiring training videos, among other things.

In March, the parties filed a motion for preliminary approval of the settlement, and the dancers amended the complaint to include the nightclubs named as defendants in the two more recent lawsuits.

Objector Poohrawn Mehraban, a student at UC Berkeley who has worked as an exotic dancer for four years, claims the deal is disappointing not least of all because it sets aside up to $2 million in cash payments for the hours worked by 4,681 dancers, $1 million for an alternate “dance fee payment” compensation program that pays a per-performance cost and up to $1 million for the plaintiffs’ attorneys.

Mehraban asked a California federal judge at a hearing last week not to grant final approval to the $5 million settlement. She called the deal “a pittance given what we’re entitled to," hours before it was approved. The dancers who opt in agree to release any wage and hour claims brought under the Fair Labor Standards Act.

According to an attorney for the dancers, 82 percent of the plaintiffs have not opted into the settlement and haven’t waived their Fair Labor Standards Act claims. They will be pursuing a different class action as a result of the settlement approval.

The case is Roe et al. v. SFBSC Management LLC et al., case number 14-cv-03616, in the U.S. District Court for the Northern District of California.

The related cases are Hughes v. S.A.W. Entertainment Ltd., case number 3:16-cv-03371, and Pera et al. v. Saw Entertainment Ltd., case number 3:17-cv-00138, in the U.S. District Court for the Northern District of California.

Mehraban’s case is Mehraban v. Gold Club SF LLC, case number 3:17-cv-05288, in the U.S. District Court for the Northern District of California.

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Published on Sep-15-17


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