Memphis Business Journal, December 11, 2012 – $25 million class action complaint filed against City Gear

Posted December 11th, 2012.

by Cole Epley

A class action complaint filed against Memphis-based clothing retailer City Gear LLC seeks more than $25 million in damages in response to allegations of unpaid overtime compensation and purported violations of the Fair Labor Standards Act, but company officials report they’ve yet to be officially served with process papers.

Filed in U.S. District Court in the Middle District of Tennessee on Dec. 11, the complaint alleges “that Defendants have violated the wage-and-hour provisions of the FLSA by depriving Plaintiffs, as well as others similarly situated to Plaintiffs, of their lawful overtime wages.”

Andrew Melzer, an attorney in the New York office of Sanford Heisler LLP, is representing the plaintiffs in the case and called the alleged violations “very cut-and-dried.”

“It’s really a fairly simple violation,” Melzer said. “They are trying to get away with paying people hourly wages but not paying them overtime.”

The complaint contends City Gear store managers and assistant managers are converted to hourly employees if they fail to log 45 hours during the work week, hours for which they are allegedly denied overtime pay.

Defendants listed in the complaint are City Gear LLC, a.k.a. Shelmar Retail Partners LLC, Shelmar Retail Partners Inc., Shelmar Inc., Marty’s LLC, Marty’s Inc., Holliday’s Fashions and Holliday’s General Service Corp.

Mike Longo, CEO of City Gear, declined to respond in-depth to the allegations and noted he became aware of the complaint only after being contacted by MBJ. He did, however, point out factual inaccuracies in the complaint.

“Holliday’s and City Gear have nothing to do with each other. They are not the same company or entity. That in and of itself says that there are flaws within whatever they’re purporting,” he said.

City Gear, which had revenue of $64.5 million in 2011, employs 175 people in Memphis and 500 nationally, according to MBJ research. The plaintiffs in the complaint each worked in local stores, according to legal representation.

This article was originally published in the Memphis Business Journal.

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