Lionsgate's $1.3M Settlement With Ex-Interns Gets Preliminary Approval

The Hollywood Sign - H 2015
Courtesy of RexUSA

On Tuesday, U.S. district judge Alison Nathan granted preliminary approval of a $1.3 million settlement in a class action lawsuit brought by former interns at Lionsgate.

The lawsuit came on behalf of Anthony Tart, a former intern on The Wendy Williams Show, and others similarly situated. The settlement is not only important because it involved Lionsgate, which the Los Angeles Times once characterized as a "high-profile holdout" on the labor front by continuing its internship program in the face of a flood of lawsuits. The deal is also meaningful because it gave a federal judge a chance to evaluate class certification in the wake of the decision by the 2nd Circuit Court of Appeals this past July to vacate a summary judgment ruling in favor of interns who worked on Fox Searchlight's Black Swan.

In that case brought by Eric Glatt and others, the 2nd Circuit decided the true test of whether internships must be paid comes down to whether the intern or the employer is the "primary beneficiary" of the relationship. By directing judges to look at such factors as whether an intern was getting educational credit for work performed, the 2nd Circuit was pointing towards a "highly individualized inquiry" that could potentially interfere with the certification of any class.

"Importantly, however, the Second Circuit left open the possibility that a case alleging more common internship policies could satisfy the predominance inquiry," writes Nathan in her latest opinion. "Furthermore, Glatt involved class certification for trial, while the instant matter involves class certification for settlement purposes only."

Having decided there's a difference, she rules that the individual issues don't bar certification.

In weighing commonality specifically, the judge notes plaintiffs' allegation of "three common corporate policies" by Lionsgate — that there was a policy of not providing academic or vocational training to interns, a uniform policy governing the logistics (human resources paperwork, scheduling, notice of no pay, etc.) of their internships, and a policy of not paying minimum wage to any interns.

These are only allegations, and Lionsgate isn't admitting liability through its settlement. But the studio is on board with the certification of a class because it will preclude others from suing without an opt-out to the deal. 

The settlement will be brought for final approval after a "Fairness Hearing" happens. As of now, the settlement doesn't look to be contested.

Here's Nathan's full opinion.