21st Century Fox Inc. has settled class-action litigation by former interns, who sued, alleging that the film company violated the Fair Labor Standards Act and New York labor law by misclassifying them as unpaid interns and not entry-level employees. The case, which was filed in a New York federal court in 2011 by former unpaid interns, Eric Glatt and Alexander Footman, who worked on Fox Searchlight's production of "Black Swan" in New York City, sparked multimillion-dollar settlements with interns at other big media companies.
According to papers filed on Tuesday in Manhattan federal court, Fox Searchlight Pictures and Fox Entertainment Group will pay $495 to each claimant who interned without pay for at least two weeks at various times between 2005 and 2010. Several dozen people are eligible for payments under the settlement, which requires approval by U.S. District Judge William Pauley in Manhattan.
The accord marks a quiet end to a lawsuit that forced companies – including an array of fashion industry firms, such as Vogue, which abruptly put an end to its internship program in October 2013 before settling a lawsuit that was filed against its parent company – to rethink how they use interns, and whether failing to pay students and recent college graduates looking for practical experience violated minimum wage laws.
Judge Pauley sparked much of the debate when he ruled in June 2013 that Fox Searchlight should have paid Glatt and Footman, who interned on the 2010 movie "Black Swan," because the company was the primary beneficiary of their work. But a federal appeals court reversed that ruling last July, saying no payment was needed if the work was designed mainly to advance interns' knowledge in a given field. It returned the case to Pauley to examine that issue, but only after companies including Comcast Corp's NBCUniversal, Conde Nast and Viacom Inc had already reached settlements of similar suits topping $5 million.
Under Tuesday's settlement, Glatt and Footman would be paid a respective $7,500 and $6,000. Their law firm Outten & Golden, which obtained some of the larger settlements, plans to seek up to $200,000 for legal fees and costs, court papers show.
Fox spokesman Chris Petrikin said in a statement: "Having decisively prevailed in our appeal, Fox wishes to put this matter completely behind us. We will refocus on a return to our proud history of offering dynamic, educational internships." A lawyer for the plaintiffs did not immediately respond to requests for comment.
The case is Glatt et al v. Fox Searchlight Pictures Inc et al, U.S. District Court, Southern District of New York, No. 11-06784.