March 8, 2017
Bernstein Liebhard LLP continues to investigate whether the Board of Directors of Flowers Foods, Inc. (“Flowers Foods” or the “Company”) (NYSE: FLO) breached their fiduciary duties to the Company’s shareholders.
Bernstein Liebhard is investigating whether the Board breached their fiduciary duties by failing to ensure that the Company complied with U.S. Department of Labor regulations including the Fair Labor Standards Act (“FLSA”). Flowers Foods is currently defending 26 lawsuits that allege, among other things, that the Company wrongfully characterized distributors as independent contractors. Flowers Foods has already settled at least one related lawsuit for $9 million. With many other cases pending, the Company is subject to significant future liability as a result of the alleged wrongdoing.
The Department of Labor is also currently reviewing the Company’s compliance with the FLSA, which regulates when an employee can be characterized as an independent contractor. On August 10, 2016, The Wall Street Journal (“WSJ”) published an article concerning the compliance review. The WSJ article stated that the Company “faces lawsuits in various states brought by delivery drivers who allege the company violated the FLSA by misclassifying them as independent contractors, causing them to miss out on overtime pay, benefits and other compensation given to employees.” Additionally, the WSJ article quoted an analyst with Pivotal Research Group who stated that “[i]f the Labor Department ultimately finds Flowers in violation of the FLSA, the company’s potential liability could top $1 billion in back wages, penalties, fines, health care and so on.”
If you are interested in discussing your rights as a Flowers Foods shareholder, and/or have information relating to the matter, please contact Joseph R. Seidman, Jr. at (877) 779-1414 or firstname.lastname@example.org.
Bernstein Liebhard LLP has pursued hundreds of securities, consumer and shareholder rights cases and recovered over $3.5 billion for its clients. The Firm has been named to The National Law Journal’s “Plaintiffs’ Hot List” thirteen times.