BURLINGTON — A federal judge certified as a class action an employee lawsuit against the corporation that purchased the majority of the assets of Koffee Kup Bakery and then abruptly shuttered it and its affiliates in April 2021.
“Plaintiffs Matthew Chaney, Nadine Miller, and Arthur Gustafson bring this action on behalf of themselves and a putative class alleging violations of the Worker Adjustment and Retraining Notification Act of 1988,” wrote Judge William K. Sessions in a decision issued Aug. 17. “The WARN Act requires that before executing a plant closing or mass layoff, a covered employer [with more than 100 employees] must provide 60 days’ written notice to employees. Plaintiffs allege that Defendants failed to provide the required notice.”
On April 26, 2021, Vermont Bread Company in Brattleboro, Superior Bakery in North Grosvenordale, Conn., and Koffee Kup Bakery in Burlington ceased operations. As a result, over 400 people lost their jobs, half of whom were employed in Vermont.
“It is undisputed that at the time of the alleged WARN Act violations, those entities were wholly-owned subsidiaries of Kup Co.,” Sessions wrote. “Plaintiffs claim that in the weeks prior to April 1, 2021, in anticipation of purchasing 80 percent of the [three companies] American Industrial Acquisition Corp. formed Koffee Kup Bakery Investment Company, LLC and Koffee Kup Bakery Holding Acquisition Company to hold its stock interests.”
The defendants argued that there was no single employer for all three companies and that they were not involved in the decision to close the bakeries, and therefore the suit should be brought by individual employees.
The judge noted to be classified as a class action, a civil suit must meet four requirements — there are too many employees to be named, the laws and facts of the case are common to all members, the claims are also common to all members and the plaintiffs are represented “fairly and adequately” by counsel.
Reviewing all the facts before him, sessions ruled that the lawsuit satisfied the four-factor test.
“Whether Plaintiffs were employed by a single employer or by separate entities will be determined after discovery …” Sessions wrote. “For present purposes, the single employer question is a commonality that favors class certification. … While Defendants urge the Court to delay class certification, such a delay could give rise to due process concerns. Assuming a class is ultimately certified, members of the class are entitled to notice in the early stages of the proceeding.”
Sessions also acknowledged the contention from the dissolution receiver, Linda Joy Sullivan of Dorset, that a joint damages award “will complicate her task of determining the various corporate liabilities …”
“It appears from the parties’ briefing, however, that AIAC is the entity most likely to satisfy a judgment, thus alleviating concerns about conflicts of interest among workers from the three different bakery sites,” noted Sessions.