CHICAGO Morton’s Restaurant Group, the Chicago-based parent of the 78-unit Morton’s The Steakhouse chain, announced the settlement of several wage-and-hour claims dating back to 2003, including a class-action suit filed against the company in 2005.
Morton’s denied the allegations of the claims, but said it settled in order to spare the company further legal fees and management time devoted to the litigation.
Under the term’s of the settlement, Morton’s will pay an undisclosed amount of cash to the plaintiffs over a four-year period as well as issue preferred stock, which will have an aggregate liquidation preference of $6 million, following the court’s approval.
The company said it would book charges in its second quarter ended July 5 of $13.4 million before tax and $8.5 million after tax, which equals approximately 53 cents per diluted share, to resolve the suits. Morton’s will report its second-quarter results early next month.
“We believe resolving the wage-and-hour litigation that has been ongoing for several years is in the best interest of our company, our shareholders and our employees,” said Scott Levin, Morton’s senior vice president and general counsel. “Eliminating the distraction and expense of this litigation will allow our management team and employees to focus on what we do best: offering our guests warm, genuine hospitality and ‘the best steak anywhere.’”
Morton’s share price fell 5.8 percent in morning trading from $3.45 to $3.25 before finishing the day at $3.30.
Contact Mark Brandau at [email protected]