As featured in Los Angeles Daliy Journal on October 7, 2013
Several firms around the country appear to be making it their practice to file class action WARN Act claims in any sizeable bankruptcy case, including in Chapter 7 cases, in the hopes of obtaining either a quick settlement or a massive administrative claim against the estate. Such claims appear to be filed after little or no analysis of whether WARN Act liability even exists, and require only that counsel find a few former employees as clients and then request class certification naming every other terminated employee — a very low barrier to entry. Creditors’ committees and trustees should be aware that numerous defenses exist to WARN Act liability that may succeed in disallowing a claim outright.