Wawa to pay $25 million to settle employee stock suit
The class-action lawsuit claimed the convenience store chain forced ex-workers to sell their Wawa stock back to the company at an unfair price. Wawa admitted no wrongdoing; the settlement awaits approval by a federal judge.
Lawyers for thousands of former Wawa employees are asking a federal judge to approve a $25 million settlement in a class-action lawsuit that claimed the convenience store chain forced ex-workers to sell their Wawa stock back to the company at an unfair price.
Though Wawa is privately held, workers can participate in an employee stock ownership plan (ESOP) to save for retirement. The ESOP's stock holdings are valued at more than $1 billion, according to the suit, roughly 40 percent of the company.
Greg Pfeifer was hired as a clerk in 1992 and rose through the ranks to work in the corporate center in Wawa, Delaware County, until he left the company in 2009.
Pfeifer, of West Chester, filed the federal class-action suit in 2015, claiming Wawa forced him to liquidate his stock that year at $6,940 a share, several hundred dollars less than the fair-market price.
Pfeifer argued in the suit that the company had promised employees they could hold the stock after leaving Wawa until they retired. He claimed that because Wawa forced him to sell, he lost out on investment gains as the company expanded along the East Coast.
About 2,300 former employees — who were vested in the program and had at least $5,000 in the ESOP — qualify as members of the suit. The portion of the $25 million each person receives will depend on the amount of stock that the person owned. Pfeifer's lawyers will be entitled to a maximum $5 million of the award, according to court documents.
Lawyers for both sides reached an initial agreement in late December 2017. Wawa admitted no wrongdoing and settled only to avoid future legal costs, according to court records.
A hearing has been scheduled for May 1 before U.S. District Judge Paul S. Diamond.
The lawyer for the former employees, R. Joseph Barton, declined to comment. A Wawa spokeswoman and lawyers for the company did not return calls requesting comment.