Tracey A. Kennedy

As a nine-year suit against Taco Bell Corp. came to an end this spring, one of the plaintiffs' experts calculated that the fast food chain could be liable for as much as $25 million in damages and $122 million in so-called Personal Attorney General Act fees.

But the actual verdict was a fraction of that size: $495,000 in damages and zero fees through the PAGA, which allows citizens who uncover labor violations to claim fees that would normally be available only to the state.

Kennedy, the lead counsel representing Taco Bell, singled out the PAGA fee decision in particular as a "total victory" for her client.

Kennedy, who was named last year as one of the nation's "most powerful employment attorneys," has worked on employment disputes for more than 20 years, after deciding they were "way more fun" than most other areas of corporate law.

"Employment law involves real-world issues that affect people's everyday lives instead of being about companies fighting over finance agreements or how contracts are worded," she said.

Kennedy's most recent cases include successfully defending a Whole Foods Market store against a lesbian worker's charges of gender-preference discrimination with presenting 27 witnesses who disputed the worker's claims and prevailing in a three-sided arbitration case involving an alleged sexual assault at a Pacific Dental Services company party. The arbitrator found that the victim's testimony was unreliable - she admitted to having more than 10 drinks at the event - and also upheld the company's decision to fire the alleged perpetrator for his actions.

In the past couple years, the vast majority of Kennedy's time has been consumed by the Taco Bell case, which accused the company of failing to provide legally required rest times or appropriate end-of-day meal times and failing to pay premiums when meal periods were cut short.

Kennedy said her most complicated task as lead counsel was developing a comprehensive trial strategy, since the lawsuit "involved a very complicated pattern of actions involving 29,852 people covering a period of nine years."

In a case that relied heavily on the plaintiffs' interpretation of raw time-punch data, she introduced expert testimony demonstrating that the punch data was too variable and unreliable to provide evidence that any violations occurred, as well as witnesses who testified that the punch data often needed to be manually corrected because the system went down or workers forgot to use it.

After a four-week trial ending in March, the jury rejected the two largest claims, regarding the late meals and rest periods, and instead focused only on the premiums for shortened mealtimes.

Despite the jury decision, the plaintiffs sought PAGA fees on all three issues.

But in April, U.S. Magistrate Judge Stanley A. Boone decided the plaintiffs were not owed a thing under PAGA — not even on their successful mealtime premium claim — because they continued to base their estimations on raw punch data, leaving little evidence they had uncovered the type of "manifest injustice" that PAGA fees are intended to address.

Kennedy has filed an appeal against the jury's decision on the premiums. But she added that even though she vigorously defends against worker lawsuits, she strongly encourages her clients to make any necessary changes to comply with employment law.

"If there are problems with a company's policies or procedures, they have to be fixed," she said. "And if that includes making back payments to the employees, it has to be done."

— Dean Calbreath