A federal bankruptcy court has approved a settlement in two class action lawsuits that were filed against failed Fresno technology and real estate company Bitwise by former employees.
Approval comes after the company reached the settlement agreement in July.
The backstory: Several employees filed a class action lawsuit against Bitwise shortly after the company collapsed around Memorial Day last year.
- Former co-CEOs Jake Soberal and Irma Olguin Jr. and board members Mitchell Kapor, Paula Pretlow, Ollen Douglass and Joseph Proietti were also named in the lawsuit.
- The class action lawsuit alleged that Bitwise violated the California Worker Adjustment and Retraining Notification (WARN) Act, conducted unfair business practices and failed to compensate employees for all hours worked.
- One of the class action lawsuits was led by the company’s Director of Operations in Buffalo, New York, while the other one was led by Bitwise’s California employees.
The big picture: The settlement agreement, which was approved on Wednesday, totals a $20 million payout to employees.
- All former employees that are part of the settlement will receive a maximum of $15,150 each, which is the maximum recovery payout allowed under Section 507(a)(4) of the Bankruptcy Code.
Zoom in: Five parties are paying into the $20 million settlement, including $11.5 million from insurance policies.
- That breaks down to $2 million from The Hanover Group, $4.5 million from Scottsdale Insurance and $5 million from Great American Insurance.
- Kapor Capital Management will pay $5 million, with another $3.425 coming from Kapor or Kapor-related entities.
- The remaining $75,000 will come from Motley Fool Ventures.
