A federal judge sent shock waves through Hollywood and corporate America when the court sided with two former interns in a labor lawsuit against Fox Searchlight this week.
Alex Footman and Eric Glatt worked on the hit film "The Black Swan" - Glatt also worked on post-production for the film - under the Fox Searchlight umbrella and sued the entertainment company in 2011 claiming its policies violated overtime laws and other labor regulations, according to The Hollywood Reporter.
The lawsuit took on additional plaintiffs, Kanene Gratts, who worked on "500 Days of Summer", and Eden Antalik, who was an FEG intern.
In Fox's defense strategy, they attempted to convince the court and Judge William Pauley that the fault fell on the production companies - like Lake of Tiers - instead of Fox Searchlight because they were the ones responsible for hiring the teams who worked on the films.
"Considering the totality of the circumstances, Glatt and Footman were classified improperly as unpaid interns and are 'employees' covered by the FLSA and NYLL," ruled Judge Pauley. "They worked as paid employees work, providing immediate advantage to their employer and performed low-level tasks not requiring specialized training."
Under the U.S. Department of Labor's Fair Labor Standards Act unpaid internships may fall under a training program if the experience is for the benefit of the intern, and not the direct, immediate and profitable benefit of the company, and the internship experience is similar to that he or she would receive in a school.
"The benefits [Glatt and Footman] may have received... are the result of simply having worked as any other employee works, not of internships designed to be uniquely educational to the interns and of little utility to the employer," the ruling read. "They received nothing approximating the education they would receive in an academic setting or vocational school."
Glatts and Antalik will move forward with a class action lawsuit, as Judge Pauley certified that method as a "more efficient mechanism."
A federal judge in New York will spearhead a review of other internships at Fox Entertainment Group.
Fox told The Hollywood Reporter they "are very disappointed with the court's rulings" and will seek a reversal by the 2nd Circuit.
