LOUISVILLE, Ky. - The largest private prison company in America paid $260,000 to a group of shift supervisors in Kentucky to settle claims that they were denied overtime, according to an agreement unsealed Wednesday.
Corrections Corporation of America, based in Nashville, Tennessee, paid the money in November to end a lawsuit brought by 25 employees of the now-shuttered Marion Adjustment Center in St. Mary's, Kentucky. The former employees took $129,000 of the settlement. Plaintiff's attorneys received $131,000.
The group claimed in a 2012 lawsuit that CCA denied them overtime after forcing them to work extra hours. CCA has denied the allegations.
Of the 25 people receiving payouts from the settlement, two got $10,300 checks, one got $10,800 and the rest amounts ranging from $1,200 to $9,100. As part of the settlement, CCA denied any wrongdoing.
The attorneys involved billed their clients amounts ranging from $100 up to $3,600 for a variety of meetings, phone calls, court filings and emails during the 18 months the litigation made its way through the federal court system.
The settlement was originally sealed, but the nonprofit Prison Legal News, a publication that primarily reports on criminal justice issues and prison and jail-related civil litigation, mainly in the United States, sought to have it unsealed. Prison Legal News Editor Paul Wright said CCA operates largely on public funds obtained through government contracts, making the settlement a legitimate concern of the public.
CCA called the settlement a private resolution and said there was no legal reason to unseal the records.
U.S. District Judge John G. Heyburn in Louisville granted the publication's request, saying court records are presumed open to the public.
"Moreover, defendant has not convinced the court precisely why confidentiality was so material," Heyburn wrote in a six-page decision.
CCA reached a larger deal with employees in 2009, ending claims of unpaid overtime over a four-year period. CCA agreed to payments worth up to $7 million in back pay and attorney fees for more than 30,000 guards and other employees.
The agreement in federal court in Kansas was immediately sealed. But U.S. District Judge John Lungstrum opened the records later that year at the behest of Prison Legal News.
Kentucky stepped out of the private prison business after three decades when it declined to renew a contract with Corrections Corporation of America for an 826-bed facility in the central part of the state.
The decision required almost 800 state inmates at the Marion Adjustment Center in St. Mary in Marion County to be transferred to other state prisons, county jails or halfway houses.
Kentucky officials estimated the state saved $1.5 million to $2.5 million per year by not renewing the contract.
The move was among a series of similar decisions since 2008. At that point, Kentucky had inmates in three prisons run by CCA. The state in 2010 pulled out of Lee Adjustment Center in Beattyville, an 800-bed facility that houses inmates from Vermont, and in 2012 from Otter Creek Correctional Center, a 600-bed facility in Wheelwright in far eastern Kentucky that's currently vacant.
Kentucky currently has 12 adult prisons spread out across the state.