March 12--Media giant Viacom has agreed to settle a lawsuit brought by former interns who demanded to be paid for their time at Viacom's television networks, including MTV and BET.
The 2013 lawsuit alleged that Viacom's unpaid internship program was a violation of state and federal wage laws.
Viacom agreed this week to pay as much as $7.2 million to settle the case, according to court documents. The amount paid will depend on how many of the former interns seek compensation for their stints at Viacom.
The lawsuit was one of several that shined a harsh spotlight on an entertainment industry practice in which unpaid internships were used as a cost-saver for television networks, movie studios and production companies -- with the prospect of a foot in the door for people aspiring to work in Hollywood.
Labor law requires that unpaid internships primarily benefits the interns -- not the employers.
This particular case was filed in August 2013 on behalf of Casey Ojeda, a New York Web developer who worked at Viacom for about five months in 2011, and Karina Reynaga, a California woman who served as an intern in Viacom's human resources department in 2012.
The suit claimed that the company illegally determined that the interns' duties were exempt from minimum-wage requirements. More than 1,000 former interns were included in the group covered by the proposed settlement.
Viacom, controlled by billionaire Sumner Redstone, began paying its interns in 2013.
Under the proposed settlement, interns who worked for Viacom's TV networks in New York between Aug. 13, 2007, and June 1, 2013, could be eligible for compensation. People who worked as interns in Los Angeles from Sept. 11, 2010, to June 1, 2013, might also qualify.
"We are pleased to conclude this litigation," Viacom said in a statement Thursday.
The wave of internship lawsuits began in 2011, when former unpaid interns on the movie "Black Swan" filed a claim against Fox Searchlight Pictures, alleging that Fox had violated the Fair Labor Standards Act.
Last fall, NBCUniversal settled a similar suit for $6.4 million.
Viacom, on Thursday, defended its intern program.
"Viacom's popular internship program has helped thousands of students launch careers in the entertainment business and beyond," the company said. "We are proud of our efforts -- not only do we fully comply with all applicable educational requirements, but Viacom's interns also take part in a unique, in-house educational program designed to broaden their experience and help them learn from senior executives across the company."
An attorney representing the former interns was not immediately available.
