Tobacco Health Insurance Surcharges & Employee Rights

Aug 26, 2026 | Investigations

Paying More for Health Insurance Because You Use Tobacco or Nicotine?

Employees across the country may be paying hundreds or even thousands of dollars more each year for employer-sponsored health insurance because they or a covered family member use tobacco or nicotine products.

These charges may appear on a paycheck or benefits statement as a tobacco surcharge, nicotine surcharge, wellness charge, tobacco-user rate, higher health insurance premium, or the loss of a non-tobacco discount. Depending on how an employer’s wellness program is structured and administered, these additional charges may warrant legal review.

Recent 7-Eleven Settlement Highlights Tobacco-Surcharge Issues

A recent proposed class action involving 7-Eleven highlights the potential significance of tobacco-related health insurance surcharges for employees. According to an August 25, 2026 Law360 article, former 7-Eleven employee Barbara A. Baker (“Baker”) filed a lawsuit challenging the company’s tobacco surcharge under the Employee Retirement Income Security Act (ERISA). The case was filed in Pennsylvania federal court in September 2024 and later transferred to federal court in Texas.

According to Law360, Baker alleged that 7-Eleven employees who used tobacco were charged $14 per paycheck, or $720 per year, to remain insured under the company’s health plan. She further alleged that employees who completed the company’s tobacco-cessation program after a specified point in the plan year were not reimbursed for surcharge amounts they had already paid.

According to Law360, in February 2026, U.S. District Judge Brantley Starr denied 7-Eleven’s motion to dismiss, concluding that Baker had alleged sufficient facts showing that the program may not comply with ERISA.

On August 24, 2026, the parties filed a Joint Status Report stating that, following an August 18 mediation, they had reached a settlement in principle to resolve the litigation. The filing states that the parties will draft a class action settlement agreement and that Baker intends to seek preliminary court approval no later than October 5, 2026.

The 7-Eleven case is one example of a broader issue that may affect employees who pay additional health insurance charges because they or a covered family member use tobacco or nicotine products.

Are You Paying a Tobacco or Nicotine Surcharge?

Your health-plan surcharge may warrant legal review if, for example:

  • You were charged more for health insurance because you or a covered family member uses tobacco or nicotine;
  • You were not clearly told how to avoid the surcharge;
  • You participated in or completed a tobacco-cessation or alternative program, but continued paying the surcharge;
  • You were required to actually stop using tobacco or nicotine to receive the lower premium; or
  • You completed an alternative program, but did not receive the full benefit or reimbursement.

Whether a particular surcharge is improper depends on the health plan’s documents, disclosures, alternative standards, and administration.

You May Be Able to Recover Tobacco-Surcharge Payments

Employees have filed class actions challenging employer tobacco and nicotine surcharges under federal employee-benefit law. Paying a surcharge does not automatically establish a claim, but employees who were charged additional amounts may have legal rights depending on how their employer’s program was designed, disclosed, and administered.

Learn more about Kehoe Law Firm’s investigation: Paying a Tobacco Surcharge for Health Insurance?

Employees: Questions About a Tobacco or Nicotine Surcharge?

Kehoe Law Firm, P.C. is investigating employer tobacco and nicotine-related health insurance surcharges. If you paid a tobacco or nicotine surcharge — or paid more because a family member covered by your workplace health plan used a covered product — Kehoe Law Firm is available to discuss your circumstances.

Contact Kehoe Law Firm, P.C.

For a free, no-obligation legal evaluation, contact:

Michael Yarnoff, Esq.
(215) 792-6676, Ext. 804
[email protected]
[email protected]

About Kehoe Law Firm, P.C.

Kehoe Law Firm, P.C. is a nationally-recognized, plaintiff-side class action law firm representing investors and consumers in matters involving securities fraud, corporate misconduct, mergers and acquisitions, antitrust violations, whistleblower claims, data breaches, consumer fraud, employment law violations, and retirement-plan mismanagement. Its attorneys have served as lead or co-lead counsel in major securities cases, recovering more than $10 billion for institutional and individual investors.

Kehoe Law Firm’s class action legal services are provided on a contingency-fee basis, meaning plaintiffs are not responsible for attorneys’ fees or litigation expenses. Any request for attorneys’ fees and expenses will be subject to court approval. 

 

 

 

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Block Stockholder Derivative Lawsuit

Aug 25, 2026 | Investigations

A verified stockholder derivative complaint filed August 21, 2026 alleges that certain current and former Block, Inc. (“Block” or the “Company”) (NYSE: XYZ) directors and officers failed to adequately oversee compliance risks involving Cash App and harmed the Company.

The action, Iron Workers Local Union No. 401 v. Dorsey, et al., Case No. 4:26-cv-08765, was filed in the U.S. District Court for the Northern District of California derivatively on behalf of Block against certain current and former directors and executive officers. Block is named as the nominal defendant.

What Claims and Relief Are Asserted?

The complaint asserts claims for breach of fiduciary duty and corporate waste, as well as alleged violations of Sections 14(a), 10(b), and 20(a) of the Securities Exchange Act of 1934.

On behalf of Block, the plaintiff seeks damages, restitution and disgorgement, and corporate-governance and internal-procedure reforms. The requested reforms include measures intended to prevent and remedy practices that violate federal and state consumer-protection and securities laws and additional audit, compliance, and internal-control procedures.

What Does the Complaint Allege?

The complaint alleges that, from at least 2019 through 2024, Block fiduciaries prioritized Cash App growth over compliance and either failed to adequately oversee compliance or caused Block to engage in allegedly unlawful conduct. Specifically, the complaint alleges that:

  • Cash App was designed to make signup and use easy, including through minimal identity-verification requirements, and Block fiduciaries allegedly chose to reduce user “friction” rather than implement compliance measures that could slow user acquisition.
  • Block became subject to regulatory actions, fines, civil litigation, and other consequences that the complaint attributes to alleged Cash App compliance failures.
  • Certain directors and officers allegedly made or allowed false or misleading statements concerning Block’s compliance practices, risk oversight, and Cash App user metrics.
  • Certain insiders allegedly sold more than $1.2 billion of Block stock while possessing material nonpublic information concerning the Company’s compliance regime and changing growth metrics.
  • The complaint alleges that false or misleading public statements caused Block to repurchase its own stock at inflated prices, further harming the Company.

Regulatory Actions Cited in the Complaint

The complaint cites several 2025 regulatory matters as part of its allegations concerning harm to Block, including:

  • A January 2025 Consumer Financial Protection Bureau order requiring Block to pay at least $75 million and up to $120 million in consumer redress, plus a $55 million civil penalty, and to implement specified changes to its practices;
  • A January 2025 multistate settlement with state money-transmission regulators requiring an $80 million penalty and compliance measures, including an independent review of Block’s anti-money-laundering program; and
  • An April 2025 New York State Department of Financial Services consent order imposing a $40 million civil monetary penalty and requiring an independent monitor to assess Block’s remediation and compliance program.

Review a copy of the Block Verified Stockholder Derivative Complaint.

What Is a Stockholder Derivative Action — and Why Does It Matter?

A stockholder derivative action is brought by a stockholder on behalf of the corporation to pursue claims that allegedly belong to the company. Unlike a securities class action seeking direct damages for investors, a derivative action can seek relief for the corporation itself, which can be significant to stockholders. In this case, the complaint seeks monetary recovery for Block as well as reforms to the Company’s governance, compliance, audit, and internal-control procedures designed to protect Block and its stockholders from a recurrence of the alleged misconduct.

Why Should Stockholders Come Forward?

Stockholders can play an important role in derivative litigation by seeking accountability for alleged misconduct and pursuing relief intended to benefit the company. A stockholder serving as a derivative plaintiff acts on behalf of the corporation rather than simply seeking an individual damages payment.

Here, the complaint asks the court to award damages to Block, require restitution and disgorgement from the individual defendants, and direct Block to improve its corporate governance and internal procedures, including additional audit, compliance, and internal-control measures. These forms of relief are intended to benefit the Company and its stockholders by seeking to restore corporate value and strengthen protections against future misconduct.

Block Stockholders: Questions About the Derivative Action?

If you are a current Block stockholder and have questions about the derivative action, your rights as a stockholder, or the role a stockholder may play in derivative litigation, Kehoe Law Firm, P.C. is available to discuss the case and evaluate your circumstances.

For a free, no-obligation legal evaluation, send us a message or contact:

Michael Yarnoff, Esq.
(215) 792-6676, Ext. 804
[email protected]
[email protected]

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    About Kehoe Law Firm, P.C.

    Kehoe Law Firm, P.C. is a nationally recognized, plaintiff-side class action law firm representing investors and consumers in matters involving securities fraud, corporate misconduct, mergers and acquisitions, antitrust violations, whistleblower claims, data breaches, consumer fraud, employment law violations, and retirement-plan mismanagement. Its attorneys have served as lead or co-lead counsel in major securities cases, recovering more than $10 billion for institutional and individual investors.

    There is no cost or obligation to speak with the firm, and there are no upfront fees or litigation costs. We handle class action matters on a contingency-fee basis. Any attorneys’ fees or expenses sought in connection with a recovery are subject to court approval.

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    Kehoe Law Firm, P.C.
    2001 Market Street
    Suite 2500
    Philadelphia, PA 19103

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    Tel: 215-792-6676

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    Manager Overtime Misclassification

    Aug 25, 2026 | KLF Blog

    Are You a Salaried “Manager” Working Overtime Without Overtime Pay?

    A proposed $7.5 million settlement involving Festival Foods department managers highlights an important wage-and-hour issue: a managerial title and a salary do not automatically make a worker exempt from overtime.

    Why Worker Misclassification Matters

    Under the Fair Labor Standards Act (“FLSA”), covered, nonexempt employees generally are entitled to overtime pay for hours worked over 40 in a workweek. The U.S. Department of Labor’s (“DOL”) Fact Sheet #23 on overtime pay explains the general overtime requirements. Certain executive, administrative, and professional employees may be exempt, but exemption depends on the employee’s compensation and actual job duties—not simply a job title or the fact that the employee receives a salary. The DOL’s Fact Sheet #17B on the executive exemption states that job titles do not determine exempt status.

    For the executive exemption, the DOL states that an employee’s primary duty generally must be management; the employee must customarily and regularly direct the work of at least two full-time employees or their equivalent; and the employee must have authority to hire or fire other employees, or the employee’s suggestions and recommendations regarding specified changes in employee status must be given particular weight, in addition to satisfying applicable salary requirements.

    Festival Foods Managers Seek Approval of $7.5 Million Settlement

    On August 24, 2026, Law360 reported that Festival Foods and a group of department managers asked a Wisconsin federal court to preliminarily approve a $7.5 million settlement of claims that salaried department managers were misclassified as exempt from overtime. The proposed settlement is expected to cover roughly 1,000 current and former employees.

    According to Law360, the workers alleged that Festival Foods uniformly classified salaried department managers as overtime-exempt, even though they spent most of their time performing manual labor and customer service and allegedly did not perform the duties necessary to qualify for the exemption. Festival Foods has denied the allegations and maintains that the managers were properly classified.

    The settlement is proposed and remains subject to court approval. Law360 reported that the parties estimated an average gross recovery of approximately $7,418 per person, with individual allocations reaching roughly $10,150.

    A “Manager” Title Does Not Decide Overtime Rights

    The allegations in the Festival Foods case illustrates a broader issue for workers in retail, restaurants, hospitality, warehouses, and other industries. An employee may be called a manager, assistant manager, department manager, or supervisor and still potentially be entitled to overtime if the employee does not satisfy the legal requirements for an exemption.

    Questions may arise when a salaried manager regularly works more than 40 hours per week, but spends substantial time performing the same customer-service, stocking, cleaning, production, or other non-management work as hourly employees, while having limited genuine management authority. Whether a particular employee is exempt is fact-specific, and performing some non-management work does not by itself make a manager nonexempt.

    Signs Your Overtime Classification May Be Worth Reviewing

    • You are paid a salary and routinely work more than 40 hours per week without overtime pay.
    • Your title includes “manager” or “supervisor,” but much of your work is manual, customer-facing, stocking, cleaning, production, or other non-management work.
    • You have little authority to hire or fire employees, or your recommendations about hiring, firing, promotion, or other changes in employee status are given little weight.
    • Your schedule, staffing, policies, and important decisions are largely controlled by higher-level managers or corporate rules.
    • You perform duties similar to hourly employees, but are classified differently for overtime purposes.

    These are indicators for further review—not a determination that a worker has been misclassified. Exemption status depends on the employee’s actual duties, compensation, and applicable federal and state law.

    What Records Should Workers Preserve?

    Workers concerned about possible overtime misclassification should consider preserving records they lawfully possess, including pay stubs, schedules, time records, job descriptions, emails or messages concerning duties, and records showing hours worked. Do not take confidential business information or materials you are not authorized to possess.

    Concerned About Overtime Misclassification?

    If you are a salaried manager or supervisor who regularly works more than 40 hours per week without overtime pay, Kehoe Law Firm, P.C. is available to evaluate whether your classification and job duties may raise wage-and-hour concerns.

    For a free, no-obligation legal evaluation, send us a message or contact:

    Michael Yarnoff, Esq., (215) 792-6676, Ext. 804
    [email protected]
    [email protected]

    About Kehoe Law Firm, P.C.

    Kehoe Law Firm, P.C. is a nationally recognized, plaintiff-side class action law firm representing investors and consumers in matters involving securities fraud, corporate misconduct, mergers and acquisitions, antitrust violations, whistleblower claims, data breaches, consumer fraud, employment law violations, and retirement-plan mismanagement. Its attorneys have served as lead or co-lead counsel in major securities cases, recovering more than $10 billion for institutional and individual investors.

    Kehoe Law Firm’s class action legal services are provided on a contingency-fee basis, meaning clients are not responsible for attorneys’ fees or litigation expenses. Any request for attorneys’ fees and expenses may be subject to court approval.

     

     

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    Hermès, Swatch & Nikon Customers: Tariff-Related Price Increases

    Aug 24, 2026 | Investigations

    Did you purchase Hermès, Swatch, or Nikon products in the United States after tariff-related price increases?

    Kehoe Law Firm, P.C. is investigating whether retail customers may have claims involving tariff-related costs reflected in the prices they paid and any corresponding tariff refunds or recoveries available to importers.

    The Issue for Retail Customers

    During 2025, tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”) increased costs on imported goods. Some companies publicly linked U.S. price increases to tariffs. In February 2026, the U.S. Supreme Court held that IEEPA did not authorize the President to impose tariffs, and subsequent proceedings established a process through which importers may seek refunds of qualifying IEEPA duties.

    The potential consumer issue is straightforward: If tariff costs were passed on to retail customers through higher prices, while the importer is later able to recover those tariff payments from the federal government, customers may have legal claims to restitution or other relief for tariff-related amounts they allegedly bore.

    Whether a customer has a claim will depend on the facts, including the product purchased, purchase date, pricing, the nature of any tariff-related increase, and applicable law.

    Hermès Customers

    Hermès publicly stated in April 2025 that it planned U.S.-specific price increases beginning May 1, 2025 to fully offset the impact of tariffs. Customers who purchased Hermès products in the United States after those tariff-related price increases may be affected by the tariff-refund issue described above.

    Swatch Customers

    Swatch publicly indicated that U.S. prices would increase in response to tariffs on Swiss imports. Customers who purchased Swatch products in the United States after tariff-related price increases may be affected by the same potential consumer issue.

    Nikon Customers

    Nikon USA announced that, due to tariffs, it would adjust U.S. pricing effective June 23, 2025. Customers who purchased Nikon cameras, lenses, or other products after tariff-related price adjustments may be affected by the same potential consumer issue.

    What Customers Should Know

    The availability of government tariff refunds to an importer does not by itself establish that a retail customer is legally entitled to a refund.

    Potential claims would depend on the circumstances and applicable law. Kehoe Law Firm is evaluating whether consumers who paid tariff-related price increases may have claims if the underlying tariff costs are later refunded or otherwise recovered by the relevant importer.

    What Records Should Consumers Save?

    If you purchased Hermès, Swatch, or Nikon products after tariff-related price increases, consider preserving records showing what you purchased and what you paid, including:

    • Receipts, invoices, order confirmations, and online order histories;
    • Credit-card or bank statements showing the purchase;
    • Checkout screens, invoices, emails, or notices referencing tariffs, duties, import charges, or tariff-related price increases; and
    • The product name or model, purchase date, seller, and amount paid.

    Hermès, Swatch & Nikon Customers: Contact Kehoe Law Firm, P.C.

    If you purchased Hermès, Swatch, or Nikon products after tariff-related price increases, contact Kehoe Law Firm to discuss your purchase and learn more about the investigation.

    For a free, no-obligation legal evaluation, contact:

    Michael Yarnoff, Esq.
    (215) 792-6676, Ext. 804
    [email protected]
    [email protected]

    About Kehoe Law Firm, P.C.

    Kehoe Law Firm, P.C. is a nationally recognized, plaintiff-side class action law firm representing investors and consumers in matters involving securities fraud, corporate misconduct, mergers and acquisitions, antitrust violations, whistleblower claims, data breaches, consumer fraud, employment law violations, and retirement-plan mismanagement. Its attorneys have served as lead or co-lead counsel in major securities cases, recovering more than $10 billion for institutional and individual investors.

    All representation is provided on a contingency-fee basis, and plaintiffs are not responsible for attorneys’ fees, court costs, or litigation expenses. Any request for attorneys’ fees and expenses will be subject to court approval. 

     

     

     

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    Contact Us

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    Kehoe Law Firm, P.C.
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    Suite 2500
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    Tel: 215-792-6676

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    No-Poach Agreements and Workers’ Rights

    Aug 24, 2026 | KLF Blog

    Could a No-Poach Agreement Be Limiting Your Job Opportunities?

    Workers benefit when employers compete to hire them. Agreements between businesses not to recruit, solicit, or hire one another’s workers can restrict job opportunities, reduce bargaining leverage, and potentially suppress wages, benefits, or working conditions.

    Workers may not know that a no-poach agreement or hiring restriction exists. A restriction can appear in a franchise agreement, vendor or service contract, or an informal understanding between businesses. A worker may discover it only after being told that another location or company cannot hire them.

    What No-Poach Agreements Can Mean for Workers

    The January 2025 DOJ/FTC Antitrust Guidelines for Business Activities Affecting Workers explain how the agencies assess business practices affecting workers under the antitrust laws. The guidelines state that antitrust law protects competition for labor and that competition among employers can benefit workers through better wages, benefits, and other terms and conditions of work. The agencies also state that conduct harming competition for workers can lead to fewer job opportunities, lower wages, and worse job quality.

    For no-poach conduct specifically, the guidelines state that businesses competing for workers may violate antitrust law if they agree not to recruit, solicit, or hire workers. The U.S. Department of Justice (“DOJ”) may bring felony criminal charges where appropriate, and the guidelines also note that such agreements may be subject to civil liability even when criminal charges are not pursued. The DOJ and FTC further state that such agreements can violate the antitrust laws whether they are informal or formal, written or unwritten, or spoken or unspoken.

    The guidelines use “no-poach” to describe agreements between businesses not to hire, solicit, or otherwise compete for current, former, or potential workers. Their examples include an agreement requiring one company to obtain another company’s permission before trying to hire an employee. The agencies also state that an agreement not to “cold call” another company’s workers is a no-solicit agreement even if workers remain free to apply on their own.

    The guidelines do not say that every hiring restriction is automatically unlawful. They explain that a restraint may require a fuller analysis when it is subordinate and collateral to a broader business collaboration, such as a joint venture, and is reasonably necessary to achieve that collaboration’s procompetitive potential. The legality of a particular restraint therefore depends on its facts and context.

    For workers, the practical concern is reduced competition for their labor. A hiring restraint can limit opportunities to move between employers or locations and can affect the competition that ordinarily influences wages, benefits, and other terms of work.

    The agencies also explain that businesses may compete for the same workers even when they sell different products or services. For antitrust analysis, the relevant question can be whether the businesses compete to hire or retain workers in the same labor market.

    Warning Signs of a Possible No-Poach or No-Hire Restriction

    • A manager says another location or business is not allowed to hire you.
    • A transfer or job application is rejected because the businesses have an agreement, policy, or understanding about employees.
    • A prospective employer must obtain your current employer’s permission or pay a penalty before hiring you.
    • Recruiters are told not to contact employees of certain companies or franchise locations.
    • Workers hear similar explanations from separate businesses that otherwise compete for labor.

    Franchise Workers Can Be Affected

    The guidelines address franchise systems directly. They state that no-poach clauses in franchise agreements are subject to antitrust scrutiny and note that franchisors often compete with franchisees for workers. The guidelines further state that a franchisor may violate antitrust law by organizing or enforcing a no-poach agreement among franchisees that compete for workers, and that written or unwritten agreements among franchisees not to poach, hire, or solicit one another’s workers may violate federal or state law.

    State law may provide additional protection. For example, Washington law prohibits a franchisor from restricting a franchisee from soliciting or hiring an employee of the franchisor or another franchisee of the same franchisor. State requirements vary.

    Recent Enforcement and a Worker Case Example

    Federal enforcement is not limited to franchise restaurants. In February 2026, the FTC finalized a consent order requiring building-services contractor Adamas and affiliated businesses to stop enforcing no-hire agreements that the FTC alleged restricted customers from hiring Adamas workers without a significant penalty.

    In In re Papa John’s Employee and Franchisee Employee Antitrust Litigation, workers challenged franchise-agreement provisions that allegedly restricted hiring among Papa John’s locations.

    Law360 reported on August 17, 2026, that a Kentucky federal court had granted final approval to a $5 million settlement. According to Law360, the settlement class covers workers employed at Papa John’s-branded restaurants in the United States from December 18, 2014 through December 31, 2021 who received more than $200 in compensation during that period.

    The article also reported that Papa John’s agreed to prohibit the use of no-poach provisions in its franchise agreements for five years and that company executives would receive antitrust compliance training. The court observed that the settlement also provides “meaningful forward-looking protection.” The settlement is not a finding that Papa John’s violated the law; Papa John’s has denied the claims and has not admitted wrongdoing or liability.

    What Workers Should Preserve

    If you suspect a hiring restriction, preserve records lawfully. Useful materials may include job postings, applications, offers, rejection messages, transfer requests, emails or texts discussing hiring limits, pay records, and the names of managers or recruiters with relevant knowledge. Do not take trade secrets, customer information, or materials you are not authorized to possess.

    Contact Kehoe Law Firm, P.C.

    Kehoe Law Firm, P.C. is available to evaluate potential claims involving no-poach, no-hire, wage-fixing, worker-mobility, and related antitrust practices. A confidential consultation can help a worker understand which laws may apply and whether filing deadlines may affect potential claims.

    For a free, no-obligation legal evaluation, contact:

    Michael Yarnoff, Esq.
    (215) 792-6676, Ext. 804
    [email protected]
    [email protected]

    About Kehoe Law Firm, P.C.

    Kehoe Law Firm, P.C. is a nationally recognized, plaintiff-side class action law firm representing investors, consumers, and workers in matters involving securities fraud, corporate misconduct, mergers and acquisitions, antitrust violations, whistleblower claims, data breaches, consumer fraud, employment law violations, and retirement-plan mismanagement. Its attorneys have served as lead or co-lead counsel in major securities cases, recovering more than $10 billion for institutional and individual investors.

    All representation is provided on a contingency-fee basis, and plaintiffs are not responsible for attorneys’ fees, court costs, or litigation expenses. Any request for attorneys’ fees and expenses will be subject to court approval. 

     

     

     

    SEND US A MESSAGE

    Contact Us

    ADDRESS

    Kehoe Law Firm, P.C.
    2001 Market Street
    Suite 2500
    Philadelphia, PA 19103

    PHONE

    Tel: 215-792-6676

    EMAIL

    [email protected]