COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 28, 2014

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

(5) COMMITMENTS AND CONTINGENCIES

Lease Commitments

As of December 28, 2014, the future minimum rental commitments for all non-cancelable leases are as follows (in thousands):

	Operating Leases		Capital Leases			Total
2015	$	38,621	$	675		$	39,296
2016		36,294		736			37,030
2017		32,365		736			33,101
2018		28,721		491			29,212
2019		22,289		—			22,289
Thereafter		45,706		—			45,706
Total future minimum rental commitments	$	203,996		2,638		$	206,634
Less – amounts representing interest				(371	)
Total principal payable on capital leases			$	2,267

Legal Proceedings and Related Matters

The Company is a party to lawsuits, revenue agent reviews by taxing authorities and legal proceedings, of which the majority involve workers’ compensation, employment practices liability, general liability and automobile and franchisee claims arising in the ordinary course of business. The Company records legal fees associated with loss contingencies when they are probable and reasonably estimable.

Litigation is subject to many uncertainties, and the outcome of individual litigated matters is not predictable with assurance. Included in the matters referenced above, the Company is party to three employment practice cases, six casualty cases and one patent case. We have established legal and insurance accruals for losses relating to these cases which we believe are reasonable based upon our assessment of the current facts and circumstances. However, it is reasonably possible that our ultimate losses could exceed the amounts recorded by $4.0 million. The remaining cases referenced above could be decided unfavorably to us and could require us to pay damages or make other expenditures in amounts or a range of amounts that cannot be estimated with accuracy. In management’s opinion, these matters, individually and in the aggregate, should not have a significant adverse effect on the financial condition of the Company, and the established accruals adequately provide for the estimated resolution of such claims.

Additionally, the Company was also named as a defendant in a lawsuit along with a large franchisee and the franchisee’s delivery driver. During the third quarter of 2013, the jury delivered a $32.0 million judgment for the plaintiff where the Company was found to be 60% liable. The Company denies liability and filed an appeal of the verdict on a variety of grounds. This case is covered under the Company’s casualty insurance program, subject to a $3.0 million deductible. The Company also has indemnity provisions in its franchise agreements.