$325K Starbucks Settlement Ends Class Action Lawsuit Over Allegedly Deficient COBRA Notices

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Starbucks Corporation has agreed to a $325,000 class action settlement to resolve a lawsuit that alleged the coffee shop chain provided certain employees and beneficiaries with inadequate notices about their right to continued healthcare coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA).

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The Starbucks class action settlement received preliminary approval from the court on July 8, 2026. Eligible for the settlement are all participants not subject to Starbucks’ arbitration agreement, and all beneficiaries in the Starbucks Welfare Benefits Plan, including the Health Plan and Vision Plan, in the United States who were sent a COBRA notice between July 21, 2016 and January 1, 2023, as a result of a qualifying event, as determined by Starbucks and/or its third-party administrator, who did not elect continuation coverage.

Court documents state that approximately 33,800 people are included in the settlement class.

The court-authorized Starbucks COBRA class action settlement website can be found at COBRANoticeClassAction.com.

Class members who file a timely, valid claim form can receive a pro rata (proportional) cash payment.

The final amount of each class member’s payment will depend on the total number of valid claims filed, among other factors.

To submit a Starbucks COBRA settlement claim form, class members can complete the form included with their copy of the settlement notice and return it by mail to the settlement administrator.

All Starbucks COBRA settlement claim forms must be postmarked by December 2, 2026.

Class members who wish to update the address to which their settlement payout will be sent can do so by navigating to this page and entering the notice ID and PIN found on their settlement notice.

The court will determine whether to grant final approval to the Starbucks class action settlement following a hearing on January 6, 2027. Settlement money will begin to be distributed to class members only after final approval has been granted and any appeals have been resolved.

The Starbucks class action lawsuit alleged that the coffee shop chain failed to provide certain employees and beneficiaries with compliant COBRA Notices that adequately informed recipients of how to exercise their rights to elect COBRA continuation coverage after a qualifying event such as termination, in violation of the federal Employee Retirement Income Security Act of 1974.

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