7-Eleven employees and family members who paid a tobacco surcharge on the company’s health plan since September 2018 would share a $2,313,480.87 settlement filed in October 2026, with checks mailed automatically. The deal still needs a federal judge’s approval, so no payments have been scheduled yet.
What Happened
7-Eleven Inc. has agreed to pay $2,313,480.87 to settle a class action over the tobacco surcharge on its employee health plan. The plaintiff in Baker v. 7-Eleven Inc., No. 3:25-cv-01609, filed an unopposed motion for preliminary approval on October 13, 2026, in the U.S. District Court for the Northern District of Texas, where the case is assigned to Judge Brantley Starr. 7-Eleven does not oppose the motion. The settlement is not final: the judge must first grant preliminary approval, notice must go out to the class, and a final approval hearing must be held before any money is paid.The lawsuit claimed that 7-Eleven charged plan participants who used tobacco or nicotine an extra premium, deducted from their paychecks, without offering and properly disclosing a way for every participant to avoid or earn back the full surcharge. 7-Eleven has denied wrongdoing, and the court has not decided whether the claims are true.
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Who Is in the Settlement Class
The proposed class covers everyone who was a participant or beneficiary of 7-Eleven’s health plan at any point from September 26, 2018 through the date of the preliminary approval order, paid a tobacco or nicotine surcharge during that time, and was not fully reimbursed for those payments. The complaint alleged that the plan had more than 10,500 active participants as of January 1, 2023, and that the class includes thousands of people who paid the surcharge. 7-Eleven will give the settlement administrator a list of class members within 21 days after preliminary approval, drawn from its own records.The class is proposed under Rule 23(b)(1), a type of mandatory class used when separate lawsuits could leave a plan facing inconsistent obligations. Unlike most consumer settlements, it has no opt-out option. Under the proposed terms, class members could object in writing to the settlement or to the fee request through the procedure the notice will describe.
How Payments Would Work
No claim form is needed. After deductions, the settlement administrator would calculate each class member’s “balance,” defined as the net tobacco surcharges paid from September 26, 2018 through the preliminary approval date, minus any refunds, and pay each person a share of the net fund in proportion to that balance. A participant who paid the surcharge for several years would receive more than one who paid it for a few months.The deductions are capped in the agreement. Class counsel, Siri & Glimstad LLP, may ask for attorneys’ fees of up to 33.33% of the fund plus litigation costs, and the named plaintiff may ask for a service award of up to $7,500. Administration costs, taxes, a contingency reserve and the fees of an independent fiduciary, who must review the deal on behalf of the plan, also come out of the fund. The court decides the final fee and award amounts.
Payments would go out by check no later than 20 business days after the later of the settlement’s effective date or the final calculation of shares. Checks would stay valid for 200 days. Money from checks that are never cashed would go to a court-approved charity as a cy pres award rather than back to 7-Eleven.
What Happens Next
Judge Starr will decide whether to grant preliminary approval. If he does, the proposed schedule calls for 7-Eleven to send the class list within 21 days, the administrator to mail notice and open a settlement website with a toll-free number, and class counsel to file the fee request at least 45 days before the final approval hearing. The motion asks for that hearing to be set no earlier than 120 days after the preliminary approval order. Open Class Actions will update this story when the court rules and when the official settlement website goes live; no official website has been announced yet.How the Case Got Here
The case was filed on September 26, 2024, in the Western District of Pennsylvania. On May 21, 2025, that court transferred it to the Northern District of Texas, enforcing a forum-selection clause in the plan. 7-Eleven moved to dismiss, and on February 19, 2026, Judge Starr denied the motion in full, finding that the complaint plausibly alleged standing based on paycheck deductions, that tobacco use counts as a health status-related factor under ERISA, and that the plaintiff plausibly alleged the wellness program did not offer the full reward and did not disclose a reasonable alternative standard. A bench trial had been set for July 2027. The parties mediated on August 18, 2026, reached a settlement in principle, and reported it to the court on August 24, 2026.Part of a Wave of Tobacco Surcharge Cases
The 7-Eleven case is one of a growing number of ERISA lawsuits against employers that charge health plan participants more for using tobacco. The claims turn on the same federal wellness-program rules: a surcharge tied to a health factor is permitted only if the program offers a reasonable alternative, discloses it in plan materials, and lets participants who complete it recover the full reward, including amounts already paid. Open Class Actions has covered the $5.1 million Casey’s tobacco surcharge settlement, which also pays class members automatically, and pending suits against Waffle House, Whataburger and Mondelez. The employer smoker fee investigation page explains how these surcharges work.Questions
Who is covered by the 7-Eleven tobacco surcharge settlement?
The proposed class covers participants and beneficiaries of 7-Eleven's employee health plan who paid a tobacco or nicotine surcharge at any point from September 26, 2018 through the date the court grants preliminary approval, and who were not fully reimbursed for those payments.
Do 7-Eleven employees need to file a claim?
No. According to the settlement motion, payment is automatic. The settlement administrator would use 7-Eleven's records to calculate each class member's share and mail a check, with no claim form required.
How much will each person get from the 7-Eleven settlement?
No per-person figure has been published. The $2,313,480.87 fund would be reduced by court-approved attorneys' fees of up to 33.33%, costs, a service award of up to $7,500, administration and independent fiduciary fees, and then divided in proportion to the net tobacco surcharges each class member paid. Someone who paid the surcharge for longer would receive a larger share.
Has the 7-Eleven tobacco surcharge settlement been approved?
Not yet. The plaintiff filed an unopposed motion for preliminary approval on October 13, 2026, in the U.S. District Court for the Northern District of Texas. Judge Brantley Starr has not ruled on it. If he grants preliminary approval, notice would be mailed to class members and a final approval hearing would be scheduled no earlier than 120 days after that order.
Can class members opt out of the 7-Eleven settlement?
The settlement asks the court to certify a mandatory class under Rule 23(b)(1), which does not include an opt-out option. Under the proposed terms, class members could object in writing to the settlement or to the fee request using the procedure the notice will describe.
What was the 7-Eleven tobacco surcharge lawsuit about?
The lawsuit alleged that 7-Eleven charged health plan participants who used tobacco an extra premium without offering and properly disclosing a reasonable alternative standard that would let every participant earn back the full surcharge, which the plaintiff said federal law requires for wellness programs. 7-Eleven has not admitted wrongdoing, and the court has not decided whether the claims are true.
Sources
- Docket, Baker v. 7-Eleven Inc., No. 3:25-cv-01609-X (N.D. Tex.), including the order denying the motion to dismiss (ECF 70, February 19, 2026) and the order vacating deadlines after the settlement was reported (ECF 91, August 25, 2026).
- Memorandum in support of the unopposed motion for preliminary approval (ECF 94-1, October 13, 2026): settlement amount, class definition, plan of allocation, fee and award caps and proposed schedule.
