Retail’s lawyers, working from home, are busy. Many are fielding calls about store leases, unemployment benefits, financing and new regulations daily during a pandemic where officials are still scrambling to restrict nonessential businesses to rein in the contagion.
The retail industry, which accounts for roughly $2.6 trillion of the U.S. annual GDP, has directly employed some 29 million Americans, according to the trade group the National Retail Federation. But successive temporary store closures across the country have left many employees out of a job and needing to seek unemployment benefits, while others face furloughs — unpaid leave while technically still on the company payroll — or salary cuts.
“Think of all the people out of a job — how are they going to pay for rent, cars, groceries and school tuition?” said Staci Jennifer Riordan, who leads the fashion practice at Nixon Peabody LLP, and is the vice-chair of the firm’s litigation department. “And the fact that there are so many people that work in this industry facing being let go, that’s a huge concern for retailers,” she said.
To help their clients navigate the existential questions arising from an unprecedented pandemic, many firms have formed task forces, created special news bulletins compiling the latest regulatory developments, and made themselves available for calls around the clock.
Here are some firms advising fashion and retail industry clients through the crisis:
Nixon Peabody LLP
The firm’s pandemic response task force pulls in attorneys from a range of practice areas including its labor and employment, government investigations, and real estate leasing groups. The goal is to help retailers navigate the interlocking concerns arising from an event that is indefinitely closing stores, leading to postponed events and delayed or stalled orders, and drawing a range of unexpected questions all at once, Riordan said.
“All of the things that were being planned — festival seasons, Easter, prom season — what happens to all those orders, what happens to all those ad campaigns, to all those activations and events that we were going to have? And what do you do with all those agreements?” she said, of the kinds of questions retail clients are contemplating.
Steptoe & Johnson LLP
The firm’s retail practice group represents clients from luxury brands to big-box stores to e-commerce and online companies. Some of those businesses fall into the definition of “essential businesses” that are allowed to stay open in states and localities that have implemented various “shelter-in-place” orders during the pandemic, while others are not. Attorneys at the firm are helping clients navigate those rules and definitions, especially as new orders are issued daily.
“We have a task force, and we have a link on our web site, where we’re putting out articles and alerts,” said Stephanie Sheridan, who chairs Steptoe & Johnson LLP’s retail and e-commerce group. “And we’re very well known for our regulatory work from our D.C. office.”
Bryan Cave Leighton Paisner LLP
Retail companies are raising questions about day-to-day operational issues, as well as real estate and employment, in particular, said Carol Osborne, a partner at Bryan Cave Leighton Paisner LLP, and co-leader of the firm’s Europe, Middle East and Africa M&A and corporate finance practice and the global sector leader for the firm’s retail and consumer products industry group. Osborne is based in the firm’s London office.
“We’re seeing all of our specialist practices providing robust, every-hour kind of advice,” she said. “And that’s across the globe, because many retailers are global, so questions like, ‘How do we treat employees in France, the U.K., the U.S., in China?’ and ‘What are the policies in terms of layoffs, or redundancies?’ or whatever the strategy is with respect to employment.”
Mintz, Levin, Cohn, Ferris, Glovsky and Popeo P.C.
Robert Burwell, member and co-chair of the retail and consumer products practice at Mintz, Levin, Cohn, Ferris, Glovsky and Popeo P.C., similarly said retail clients are seeking advice on specific areas of the law in terms of force majeure contracts to help them navigate agreements including store leases, while stores are closed, as well as employment issues, and the laws coming out of various state governments.
“A lot of what I’ve been doing as head of our retail practice is to play matchmaker between experts in the firm, and clients with questions about different areas of concern, like business interruption insurance, shelter-in-place rules and privacy concerns raised by working from home,” Burwell said.
Michelman & Robinson LLP
Retailers closing stores are either laying off their staff, letting them seek unemployment benefits in their respective states or furloughing them, which keeps them on the company’s payroll, but where they would need to use their existing vacation and sick time to get paid.
“We had to very quickly become much more savvy in the world of unemployment benefits,” said Lara Shortz, firm recruiting partner at Michelman & Robinson LLP.
Arent Fox LLP
The firm’s fashion practice has roughly 70 attorneys, said Anthony Lupo, partner at Arent Fox LLP, who focuses on areas including entertainment, fashion and technology.
“Last week, it was like hitting tennis balls just being fired at you, this week has been a little more strategic,” Lupo said. “Going forward, we’re looking at ways to excuse performance under agreements, which would include rent, supply and the like. We’re acting as consigliere to many fashion companies.”