Recent legal developments in the fashion industry shed light on the industry’s employer/employee relations. In attempts to cope with an increasingly challenging retail climate, an array of brands has allegedly taken to depriving employees of legally mandated meal and rest breaks. Moreover, at least one prominent brand has been slapped with a lawsuit initiated by a former employee alleging pregnancy discrimination.
On the intellectual property front, trade dress continues to take center stage, with Dr. Martens taking Steve Madden to court over the British brand’s famed boots.
Retailers Cannot Skimp on Meal, Rest Breaks
A newish trend is developing in fashion: Brands and retailers are being hit by litigation from employees for allegedly failing to provide them with legally required meal and rest breaks. Over the past several years a string of lawsuits have been filed against Gucci, Michael Kors, Coach, Urban Outfitters, J. Crew, Forever 21, Abercrombie & Fitch, Cole Haan, Ann Taylor and Saks Fifth Avenue, among others, claiming such action.
Almost all of these suits have been settled out of court relatively quietly — with the exception of the Ann Taylor and Saks matters, which both recently appeared to be close to settling their cases but in each case, the judges sent the parties back to the drawing board in connection with the terms of the deals.
But the cases overall represent an interesting development. Moreover, they shed light on the ways in which retailers are allegedly working to cut corners in light of a less than favorable economic climate, as well as one that is increasingly difficult for brick-and-mortar stores.
The cases at hand — the majority have been filed in California — center on state law, which provides that “employees are entitled to a timely and uninterrupted meal period of at least 30 minutes for each workday they worked for more than five hours and a second meal period on days where they worked additional overtime hours and third meal periods where applicable” and “a paid rest break of at least ten minutes in duration during every four hours.”
What is it — exactly — that retailers hope to gain in connection with such legally improper employment policies? Well, according to the Michael Kors case, for instance, which was filed back in 2015 and settled in September 2016, the plaintiff, Pamela Thomas-Byass, a former Michael Kors store manager, alleged that by “intentionally and knowingly” denying its employees rest and meal breaks, Kors was “substantially [reducing] its labor costs by placing the labor burden on a smaller number of employees…in order to “successfully compete against other apparel companies.”
While allegations set forth in lawsuits are just that, allegations, there appears to be a pattern among retailers in cutting down on state-law mandated breaks, at least according to the recent array of lawsuits. Moreover, it is hardly a secret that retailers are struggling to make ends meet, as indicated with the frequency with which retailers have been filing for bankruptcy protection. Given the regularity of such lawsuits, which are filed as class-action suits thereby allowing similarly situated individuals (and there are often many) to join in the suit and the ultimate settlement amount — fashion retailers could stand to benefit from extra attention to employment-centric practices, particularly as such suits (and the frequency with which they are being filed) do not appear to be subsiding anytime soon.
Pregnancy Woes at Nicole Miller, A Trend in Fashion?
Another potential trend: discrimination, particularly in connection with pregnancy. According to a lawsuit recently filed against Nicole Miller, the New York-based brand is on the hook for discriminating against a highly ranked employee, who alleges that she gave birth to twins and was subsequently fired.
Wendy Simchi-Levi claims in her lawsuit, which was filed in New York Supreme Court earlier this month, that the label’s founder took an “unsympathetic and truly reprehensible disposition” toward her upon learning of her pregnancy, allegedly ostracizing her and refusing to address her directly during meetings. A month after giving birth to twins, Simchi-Levi claims she was terminated due to “ongoing performance issues from last year.”
Of the allegations set forth in Simchi-Levi’s suit, David C. Berg, counsel for Miller and her company, stated: “As a company policy, Nicole Miller does not comment on pending litigations. We will respond on Ms. Miller’s and her company’s behalf in the proper forum at the appropriate time.”
The lawsuit comes on the heels of a number of similar suits filed in 2015 against now-bankrupt Nasty Gal for allegedly firing four pregnant employees in violation of California state law. According to one of the lawsuits, which was filed by former employee Aimee Concepcion, the retailer systematically and illegally terminated pregnant employees, without offering them the four months of unpaid leave guaranteed for new mothers under California law. Conception alleged at that time, “Instead of providing [state-mandated] pregnancy leave and reinstatement [of employment after such leave], Nasty Gal terminates pregnant employees so that it does not have to deal with what it perceives to be the inconveniences of dealing with pregnant employees [including providing them with maternity leave].”
Not only does pregnancy discrimination litigation prove problematic for retailers — legally — such lawsuits certainly do not bode well for a brand’s reputation, particularly for women’s wear brands, whose customers are, after all, women. The bad press that often comes hand-in-hand with litigation is not something to be underestimated.
Dr. Martens Files Trade Dress Suit Against Steve Madden
On the heels of being slapped with a trade dress lawsuit from Aquazzura for allegedly copying a number of its best-selling shoes, Steve Madden has been named in a trade dress infringement lawsuit from AirWair International, a subsidiary of Dr. Martens Footwear, for “knowingly and intentionally” copying one of its famed shoe designs.
According to Dr. Martens’ suit, which was filed in the U.S. District Court in the Northern District of California, Steve Madden has copied the legally protected sole of Dr. Martens’ 1460 Boot. In particular, Steve Madden’s McBeth, Macen, JPlayy and JFunn boots make use of Dr. Martens’ “two-tone grooved sole edge, undersole and heel loop,” Dr. Martens asserts.
The Steve Madden brand has found itself on the receiving end of lawsuits from a string of fashion brands, including Alexander McQueen, Balenciaga and Stella McCartney, in connection with its allegedly infringing designs.
The suit proves an interesting one as fashion continues to rely quite heavily on trade dress — a form of trademark protection that extends to the overall image of a product that indicates or identifies the source of the product and distinguishes it from those of others — in lieu of heavy copyright protection for garments and accessories. To the detriment of designers, copyright law does not protect useful articles, such as garments and accessories, in their entirely, and as a result, trade dress has emerged as a favored form of protection in the fashion industry in the U.S.
Julie Zerbo is the founder of The Fashion Law.