Sports Plaza Liquor License Coming To Chicago

With the Wrigley renovations on their way, Alderman Tunney has proposed a new liquor license type to allow beer and wine to be sold in a "sports plaza."  The specifics of the legislation are unknown at this time, but it would conceivably open the door to similar "plaza's" near US Cellular Field, Soldier Field, and potentially the United Center. Legal issues for such a proposal include potential dram shop liability, ILCC crackdowns for underage drinking in what is a family friendly area, and potential violations of the City's open container laws.  Further, it will be interesting to see the business implications for restaurants and bars surrounding the ball park.

http://www.dnainfo.com/chicago/20131127/wrigleyville/cubs-wrigley-field-plaza-serve-liquor-under-new-ordinance-from-tunney

Restaurants Face Crack Down on Wage and Hour Violations Nationwide

A restaurant in Ohio was recently sued by the United States Department of Labor for alleged failure to pay overtime to employees who were primarily paid in tips. The restaurant contends that the employees were exempt from the overtime requirements under the Fair Labor Standards Act. In Illinois, a restaurant was also sued by the Illinois Department of Labor for alleged wage and hour violations related to whether employees were entitled to pay for break time, or whether that was properly omitted from their paychecks.

There is a recent trend across the country where Federal and State authorities are seeking to enforce the wage and hour laws, especially in the restaurant industry. The Fair Labor Standards Act governs the federal minimum wage and overtime pay laws, and provides for certain exemptions for employers.  Additionally, most, if not all, states have their own wage and hour laws.  The fact that servers receive most of their pay from tips, the reporting requirements for tipped wages, and the reduced minimum pay based on tips complicates matters further for restaurant owners and management. Many overlook the fact that seemingly minor issues such as having employees clock out during break periods, or relatively straightforward facts such as the federal vs. state minimum wage, can be complicated by the complex wage and hour laws at the federal and state levels.

The Labor and Employment group at Clark Hill is knowledgeable about all aspects of the Fair Labor Standards Act, the various state laws relating to wage and hour issues, and handling inquiries or litigation with the US Department of Labor or the state counterpart. The best way to avoid costly wage and hour issues down the line is to consult with a professional ahead of time and determine the wage and hour requirements for your employees, determine your compliance with the various laws, and implement a system that takes into account the complexities facing the specific industry.

http://www.lawyersandsettlements.com/articles/ohio-employment-labor-law/ohio-employment-labor-laws-16-19160.html#.UmaGY9Kkr9k

Chicago Alderman Seeks Further Restrictions in Dry Precincts

 The exceedingly complicated laws regulating the City of Chicago's liquor licenses have just gotten even more complicated.  Dry precincts are areas in the City of Chicago that have been voted dry by the voting constituents.  Up until now, restaurants and bars still could open there and allow "BYOB" or bring your own beer/wine/alcohol.  Alderman Deb Graham has just introduced a bill to prohibit allowing BYOB establishments in the already established "dry precincts."

Prior to opening a new bar or restaurant in the city, it is important to do your homework regarding zoning and licensing capabilities.  The food and beverage team at Clark Hill can certainly help with both the background work, zoning considerations, licensing, and advise you about the licensing options, as well as restrictions like moratoriums and dry precincts.


http://www.chicagotribune.com/news/local/ct-met-deb-graham-byob-1004-20131004,0,5442758.story

Restaurant Owners Lobby Congress Regarding Affordable Care Act

Under the Affordable Care Act starting in 2015, for businesses that employ more than 50 employees, any employee that averages at least 30 hours per week becomes considered a "full-time equivalent employee."  That designation means that the business would have to offer health care benefits, or face a government penalty. The concerns for those involved in the restaurant industry is that the this government penalty could erase any existing profit margin (given the low profit margin associated with the industry), and could reduce hours for current employees. There are several bills being advanced in Congress attempting to change the definition of "full-time equivalent employee" to 40 hours. In fact, restaurant industry owners and lobbyists were on Capitol Hill on September 17, 2013 discussing these very issues.  However, in the event those measures do not pass, it is imperative that those in the industry develop a plan for ways to maintain the profit margin while complying with the new law. The Clark Hill Labor and Employment team can analyze your business, alert you to the effect of the new Act on your business, and provide you with the tools necessary to develop a plan given the intricacies related to Affordable Care Act as is, and in the event of a last minute definition change.

http://www.sfgate.com/business/article/Restaurants-fight-30-hour-rule-in-health-care-law-4834700.php
http://thehill.com/business-a-lobbying/322583-franchise-owners-plead-for-relief-on-obamacare-

Caution Regarding Sticking Staff With Cash Shortages

The Minnesota Supreme Court recently sided with the bar staff who were forced to pay cash shortages out of their tips.  The full opinion is linked below, as well as newspaper coverage. The Court held that the mandatory deductions violated Minnesota wage and hour laws, which most, if not all states have in place.
 Aside from the legal implications, the media coverage caused substantial harm to the business, which has since filed for bankruptcy.  On a practical level, employee morale may be significantly decreased if such a policy is in place in your establishment, and turnover may increase resulting in major costs.  If cash shortages are a significant and recurring problem with a certain employee, it is better to document the issues and confront the employee.

http://case.lawmemo.com/mn/karl.pdf

http://www.startribune.com/local/minneapolis/219646251.html

Jordan and Dominick's Beef a Cautionary Tale Regarding the Illinois Right of Publicity Act

The Dirksen Federal Courthouse is no stranger to celebrities, politicians, and athletes walking through the doors.  However, it still makes heads turn when his Airness himself, Michael Jordan, is summoned to a Judge's chambers.  Unlike the former Illinois governors, though, Jordan was brought in to discuss his requested damages against Dominick's Finer Foods for their advertisement congratulating him on his Hall of Fame Career. Jordan has already been granted summary judgment and won the liability of phase of his case when Judge Shadur agreed that Dominick's violated the Illinois Right of Publicity Act.

Jordan brought suit against Dominick's Finer Foods, No. 10 CV 00407, alleging violations of the Illinois Right of Publicity Act, Trademark infringement, and various violations of the Lanham Act. Jordan strategically moved for summary judgment on the violation of the Illinois Right of Publicity Act. Once that was granted, the remaining allegations were voluntarily dismissed, and all that is left to argue is how much Jordan was damaged. 

The Right of Publicity Act, effective January 1, 1999, completely replaced the common-law tort of appropriation of likeness, although it did not affect the other three common-law privacy torts." Maremont v. Susan Fredman Design Group, Ltd., 772 F. Supp. 2d 967, 972, 2011 U.S. Dist. LEXIS 26441, 99 U.S.P.Q.2D (BNA) 1384, 31 I.E.R. Cas. (BNA) 1845, 39 Media L. Rep. 1992 (N.D. Ill. 2011). The Act protects against unauthorized "commercial" uses of a person's identity.  "Commercial" use is defined as "the public use or holding out of an individual's identity (i) on or in connection with the offering for sale or sale of a product, merchandise, goods, or services; (ii) for purposes of advertising or promoting products, merchandise, goods or services, or (iii) for the purpose of fundraising." 765 ILCS 1075/5."Identity" is defined by the statutes "any attribute of an individual that serves to identify that individual to an ordinary, reasonable viewer or listener, including but not limited to (i) name, (ii) signature, (iii) photograph, (iv) image, (v) likeness, or (vi) voice." 765 ILCS 1075/30. The statute is held to be a broad and expansive approach to protecting use of a person's identity without their permission. Muzikowski v. Paramount Pictures Corp, 2003 WL 22872117, at *6 (N.D. Ill., Dec. 3, 2003).

In Jordan's case, the claim under the Act was a slam dunk (bad pun intended).  Dominick's used his name, trademark number 23, and Air Jordan emblem in order to promote the sale of their Rancher's Reserve Steaks.  Dominick's even included a coupon, and admitted that they did not receive Jordan's permission.  It was a clear violation of the Act.

As for Jordan's damages, he demanded five million dollars from Dominick's Finer Foods.  I, along with the public and Judge Shadur, wonder how Jordan came up with that number.  My initial thought was that he has lost the concept of money, or he's had too much of that Miami sun.  However, the statute also defines what are recoverable damages. Section 40 of the Act provides that Jordan can recover actual damages, profits derived from the misuse and punitive damages.  765 ILCS 1075/40. It will be interesting to see how many steaks Dominick's actually sold based on the ad, and what Jordan can show his actual damages are.

Jordan brought a similar suit against Jewel-Osco, No. 10 CV 00304. However, Judge Gary Feinerman rejected Jordan's claims. In that case, Judge Feinerman ruled that the advertisement was noncommercial speech and, thus, entitled to First Amendment protections.  The advertisements can be seen below, and the most glaring differences were that Jewel-Osco was not promoting a product, and did not attach a coupon.

 Even if Jewel and Dominick's intent was only to honor Jordan, this is another example that no good deed goes unpunished. Companies, big or small, planning to use a celebrity's identity in Illinois should think long and hard before running an advertisement.  The Illinois protection goes even further than the federal protections, as an identity has been held to afford even broader protection than a trademark.  It is imperative to either (1) receive permission, which usually will include paying some kind of royalties; or (2) examine the advertisement long and hard to make sure its noncommercial speech, knowing full well that some courts hold that any company advertisement can be held to be commercial speech. The risk may very well outweigh the reward

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Interesting article about concerns for the restaurant industry based on the new healthcare laws...  Would love to hear feedback on what questions you are encountering as an employer.