Labor & Employment

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Case: Doran v. 7-Eleven, Inc., No. 05-56439 (9th Cir. Nov. 9, 2007)

The One Sentence Summary: If an ADA plaintiff has encountered or has personal knowledge of at least one barrier affecting his or her disability and thereby has been deterred from attempting to gain access to a place of public accommodation, the plaintiff has standing to challenge all accessibility barriers in that public accommodation that are related to his or her disability.


What They Were Fighting About: Plaintiff Jerry Doran sued for ADA violations at a 7-Eleven store located in Anaheim, 550 miles from his home. Doran is a paraplegic and uses a wheelchair for mobility. His complaint identified nine alleged barriers at the 7-Eleven store including that the store aisles were too narrow and that disabled patrons were denied access to the employees-only restroom. During discovery, Doran’s expert conducted a site visit and identified three additional barriers that would potentially impact mobility-impaired persons. The trial court granted summary judgment to 7-Eleven on all of Doran’s ADA claims, holding that Doran did not have standing to challenge barriers first identified in the expert report because he did not personally encounter or have personal knowledge of those barriers. The trial court also found that Doran failed to provide any evidence that the nine barriers identified in the complaint had not been removed or violated the ADA. Doran appealed.

Court Holdings:

  • The fact that Doran lived 550 miles away from the 7-Eleven store did not preclude him from establishing Article III standing. He personally visited the store on 10 to 20 prior occasions, is currently deterred from visiting the store due to its accessibility barriers, and planned to visit Anaheim at least once a year on annual trips to Disneyland.
  • Trial court erred in precluding Doran from suing as to those accessibility barriers related to his disability as a wheelchair user that he did not personally encounter. If an ADA plaintiff knows about at least one violation that deters him or her from attempting to enter the public accommodation again and conduct further investigation of its accessibility, the plaintiff has Article III standing to sue. Discovery may then be conducted as to any other barriers related to his or her disability and those may be included in the claim.
  • A rule limiting an ADA plaintiff to challenging only those violations affecting his or her disability that he or she personally encountered or knew about at the time of filing suit would burden businesses with more ADA litigation, encourage piecemeal compliance with the ADA, and interfere with the goal of eliminating disability discrimination in places of public accommodation.
  • The dissenting judge expressed serious concern that the majority were improperly expanding Article III standing to plaintiffs who had not suffered an injury. The dissenting opinion presented a hypothetical of a mobility-impaired customer who sued after being unable to find a disabled parking space in a shopping center, and then sought discovery as to ADA violations by all the tenants of the center whose stores he or she never visited after being unable to find parking. The majority distinguished this scenario as involving establishments within the shopping center that were not responsible for the injury to the customer caused by the lack of disabled parking access.
  • The Ninth Circuit affirmed the dismissal of alleged ADA violations that Doran failed to prove with any evidence. As to the allegedly narrow aisles in the 7-Eleven store, plaintiff did not present any measurements to show that the aisles did not comply with the 36-inch clearance required by the ADA Accessibility Guidelines. Regarding the lack of access to the employees-only restroom, that is not a place of public accommodation under the ADA because it is not open to the public. Therefore, no violation of the ADA occurred.

Case: Gentry v. Superior Court of Los Angeles Co. (Circuit City Stores, Inc.), No. S141502 (Cal. Aug. 30, 2007)

The One Sentence Summary: The California Supreme Court held that class arbitration waivers should not be enforced if a trial court determines that class arbitration would be a significantly more effective way of vindicating the rights of affected employees than individual arbitration.

What They Were Fighting About: Plaintiff filed a class action lawsuit in superior court against Circuit City Stores, Inc. (“Defendant”), seeking damages for violations of the Labor Code. Plaintiff argued that Defendant had illegally misclassified salaried customer service managers as exempt managerial/executive employees not entitled to overtime pay, when in fact, they were non-exempt non-managerial employees entitled to be compensated for hours worked in excess of eight hours per day and 40 hours per week. When he was hired, however, Plaintiff executed an arbitration agreement with Defendant that precluded class actions. As such, Defendant moved to compel individual arbitration.

Court Holdings:

  • The Court held that class arbitration waivers in overtime cases may be contrary to public policy. Specifically, the Court found that “the rights to the legal minimum wage and legal overtime compensation conferred by the statute are unwaivable,” “overtime wages are another example of a public policy fostering society’s interest in a stable job market,” and “overtime laws also serve the important public policy goal of protecting employees in a relatively weak bargaining position against ‘the evil of overwork.'”

  • Accordingly, the Court set forth certain factors a trial court must consider when employees allege that an employer has systematically denied proper overtime pay to a class of employees and a class action is requested notwithstanding an arbitration agreement that contains a class arbitration waiver.

  • First, the trial court considers the modest size of the potential individual recovery. Second, the potential for retaliation against members of the class. Third, the fact that absent members of the class may be ill informed about their rights. And lastly, other real world obstacles to the vindication of class members’ right to overtime pay through individual arbitration.

  • “If [the trial] court concludes, based on these factors, that a class arbitration is likely to be a significantly more effective practical means of vindicating the rights of the affected employees than individual litigation or arbitration, and finds that the disallowance of the class action will likely lead to a less comprehensive enforcement of overtime laws for the employees alleged to be affected by the employer’s violations, it must invalidate the class arbitration waiver….”

Proposed Legislation: Senate Bill 1957, Design Piracy Prohibition Act

The One Sentence Summary: The proposed Design Piracy Prohibition Act would provide copyright protection to fashion designs, whereas existing law only protects fashion labels from being copied by counterfeit merchandisers.

Summary of Legislation:

  • Senate Bill 1957 would provide copyright protection to a “fashion design,” which is defined as “the appearance as a whole of an article of apparel, including its ornamentation.”
  • The “apparel” entitled to fashion design protection includes clothing (undergarments, outerwear, gloves, footwear, and headgear), handbags, purses, tote bags, belts, and eyeglass frames.
  • The period of copyright protection provided would be three years for fashion designs.
  • Fashion designs not subject to protection under Senate Bill 1957 include those embodied in a useful article that was made public by the designer or owner more than three months before applying for copyright registration.
  • Senate Bill 1957 would also make fully applicable to fashion designs the doctrines of secondary infringement and secondary liability.
  • This proposed legislation has sparked considerable debate within the fashion industry. Opponents of the bill, such as the California Fashion Association, contend that it would stifle creativity in the fashion industry and result in more litigation because of difficulties identifying what constitutes a violation of the act. Supporters of the bill, such as the Council of Fashion Designers of America, argue that it would protect against l0w-end knock-offs profiting from fashion designers’ creativity.

Case: Grocery Outlet Inc. v. Albertson’s Inc., No. 06-16380 (9th Cir. 8/9/07)

The One Sentence Summary: Ninth Circuit affirmed the district court’s granting of a preliminary injunction to Albertson’s, based on the possibility of irreparable injury and the strong likelihood of its prevailing on the merits despite competitor Grocery Outlet’s asserted defense of abandonment of “Lucky” trademark by nonuse.


What They Were Fighting About: Grocery Outlet, a competitor of Albertson’s in the retail grocery industry, contended that Albertson’s abandoned the “Lucky” trademark by publicly announcing after a 1999 merger that “Lucky” stores were being converted to Albertson’s stores. Albertson’s sought a preliminary injunction for trademark infringement in the Northern District of California to restrain Grocery from using the “Lucky” mark. The district court granted the motion, finding at the preliminary injunction stage that Albertson’s legally owned the “Lucky” mark and rejecting Grocery’s abandonment defense. Grocery appealed.

Court Holdings:

  • Ninth Circuit held that the district court did not abuse its discretion in finding that Albertson’s demonstrated a strong likelihood of success on its trademark infringement claim and the possibility of irreparable injury in the absence of a preliminary injunction.
  • On appeal, Grocery did not dispute that its use of the “Lucky” mark for retail grocery services was likely to cause consumer confusion. Thus, whether Albertson’s was likely to succeed on the merits turned on whether Grocery’s abandonment defense would be successful.
  • Abandonment by nonuse is a defense under the Lanham Act that requires proof of both the mark owner’s discontinuance of trademark use and intent not to resume such use.
  • Ninth Circuit concluded that Albertson’s offered sufficient evidence of its intent, during the short period of alleged nonuse, to resume use of the “Lucky” mark within the reasonably foreseeable future. Accordingly, the district court did not abuse its discretion in rejecting Grocery’s defense of abandonment at the preliminary injunction stage.
  • On the standard of proof for the abandonment defense, Grocery adopted the clear and convincing evidence standard in its briefing in the district court. The Ninth Circuit found Grocery to have waived any challenge on this point and decided not to resolve the disputed issue of whether the standard of proof is preponderance of the evidence or clear and convincing evidence.
  • Two circuit judges agreed with the court’s per curiam opinion but wrote separate concurring opinions to express their divergent views on the standard of proof for an abandonment defense under the Lanham Act. While the court’s per curiam opinion did not discuss the issue, the concurring opinions provide future litigants in Ninth Circuit courts with their legal arguments for either a preponderance of the evidence or a clear and convincing evidence standard of proof.

Case: Angelucci v. Century Supper Club, 41 Cal. 4th 160 (May 31, 2007)

The One Sentence Summary: The California Supreme Court held that a plaintiff is not required to allege that he or she requested equal treatment and the retailer refused in order to state a claim under the Unruh Civil Rights Act for gender-based price discrimination.


What They Were Fighting About: The plaintiffs were male patrons of a club that offered discounted admission to women, charging $20 admission for men and $15 for women. They paid the male admission price on several occasions and then sued alleging that the club’s pricing policy violated California’s Unruh Civil Rights Act. Civil Code section 52(a) contains a private right of action to enforce the Act. Section 51.6(b) provides: “No business establishment of any kind whatsoever may discriminate, with respect to the price charged for services of similar or like kind, against a person because of the person’s gender.” The trial court granted (affirmed by the court of appeal) defendant’s motion for judgment on the pleadings on the grounds that plaintiffs’ failure to allege that they requested and were refused the discounted admission price precluded any claim for price discrimination.

Court Holdings:

  • The California Supreme Court reversed and held that plaintiffs stated a cause of action for unlawful price discrimination based on gender.

  • Nothing in the statute requires a customer to specifically demand nondiscriminatory treatment and be denied same by a retailer in order to state a claim for violation of the Unruh Civil Rights Act. The plaintiffs were injured within the meaning of the Act when they presented themselves for admission and were charged the club’s nondiscounted male-only price. The defendant’s interpretation of the statute would be inconsistent with the Act’s policy of eliminating arbitrary discrimination in places of public accommodation.

  • While acknowledging there might be some instances in which a compelling public policy justified differential treatment of male and female patrons, the court made clear that a retailer’s policy of offering gender-based price discounts would ordinarily constitute unlawful price discrimination.

  • The court concluded by stating that nothing in its opinion should be construed as restricting potential equitable or constitutional defenses to any damages sought by a plaintiff under Civil Code section 52(a). This statement was a response to defendant’s argument that plaintiffs made repeated unannounced visits to the club on Ladies Day as a “shakedown” tactic to increase the statutory damages they could seek for violation of the Act.

Case: Abercrombie & Fitch Co. v. Moose Creek, Inc., No. 06-56774 (9th Cir. 5/22/07)

The One Sentence Summary: District court erred in denying Abercrombie & Fitch’s motion for a preliminary injunction against Moose Creek’s use of new marks by (1) misapplying the doctrine of judicial estoppel, and (2) erroneously concluding that the parties’ trademarks were more different than similar.

What They Were Fighting About: Abercrombie & Fitch filed suit in August 2005 against Moose Creek for alleged trademark infringement, unfair competition, and false designation of origin under the Lanham Act and various California common law claims, one year after the parties settled a 2004 trademark infringement suit brought by Moose Creek. In the later action Abercrombie contended that Moose Creek’s two new logos, a moose silhouette and a moose outline, infringed on Abercrombie’s similar marks. Abercrombie moved to enjoin Moose Creek’s use of its new marks pending resolution of the lawsuit. District court denied Abercrombie’s motion because it concluded that (1) a number of Abercrombie’s arguments were contrary to its positions in the prior litigation and therefore barred by judicial estoppel, and (2) differences between the parties’ marks outweighed the similarities.

Ninth Circuit Holdings: The Ninth Circuit reversed and remanded the case to the district court for reconsideration of Abercrombie’s motion for a preliminary injunction, because:

  • Applying the Sleekcraft factors regarding likelihood of confusion, the district court abused its discretion in finding that Abercrombie was judicially estopped to assert arguments about the strength of Moose Creek’s marks and the degree of care likely to be exercised by the purchaser.

  • The district court also erred in estopping Abercrombie from arguing post-purchase confusion as a ground for trademark infringement.

  • Judicial estoppel does not apply where the party’s later litigation position is not “clearly inconsistent” with its earlier litigation position.

  • With respect to the third Sleekcraft factor – similarity of the marks – the district court clearly erred in concluding that differences between the parties’ marks outweighed similarities. District court erroneously relied on comparisons to Moose Creek’s marks as they appeared in a catalog, rather than as they appeared embroidered on the company’s apparel in the marketplace. Ninth Circuit noted that “marks must be considered in their entirety and as they appear in the marketplace.”

Case: Belton v. Comcast Cable Holdings, LLC, No. A112591 (Cal. Ct. App. 6/8/07)

The One Sentence Summary: California court of appeal rejected blind customer’s claim that Comcast’s policy requiring purchase of television cable services in order to obtain cable FM or music services violated the Americans with Disabilities Act, because the plaintiff was not denied access to a place of public accommodation.


What They Were Fighting About: Plaintiff was a legally blind resident of Sonoma County, California and a subscriber to Comcast cable services. Defendant Comcast offered FM or music services to Sonoma County residents only as part of a basic cable package that included television cable service. Plaintiff did not wish to purchase the television cable service, since his blindness prevented him from using it. The complaint alleged various causes of action including violation of California’s Unruh Civil Rights Act (Civil Code section 51 et. seq.), based on Comcast’s practice of packaging music service together with television programming and refusing to provide music service by itself. A violation of the right of any individual under the Americans with Disabilities Act of 1990 (ADA) also constitutes a violation of the Unruh Act. The trial court granted Comcast’s motion for summary judgment on all causes of action.

Court Holdings:

  • The court of appeal affirmed the trial court’s granting of judgment in favor of Comcast on the Unruh Act claim and all other causes of action.

  • Although Civil Code section 51(f) provides that “[a] violation of the right of any individual under the Americans with Disabilities Act of 1990 . . . shall also constitute a violation of [the Unruh Act],” the court held that plaintiff could not establish any violation of the ADA.

  • To state a claim under the ADA, plaintiff must show he has been denied access to “a place of public accommodation.” The court held that, as a matter of law, cable services are not a place of public accommodation. Because the facts could not establish a violation of plaintiff’s rights under the ADA, the Unruh Act claim failed as a matter of law.