The Learned Concierge - September 2024, Vol. 12

The Learned Concierge

Welcome to your monthly legal insights on the trends impacting the Retail, Hospitality, and Food & Beverage Industries.

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Cybersecurity & Privacy

The Monthly Rundown of All Things Cyber, Privacy, and Technology

Click here to read the Right to Know – July 2024, Volume 20

Wearable Tech Designed to Protect Against Heat-Related Injuries Are Also Privacy Concern for Employers

Workers subject to high temperatures, hard work, and physically stressful jobs have been asked by employers to wear technology that is able to track temperature, heart rate, and sweating in order to look for possible heat related injuries. Yet, the wearing of such tech also raises privacy concerns for those employees and how employers are using the collected data. However, the collection of such information could be used to move workers away from higher paying more stressful jobs or could prevent other workers from taking breaks or seeking relief until medical conditions become severe enough in the employer’s estimation to allow for a break. Companies collecting such data should be aware of applicable consumer data privacy laws to ensure that their collection and use of such data does not run afoul of laws and regulations.

Texas AG Sues GM for Unlawful Data Collection and Sales

On August 13, 2024, Texas’ Attorney General sued General Motors for allegedly false, deceptive, and misleading business practices relating to GM’s unlawful collection and sale of private driving data belonging to 1.5 million Texans to insurance companies. The AG claims that the collection and sales took place without the individuals’ knowledge or consent. The suit follows an investigation launched in June into several car manufacturers which purportedly found that the sales were made to insurance companies who used the data to develop “driving scores” for the drivers, resulting, in some cases, in insurance premium increases.

Food & Beverage

New Industry Research Takes Aim at a Major Hurdle to Grocery Store Alcohol Sales

As grocers fight for expanded alcohol sales in several states, the liquor industry has long claimed that allowing supermarkets to sell more of those products would reduce liquor store sales and even lead to closures of mom-and-pop liquor stores.

But a new report from FMI — The Food Industry Association looking at Tennessee, which adopted a policy in 2016 allowing grocery stores to sell wine, indicates that liquor stores did not see a statistically significant increase in closures and that state sales tax revenues increased due to grocery store wine sales. Click here to learn more.

Nationwide Debate Intensifies Over Delta-8 THC Regulations: Alcohol vs. Cannabis Showdown

The ongoing debate surrounding Delta-8 THC regulation in New Jersey has ignited tensions between the alcohol and cannabis industries. With recent legislation allowing liquor stores to sell hemp-derived beverages, questions are emerging about how this will impact both sectors. Click here to learn more.

SB24-231 “Concerning implementing consensus recommendations of the liquor advisory group convened by the department of revenue to conduct a comprehensive review of Colorado’s liquor laws, and, in connection therewith, making an appropriation.”

During the last 2024 legislative session the Colorado legislature signing it to law on May 18, 2024, SB24-231:, which became effective August 7, 2024.

The new legislation primarily pertains to licenses required and the sale of liquor.

Brief Summary:

Under the prior law both a lodging facility and an entertainment facility were licensed as a “lodging and entertainment facility licensee.” The acts convert that license to two separate licenses one for lodging facilities to lodging facility licenses and a second for the licenses of entertainment facilities to entertainment facility licenses. Additionally, the act creates two new licenses a catering license and an alcohol beverage shipper license.

Other notable changes included:

• Provides a brewery, a limited winery, and a distillery to manufacture alcohol beverages at up to two noncontiguous locations, with an annual fee for these operations.
• Increases the limit for the amount of alcohol beverages certain retailers can purchase from retail liquor stores, liquor-licensed drugstores, and fermented malt beverage and wine retailers from $2000.00 to $7,000 (with state licensing authority tasked with annually adjust the cap consistent with inflation).
• For events and consumption of alcohol beverages on the premises of an off-premises retailer:
• Allows an off-premises retailer to conduct tastings;
• Allows tastings for all authorized retailers to begin at 10 a.m. instead of 11 a.m.;
• Allows retail liquor stores to hold educational classes; and
• Allows a distiller that operates a sales room to purchase and use common alcohol modifiers to mix with its spirituous liquors to produce cocktails.
• General Licensing changes include:
  • qualifying liquor licensees may apply for a 2-year license.
  • requires the state licensing authority to study the feasibility of adopting an online application and renewal system.
  • removes the requirement that a local licensing authority schedule a public hearing on an application for a new retail liquor license.
  • Changes the festival permittee notification requirements for multiple festivals from 30 business days to 30 calendar days before each festival.
  • allows wholesalers of vinous or spirituous liquors to obtain an importer’s license and allows all wholesalers to hold trade show events.
  • allows a retail liquor store going out of business to sell its inventory to another retail liquor store.
  • allows an arts licensee to place limited advertising of the availability of alcohol beverages for sale on the licensed premises while an artistic or cultural production or performance is taking place.

‘Transparency’ Mandate Would Burden Small Brewers and Distilleries

The Alcohol and Tobacco Tax and Trade Bureau (TTB) is considering new rules for alcohol labeling, including a mandate to display nutritional information and ingredients on booze bottles and cans.

Groups like the Center for Science in the Public Interest and the Consumer Federation of America have been petitioning for mandatory labeling for more than two decades. After the 2022 report, these organizations sued the TTB to force it to move, citing a “nearly nineteen-year delay in responding to a 2003 petition.” Click here to learn more.

International Trade

U.S. Lawmakers Move to Restrict Trade Provision Favored by China’s E-Commerce Giants

A bipartisan group of U.S. lawmakers have proposed a new law to restrict a trade provision, favored by retailers such as Temu and Shein, that lets goods flow in from China with little scrutiny and no duties.

The bill, released Thursday, would block textiles and apparel from being imported through what is known as the de minimis provision. It also would establish a fee of $2 per shipment for goods that are not banned from entering via this route. Click here to learn more about this new legislation.

Labor & Employment

The FTC’s Noncompete Ban: Its Status and Potential Strategies

Paul Starkman authored an article, “The FTC’s Noncompete Ban: Its Status and Potential Strategies.”

On April 23, the Federal Trade Commission (FTC) issued its Final Noncompete Clause Rule in which the FTC essentially banned all employment noncompetes with two narrow exemptions: (i) existing noncompetes with “senior executives” (executives who have the final say on policy decisions that significantly impact the business and who earned at least $151,164 in total annual compensation from their employer in the preceding year) and (ii) noncompetes in the context of the sale of a business. The FTC’s noncompete Final Rule is scheduled to go into effect on Sept. 4 when employers will be required to send a written or electronic notice to current and former employees informing them that their noncompete will no longer be enforceable. This Clark Hill Client Alert discusses the chaotic status of the FTC Final Rule and potential strategies given its impending Sept. 4 effective date.

Lactation Accommodation Results in Misconduct Firing, Tenth Circuit Affirms

Michael Laszlo authored an article, “Lactation Accommodation Results in Misconduct Firing, Tenth Circuit Affirms.”

In Spagnolia v. Charter Communications LLC, The Tenth Circuit Appeals affirmed the lower court’s decision that an employee could not sustain a claim under Colorado’s Anti-Discrimination Act (“CADA”) when she claimed she was fired in retaliation for making a request for lactation accommodations the employee requested after the birth of her second child. The Plaintiff employee was granted the accommodation but after her lactation breaks averaged two hours per day, the company changed its policy and began requiring employees to clock out before taking a pump break. Shortly thereafter, the employee met with her supervisor to discuss the change in the policy where she surreptitiously recorded the meeting. Secret recording of meetings violated the company’s internal policies and for this reason, she was later terminated.

Industry Trends

Why ‘Wardrobing’ Retail Fraud Soars in the Summer

“Wardrobing,” in which a shopper buys an expensive item, wears it with the tags on, and then returns the item for a refund, picks up as shoppers bolster their closets for summer vacations. The challenge for retailers is handling the items when they came back upstream. Click here to learn more.

California Legislature Passes Historic Bundle of Retail Theft Bills

The California Legislature is back in session, and lawmakers are making quick work of passing a multitude of bills to target rising retail crime in the Golden State.

The package of legislation orbits around the California Retail Theft Reduction Act (AB 2943), which was introduced in February by select committee on retail theft chair and Assemblymember Rick Zbur (D-L.A.). Click here to learn more.

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