Industry

Retail and Consumer Products

Helping Clients in a Rapidly Changing Industry Preserve and Grow Their Businesses

In an industry facing numerous challenges and simultaneous changes, clients need a firm with a proven track record of astute engagement and creative solutions. From wins in securities litigation with billions on the line to thoughtful representation in gender discrimination suits, we have worked closely with retailers and consumer product manufacturers in bet-the-company cases. Through our experience, we understand how the retail sector works and strive to not just address client problems as they arise, but to be a trusted advisor in analyzing how developments across the legal and social landscapes will affect the bottom line and how best to address novel issues. Our goal is not to merely “win” cases, but to ensure that our clients’ businesses thrive moving forward.

Services

Clients benefit from Munger, Tolles & Olson interdisciplinary approach. Our broad-ranging services include:

Employment

  • Whistleblower Claims
  • Retaliation
  • Harassment
  • Discrimination

Wage and Hour

  • Meal and Rest Breaks
  • PAGA
  • Suitable Seating
  • Pay Equity

Class Actions

  • Product Liability
  • Consumer
  • Securities
  • Wage and Hour

Other Business Issues

  • Restructuring/Bankruptcy
  • FCPA
  • Corporate – M&A

Clients

We represent a wide range of clients, including supermarket chains, discount stores, and specialty retailers and manufacturers. Recent representations include:

  • 99 Cents Only Stores
  • Costco
  • Founders of Forever 21
  • Gymboree
  • Juul
  • Mattel
  • Nine West
  • Rent-A-Center
  • See’s Candies
  • Toys ‘R’ Us

Related Practices

Team

Many Munger, Tolles & Olson attorneys work closely with retail clients, all of whom benefit from the firm’s interdisciplinary approach to staffing matters. 

Brad Brian
Martin Bern
Robert Dell Angelo
Katherine Forster
Seth Goldman
Malcolm Heinicke
Joseph D. Lee
John Spiegel
Thomas Walper

Experience

Employment
We help retail employers resolve their most important labor and employment issues, including representing:

  • 99 Cents Only Stores in a broad range of employment litigation and related advice and counseling.
  • A Major Retailer in an investigation by the California Department of Fair Employment and Housing into sexual harassment allegations made by multiple claimants.
  • A Specialty Retailer in an internal investigation of alleged sexual abuse of a minor employee by a high-level field manager.

Wage and Hour
We’ve handled many actions alleging wage-and-hour law violations for retail clients, including:

  • See’s Candies in defeating class certification, based in part on a fact-gathering campaign to demonstrate that break policies were lawfully applied when statistical analysis of employee timecards suggested otherwise, and in successfully defending that result on appeal.
  • 99 Cents Only Stores in:
    • a lawsuit alleging wage and hour violations under the Labor Code on both an individual and class-wide basis, as well as a representative claim for civil penalties pursuant to the Private Attorneys General Act (PAGA). We moved to compel individual arbitration of the plaintiff’s Labor Code claims, which the trial court denied, but we secured reversal in the Court of Appeal. After remand, the plaintiff chose to dismiss his individual claims and proceed on a PAGA-only basis, eliminating a large portion of the potential exposure. The parties have agreed to mediate the PAGA claim.
    • defeating class certification in a wage-and-hour class action for alleged off-the-clock work arising from store security policies.
    • resolving a PAGA action involving over 30,000 employees for just $289,000 after causing the plaintiffs to abandon most of their claims through aggressive motion practice.
  • A Confidential Retail Client in advice relating to premium pay ordinances for employees working in essential services during the pandemic.
  • Multiple Major Retailers in so-called suitable seating cases, all of which have resolved at various stages at an extraordinary discount – some for less than a penny on the dollar.

Class Actions

The firm is known for delivering innovative legal strategies and extraordinary results in class action litigation on behalf of retail clients. Recent representations include:

  • Juul in litigation and related strategic advice pertaining to over a thousand lawsuits, including consumer class actions, personal injury suits and suits by public entities. The class actions allege unfair competition, product defect and  other claims.
  • Mattel in obtaining dismissal of a securities class action alleging that Mattel engaged in illegal “channel-stuffing” and in successfully defending that dismissal on appeal, as well as in obtaining dismissal of an unrelated securities class action challenging Mattel’s disclosures regarding its cost savings program.    

Other Business Issues

Munger, Tolles & Olson’s deep experience and broad capabilities in the retail sector also cover:

  • Nine West, Costco, Founders of Forever 21, Toys ‘R’ Us, Gymboree and Payless Shoes in restructuring proceedings.
  • A Luxury Streetwear Fashion House in its partnership with a multinational sportswear manufacturer and in general corporate strategic advice.
  • Rent-a-Center in obtaining judgment after expedited trial in the Delaware Court of Chancery holding a merger termination valid and resulting in payment to Rent-A-Center of a $92.5 million termination fee.

Case Studies

Detailed examples of how Munger, Tolles & Olson has guided its clients through complex matters follow:

Millions Of Dollars on the Line in a Statewide Employment Class Action
Client: See’s Candies

Munger, Tolles & Olson secured a victory for See’s Candies when the California Court of Appeal rejected a proposed statewide employment class action based on alleged meal and rest period violations. Because See’s stores are relatively small, and often only have one staff member present, the plaintiff adopted a somewhat novel theory, trying to use expert analysis to certify a claim that the candy maker denied rest/meal periods to employees who worked alone and/or on unusually long shifts because they, as the sole employees, had to remain in the store and attend to customers.

Plaintiff Debbie Salazar sought class certification to represent two classes of workers who she alleged were unfairly denied meal and rest periods. Plaintiff relied upon both anecdotal evidence and expert, statistical analysis to support her claims, including that: (1) See’s often staffed employees alone at shops; and (2) pertinent scheduling forms did not address or cover second meal periods for those who worked long shifts. The trial court declined to certify the proposed classes.

Plaintiff appealed the ruling, focusing her appeal entirely on the “second meal period” class, arguing that See’s had effectively failed to provide the second meal periods as required by California law. To support this, Plaintiff established that in over 76% of the shifts exceeding ten hours, the employees had not recorded a second meal period on their respective timecards. In challenging Plaintiff’s claims, Munger, Tolles & Olson undertook an extensive fact-gathering campaign and found not only that employees recorded second meal periods in 24% of the pertinent shifts, but in fact, 43% of the employees who worked shifts over ten hours recorded second meal periods at least once. In addition, many left employees left their shifts early in place of taking a second meal, as allowed by the law. 

On May 10, 2021, the Court of Appeal affirmed the trial court’s decision and found that See’s had demonstrated its actual meal and rest period policy was fully compliant with California law. The court also concluded that the determination as to why any specific employees eligible for a second meal period declined to take one would require an individualized inquiry and thus class certification would be improper.

Media Coverage: See’s Candy Workers Lose Bid to Form Class in Meal Break Dispute

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