Bill to Push Minimum to $11.00, $12.00, then $13.00 per Hour Is Halfway Through the Legislature

As earlier reported, California’s minimum hourly wage will rise to $9.00 on July 1, 2014 and to $10.00 on January 1, 2016, thus ranking among the highest in the country. See, California Minimum Wage Increasing and Amended Minimum Wage Notice Must Be Posted by July 1, 2014. The California Senate aims to place the state at number one in the nation, recently passing a measure to accelerate the minimum to $11.00 per hour on January 1, 2015, to $12.00 per hour on January 1, 2016, and to $13.00 on January 1, 2017.

If in current form it successfully navigates the Assembly and is signed into law by Governor Brown, Senate Bill 935 is intended to “stimulate the economy and combat poverty and the decline of California’s middle class.” The measure’s opponents include the California Chamber of Commerce, viewing these prospective increases as a “job killer”, saying “The bill unfairly increases employer costs by increasing the minimum wage to $13 by 2017 and then increased thereafter according to the Consumer Price Index.”

This is one of several related developments nationally. A move earlier this year to increase the federal minimum from $7.25 per hour stalled and is not expected to revive before this fall’s mid-term elections. On the other hand, a number of major municipalities have passed “prevailing wage” ordinances setting minimums above their state’s standards. San Francisco’s minimum is now $10.74 per hour, San Jose’s is currently $10.00. Departing from Washington state’s current $9.32 per hour standard (currently the nation’s highest,) the City of Seattle is raising its minimum in increments, starting with $10.00 on April 1, 2015 and in 2017 will begin phasing in $15.00.

Stay tuned and we will keep you posted on the fate of Senate Bill 935.

Measure Took Effect March 2, 2015

Effective March 2, 2015, Oakland’s paid sick leave ordinance (Measure FF), requires employers to provide paid sick leave benefits to part-time, full-time and temporary employees who perform at least two hours of work in a particular workweek within the city limits. This new law provides benefits greater than those required statewide by California’s The Healthy Workplaces, Healthy Families Act (the Act), going into effect on July 1, 2015. For basics on the Act’s paid sick leave benefits, see our recent articles such as California Labor Commissioner Provides the FAQs on New Paid Sick Leave Benefits Law and Shall The Fog Be Forever Forsaken?, California Labor Commissioner Again Attempts to Resolve Questions on New Paid Sick Leave Benefits Law.

Under Oakland’s Measure FF, eligible employees shall accrue one hour of paid sick leave for every 30 hours worked, which is identical to the Act’s accrual rate. Employers may cap accrued paid sick leave at 40 hours for small businesses (fewer than 10 workers) and at 72 hours for other employers. Employees may use paid sick leave for the employee’s own illness or injury, or to care for family members or other designated persons as defined by the ordinance. Accrued sick leave will carry over from year to year but need not be paid out upon termination of employment.

Employers covered by Measure FF are required to post a notice informing employees of their rights under the paid sick leave ordinance.

The Act “establishes minimum requirements pertaining to paid sick days and does not preempt, limit, or otherwise affect the applicability of any other law, regulation, requirement, policy or standard that provides for greater accrual or use by employees of sick days,… or that extends other protections to an employee.” California Labor Code section 249(d). Thus, employers affected by both Measure FF and the Act must comply with the highest standard imposed by either law. Such employers will also have to post the notices required by each of these laws.

Some of the main differences between Measure FF and the new Act include:

• State law allows employers to provide the sick leave benefit up front instead of accruing over time, Oakland’s does not.
• Oakland allows an employee without a spouse or registered domestic partner to designate another person for whom they may use paid sick leave, state law does not.
• Oakland does not include parents-in-law in its definition of “family members,” state law does.
• Oakland allows employers to require medical certificates to verify paid sick leave under certain circumstances, the state law is silent on the issue.
• Oakland’s small business 40-hour cap on accruable sick leave does not comply with state law’s cap of 48 hours or 6 days. Thus, small business employers must cap at the higher state threshold.
• Oakland’s 72 hours cap on accruable sick leave for other employers is greater than the Act’s accrual cap of 48 hours or 6 days.
• State law caps or limits amount of accrued sick leave an employee may use in a year at 24 hours or three days, Oakland does not permit a usage cap. Thus, under Oakland law an employee may take or use all of his or her accrued sick leave throughout the year without restriction.

For more information, please contact one of our attorneys, Timothy Bowles, Cindy Bamforth or Helena Kobrin.

Cindy Bamforth, March 27, 2015

Measure Took Effect March 2, 2015

Effective March 2, 2015, Oakland’s paid sick leave ordinance (Measure FF), requires employers to provide paid sick leave benefits to part-time, full-time and temporary employees who perform at least two hours of work in a particular workweek within the city limits. This new law provides benefits greater than those required statewide by California’s The Healthy Workplaces, Healthy Families Act (the Act), going into effect on July 1, 2015. For basics on the Act’s paid sick leave benefits, see our recent articles such as California Labor Commissioner Provides the FAQs on New Paid Sick Leave Benefits Law and Shall The Fog Be Forever Forsaken?, California Labor Commissioner Again Attempts to Resolve Questions on New Paid Sick Leave Benefits Law.

Under Oakland’s Measure FF, eligible employees shall accrue one hour of paid sick leave for every 30 hours worked, which is identical to the Act’s accrual rate. Employers may cap accrued paid sick leave at 40 hours for small businesses (fewer than 10 workers) and at 72 hours for other employers. Employees may use paid sick leave for the employee’s own illness or injury, or to care for family members or other designated persons as defined by the ordinance. Accrued sick leave will carry over from year to year but need not be paid out upon termination of employment.

Employers covered by Measure FF are required to post a notice informing employees of their rights under the paid sick leave ordinance.

The Act “establishes minimum requirements pertaining to paid sick days and does not preempt, limit, or otherwise affect the applicability of any other law, regulation, requirement, policy or standard that provides for greater accrual or use by employees of sick days,… or that extends other protections to an employee.” California Labor Code section 249(d). Thus, employers affected by both Measure FF and the Act must comply with the highest standard imposed by either law. Such employers will also have to post the notices required by each of these laws.

Some of the main differences between Measure FF and the new Act include:

• State law allows employers to provide the sick leave benefit up front instead of accruing over time, Oakland’s does not.
• Oakland allows an employee without a spouse or registered domestic partner to designate another person for whom they may use paid sick leave, state law does not.
• Oakland does not include parents-in-law in its definition of “family members,” state law does.
• Oakland allows employers to require medical certificates to verify paid sick leave under certain circumstances, the state law is silent on the issue.
• Oakland’s small business 40-hour cap on accruable sick leave does not comply with state law’s cap of 48 hours or 6 days. Thus, small business employers must cap at the higher state threshold.
• Oakland’s 72 hours cap on accruable sick leave for other employers is greater than the Act’s accrual cap of 48 hours or 6 days.
• State law caps or limits amount of accrued sick leave an employee may use in a year at 24 hours or three days, Oakland does not permit a usage cap. Thus, under Oakland law an employee may take or use all of his or her accrued sick leave throughout the year without restriction.

For more information, please contact one of our attorneys, Timothy Bowles, Cindy Bamforth or Helena Kobrin.

Cindy Bamforth, March 27, 2015

What is a Trade Secret?

In our blog, “What is Intellectual Property?”, we identified several kinds of intellectual property, i.e., products created through one’s creativity and intellect, that others may not use without permission. One of those is trade secrets. The most famous example is the Coca-Cola formula, maintained as a trade secret since its creation.

Each state, including California, enacts its own trade secret laws. California Civil Code sections 3426 – 3426.11 define a trade secret as “information, including a formula, pattern, compilation, program, device, method, technique, or process” which meets two criteria. First it must have “independent economic value” whether “actual or potential,” based on the fact that it is not “generally known to the public” or to people who would be able to make money or gain other economic value from using or disclosing the information. Second, its owner must take reasonable efforts to keep it secret from unauthorized persons.

If you have an invention, source code, a chemical formula that you are developing to create some product, an idea or prototype for some device, or anything with current or potential economic value, you can claim trade secret protection. An advantage over patents is that trade secrets are not filed with the government and thus not made public.

However, to claim trade secret protection, it is crucial that you comply with the second requirement by taking reasonable measures to safeguard the secrecy of the information that fit the situation. For example, you developed source code for a new computer app, but need funding to market it. If you give a potential funding source your source code to review without any confidentiality measures, you are not making reasonable efforts to keep the source code secret. On the other hand, if you have an attorney create a strong non-disclosure agreement (NDA) and require the potential funding source and its staff to sign that document in advance of disclosure, this could well be deemed a reasonable effort. In 2012, a small company, TechForward, won a $27 million verdict against Best Buy for misappropriating its trade secrets because it had done that.

If you left the papers containing such source code lying around the office conference room where unauthorized persons might be able to pick it up, you would not be taking reasonable efforts to keep it secret. Such material should be stored securely with access permitted only by people with a need to know and obligated to non-disclosure by an adequate, signed NDA. Your measures might also include non-disclosure of access passwords or encryption codes by otherwise authorized persons as well as other special technological procedures, such as required deletion or erasure by any employee who inadvertently receives trade secret data he or she is not permitted to hold.

What measures will be deemed reasonable under the trade secret law depends on various factors, such as the value of the trade secret, the size and income of your company, and the likelihood of industrial espionage in your industry aimed at the particular type of property. For the Coca-Cola Company, this meant specially constructing a large vault to protect its trade secret.

A downside to relying on trade secret protection is that if it does get out in spite of your efforts and becomes generally known to the public or to those who can profit from using it, that protection likely will be lost. A decision to treat information as a trade secret – as well as just what confidentiality measures are necessary to protect it – should be made deliberately with skilled attorney assistance.

For any questions concerning trade secrets, please contact attorney Helena Kobrin.

Helena Kobrin, February 18, 2015

What is a Trade Secret?

In our blog, “What is Intellectual Property?”, we identified several kinds of intellectual property, i.e., products created through one’s creativity and intellect, that others may not use without permission. One of those is trade secrets. The most famous example is the Coca-Cola formula, maintained as a trade secret since its creation.

Each state, including California, enacts its own trade secret laws. California Civil Code sections 3426 – 3426.11 define a trade secret as “information, including a formula, pattern, compilation, program, device, method, technique, or process” which meets two criteria. First it must have “independent economic value” whether “actual or potential,” based on the fact that it is not “generally known to the public” or to people who would be able to make money or gain other economic value from using or disclosing the information. Second, its owner must take reasonable efforts to keep it secret from unauthorized persons.

If you have an invention, source code, a chemical formula that you are developing to create some product, an idea or prototype for some device, or anything with current or potential economic value, you can claim trade secret protection. An advantage over patents is that trade secrets are not filed with the government and thus not made public.

However, to claim trade secret protection, it is crucial that you comply with the second requirement by taking reasonable measures to safeguard the secrecy of the information that fit the situation. For example, you developed source code for a new computer app, but need funding to market it. If you give a potential funding source your source code to review without any confidentiality measures, you are not making reasonable efforts to keep the source code secret. On the other hand, if you have an attorney create a strong non-disclosure agreement (NDA) and require the potential funding source and its staff to sign that document in advance of disclosure, this could well be deemed a reasonable effort. In 2012, a small company, TechForward, won a $27 million verdict against Best Buy for misappropriating its trade secrets because it had done that.

If you left the papers containing such source code lying around the office conference room where unauthorized persons might be able to pick it up, you would not be taking reasonable efforts to keep it secret. Such material should be stored securely with access permitted only by people with a need to know and obligated to non-disclosure by an adequate, signed NDA. Your measures might also include non-disclosure of access passwords or encryption codes by otherwise authorized persons as well as other special technological procedures, such as required deletion or erasure by any employee who inadvertently receives trade secret data he or she is not permitted to hold.

What measures will be deemed reasonable under the trade secret law depends on various factors, such as the value of the trade secret, the size and income of your company, and the likelihood of industrial espionage in your industry aimed at the particular type of property. For the Coca-Cola Company, this meant specially constructing a large vault to protect its trade secret.

A downside to relying on trade secret protection is that if it does get out in spite of your efforts and becomes generally known to the public or to those who can profit from using it, that protection likely will be lost. A decision to treat information as a trade secret – as well as just what confidentiality measures are necessary to protect it – should be made deliberately with skilled attorney assistance.

For any questions concerning trade secrets, please contact attorney Helena Kobrin.

Helena Kobrin, February 18, 2015

Copyright Owners “Make Some Noise” for Infringement of Their Songs

Protecting your own copyrights is of paramount importance. See “Annals of Copyright Number 2.” Vigilance in avoiding violations of others’ copyrights is equally necessary to prevent expensive legal disputes. See “The Annals of Copyright Number 3”. Monster Energy has learned this the hard way in a lawsuit brought by Beastie Boys. See Beastie Boys v. Monster Energy Co.

To promote its products, Monster Energy engages in so-called “lifestyle marketing.” As the Beastie Boys judge observed: “This entails sponsoring action-sport athletes and musicians, promoting concert and “festival-styled” tours, and hosting events. Monster’s advertising goal is to create an aggressive and fun “brand personality,” which will lead consumers to associate its beverages with music, action sports, video games, and attractive girls … (“Monster is a lifestyle in a can.”).

Monster strayed into the copyright infringement minefield when it made a four minute, six second video filled with Beastie Boys’ music and containing other, written references to the group. Beastie Boys “made some noise” when they sued Monster for copyright infringement and false endorsement under the federal Lanham Act. This law protects against trademark infringement and other actions that are “likely to cause confusion . . . as to the origin, sponsorship or approval” of a person’s distinct product or service.

Monster Energy admitted to copyright infringement but claimed its actions were not intentional. The Beastie Boys pressed on through a jury trial on the false endorsement claim and on whether some 15 instances of copyright infringement were willful. The jury found Monster Energy liable for 10 infringements, awarding damages at $120,000 per instance. It also awarded $500,000 for the false endorsement claim, for a total of $1,620,000.

So how did a large company like Monster Energy go wrong? Its first error was “recklessly disregarding” Beastie Boys’ rights by making a video with five songs by the group without seeking any permission. The court found Monster Energy’s infringement “derived from a gross lack of attention at corporate level to others’ intellectual property rights.” In contrast with protecting its own copyrights vigorously, it lacked any copyright licensing policy or training for its staff using others’ music for videos or other purposes.

These days, it is common for companies and organizations to use copyrighted music and other content that they do not own for a variety of purposes. For some uses, including playing music at an event, there are licensing agencies – primarily BMI, ASCAP and SESAC – that provide licenses permitting the action. For other uses, such as putting music in commercials, multiple types of licenses may be required. As Monster Energy learned, if you do not seek help to ensure you are covered with all the needed licenses, it may turn into an expensive mistake. While the Beastie Boys set-back will not put Monster Energy out of business, a similar judgment against a smaller company might have that result.
For help in obtaining the appropriate licenses, contact Helena Kobrin, a knowledgeable copyright attorney.

Helena Kobrin, February 4, 2015

Copyright Owners “Make Some Noise” for Infringement of Their Songs

Protecting your own copyrights is of paramount importance. See “Annals of Copyright Number 2.” Vigilance in avoiding violations of others’ copyrights is equally necessary to prevent expensive legal disputes. See “The Annals of Copyright Number 3”. Monster Energy has learned this the hard way in a lawsuit brought by Beastie Boys. See Beastie Boys v. Monster Energy Co.

To promote its products, Monster Energy engages in so-called “lifestyle marketing.” As the Beastie Boys judge observed: “This entails sponsoring action-sport athletes and musicians, promoting concert and “festival-styled” tours, and hosting events. Monster’s advertising goal is to create an aggressive and fun “brand personality,” which will lead consumers to associate its beverages with music, action sports, video games, and attractive girls … (“Monster is a lifestyle in a can.”).

Monster strayed into the copyright infringement minefield when it made a four minute, six second video filled with Beastie Boys’ music and containing other, written references to the group. Beastie Boys “made some noise” when they sued Monster for copyright infringement and false endorsement under the federal Lanham Act. This law protects against trademark infringement and other actions that are “likely to cause confusion . . . as to the origin, sponsorship or approval” of a person’s distinct product or service.

Monster Energy admitted to copyright infringement but claimed its actions were not intentional. The Beastie Boys pressed on through a jury trial on the false endorsement claim and on whether some 15 instances of copyright infringement were willful. The jury found Monster Energy liable for 10 infringements, awarding damages at $120,000 per instance. It also awarded $500,000 for the false endorsement claim, for a total of $1,620,000.

So how did a large company like Monster Energy go wrong? Its first error was “recklessly disregarding” Beastie Boys’ rights by making a video with five songs by the group without seeking any permission. The court found Monster Energy’s infringement “derived from a gross lack of attention at corporate level to others’ intellectual property rights.” In contrast with protecting its own copyrights vigorously, it lacked any copyright licensing policy or training for its staff using others’ music for videos or other purposes.

These days, it is common for companies and organizations to use copyrighted music and other content that they do not own for a variety of purposes. For some uses, including playing music at an event, there are licensing agencies – primarily BMI, ASCAP and SESAC – that provide licenses permitting the action. For other uses, such as putting music in commercials, multiple types of licenses may be required. As Monster Energy learned, if you do not seek help to ensure you are covered with all the needed licenses, it may turn into an expensive mistake. While the Beastie Boys set-back will not put Monster Energy out of business, a similar judgment against a smaller company might have that result.
For help in obtaining the appropriate licenses, contact Helena Kobrin, a knowledgeable copyright attorney.

Helena Kobrin, February 4, 2015

Should You Register Your Copyrighted Work?

Registration with the U.S. Copyright Office gives the copyright holder the right to file a lawsuit for infringement against an unauthorized user of that work. Title 17 United States Code section 411(a). It also enables the copyright holder to claim and possibly win actual or statutory damages (set amounts not requiring proof of actual loss) and attorney’s fees if the court confirms the infringement, section 412. A lot can be at stake. Statutory damages range from $200 for an innocent infringement to $150,000 for a willful one, for each violation.

Registration places the rest of the world on notice of the copyright and can thus deter a potential infringer.

Registration within the first five years after publication can add greater weight to the evidence that the work is original and protected.

Also, many registrations are easy and low cost, achievable online for as little as $35.00.

However, there are factors that might not favor registration. The number of copyrighted works one creates is a consideration. Whether the original work is central or incidental to one’s enterprise is another. For example, a performer who writes her or his own music might well be smart to register such creations. However, a band’s creation of throw-away promo for various live performances may not be worth the trouble because a lawsuit to protect those flyers might not ever be seriously considered.

Generally, the more valuable the copyright, i.e., the larger the audience for your work and the more you stand to profit from it, the more sense there is in prompt registration.

If you do choose to register any copyrights, it normally takes some time to receive confirmation. The Copyright Office currently advises that confirmation of online registration is taking up to eight months and up to 13 months for hard copy registrations. If you have any questions about copyright, including registration, fair use or other issues, contact our Of Counsel attorney, Helena Kobrin.

Helena Kobrin, January 9, 2015

Should You Register Your Copyrighted Work?

Registration with the U.S. Copyright Office gives the copyright holder the right to file a lawsuit for infringement against an unauthorized user of that work. Title 17 United States Code section 411(a). It also enables the copyright holder to claim and possibly win actual or statutory damages (set amounts not requiring proof of actual loss) and attorney’s fees if the court confirms the infringement, section 412. A lot can be at stake. Statutory damages range from $200 for an innocent infringement to $150,000 for a willful one, for each violation.

Registration places the rest of the world on notice of the copyright and can thus deter a potential infringer.

Registration within the first five years after publication can add greater weight to the evidence that the work is original and protected.

Also, many registrations are easy and low cost, achievable online for as little as $35.00.

However, there are factors that might not favor registration. The number of copyrighted works one creates is a consideration. Whether the original work is central or incidental to one’s enterprise is another. For example, a performer who writes her or his own music might well be smart to register such creations. However, a band’s creation of throw-away promo for various live performances may not be worth the trouble because a lawsuit to protect those flyers might not ever be seriously considered.

Generally, the more valuable the copyright, i.e., the larger the audience for your work and the more you stand to profit from it, the more sense there is in prompt registration.

If you do choose to register any copyrights, it normally takes some time to receive confirmation. The Copyright Office currently advises that confirmation of online registration is taking up to eight months and up to 13 months for hard copy registrations. If you have any questions about copyright, including registration, fair use or other issues, contact our Of Counsel attorney, Helena Kobrin.

Helena Kobrin, January 9, 2015