Manufacturing & Distribution Client Advisory - December 2016

TEXAS DISTRICT COURT ENJOINS DOL OVERTIME RULES
By Bob Barry

On November 23, 2016 in a closely watched case styled Nevada vs. U. S. Department of Labor, a Texas federal district court issued a preliminary injunction barring the U.S. Department of Labor from enforcing its new overtime rules under the FLSA which were set to go into effect on December 1. The court determined that Congress had unambiguously expressed its intent for employees with executive, administrative, and professional duties to be exempt from overtime. Nothing in the exemption, explained the court, indicated Congressional intent to give the Department of Labor authority to define or limit the exemption based on salary. Of course DOL has been doing just that for many years.

Employers in all sectors of the economy are asking what comes next? That is a difficult question since the next move will be by the Department of Labor. On December 1, DOL advised the district court that it would seek an appeal to the United States 5th Circuit Court of Appeal. This then raises the question of how long the appeal will take. It is possible that the matter will be expedited, or it could become moot with a new administration coming in on January 20, 2017.

Employers have several choices at this juncture. They may implement changes that they had planned for December 1, even though they are not required to do so. They may also choose to restore their pre-December pay plans. For employees who have been promised a raise to comply with the new law, employers may, of course, go through with the raise. Those who wish to avoid that extra cost may do so but should be careful to explain to employees that the raise was expected but not a contractual or other obligation.

The current situation is fluid, and the best advice may be for employers to retain the status quo until more is known. This could happen quickly or could take until after the new administration takes some action. Stay tuned.


TRADEMARK PROTECTION BEYOND YOUR CORPORATE/BUSINESS NAME
By Bob Smartschan

We have found over the years that many of our clients whether manufacturers or ones in other industries consider it important to protect their corporate/business names as trademarks, but too often do not go to the next level and give similar attention to protection for the names they use for their products and product lines. Failing to do that can leave the door open for competitors to adopt names for their products that are similar or identical to what you use for yours, creating the potential for confusion in the marketplace and diversion of customers to the competitors products. While some degree of uniqueness is a prerequisite for trademark protection (i.e., the generic name of a product will not be registrable as a trademark), the threshold for U.S. federal registration is not so high that a manufacturer should assume that its product names will not be protectable as registered trademarks because they are too mundane, common or descriptive of the products. We have had a high level of success in obtaining U.S. federal trademark registrations on product names that are recognizable acronyms for a series of words in the name, or that are letter/number combinations representing individual products within a product line, or that describe size or other physical features of the products involved. Obtaining U.S. federal registrations for these types of trademarks can be as valuable as obtaining them in more distinctive and unique product names, because in each case a trademark registration provides the right to prevent competitors from using the same or similar names for their products. This in turn strengthens your ability to distinguish and differentiate your products in the marketplace.


The contents of this publication are intended for general information only and should not be construed as legal advice or a legal opinion on specific facts and circumstances. Copyright 2017.

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