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Retail Law Advisor

Retail Hybrids: Following Trends in Cars, Sports and Food

Posted in Retail

Hybrids of many sorts have been trending in countless industries throughout the years and show no sign of fading away anytime soon.  Toyota announced that it sold its 10 millionth hybrid car this year, twenty years after launching its first Prius. Prior to this year’s NBA Final, the New York Times described four time NBA MVP and three time league champion LeBron James, arguably the league’s best player, as “a hybrid of Magic [Johnson] and Michael [Jordan], with some Karl Malone, too.” The hybrid trend has also been a mainstay in the culinary field for years ranging from the delicious (Cronuts) to the exotic (Sushi Donuts) to the indescribable (Burger King’s Mac and Cheetos—a fried Cheeto filled with macaroni and cheese). Recently, in following with other hybrid trends, retailers and office tenants have begun combining their space needs into a hybrid retail/office storefront.

For years, coffee shops have been the de facto offices of college students, struggling writers, and professionals desperate to find reliable Wi-Fi connections, but Capital One has gone ahead and officially made the coffee shop its office. Peet’s Coffee and Capital One have combined your neighborhood java distributor and local bank branch office into Capital One Cafes. These cafes are staffed with both “digital lifestyle coaches” assisting customers with online banking needs and baristas serving up your morning cup of joe. Despite the fact that the banking industry has seen a steady decline in the number of bank branches (reports show the number of bank branches in the U.S. declining from 99,500 in 2009 to 92,997 in 2015), Capital One Cafes are expanding and offering customers a convenient alternative to traditional banking. Capital One Cafes are located in Boston, Chicago, Denver, Boulder, Los Angeles, Philadelphia, Richmond, West Palm Beach, San Francisco and St. Cloud, MN with plans to open cafes in Seattle, South Florida and Austin.

Although many of us may think that Capital One Cafes are offering a limitless supply of the most important office supply—coffee, Staples and Workbar are collaborating to make sure that some businesses are never in danger of being out of any office supplies. The space within a space idea provides Workbar with co-working space inside of three Staples retail locations in Massachusetts: Brighton, Norwood, and Danvers. The Workbar spaces offer some of the newer amenities that you might see in a tech start-up space, such as smart boards, interactive screens, and a putting green. These amenities are all bundled in a collaborative environment encouraging consultations with co-workers and collaborations with other businesses operating in the same space. Plus, there is the obvious upside of being a few feet away from those ever elusive printer cartridges and that special type of pen that you like, but can never find.

Mixed-use developments that include office, retail, and residential space are not a new innovation, but the integration of office space with inline retail space in lifestyle and strip centers is further blurring the lines between office and retail. Whereas dentist and other medical offices have traditionally been part of the lifestyle and strip center tenant mix, such office uses are expanding to include urgent care facilities and new types of office tenants, which are helping to reinvigorate once quiet retail centers. For example, the Westfield San Francisco Center is a nine-story mall featuring over 150 shops and restaurants. The fourth floor of the Center is now occupied by Bespoke, a company that offers a trifecta of co-working, demo and event spaces where tech and retail market places converge. Bespoke is estimated to have attracted 100,000 additional customers to the Westfield project in its first year as a tenant.

While these innovative ideas for retail and office show great promise, it remains to be seen whether they will have the staying power to help existing retailers thrive, or will, like most trends, fall out fashion. The key to a successful hybrid is bringing together two things that people want and/or need that when combined create a whole greater than the sum of its parts. As the demands in both retail and office change, combining the two may provide greater flexibility for retailers and space for office tenants that meets their shifting needs.

Artificial Intelligence in Brick and Mortar Retail

Posted in Retail, Retail Sales, Technology

Headlines about brick and mortar retail tend to be dominated by how these establishments are in decline while online retail is burgeoning. Fortunately for brick and mortar retailers, their demise is not preordained since tools from the online retail universe may also help them succeed. One such tool is artificial intelligence (AI), which is expected to grow rapidly in the next few years.

Online retail is able to target customers easily because of the large data collection that occurs with every transaction. However, brick and mortar retail establishments may employ various AI tools to collect data to tailor in-store shopping experiences and target consumers. For example, video and/or audio surveillance can be used to track shopper activity in stores, and stores can then predict customer preferences and behaviors by analyzing and conglomerating in-store surveillance. Such surveillance methods can use facial and/or voice recognition software to analyze facial and voice expressions to understand how customers react to particular products or experiences.

Robots are another AI tool that may help brick and mortar retail compete more effectively with online retail. Robots may enhance the physical shopping experience in many ways. Humanoid robots can be deployed into retail establishments to greet customers, answer questions, and guide them through the store. Lowe’s has piloted a robot program at its Bay Area stores, where robots help customers search for products and guide them in the stores. Also, robots are being used and expanded to check and resupply inventory, deliver products, and assist with checkout and payment.

Finally, the collection of sales data can help retailers personalize a customer experience and ultimately help increase sales – whether in-store or online. Data can be collected online and then used in stores, or data collected from a customer’s previous visit can be used to enhance his or her next visit to a bricks and mortar store. “Machine learning” can discover patterns in a customer’s behavior and then make suggestions or produce incentives, such as instantly printing coupons for products that are likely to be desirable to an individual customer. The same data collection can be used to better tailor inventory, customize shopping experiences, adjust pricing, and refine product selection. While all of these techniques are equally useful online retail tools, their utility in the bricks and mortar environment may help these physical establishments remain competitive with their online counterparts.

A Nation of Shopkeepers

Posted in Restaurants, Retail, Retail Sales

David Rabinowitz and Matt Epstein who, with Nancy Davids, co-chair Goulston’s Retail, Restaurant and Consumer Group, spent some time in London last month surveying the retail landscape. There are both similarities and differences between the US and UK markets. Of course, the impact of ecommerce on bricks and mortar is top of mind. It doesn’t seem that many UK retailers who started out peddling their wares on the web have jumped to the High Street, a la Warby Parker, Bonobos and Amazon. You will, however, find that entertainment and food takes up more and more square footage on both sides of the Atlantic. It’s not simply aimed at appealing to the Millenials’ appetite for the next “experience”; restaurants seemed packed with baby boomers as well. The Brits are taking the Brexit uncertainties in stride; the professionals we met with are charging forward with their deals with the belief that you can’t control that which you cannot predict. We heard differences of opinion regarding the future of The City (i.e. London’s Wall Street). Some expressed concern about the rumblings from banks, hedge funds and private equity shops that Paris, Dublin and Frankfurt were looking more and more attractive. Others discounted the likelihood of a mass exodus of money to cities which lacked the infrastructure, labor laws and financial depth of London.

Perhaps the greatest difference we noticed between London and Manhattan can be attributed to the ownership of large tracts of London by tradition bound and centuries old estates, such as the Crown Estate and the Grosvenor Estate. You simply don’t see the same level of retail vacancies on Regent and Bond Streets as you find on Madison Avenue and in Soho. These large estates take the long view; landlords look for stability and don’t squeeze the last dollar in rent from each tenant. This results in some very hefty key money payments from tenants assuming leases. But with the Crown’s wealth, it’s not necessary to continually refinance to take your cash out. It’s a steadier retail landscape with more gentle hills and shallower valleys. Although we’re not making any value judgments, shoppers in London—and the footfall on Regent Street is something to behold—rarely encounter the depressing vista of an empty store that resulted from the oversized rental expectations of a landlord with a hungry lender awaiting its monthly feeding.

ICSC Deal Making Conference Explores the Changing Retail Industry

Posted in Retail

The ICSC New England Conference & Deal Making was held from July 18 through July 20, 2017 at the Hynes Convention Center in Boston. Registered attendance at the Conference was strong again this year, with over 1,200 people registered for the show.

The sessions on the opening day of the show included a program on public/private partnership, as well as some fun from NextGen with real estate trivia. The key note speaker of the opening day was Tom Wilder from The Wilder Companies. In his remarks, Tom highlighted many of the changes that are transforming the industry. He pointed out the decline in the apparel retailers, which is a trend that so many at the Conference are seeing in their projects. However, the growing importance of retailers that offer an experience or a service, including restaurants, entertainment, medical office or other service retail, is changing what projects look like today. Mixed use projects that offer a vibrant round-the-clock atmosphere are well positioned for success. Tom closed his remarks with advice that in order to survive and thrive in these changing times, landlords and developers need to take risks and try something new. The Retailer Runway in the afternoon was consistent with Tom’s remarks, featuring many restaurants and fitness concepts, as this segment of the industry continues to grow and flourish. A common theme among the participating retailers in the Retailer Runway (including Frank Pepe Pizzeria Napoletana, Orange Theory Fitness, and honeygrow, among others) was the “halo effect” that a vibrant tenant use can have in terms of attracting other tenants and customers to a project.

The deal making session on the second day of the show was attended by both landlords and tenants. While at times the traffic in the leasing floor seemed light, attendees reported several positive and productive meetings. The mood at the after-Conference party was upbeat and positive. There was acknowledgement that the industry is in a period of change, but a recognition that there is opportunity as well.

E-commerce Is Changing the Definition of Retail Employment

Posted in E-commerce, Employment, Retail, Retail Sales

The retail landscape is in the midst of a mind-boggling – and fast-moving – evolution.  In a short amount of time, Americans have radically changed how they shop for things, utilizing multiple channels of shopping to meet their needs.  80% of Americans are now shopping online, and they utilize e-commerce for a wide range of purposes – from researching costs and reviews before making a buying decision (sometimes at home, sometime while they are in a physical store location), to ordering non-perishable household goods and clothing.

As a result of these on-going changes to the retail landscape, 2017 has seen an unprecedented number of retail bankruptcies and store closings, with department and clothing stores in particular taking big hits.  Just this year, The Limited, Wet Seal, Payless Shoes, and Gymboree have all filed for bankruptcy.  As reported by Bloomberg, the CEO of Urban Outfitters described the current retail clothing picture as a bubble, “and like housing, that bubble has now burst . . . We are seeing the results: Doors shuttering and rents retreating. This trend will continue for the foreseeable future and may even accelerate.”

What has this larger sea change in retail meant for employment?  Retail jobs are a mainstay in this country, offering entry level positions and reliable work for tens of millions of Americans.  It is clear that along with shuttered stores, we are losing traditional retail jobs – reportedly 30,000 in March alone.  However, the report is not so bleak across the board.  It seems that jobs are shifting to new areas of demand, rather than simply disappearing.  While the rise of e-commerce has led to fewer traditional retail jobs, it is also driving a huge demand for warehouse, distribution and customer service jobs.  Amazon alone is planning to hire approximately 100,000 people by mid-2018.  That hiring boom, along with Amazon’s acquisition of Whole Foods, signals plenty of job opportunities in “new” retail.  Additionally, e-commerce jobs may be better quality work than traditional retail.  E-commerce pays significantly better than traditional retail jobs – approximately 26% percent more, as increased demand has led to increased competition for workers and higher wages, and the 100,000 jobs Amazon has announced are full-time positions with benefits.

Another area for retail job growth is customers’ increasing interest in so-called experiential retail.  Consumers don’t want to shop simply for goods (hence, the reduced demand for broad-based department and clothing stores), they are looking for brick and mortar stores to provide experiences and services.  The brands that provide such experiences are thriving, from fast casual restaurants like Shake Shack, to beauty providers like Sephora and Ulta, to specialty fitness like SoulCycle.  Experiential retail is also one way to address a major concern with new e-commerce jobs – specifically, how unevenly they are distributed.  New jobs in e-commerce are located near distribution centers, which are disproportionately located near large metropolitan areas.  That has left smaller metropolitan and rural areas with two waves of job losses – first from manufacturing, and now from retail shifts.  Therefore the demand for experience may pave the way for a renaissance of local businesses, even in rural and small metro areas, that provide services rather than goods.  So while mom-and-pop shops have been pushed out by Walmart and similar retailers, there is room for local stores as well as chains to spring up in lots of markets, if they offer services, such as spa and nail services, restaurants, local breweries, and fitness.

In short, while the consequences of e-commerce are still shaking out, and there are likely to be many more store closings and bankruptcies in the future, there is reason to be optimistic about “new” retail and the opportunities it can create for individuals.  That is, until the robots come.

Sneak peak at next month’s blog post topic – “The Robots Are Coming: How Will the Rise of Automation Alter Retail Jobs?”

Is Artificial Intelligence the Key to Retail Survival?

Posted in Retail, Retail Sales, Technology

In light of the sea change in the current retail landscape, which was punctuated by the recent acquisition of Whole Foods by Amazon, retailers today are forced to ask themselves: How will we combat disruption in our industry by giants like Amazon and its few peers? To what extent should we migrate to mobile shopping (“m-commerce”), adopt cashier-less checkout, or even try to deliver purchases by drone?

Artificial intelligence is the prohibitive favorite among analysts to influence the future of retail, but current examples of retail adaptations to changing consumer preferences show that not all success will be driven by technology. According to a Gartner report and a TechEmergence article, some of the many adjustments that retailers are making to stay relevant in the world of online giants are high-tech, but some are not: (1) free delivery and returns; (2) data collection by in-store audio and video monitors; (3) improving in-store footprint/layout; (4) providing in-store assistance from people and robots to improve the experience and make checkout quicker/easier; and (5) using browser history and/or in-person shopping history to personalize the shopping experience and provide personalized promotions.

The consistent theme of these changes appears to be tailoring the shopping experience to each customer and expediting the painful parts of the process, namely, standing in lines and paying. Retailers that originated as exclusively e-commerce operations inherently better understand and implement artificial intelligence solutions. On the other hand, large retail establishments and boutique brick and mortar shops have had varying degrees of success in maintaining a devoted consumer base despite the stores’ best efforts to stay relevant.

Big box stores and club/membership stores are stereotypically slower to make changes because of their conservative boards and corporate hierarchies. The short-term bottom line matters most. Stock-price pressure will often force the hand of these stores to make only those changes that directly and irrefutably improve the bottom line. While artificial intelligence has gained traction in certain industries and certain companies, technology-based automation is often used in these stores only for certain pieces of the supply chain or manufacturing improvements, where the effect on the bottom line is perceived to be more easily calculated. With respect to UK grocery stores, for example, a recent Blue Yonder study found that “nearly 85 percent of UK directors said automation would help them to make faster decisions, yet in spite of this, half of grocery retail managers said that ‘gut feeling’ still plays a major part in their decision-making process.”

Boutique retailers often take a more personalized, but sometimes less high-tech, approach to improve customer conversion, retention and other KPIs. Their efforts may include: (1) targeted promotions based on proximity/mobile touchpoints; (2) back stories to products explained through multimedia productions; and/or (3) humanizing the shopping experience and making it more interactive (e.g., the DIY or “pick-your-own” movement; the sustainably-sourced local produce). Some small retailers also have a reliable niche customer base (such as tourists) who may be an exception to the general trend of online/mobile purchases. Even these niche retailers have an opportunity to expand their market through targeted advertising and facilitating purchases when customers leave the traditional reach of the niche shop.

Grocery stores, in particular, offer a unique opportunity for a brick and mortar stronghold due to the customer’s innate desire to see and select the fresh food he or she will consume.  The PwC strategy+business blog explains that groceries began as a “pull” over-the-counter industry where the grocer would pull products from a stock room based on a customer’s order at the counter.  The shift to a “push” industry began with the advent of supermarkets, now captained by worldwide retail grocery leader Wal-Mart. Push the products out on the shelves, the theory goes, and let the consumers select from the available choices. Then, more recently, the “digital pull” concept arose, through which mobile grocery orders can be submitted, the grocer will pull the desired products and either arrange for pick up or delivery.  We will see how Amazon applies the digital pull method to Whole Foods, and if the AmazonFresh (grocery delivery) and/or Amazon Go (cashier-less brick and mortar) models becomes their standard.

Nevertheless, in the face of such competition from the push giant, Wal-Mart, and the pull giant, Amazon, smaller grocery stores still have unique advantages of strong customer loyalty and responsive price changes and promotions to be able to “ply-your-wares,” as PwC suggests. The digital ply method may very well prove to keep boutique grocers alive:

A digital ply model gives consumers something they can’t get from a scale-based model: tailored offers based on historical in-store shopping patterns and micro-segmentation derived from big data. The family being targeted by a digital message is not just segmented, but analyzed for its needs and wants, almost down to an individual level. The supermarket no longer tries to compete with Amazon or Walmart by providing everything; instead, it provides what it perceives its customers will want and need most. Sometimes this will be fresh or precooked food; other times, just the right assortment of staple goods. Sometimes, the supermarket offers rare items that a few key customers have bought in the past, and that happen to be available now.

In practice, retailers may also find that a combination of the methods described above works best. Roche Bros., for example, is a Massachusetts supermarket chain that remains confident that it can weather competition from the likes of Whole Foods. It has grown its loyal customer base by implementing a combination of high-tech and traditional strategies. Roche Bros. has run its own e-commerce platform for over a decade, which has been updated and modernized by a top e-commerce software firm, and most locations offer certain delivery and pick-up services. Also, by emphasizing fresh produce, meats, seafood and prepared foods, Roche Bros. has tried to avoid relying on non-perishables that are increasingly purchased through online retailers. It is also expanding new concepts with smaller stores that even better address the needs of local repeat customers. This mixture of technological advancements and strategic product offerings has kept Roche Bros. on strong ground.

As is true in any retail environment, a wholly-successful relationship between a seller and its buyers occurs when the seller has exactly what each buyer wants to buy, and no excess inventory. Like small grocery stores, most traditional small retailers will need to adopt tech-driven solutions to achieve such a delicate balance. But they are best positioned to adapt to local demands and may be able to use a combination of low-tech and artificial intelligence strategies to sustain a loyal customer base, even in the face of giants.

Happy 4th of July!

Posted in Holiday, Retail

dreamstimefree_17461During this week, we pause to proudly celebrate freedom across the United States.

Our blogging team will resume providing timely information about issues that may be facing the retail industry next week.

Thank you for subscribing to our retail blog.  Have a safe and happy Fourth of July!

Warm Wishes,

The Retail Law Advisor editorial board

Retailers Grow Successfully by Introducing New Brands

Posted in Retail, Retail Sales

teenshoppingAs fashion retailers across the country jostle for market share in an ever-changing and ever-competitive marketplace, some retailers are trying to improve their bottom lines not by adjusting or expanding their offerings in each store but by opening differently branded stores separate from their flagship brands. Many retailers, especially those in the fashion world, have found that growth under their flagship brands is pushing up against a ceiling. As margins begin to narrow and discounts are less effective in bringing customers through the door, some companies have sought new customers by expanding into new markets with different brands.

One of the world’s largest fashion retailers, Inditex SA, has been pursuing this approach since 1991 and has ridden its multi-brand strategy to over 7,300 stores.  Two-thirds of the company’s locations now operate under a brand other than the “Zara” flagship brand and account for about one-third of its revenue.  Another example is Hennes & Mauritz AB, a Swedish company that has ridden a wave of popularity among teenagers and millennials with its flagship H&M stores, but has been forced in recent years to diversify the branding of its stores to keep new customers lining up for its goods.  Among other reasons, a drop in net profits from 26% in 2007 to about 9.5% today has motivated executives at H&M to explore introducing new brands as a way to keep growing. While the company started diversifying in 2007 by creating new brands and acquiring smaller retailers, today still less than ten percent of its almost 4,400 stores are under separate brands. Nonetheless, although industry groups estimate that these smaller brands account for only about five percent of H&M’s sales, the company sees its other brands as crucial to its future success by expanding into higher-end clothing that attracts a different consumer than the flagship brand attracts.

It goes without saying that expanding into newly branded locations, or expanding by acquiring smaller boutique brands, are only two of the many strategies a mature retailer can use to entice new customers into its locations and thus diversify and grow its customer base. Companies certainly need to keep revitalizing their flagship brands, whether through implementing more efficient supply chains, improving inventory management practices or adapting marketing plans to appeal to a wider audience. But finding a broader customer base outside the flagship brand’s core demographic by opening or acquiring other branded locations has proven to be a successful growth strategy for some of fashion’s largest retailers.

Amazon & Wal-Mart: Pinky and The Brain of Retail

Posted in Retail, Retail Sales

online-shoppingIn the opening montage of the American animated series, Pinky and The Brain, Pinky asks his best friend, The Brain: “What do you want to do tonight?” To which The Brain replies: “The same thing we do every night; try to take over the world!” Doug McMillon (CEO of Wal-Mart) and Jeff Bezos (CEO of Amazon) personify these lovable characters in their ambition to take over the retail world for better or worse. Last week’s bombshell announcements of online behemoth Amazon’s purchase of Whole Foods and Walmart’s purchase of Bonobos rippled through the retail world, and even caused the stock of certain retailers to plunge, which some business analysts have interpreted to signal the proverbial “white flag” in terms of consumer/investor confidence. As these big-box retailers try to make sense of these momentous deals and the imminent changes to the retail world as they know it, Amazon and Wal-Mart are forging forward in a head to head battle for retail supremacy. If the recent moves from Walmart and Amazon are any indication, the future of retail will be a seamless fusion of online e-commerce and brick-and-mortar retail omnipresence.

For the past decade, Amazon has led an online retail crusade morphing into the country’s biggest online retailer and has crushed the bottom-line of many brick-and-mortar retailers, like Wal-Mart, along the way. But, with Walmart’s purchase of Bonobos and Moosejaw, Wal-Mart has taken a strong foothold in the online retail world to compete on Amazon’s turf. These aggressive moves, aimed squarely at Amazon in an effort to knock it off of its perch, prove that Walmart may well be the only retail giant with enough size, scale and funds to battle Amazon. What both retail giants understand is that shopping is not a monolithic online experience, nor does it operate exclusively in brick-and-mortar shops. And, the whims of modern day consumers call for a versatile shopping experience, whereby consumers can invigorate their senses through an in-store experience one day, and sit in the comforts of their homes perusing online and waiting for their package the next.

Amazon initially explored the grocery business with Amazon Fresh, a grocery delivery service, which did not turn-out as successful as Amazon had hoped due to logistics and economics involved with perishable items. But, given Amazon’s vast institutional knowledge of online e-commerce and its cash cow Amazon Prime, acquiring Whole Foods was a logical and inspired maneuver by Amazon. Not only does this acquisition give Amazon an edge over delivery start-ups such as Instacart and Fresh Direct, but it also provides Amazon with a national platform to compete with Walmart in the grocery arena. Right now, it’s unclear how Amazon will choose to deploy its newest toy. However, with a national footprint on the horizon, one can only speculate that Amazon will likely inject its new darling with an infusion of cash and technological innovation, such as “Amazon Go” which allows consumers to exit the store without checking out.

While Amazon is learning the ropes of retail stores, Walmart’s acquisition of Bonobos will allow it to build expertise in the online universe where it is trying to overtake Amazon. By acquiring Bonobos and various other retail brands, Walmart is corralling established upstart online business that will improve Wal-Mart’s ability to take on Amazon in areas where it lacks expertise and/or inventory. Effectively pairing these online businesses with its existing brick-and-mortar retail stores – whether by incentivizing online shoppers to pick up their items in stores or employing Wal-Mart staff to serve as delivery drivers for online orders – will better position Wal-Mart to break Amazon’s vice grip on the online e-commerce industry.

At one point in time, Amazon and Walmart operated in parallel universes, each reigning supreme in its particular industry. However, a convergence of wills and retail zeal has sparked an impassioned competition for retail dominance between these companies that has the potential of changing the future of retail forever.

Forging a Legal Firewall: Recent Decisions May Shield Retailers from ADA-Based Website Inaccessibility Claims

Posted in Employment, Litigation, Retail

Keyboard - access key Contact usIn a post published earlier this year, we commented on a surge of lawsuits being filed under Title III of the Americans with Disabilities Act (“ADA”). Title III of the ADA prohibits discrimination in the full and free enjoyment of public accommodations on the basis of disability. Where websites and mobile applications serve as extensions of brick-and-mortar stores, some courts have held that retailers are responsible for accommodating disabled consumers on their online platforms.

We previously noted the lack of authoritative guidelines for businesses seeking to adjust their websites to comply with the law. Despite issuing a notice of proposed rulemaking seven years ago, the Department of Justice has still not promulgated regulations defining accessibility as it applies to web-based tools.  In the fall of 2015, the Department of Justice announced that it would issue the proposed regulations in 2018. However, President Donald Trump’s Executive Order 13771 will likely delay the release of such proposed regulations even further. Trump’s executive order places restrictions on new or pending rulemaking, slowing existing initiatives and requiring reconsideration of departmental priorities moving forward.

As companies await official guidance from the Department of Justice, some rely on the Web Content Accessibility Guidelines 2.0 issued by the World Wide Web Consortium. As we explained in a prior piece, the Guidelines specify ways by which retailers may improve the accessibility of online tools for those with disabilities. The Department of Justice regularly uses the Web Content Accessibility Guidelines in structuring settlement agreements with companies charged with non-compliance of the ADA. Some legal experts predict that the forthcoming official Department of Justice regulations will resemble these guidelines.

While website accessibility actions continue to bombard retailers, two recent decisions may indicate courts’ increasing skepticism of the claims. In Andres Gomez v. Bang & Olufsen America, Inc, a Florida district court held that the ADA does not require places of public accommodation to create full-service websites for disabled persons, as there is no obligation for places of public accommodation to have a website at all. The court explained that the ADA only requires that a website not impede a disabled person’s ability to do business at a retailer’s physical store. In this case, because the retailer’s website did not interfere with plaintiff’s ability to purchase their merchandise offline, the court dismissed plaintiff’s claim.

In Robles v. Dominos Pizza LLC, a California district court granted Dominos Pizza’s motion to dismiss under the primary jurisdiction doctrine. The doctrine, which has been rejected by other courts, provides for the dismissal of lawsuits pending the resolution of an issue by a government agency. Relying on the fact that the Department of Justice has not yet offered meaningful guidance on website accessibility requirements, the court found that holding Dominos to have breached the Title III of the ADA would violate Dominos’ due process rights. In reaching this decision, the court effectively rejected requiring compliance with the Web Content Accessibility Guidelines without designating concrete minimum achievement standards.

It remains to be seen whether these decisions are outliers or first in a wave of jurisprudence hostile to website inaccessibility claims. Until the Department of Justice’s regulations are promulgated or further court decisions are released, businesses would be well-advised to consult the Web Content Accessibility Guidelines when designing or making changes to their websites and mobile applications. Notwithstanding that advice, retailers should also consider the delayed implementation of regulations as a potential defense to website inaccessibility claims.