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MITCHELL v. FURMAN BEAUTY SUPPLY

March 14, 1961

James P. MITCHELL, Secretary of Labor, United States Department of Labor, Plaintiff,
v.
FURMAN BEAUTY SUPPLY, INC., Defendant



The opinion of the court was delivered by: FOLLMER

Plaintiff alleges that the defendant, Furman Beauty Supply, Inc., was engaged in interstate commerce and in the production of goods for interstate commerce and had employed some of its employees for work weeks longer than forty hours, without compensating them at rates not less than one and one-half the regular rate at which they were employed for employment in excess of forty hours. Accordingly, plaintiff seeks to enjoin the defendant from violating the provisions of the Fair Labor Standards Act of 1938, as amended (29 U.S.C.A. § 201 et seq.)

We need not consider defendant's defense contained in its Answer 'that it believes it is exempt from the application of the Act by virtue of the fact that * * * it is engaged primarily in intrastate commerce and only in an insubstantial manner in interstate commerce' since defendant's second defense that 'it is exempt by reason of Section 13(a)(2) of the (Fair Labor Standards) Act' is dispositive of the action.

 This section (as 29 U.S.C.A. § 213) provides, inter alia, as follows:

 '(a) The provisions of sections 206 and 207 of this title shall not apply with respect to * * * (2) any employee employed by any retail or service establishment, more than 50 per centum of which establishment's annual dollar volume of sales of goods or services is made within the State in which the establishment is located. A 'retail or service establishment' shall mean an establishment 75 per centum of whose annual dollar volume of sales of goods or services (or of both) is not for resale and is recognized as retail sales or services in the particular industry; * * *'

 In determining the applicability of this section in the instant case, we may start with certain facts which were agreed upon by the parties, namely:

 1. The defendant's place of business is 416 Kelker Street, Harrisburg, Pennsylvania, at which place it displays and sells merchandise, and from which place of business it ships merchandise, by truck and other means, to customers, 98% Of whom are within the State of Pennsylvania and approximately 2% Are in the State of Maryland just over the border from Pennsylvania. *fn1"

 2. The defendant sells to persons who operate beauty shops in which establishments beauty treatments are administered and hair dressing and styling performed.

 3. The defendant also from time to time sells beauty shop equipment to be installed in beauty shops such as dryers, permanent waving equipment, cabinets, etc.

 4. The merchandise sold to its customers is in small quantities.

 5. The merchandise other than dryers, permanent waving equipment, cabinets, etc., consists of lotions and fluids and similar articles and are used by the hairdresser and beautician for the purpose of giving treatments to customers.

 In the light of the testimony at the trial, I find further that:

 6. All of the merchandise sold by the defendant other than dryers, permanent waving equipment, cabinets, etc., is used and consumed by its customers in the operation of their beauty establishments and in connection with services to the beauticians' customers. (Transcript of Record, Pages 29-31, 33, 34, 37.) *fn2"

 7. The types of hair oils, et cetera, in which the defendant deals are not transferred in their original packages to the beauty parlors' customers but are sprayed on the customers' hair or otherwise used in giving the various types of treatment to the customer.

 8. None of the merchandise sold by defendant to its beautician customers is resold by said customers but all of it is used and consumed in the various ...


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