In the Broward County legal community, it is almost hard to focus about anything other than the Scott Rothstein debacle right now. It has captured national attention, drawing unfortunate comparisons to Marc Dreier and Bernie Madoff. Not too long ago, though, I remember sharing some time with his Scott's former partner, Stuart Rosenfeldt.
We were at the Floridian on East Las Olas, having lunch, and the topic of strippers came up. Well, in a good way. As you may know, Stuart kind of majors in employment and labor law, and I represent a number of strip clubs. The employment status of strippers is a significant issue in adult clubs. Stuart mentioned how, for some of his own clients, he had recently drafted some unique contracts for dancers, which confirmed their status as independent contractors. I had a similar form which I used for my clients, and we compared our notes.
Obviously, Stuart has other things on his mind today. However, he might get a kick out of what is happening in Vegas this week, and my blog this morning. It seems that the Sapphire Gentlemen's Club in Las Vegas has been hit with a class-action lawsuit claiming that the dancers who entertain in their club are not independent contractors and are in fact, employees entitled to regular wages and overtime.
The suit follows a Nevada Supreme Court ruling last year allowing a similar class-action lawsuit against another topless club to proceed under state law claims. If the lawsuit gets certified as class-action, it could represent 5000+ dancers that have worked at the club over the last two years. Sapphire bills itself as the 'Largest Gentlemen's Club in the world' , is over 70,000 square feet and claims to have 400 dancers in the club every evening.
This suit could impact many of those that have already danced there as well as future performers. If the dancers win, employers could become liable for so many payroll taxes it could bankrupt them. The suit claims that Sapphire has so many rules governing the dancers' working conditions that they don't qualify as independent contractors. Sapphire requires dancers to work a minimum number of hours, stops them from leaving the club during their shift, meeting with customers during off hours or leaving with them while they are on duty. These types of rules are designed to comply with city-enacted morals codes, but they could fly in the face of IRS standards for independent contractors.
California and Florida, South and Central Florida particularly, have many strip clubs, most straight, some gay. I represent both. The bottom line is that straight or gay, the ruling in this Vegas case could have some residual impact here in our community and elsewhere in adult clubs throughout the country. At least it gives Mr. Rosenfeldt something else to think about in these difficult days for his firm.
I do see and I am sure you have now read that a receiver has been appointed and many of the RRA associates are standing by Stuart. It is going to be tough if the bank accounts have been raided and people have not been paid. We can only wish them the best during a challenging time. Hell, business is so bad in this town for so many lawyers already, that if their firm is broke, then they are just catching up to the rest of us :-)