COMPETITOR GROUP (Rock'nRoll Marathon races) is SCREWED

Dkdjdjdjdndndn wrote:

I actually went to law school and the arguments in the briefs are terrible.

Don't make this more than what it is.

You went to law school and never read Posner?

501C3 wrote:

much how NYRR laughably holds itself out as a non-profit when it most certainly is a for-profit) to get around this issue.

NYRR is certainly a non-profit. The only thing that disturbs me about them is the big discrepancy between executive employees (>500k salary for Mary in the last years) but the guys who do the hard labor (mostly Mexicans) basically struggle to make months end.

NYRR is certainly a FOR-profit. It puts on races and runs them to maximize profits (it raises prices and cuts expenses wherever it can). Yes, it has a sideshow with the youth stuff but that's not what its business is. Most for-profits also have little sideshow charitable work endeavors (all of the banks donate millions of dollars to charities and continually have employees work in soup kitchens or with Habitats for Humanity) but that doesn't change their status.

Most people who work at NYRR aren't Mexican. I think you are confusing the grossly overworked and underpaid NYRR employees with the eager beaver white recent undergrads who flock to NYRR before they become disillusioned.

saldkfjs;ldajfasdf wrote:

How screwed are they?

Wasn't this just getting past preliminary stage?

It's not even near Motion for Summary Judgment

Who thinks they will win if it doesn't settle?

Do you work for Competitor or something? Why are you taking up half the posts on this thread repeating that this is a sham lawsuit?

The Fair Labor Standards Act has been the law of the land for over 75 years. Here is what it has to say about volunteering.

http://www.dol.gov/elaws/esa/flsa/docs/volunteers.asp

The law is very clear on this specific matter:

"Under the FLSA, employees may not volunteer services to for-profit private sector employers."

Period. End of discussion.

You can still volunteer for charity races and running-club races. But you can't be free labor for someone who is trying to maximize their profits. It's too easy for that for-profit organization to use shady tactics (like *pretending* that their races are primarily about charity when they are not) or strong-arm tactics to get people in weak positions in society to work for free.

If you're a for-profit organization, pay people, and figure out how to make the experience you are providing a superior value for the money that you need to take in to pay those people and still profit. That's how capitalism works. That's what every other company in the country has to do. If you cannot accomplish this, you do not deserve to be in business.

I thought part of a previous article about this focused on competitor group misleading people into thinking a particular race was actually for charity.

So, not about whether a for-profit can have volunteers or not, but rather about whether competitor tries to blend in with non-profit races and mislead people into thinking they are volunteering for a good cause.

Here in Raleigh they push the "charity" angle very hard. Take a look at how the logo says the race is "benefiting the V Foundation":

http://rnr30.compgroup.netdna-cdn.com/wp-content/sites/9/2015/04/logo_ral-360x240.png

However, CG doesn't actually donate to charity:

http://fittish.deadspin.com/whos-actually-doing-the-donating-at-your-local-charity-1697522978

They do donate some race spots to people who want to fundraise. But CG is definitely working hard to give the impression that this race is about the beloved local charity (Jimmy V! NC State! Cuing childhood cancer!), when it's really not.

Other companies donate to charity without having people work for free. What CG does comes across as deceptive, taking advantage of people's good will to get them to volunteer. I don't know if that's really the intent or part of their business plan, but I think they need to be careful about it for sure.

Mundus Vult wrote:

Dkdjdjdjdndndn wrote:

I actually went to law school and the arguments in the briefs are terrible.

Don't make this more than what it is.

You went to law school and never read Posner?

Yes.

Did you know that it is called Law & Economics and not Law = Economics?

There is a reason for that.

And it's just one school thought that is not even very popular.

I'm sure they do that on purpose. A lot of other for profit, nationally run race chains do the same thing. They make a huge deal about the race benefiting something like the Ronald McDonald House but it really doesn't.

I don't want to name names but a lot of these races throw color pellets at you or make you climb over obstacles and through mud.

huh????? wrote:

saldkfjs;ldajfasdf wrote:

How screwed are they?

Wasn't this just getting past preliminary stage?

It's not even near Motion for Summary Judgment

Who thinks they will win if it doesn't settle?

Do you work for Competitor or something? Why are you taking up half the posts on this thread repeating that this is a sham lawsuit?

I am not. But sorry I'm pissed you off. I'll just STFU and stop posting ok.

You Are What You Is wrote:

If you're a for-profit organization, pay people, and figure out how to make the experience you are providing a superior value for the money that you need to take in to pay those people and still profit. That's how capitalism works. That's what every other company in the country has to do. If you cannot accomplish this, you do not deserve to be in business.

And to those who argue that race fees will skyrocket. Do you really need thousands of workers for a race?

A 5k race doesn't need 3 water stations.

5k: water station at the end

10k: water station at 5k and 10k

HM: water station at 5mi, 10mi and at the end (as compared to every single mile, like NYRR races)

501C3 wrote:

NYRR is certainly a FOR-profit. It puts on races and runs them to maximize profits (it raises prices and cuts expenses wherever it can). Yes, it has a sideshow with the youth stuff but that's not what its business is. Most for-profits also have little sideshow charitable work endeavors (all of the banks donate millions of dollars to charities and continually have employees work in soup kitchens or with Habitats for Humanity) but that doesn't change their status.

Most people who work at NYRR aren't Mexican. I think you are confusing the grossly overworked and underpaid NYRR employees with the eager beaver white recent undergrads who flock to NYRR before they become disillusioned.

You obviously do not know what a not for profit entity is.

NYRR has registered as a not for profit organization in the state of New York -

And it is tax exempt organization as designated by the IRS -

You Are What You Is wrote:

The law is very clear on this specific matter:

"Under the FLSA, employees may not volunteer services to for-profit private sector employers."

Period. End of discussion.

I don't think it is that cut and dry.

CGI claims that it is exempt from FLSA coverage pursuant to 29 U.S.C. §213(a)(3)(A) because it is "an amusement or recreational establishment." CGI argues that the Rock `n' Roll Marathon/Half-Marathon Series is designed as "recreation" or as a means to "relax or have fun." (ECF No. 34 at 7). It also emphasizes the event's "party-like atmosphere." (ECF No. 34 at 8).

CGI refers the Court to Chen v. Major League Baseball, where the district court in the Southern District of New York held that the 2013 All Star Week festivities, in conjunction with the 2013 Baseball All Star Game in New York City, were an amusement or recreational establishment that operated for fewer than eight months and, therefore, the Section 213(A)(3) exemption applied.

The types of activities exempt under Section 213(a)(3) include "amusement parks, carnivals, circuses, sports events, parimutuel racing, sport boating or fishing".

The counter argument by Liebesman is that the Rock `n' Roll Marathon/Half-Marathon Series events are not "amusement or recreational" because they are not spectator events. Rather, Liebesman likens this case to unpaid labor to operate a for-profit gym or yoga class.

usually never clear wrote:

I don't think it is that cut and dry.

Great post, thanks.

As a non-lawyer, reading through that section of the law is kind of jaw-dropping in terms of the kinds of exceptions granted, most of them pretty obviously in response to influence from special interests:

You Are What You Is wrote:

usually never clear wrote:

I don't think it is that cut and dry.

Great post, thanks.

As a non-lawyer, reading through that section of the law is kind of jaw-dropping in terms of the kinds of exceptions granted, most of them pretty obviously in response to influence from special interests:

https://www.law.cornell.edu/uscode/text/29/213

Yeah, statutes are great in theory, but usually horrible in execution.

The more nuanced the language, the more fertile the grounds are for argument, which is great for lawyers. And guess who writes these things... :)

I most certainly do know what a not-for-profit is and know that NYRR is registered as one. However, that doesn't change the fact that it is run as a FOR profit entity and its tax exempt status is bogus. There are a ton of entities that are registered as tax exempt that shouldn't be and NYRR is no different than any of those. As I mentioned above, I think that we now are going to see even more sham tax exempt entities as for-profit event companies will being changing to tax exempt in order to continue to "hire" volunteers for free and not have to worry about getting sued.

I doubt it makes much of a difference, but the event at issue here was held in missouri.

Since the IRS obviously granted NYRR with the tax exempt status (which is not automatic), how does it not qualify as a 401(c)(3)?

So that you know what it means to be tax exempt under 401(c)(3), below is what it means

To be tax-exempt under section 501(c)(3) of the Internal Revenue Code, an organization must be organized and operated exclusively for exempt purposes set forth in section 501(c)(3), and none of its earnings may inure to any private shareholder or individual. In addition, it may not be an action organization, i.e., it may not attempt to influence legislation as a substantial part of its activities and it may not participate in any campaign activity for or against political candidates.

The exempt purposes set forth in section 501(c)(3) are charitable, religious, educational, scientific, literary, testing for public safety, fostering national or international amateur sports competition, and preventing cruelty to children or animals.

It has nothing to do with whether the organization ends their fiscal year in the red or black and NYRR has no shareholders or owners like for profit businesses do to distribute any earnings. Other than that, I am not sure what you mean that are "run like a FOR profit entity" I work with both for profits and not for profits and many not for profits would serve their communities and constituencies better if they were run like for profit entities.

In your example, the for profits that donate to soup kitchens or Habitat for Humanity are contributing to existing 401(c)(3)s (Habitat and the soup kitchens (or whatever church or other organization runs the kitchens)) and those for profits have shareholders themselves. They obviously get to write off those donations but the for profits have nothing to do with the business of the soup kitchen or Habitat.

Imagine McDonalds used some volunteers to clean the restaurant every night.

If McDonalds advertised for volunteers to clean their restaurants at night and people showed up there would be nothing wrong with that.

I volunteer at road races because I've been running for 44 years and I thought it was about time (about 15 years ago) to give something back, so to speak.

I don't care if someone is making money. I'm thinking about the people who want to run (in) the race not the people who run the race.