U.S. Supreme Court
Arnold v. Ben Kanowsky, Inc., 361 U.S. 388 (1960)
Arnold v. Ben Kanowsky, Inc.
Argued January 11, 1960
Decided February 23, 1960
361 U.S. 388
Petitioner sued respondent under § 16(b) of the Fair Labor Standards Act for payment of overtime wages claimed under § 7. Respondent claimed exemption from the Act's overtime requirements as a "retail or service establishment" under § 13(a)(2), as amended in 1949. Respondent conducts an interior decorating and custom furniture business, but also fabricates on the same premises plastic aircraft parts which it sells in interstate commerce to manufacturers which incorporate them into aircraft or parts thereof which they sell to others. Sales of such plastic parts account for more than 25% of respondent's annual sales, and respondent introduced no evidence to prove that at least 75% of its sales were recognized in the industry as retail.
Held: Respondent failed to satisfy the requirements of § 13, and is not entitled to exemption thereunder. Pp. 361 U. S. 389-394.
(a) That respondent's manufacture of plastic parts may be considered a "sideline" from respondent's viewpoint does not remove petitioner from coverage under the Fair Labor Standards Act unless respondent's activities fall within the specific exemptions enumerated in § 13 . P. 361 U. S. 391.
(b) Since respondent, through its fabrication of such plastic parts, is making or processing the goods that it sells, it must comply with the requirements of § 13(a)(4), as well as § 13(a)(2), in order to be exempt. Pp. 392- 361 U. S. 393.
(c) Respondent failed to satisfy the requirements of § 13(a)(2), because sales of plastic parts accounted for more than 25% of its annual sales, and respondent introduced no evidence to prove that 75% of its sales were recognized in the industry as "retail." Pp. 361 U. S. 393-394.
(d) The sale of parts to be incorporated into aircraft that were to be sold by the purchasers of such parts were sales for resale, and, since such sales exceeded 25% of respondent's total sales, respondent failed to meet the requirement of § 13(a)(2) that 75% of its annual sales be "not for resale." P. 361 U. S. 394.