Davis v. FOUR SEASONS HOTEL LTD.
810 F. Supp. 2d 1145
D. Haw.2011Background
- Plaintiffs are food and beverage servers at the Maui and Hualalai Four Seasons resorts.
- Four Seasons Hotel, Limited manages both resorts; MSD Capital, Inc. has an ownership stake but is not served.
- Resorts bill customers an 18–22% service charge; Four Seasons retains a portion of that charge.
- Plaintiffs allege Four Seasons violated HRS 481B‑14 by not disclosing that the service charge would not be remitted to employees.
- Plaintiffs seek unpaid wages under HRS 388‑6, 388‑10, and 388‑11; trial court previously denied dismissal on the wage claim.
- Court granted Plaintiffs’ partial summary judgment on Count 5 as to liability, with damages to be determined at trial.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether 388‑6 supports unpaid wages based on 481B‑14. | Plaintiffs argue service charges must be tip income; withholding violates 388‑6. | Four Seasons contends 481B‑14 does not create a wage‑claim basis. | Yes; statutes read in pari materia support a wage claim. |
| Whether Four Seasons is the employer of the servers. | Economic reality shows Four Seasons controls and pays, despite other entities. | Maui and Hualalai entities claim independent control. | Four Seasons is an employer for 388‑6 purposes. |
| Whether 481B‑14 is preempted by FLSA regulations. | Preemption undermines Hawaii protections; service charges can be tip income under 481B‑14. | FLSA regulations could differentiate service charges from tips. | Not preempted; no conflict with FLSA. |
| Whether 481B‑14 is unconstitutionally vague. | Statute clearly requires service charges to be tip income for employees. | Vagueness due to undefined “tip income.” | Not unconstitutionally vague. |
| Whether arbitration clause defenses bar the claim. | Waiver of arbitration defense is improper after lengthy litigation. | Arbitration should be compelled under contract. | Arbitration defense waived; proceeding may continue in court. |
Key Cases Cited
- Davis v. Four Seasons Hotel Ltd., 122 Hawaiʻi 423 (2010) (holding legislative history supports employee enforcement under 481B‑14; standing not at issue here)
- State v. Rauch, 13 P.3d 324 (2000) (interpretation using in pari materia principles; legislative history relevant if ambiguous)
- Singleton v. Liquor Comm’n, County of Hawaiʻi, 140 P.3d 1014 (2006) (statutory language not vague where terms are readily definable)
- Kang v. State Farm Mut. Auto. Ins. Co., 815 P.2d 1020 (1991) (when language is plain, give it effect; avoid absurd results)
- T-Mobile USA, Inc. v. County of Hawaiʻi Planning Comm’n, 104 P.3d 930 (2005) (use legislative history only where statute is unclear or ambiguous)