306 P.3d 175
Haw.2013Background
- District Court certified whether hotel/restaurant employees may sue under HRS § 481B-14 by invoking HRS §§ 388-6, -10, and -11 without relying on §§ 480-2 or 480-13.
- Plaintiffs allege hotels/restaurants apply service charges but do not distribute full amounts as tip income to servers or disclose this to customers.
- Requests for enforcement focus on whether § 481B-14 violations can be enforced through Hawaii’s wage and hour provisions (Ch. 388) rather than consumer protection remedies (Chs. 480/481B).
- District Court’s certified questions reference Villon and Rodriguez complaint allegations about Marriott/Starwood service charges and purported under-distribution to employees.
- Davis v. Four Seasons and related Hawaii precedents discuss whether § 481B-14 enforcement lies inside or outside Chapter 388 and the scope of remedies; the Hawaii Supreme Court answers affirmatively for enforcement via Chapter 388.
- The majority ultimately holds that § 481B-14 violations may be enforced through §§ 388-6, -10, and -11 when undisclosed service-charge withholding harms employees or customers.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 481B-14 can be enforced through Chapter 388. | Employees may use 388 to enforce 481B-14. | Remedies under 480/481B are exclusive. | Yes; 481B-14 may be enforced via 388. |
| Whether remedies under 480-2/480-13 are available to employees for § 481B-14 violations. | Remedies are available to vindicate employees’ rights. | Remedies should be limited to UDAP/UMOC context. | Yes; employees may pursue 480-13 damages for § 481B-14 violations. |
| Whether the “nature of the competition” pleading requirement from HMA applies to § 481B-14 actions. | Nature of the competition must be alleged. | Not required when violation is deemed UMOC/UDAP. | No; not required where violation is deemed UMOC. |
Key Cases Cited
- Davis v. Four Seasons Hotel Ltd., 122 Hawai'i 423, 228 P.3d 303 (Haw. 2010) (debated whether § 481B-14 enforcement lies under Ch. 388 or Ch. 480/481B)
- Hawaii Medical Ass'n v. Hawaii Medical Service Ass'n, 113 Hawai'i 77, 148 P.3d 1179 (Haw. 2006) (discussed the necessity of alleging the ‘nature of the competition’ in UMOC claims)
- Town Hotels Ltd. v. Marriott Int’l Inc., 246 F.Supp.2d 469 (S.D. W. Va. 2003) (antitrust injury framework for pricing/competition claims in related contexts)
- Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 97 S. Ct. 690 (U.S. 1977) (antitrust injury standard; injury must correspond to violation rationale)
- Atlantic Richfield Co. v. USA Petroleum Co., 495 U.S. 328, 110 S. Ct. 1884 (U.S. 1990) (antitrust injury principle; injury must reflect the violation’s rationale)
- Haole v. State, 111 Hawai'i 144, 140 P.3d 377 (Haw. 2006) (statutory interpretation; DLIR rules not controlling where plainly inconsistent)