Kahala Hotel Faces Suit over Service Fees

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A lawsuit seeking class action status has been filed by a Hawai'i resident, over several thousands of dollars for a food and beverage service fee he was charged by the Kahala Hotel and Resort.

The suit alleges that in 2007, Jason Kawakami, who held a wedding reception at the resort, received a bill with a service charge of $4,811 representing 19 percent of the food and beverage bill. He assumed that the service fee went in its entirety to the service staff, however there was no disclosure on the bill stating where or to whom the service charge would be distributed. This is in violation of a state law passed in 2000 that requires clear disclosure to consumers if hotels or restaurants apply a food and beverage service charge, stating that it isn't entirely distributed as tip income to employees. The suit is seeking to determine how much of the fee may have been retained by the hotel for purposes other than paying gratuities, and restore damages on behalf of customers.

The suit is seeking class action certification because the law doesn't apply only to catered events, but also applies to restaurant bills where a gratuity is automatically included. Therefore, there could be hundreds, possibly thousands of customers who paid a food and beverage service charge at the hotel since March 2006, when the hotel was bought by a group of investors who changed management of the resort, and who were not advised as to how the fee would be distributed.

Kahala Hotel Food and Beverage Service Fee Legal Help

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