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HomeMy WebLinkAbout2017-12-07 Liquor Adjudication Board MinutesCOUNTY OF HAWAII DEPARTMENT OF LIQUOR CONTROL LIQUOR ADJUDICATION BOARD DECEMBER 7, 2017 WEST HAWAII CIVIC CENTER, 74-5044 ANE KEOHOKALOLE HIGHWAY, BUILDING B, 2ND FLOOR, KAILUA-KONA, HAWAII I. Call to Order The meeting was called to order by Vice Chair Sidney Fuke at 1:30 P.M., in the Meeting Room, Department of Liquor Control, West Hawaii Civic Center, 74-5044 Ane Keohokalole Highway, Building B, 2nd Floor, Kailua-Kona, Hawaii. The following were present and constituted a quorum: Adjudication Board: Sidney Fuke, Vice Chair Geraldine Giffin, Board Member Riley Smith, Board Member Absent and Excused: Bryan Lindsey, Chair Andi Pawasarat, Board Member Renee Schoen, Assistant Corporation Counsel Others Present: Gerald Takase, Director Brandon Gonzalez, Administrative Officer Craig Masuda, Deputy Corporation Counsel Nyssa Aoki, Clerk III Dorsi Lim, Secretary to the Board and Commission Fuke: Good afternoon. I'm Sidney Fuke, Acting Chair for the Liquor Adjudication Board. We're here to hear several items on the agenda. Before proceeding with the agenda items; however, I'd like to request if you have any cell phones, please turn them to silent or turn them off. I'd also like the other Board Members to introduce themselves as well as the staff, starting with my far right. Smith: Riley Smith, Board Member. Giffin: Geri Giffin, Board Member. Masuda: Craig Masuda, Board Counsel. Takase: Gerald Takase, Director. Lim: Dorsi Lim, Secretary to the Board and Commission. Gonzalez: Good afternoon, Brandon Gonzalez, Administrative Officer. Fuke: Thank you very much. Before going on to the specific agenda items, it is my understanding that we have one case where the Licensee is here to make a statement, DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 1 so with the Board Members' consent I'd like to request that the agenda be amended to put Case No. 2017-014, in the matter of El Guapo Enterprises, dba Dolphin Spit Saloon as the first item to be considered. Any objections? Giffin: None. There were no objections from the Board. II. Approval of Minutes Fuke: Thank you. Having said that, I'd like to move on to the minutes of September 21, 2017, that were circulated. May I have a motion to either approve or amend the minutes? Giffin: I move to approve. Smith: Second. Ms. Giffin moved to approve the September 21, 2017, Liquor Adjudication Board minutes as circulated; seconded by Mr. Smith. Fuke: Moved and seconded. Discussion? There was no discussion from the Board Members. Fuke: Those in favor say, "Aye." The Board Members voted "Aye." Fuke: Chair votes "Aye." Fuke: Those opposed, "Nay." There was no opposition by the Board Members. Fuke: Motion carries. The motion was carried unanimously. III. Hearings Fuke: First item, Case No. 2017-014. 1. CASE NO. 2017-014 (1:33 P.M.) In the Matter of the Accusation Against El Guapo Enterprises, LLC, dba Dolphin Spit Saloon, located at Kailua-Kona, Hawai'i. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 2 Informal Hearing (Alternative II) on violation of Rule 3-8-B of the Rules and Regulations of the Liquor Commission of the Department of Liquor Control of the County of Hawaii, State of Hawaii, as patrons remained in the licensed premises after 2:00 A.M. James Tomlinson, Managing Member and General Manager, and Jill (support) were present. Fuke: I'd like to ask the Licensee to please identify themselves. Tomlinson: I'm James Tomlinson, Managing Member of El Guapo Enterprises, General Manager also. This is Jill, my girlfriend. She's here for support. Fuke: Support? Tomlinson: Yes, for support. Fuke: And we do have an Acting Counsel who is also representative of the Department as well, Brandon Gonzalez. The Licensee has selected Alternative II, admitting to the allegation and waives its right to a hearing and appeal, and has requested an informal hearing to present the circumstances surrounding the violation. Is there anything more you'd like to add, Counsel? Gonzalez: Good afternoon, Mr. Chair, Brandon Gonzalez for the Department. The Complaint and Accusation in this case reads that on or about the fifteenth day of October 2017, in the County and State of Hawaii, patrons remained in the licensed premises of the Licensee, El Guapo Enterprises, LLC, dba Dolphin Spit Saloon, after 2:00 A.M., in violation of Rule 3-8-B as in Bronco, of the Rules and Regulations of the Liquor Commission of the Department of Liquor Control of the County of Hawaii, State of Hawai'i. Licensee has selected Alternative II, admitting to the allegation, waiving any right to hearing and appeal and requests an informal hearing to present their circumstances surrounding the violation. Fuke: I'd like to request a motion to find the Licensee in violation of the charge. Giffin: I so move. Smith: Second. Ms. Giffin moved that the Licensee in Case No. 2017-014, be found in violation of Rule 3-8-B of the Rules and Regulations of the Liquor Commission of the Department of Liquor Control of the County of Hawaii, as patrons remained in the licensed premises after 2:00 A.M.; seconded by Mr. Smith. Fuke: Is there any discussion on the charge? There was no discussion from the Board Members. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 3 Fuke: If not, all those in favor please say, "Aye." The Board Members voted "Aye." Fuke: Chair votes "Aye." Fuke: Those opposed, "Nay." There was no opposition by the Board Members. Fuke: Unanimously carried. The motion was carried unanimously. Fuke: Prior to assessing a penalty, we'd like to give you an opportunity to present your side of the situation. There may be some mitigating situations where the Board is entitled to consider. You have the floor. Tomlinson: Thank you. I'm not disputing anything that happened. It happened as it was said. The next morning, I heard from Malia, who was the MOD at the time. I stopped by to speak with Kalani on Monday and found out it happened exactly as said. I just wanted to come today to basically let everybody know that we take this extremely seriously. We're going on four years now and a lot of things happened, but we try our best to always stay focused, not become complacent, and abide by all in-house and County rules. Malia was suspended for ten days. That's basically all I wanted to do, let everybody know we try to do things correctly. We have good relationships with the agents outside since Gerald's been here and that's awesome. I would be remiss in not asking for any leniency in the penalty, just because I would. And, I want to share with everybody that this is taken seriously and she was reprimanded and suspended. That's all. Thank you. Fuke: Thank you very much. Are there any questions from the Board Members of the violator? Giffin: I have a question, but I want to stand corrected if it's out of order or improper for me to ask. I can't pronounce Malia's last name. Tomlinson: Chaul. Giffin: Chaul. What precipitated this? Certainly she knew what time it was. Certainly she knew it was a violation. What happened? Tomlinson: She did. Her response to Steve Frendo was that time had gotten away from her. I'm not making any excuses for her. It was Ironman night and as it states in here, she had called me at about 11:00 P.M. and said, "Can I close early? There's nobody here." I said, "Close, just get out of there." All the streets were blocked. She said shortly after that a bunch of people came in from other places, friends. It was her birthday the next day. Once again, I'm not making any excuses. She was on a remote karaoke device that she hooked up to the tv. There was no drinking taking place at the time, as Steve noticed. But, that's a separate violation I understand. Once again, I'm not making DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 4 any excuses for her. She thought it was earlier, actually. She thought it was 2:06 A.M. or something, which doesn't make any difference, it's the same thing. Giffin: Thank you. Smith: I have a question. Brandon, does this Licensee have any prior issues? Gonzalez: Thank you. The license was originally issued on February 19, 2014. Yes, there is a prior violation. In November of 2014, the Licensee had band members performing; consuming liquor while they were performing. Smith: Three years ago? Gonzalez: Yes. Fuke: Any further questions? I have a few. Do you have a clock somewhere in the establishment? Tomlinson: Yes, we do. I would like to say it's an isolated incident. The only people, and I've spoken with Steve and Kalani; the only people that are even considered to be allowed after work would be a ride for an employee. And most of the time, they stay in the car. But a taxi driver can be inside after, just waiting. That's the only time it would ever be considered. She made a mistake, a bad mistake. Whether she was consciously doing it or time legitimately got away from her doesn't make any difference to me. She does understand the gravity of this versus any other offense as all the employees do. We take this very seriously. We had an employee meeting the week after to discuss this specific issue and more issues. I don't want to let anything get away from us. I was at Ulu's in Coconut Grove for years and that was something inherited so that was more of an issue. We're smaller, but I want to comply and do everything the correct way as everybody's known. The pieces are there for her to know what time it is—absolutely. Fuke: When was the suspension? Did the suspension occur immediately after you were cited? Tomlinson: Immediately. She normally comes on Tuesday night and she knew on Monday morning that she was not going to work. Fuke: So she's back at work? Tomlinson: She's back at work now, yes. Fuke: You said she was doing like a "one-man show" after hours? Tomlinson: That's pretty much what I heard, yes. That is what I heard. Fuke: You've never heard of her being an entertainer while she's at work at the same time? Tomlinson: No. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 5 Fuke: Theoretically, she was off duty at the time the infraction occurred? Tomlinson: She is the MOD and the place was not closed. It was not locked up. Fuke: One final question and I'll turn it over to the other Board Members. Are your employees salaried employees? Or are there any incentives for them to promote additional alcohol sales so that they get a commission? Tomlinson: No. They're hourly employees, and no there is not. I can honestly say this is an isolated incident and it was not for any monetary gain for her or the business. I can say that with 100 percent honesty. Fuke: Board? Giffin: Mr. Chair, I have a question. I heard, in what you've said to us, several actions that you took to try to improve the situation and not have this occur again. One of them was the suspension. Secondly, you had a meeting right after that. The Chairman asked you if there is a clock visible. Those are the three things I heard. Were there any other actions that you would consider taking so that something of this gravity doesn't occur again? Tomlinson: I can say that at the meeting that we had in the ensuing week --I don't hold back. I speak very bluntly and honestly with the staff. It's myself and six employees. There's always things that are on our minds to make sure that the place stays safe and this is an inviting place. Everybody appreciates their job, they don't want to lose their job. Malia is actually my "lead" employee. She was disappointed in the two weeks, but she also understood. It wasn't a token suspension. I wanted it to hurt her. It hurt her financially. And that is the only way in the twenty plus years that I've been doing this, that I've ever known to hurt a bartender. "Hurt" is the wrong word, I'm sorry --to impress on them that these two weeks are being taken away from you and you do not want to lose your job. And, being that she was my lead, the other employees had to also see that there's not going to be favoritism, there's not going to be nepotism, and everybody's on the same ground. Everybody knows that if you mess up, your job is on the line, and that's going to financially hurt you. She's a single mother, and I understand, but business is business. Rules are rules and the more you let slide, the more the little things get out of my grasp to handle. Giffin: I appreciate the fact that you take this very seriously, because we do. Fuke: Just two final questions. What is the size of your establishment in terms of seating capacity? Tomlinson: Seating capacity is 112. Rarely does it fill. Normally on a Saturday night, there would have been two on, but like I said, it was Ironman night. I wished she would've closed at 11:00 P.M. and went down the street and enjoyed herself. And that is what I implored on her. I asked her why she didn't just close up after she called and go. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 6 Fuke: That's a good size. Mr. Gonzalez had indicated that back in 2014, there was a violation of consumption by the band members. Were you in charge of the establishment then? Tomlinson: Yes, since day one. I felt at that time that the fine and that charge might have been a little too much. I don't want to sound combative at all. I took responsibility for it. I went to the hearing, the guy was from Oahu and was warned several times "you cannot do this" yet he did it again, and Steve Frendo saw it and he wrote it up. Yes, he was an employee even though he wasn't getting paid, I understand he took responsibility for it. But I believe that one was a $2,000 fine with $1,000 suspended. I felt that it was maybe, it doesn't matter. It was an employee because he was playing in there, and understand fully. It just seemed a little, maybe, extreme to me. But it is in the past. Fuke: Any more questions from the Board Members? There were no questions from the Board Members. Fuke: Since none, Mr. Gonzalez, could you read the recommended penalties? Gonzalez: The Department is recommending a $1,500 fine with $500 suspended for one year from the date of service of the Decision and Order on the condition that there are no similar violations to Rule 3-8-D, and that $1,000 is to be paid within 30 days upon receipt of the Decision and Order for said violation, payable to the Department of Liquor Control. However, if a payment plan is necessary, we can work one out with the Licensee. The basis for the recommendation is as follows: We are taking into account the Licensee has immediately taken responsibility for their actions. They have taken corrective actions to insure, as best as they can, that this will not occur again. But, we also have to take into account the previous violation that exists within the last three years. In that case, entertainers on the premises (there were two entertainers, 2 counts) were found to be consuming liquor while performing. The fine imposed in each count was a $2,000 fine, and in each count, $1,500 was suspended. So Licensee was required to pay $1,000 total. They paid promptly, within two days of being served in (inaudible). Other than that, the Licensee has been operating well. We appreciate his quick corrective action and him taking responsibility. Fuke: Thank you very much. Is there discussion on the penalty? There was no discussion from the Board Members. Fuke: Could I have a motion on the recommended penalty? Smith: I move that we accept the recommendation of the Department and impose the fine as stated. Giffin: I second. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 7 Mr. Smith moved that the Licensee in Case No. 2017-014, be assessed a penalty in the amount of $1,500 with $500 suspended for one year from the date of service of the Decision and Order on the condition that there are no similar violations to Rule 3-8-D, and that $1,000 is to be paid within 30 days upon receipt of the Decision and Order; seconded by Ms. Giffin. Fuke: Any further discussion on the penalty? There was no further discussion from the Board Members. Fuke: All those in favor please say, "Aye." The Board Members voted "Aye." Fuke: Those opposed, "Nay." There was no opposition by the Board Members. Fuke: The vote is unanimously carried. The motion was unanimously carried. Fuke: A written Decision and Order will be expended to you pursuant to what Mr. Gonzalez indicated and hopefully you'll come through within that stipulated period. Gonzalez: Mr. Chair, if we may take another case out of order, Item No. 3 on the Agenda, Case No. 2017-015, in the matter of the Accusation against Hawaii Wikiwiki Stores LLC, dba Kona Wikiwiki Mart, located at Kailua-Kona, Hawaii. Fuke: Any objections by the Board Members? There were no objections by the Board Members. Fuke: We are now hearing Case No. 2017-015, as indicated by Mr. Gonzalez, is the Accusation against Hawaii Wikiwiki Stores LLC, dba Kona Wikiwiki Mart, located at Kailua-Kona. It's an informal hearing (Alternative I), relating to a violation of Section 281-78(b) (1) (A), of the Hawaii Revised Statutes, as amended, relating to the Sale to a Minor. 2. Case No. 2017-015 (1:47 P.M.) In the Matter of the Accusation Against Hawaii Wikiwiki Stores LLC, dba Kona Wikiwiki Mart, located at Kaiula-Kona, Hawaii. Informal Hearing (Alternative I) on violation of Section 281-78(b) (1) (A), of the Hawaii Revised Statutes, as amended, Sale to a Minor. Andrew Nguyen, Employee, Kona Wikiwiki Mart, was present. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 8 Fuke: Could I have a motion to find the Licensee in violation of the charge? Giffin: I so move. Smith: Second. Ms. Giffin moved that the Licensee in Case No. 2017-015, be found in violation of Section 281-78(b) (1) (A), of the Hawaii Revised Statutes, as amended, relating to the Sale to a Minor; seconded by Mr. Smith. Fuke: Any discussion on it? There was no discussion from the Board Members. Fuke: All those in favor say, "Aye." The Board Members voted "Aye." Fuke: Those opposed, "Nay." There was no opposition by the Board Members. Fuke: Unanimously carried. The motion was carried unanimously. Fuke: Mr. Gonzalez, can I ask you to read the complaint? Gonzalez: Yes, Mr. Chair. Pardon me, I should note that although the Licensee selected Alternative I, where they stipulate to the violation, waive their presence at the hearing, and also waive any right to appeal, the Licensee instructed the cashier on duty that made the sale that night to come and observe. So, present to my left is Mr. Andrew Nguyen who was working at Wikiwiki the night of the compliance check. I will read the Complaint and Accusation. I wanted to explain who was sitting to my left. Fuke: Thank you. Gonzalez: The Complaint and Accusation in this case reads that on or about the third day of November 2017, in the County and State of Hawaii, the Licensee Hawaii Wikiwiki Stores LLC, dba Kona Wikiwiki Mart did sell, serve or furnish liquor to a minor, age 20 in violation of Section 281-78(b) (1) (A), of the Hawaii Revised Statutes, as amended. The Licensee has selected Alternative I. They admit to the allegation and stipulates that disciplinary action may be taken without the presence of the Licensee and that the Licensee has waived their right to a hearing and appeal. Thank you. Fuke: Thank you very much. Is there a motion to find the Licensee in violation of the charge? Giffin: I so move. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 9 Smith: Second. Ms. Giffin moved that the Licensee in Case No. 2017-015, be found in violation of Section 281-78(b) (1) (A), of the Hawaii Revised Statutes, as amended, relating to the Sale to a Minor; seconded by Mr. Smith. Fuke: Discussion on it? There was no discussion from the Board Members. Fuke: All those in favor of the motion please say, "Aye." The Board Members voted "Aye." Fuke: Those opposed, "Nay." There was no opposition by the Board Members. Fuke: Inasmuch as the Representative of the Applicant, or at least the Applicant's employee here, do you want to make any statement? Gonzalez: I would let the Board know that the Licensee is making Mr. Nguyen pay the fine. They fined him $1,000. So, he probably wouldn't want to make any other statements. Giffin: Mr. Chair, before we go any further, can you pronounce your last name? Nguyen: Win. Fuke: Not "nu yen?" Nguyen: A lot of people pronounce it that way. I just go with it. Fuke: But it's "win" like w -i -n? Nguyen: It's "win." Yes. Fuke: Do any of the Board Members have questions of Mr. Nguyen or the staff? Smith: When I look at the Investigator's Report, the minors that came in to purchase actually handed you their license? Nguyen: Yes. Smith: And you checked it and sold it to them? Masuda: Mr. Nguyen if you could, answer out loud instead of shaking your head. Smith: Yes, we're recording this. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 10 Fuke: Yes, can you say "affirmative" or "yes or no" rather than just nodding? Nguyen: Yes. Fuke: Thank you. Smith: They gave you the license that showed they were not twenty-one years old? Nguyen: Yes, sir. Smith: And you? Nguyen: Miscalculated. Smith: Miscalculated? Nguyen: Yes, I miscalculated. Smith: If you had the same situation, or going forward from this time, have you learned that you need to be more diligent? What have you done differently since then? Nguyen: I learned how to pay better attention and I'm more aware. I card everybody except the ones that are older and regular. I'm more diligent and pay attention. Smith: I think one of the important things that we want to see is that while we all make mistakes, going forward what response will you have? Are you more diligent? Have you learned from this? What are you going to change in your behavior to make sure that it doesn't happen again? Nguyen: Oh, yes. Smith: I appreciate that. Thank you. Nguyen: Thank you. Giffin: Mr. Chair? Mr. Nguyen? Correct me if I'm wrong, but isn't there some sort of mode where you can have the machine at the check-out do the math for you? Because like you, I'm really poor in math so the subtraction of those years would be difficult. But isn't there something on the machine itself that you could just use? Nguyen: Yes, ma'am. We do have but it doesn't calculate, but it tells if the person is available to buy it or not. It does say. Giffin: Legally? Nguyen: Yes. Like this person's not old enough or this person is, to buy. Giffin: And you didn't use it at this time? DECEMBER 7, 2017- LIQUOR ADJUDICATION BOARD MINUTES 11 Nguyen: No, ma'am. Giffin: Seems to me that that would be one of the first things that you would change in your behavior, right? Nguyen: Yes. I do now. I scan everything now. I'm more diligent now. Fuke: Any further questions? Smith: In looking at the report, it talks about a previous violation on August 4th This one was on November 3rd. Can you help us understand, in those two or three months, what did or didn't happen? Nguyen: This is my second month I've been hired and I don't know that much about that allegation. The company did warn me about it happening, but I just got hired and I'm not too aware about that case. Smith: I'm sorry, I misunderstood. I thought that you were the person charged. Fuke: That was the first application. Any further questions for him? Giffin: No, but I appreciate your attitude and how you're trying to rectify the situation because I think that's the most important thing that I would be looking for. Nguyen: Yes, ma'am. Giffin: And I'm sure paying the fine was significant. Fuke: Is this your first job in the retail industry? Especially in the industry where you sell or consume alcoholic beverage? Nguyen: Yes, this is my first time. Yes. Fuke: And first job in the retail industry as well? Nguyen: Yes. I mostly worked at the warehouse. This is my first ever. Giffin: I have a question for Brandon. Did Mr. Nguyen have his card? Did he pass the class? Gonzalez: Yes, he did pass the class. The card was not delivered yet, however. Fuke: I guess this is more directed to the Department because it relates to the question that you raised, Riley. There's a first compliance check and then there's another, then there's a violation. During the course of the compliance check there was already an infraction. During a compliance check, is there any fine assessed for the infraction or is there a grace period? DECEMBER 7, 2017 — LIQUOR ADJUDICATION BOARD MINUTES 12 Takase: As a Department, we hadn't done compliance checks for a couple of years because once we did it, approximately two years ago, we had a pretty good percentage of compliance so we gave them a break. We let off with just doing a check. Instead of fining everybody, we brought all of them in to tell them we had done it. But, we started again. Fuke: Educated? Takase: Yes. I think there was about thirteen out of seventy. Not a bad percentage, but brought either the managers or the owners in and talked about the situation. They were given a warning and they might be a little (axed. Overall, the Licensees did pretty well. This was on the Hilo and Kona sides. I informed them that we would follow up and check again and unfortunately, Mr. Nguyen was caught in this one. We gave them one chance and this is the second one so we had to move forward and really, it was just one in Hilo and one in Kona. We had pretty good compliance. Fuke: In terms of when the actual violation occurs, does there have to be a monetary exchange? With the first one, there was actually the ringing of the cash register and change was given. In this particular situation when you entered (the store), it didn't give the impression that there was monetary exchange, but the beer was on the counter. The follow up report indicates that there was a receipt. Gonzalez: Correct. He rung them up. The definition for liquor to a minor is rather broad. It's "sell, serve or furnish." And at that point he had told them and he had his hand out indicating how much was owed. From our perspective we intervened at that point to eliminate them having to go back into the register and return the money. If we were involved with the Police Department (like) in the Hilo case, they let the whole transaction go through. But we've had certain transactions occur where we couldn't stop before that happened. That's why we stopped it at that point because we felt it progressed enough. That's why he had the receipt, because it was showing on the register that he had already rung him up. Giffin: He had already chalked it up? Gonzalez: Yes. Smith: Just so I understand this, your employer has made the decision that whatever we vote on and approve, it's going to be a personal payment made by you. Is that accurate? Gonzalez: From what Mr. Nguyen has indicated to me, he has been fined $1000 by his employer. Smith: One of the goals that we have as an adjudication board is to insure compliance. I'm assuming, like with the previous Licensee, when you try to insure corrective behavior, if you make it meaningful by exacting some kind of remedy that's meaningful to the employee, I'm assuming something like this is going to impact you and it's meaningful to you. And then you're going to tell all your co-workers what happened and they're going to understand that your employer is serious and trying to enforce these rules. I would tend to think that would help to get the message to everybody that these are the rules we all DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 13 have to follow. Does that seem accurate? Do you understand that? Do you agree with that? Nguyen: Yes, sir. Smith: Okay. I know this is uncomfortable for you. You came here dressed well and you're taking this seriously. We just want you and the rest of your fellow workers to understand it's important to follow the rules. We want you to be successful. Just follow the rules and everything's fine. Nguyen: Yes, sir. Fuke: Any other questions? There were no further questions from the Board Members. Giffin: No, but I do appreciate you coming. Nguyen: Thank you. Fuke: Can we have a discussion on the penalty? Gonzalez: Yes. For compliance checks, to be consistent in prior penalties imposed for compliance check failures, the Department is recommending the $2,000 fine with $1,000 being suspended. The license for this Licensee was originally issued on January 16, 2014. Since that time, there has been one violation for failure to pay percentage fee and that was on November 16, 2016. They do have one violation, not related to Sale to a Minor. We are recommending the $2,000 fine with $1,000 suspended for one year from the date of service of the Decision and Order, on the condition that there are no similar violations and that $1,000 is to be paid within 30 days upon receipt of the Decision and Order. I think Board Member Smith touched upon the rationale that everyone on the Licensee chain is responsible. The Licensee has to figure out the way they can hold their frontline employees accountable and responsible so that it's not just the corporate structure making the payment. One other path they could have taken was to fire Mr. Nguyen, but that wouldn't help anybody really. I think they're trying to make good use of the situation as best as they can to make sure that everybody understands the responsibility that is due so that they know what the usual fine is for this type of violation as well. Fuke: Quite honestly, I think it's good that the Licensee is trying to hold the specific violator accountable and in so doing you're trying to change the culture. I think what your employer is trying to do is to say that kind of culture doesn't work. We have to be more mindful and respectful of what the regulations call for. If you let that go, it can eventually snowball into something else. Having said that, is there a motion on the recommended penalty? Giffin: I move that we do accept the recommended penalty as proposed by Mr. Gonzalez. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 14 Smith: Second. Ms. Giffin moved that the Licensee in Case No. 2017-015, be assessed a penalty in the amount of $2,000 with $1,000 suspended for one year from the date of service of the Decision and Order on the condition that there are no similar violations to Rule 3-8-D, and that $1,000 is to be paid within 30 days upon receipt of the Decision and Order; seconded by Mr. Smith. Fuke: Any discussion? Smith: Brandon, the Licensee was issued the license in 2014? That's when the store opened, right? Gonzalez: Yes. Smith: The Wikiwiki Mart is the one that has the fuel pumps in front of it and is on the north side of the Kona International Market Place? Gonzalez: That is correct. Smith: So it wasn't like someone else was operating this business before them, they got their license when they opened? Gonzalez: Yes. The issuance for that store is 2014. Smith: I don't think they existed. They added the fuel pumps and the small store there. Gonzalez: Yes. Smith: Thank you. Fuke: We already moved and seconded. All those in favor of the recommended penalty of $2,000 with $1,000 suspended please say, "Aye." The Board Members voted "Aye." Fuke: Opposed, "Nay." There was no opposition by the Board Members. Fuke: Unanimously carried. The motion was unanimously carried. Fuke: A written Decision and Order will be sent to the Licensee, not to you directly. We thank you very much for being here. We're sorry you had to go through this, but we hope that moving forward you can understand our role and your role as well, in the community. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 15 Nguyen: Yes, sir. Fuke: I know it's a pinch and especially since this is your first job in retail, we feel a little compassionate about it. Thank you very much for being here. Nguyen: Thank you, Chairman. Thank you. There was discussion between Mr. Nguyen and Mr. Gonzalez. Giffin: Do we go to Agenda Item 1? Fuke: Yes. I want to give them some time. We're back to the regularly scheduled Item No. 1, Case No. 2017-013, in the Matter of the Accusation Against B & S Aburamen Inc., dba Manono Mini Mart, located at Hilo, Hawaii. It's an informal hearing (Alternative I), on the violation of HRS 281-78(b) (1) (A), of the Hawaii Revised Statutes, as amended, relating to the Sale to a Minor. Mr. Gonzalez? 3. CASE NO. 2017-013 (2:07 P.M.) In the Matter of the Accusation Against B & S Aburamen Inc., dba Manono Mini Mart, located at Hilo, Hawaii. Informal Hearing (Alternative I) on violation of HRS 281-(b) (1) (A), of the Hawaii Revised Statutes, as amended, Sale to a Minor. Gonzalez: Thank you, Mr. Chair. In this case the Complaint and Accusation reads: On or about the sixth day of October 2017, in the County and State of Hawaii, the Licensee B & S Aburamen Inc., dba Manono Mini Mart did sell, serve or furnish liquor to a minor age 20, in violation of Section 281-78(b) (1) (A), of the Hawaii Revised Statutes, as amended. The Licensee has selected Alternative I, admitting to the allegation, waiving their presence at the hearing, stipulating to disciplinary action without their presence and waiving any right to appeal. Thank you. Fuke: Thank you very much, Mr. Gonzalez. Is there a motion to find the Licensee in violation as charged? Giffin: I so move. Smith: Second. Ms. Giffin moved that the Licensee in Case No. 2017-013, be found in violation of Section 281-78(b) (1) (A), of the Hawaii Revised Statutes, as amended, relating to the Sale to a Minor; seconded by Mr. Smith. Fuke: Any discussion on that motion? There was no discussion from the Board Members. Fuke: Since none, all those in favor please say, "Aye." DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 16 The Board Members voted "Aye." Fuke: Opposed, "Nay." There was no opposition by the Board Members. Fuke: Unanimously carried. The motion was unanimously carried Fuke: Since the Licensee is not here, what is the recommended penalty? Gonzalez: The recommendation, Mr. Chair, is a $2,000 fine with $1,000 suspended for one year from the date of service of the Decision and Order on the condition that there are no similar violations and that $1,000 is to be paid within 30 days upon receipt of the Decision and Order, payable to the Department of Liquor Control. The basis for the recommendation is as follows: the original issuance of the license was July 1, 2009. There are no previous violations; however, to be consistent with all other Sale to Minor infractions which the Department takes as one of its most serious violations, we are recommending the $2,000 fine. As a historical note for your information, educational compliance checks were held on June 9, 2017. That's where the Department checked sixty four total Licensees within the South Hilo area. Of those sixty four Licensees, thirteen did not pass. On October 6 the Department conducted follow up compliance checks. This is after the Department met with each person that violated, instructed them on the requirements of the law to identify minors or people trying to purchase alcohol and telling them that we would do follow-ups in the future. Unfortunately, in this case the same cashier that made the sale during the educational compliance check also made the sale during our follow up compliance check. It reflects poorly in this instance, but it's not only the cashier's fault if the Department took steps and the Licensee themselves did not take extra steps to make it easier or make sure their cashiers weren't doing what they're supposed to. Everybody is strictly accountable on the Licensee's end for following the law and this is the reason why this case is in front of us today. But, the Licensee took responsibility right away on finding out about the violation and selected Alternative I. Fuke: Any discussion or questions of Mr. Gonzalez regarding the penalty? Smith: I have a question. In the other situations that we heard today the employer tried to implement or remedy by some financial consequences to the individual. In this instance when I look at the report he didn't even ask for the ID. At least the other person asked for the ID whether he could calculate it or not is a different issue, but this person didn't even ask for the ID. It's the same person that was caught before and you just wonder whether they have instituted remedies that are going to make a change. What are your thoughts? Gonzalez: We have been in contact with the Licensee and from the feedback today, we can definitely follow up on what processes they've taken to make sure that this type of oversight or lack of enforcement doesn't happen again. I don't have anything in detail from them yet. I don't know about the status of the cashier, if he's still working there or not. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 17 Smith: I guess my comment to that is, we have to make a decision based on your information in front of us today. But, should this Licensee have an issue in the future and they've not taken corrective action that remedies a solution that works then I think waiving the second thousand isn't warranted at all. Gonzalez: You may even be in the realm of suspension of the license. Giffin: The license? Gonzalez: Yes. Fuke: Gerri, any questions? Giffin: No. Fuke: I think with the first two violators you can see that they're making some attempt to rectify the violation and passing it down so that the overall "culture" begins to shift. In this situation, the fact that the same individual is the one who did the infractions brings to mind what kind of culture we are trying to promote in this particular instance. It's too bad that the Licensee or at least the employee that was responsible for that specific violation is not here to at least provide some explanation. I can totally understand and agree with what Riley is saying. I think indirectly, you're saying is it necessarily fair that we assess the penalty similar to the previous one. I'm beginning to have some reservation about that. Can we have a discussion? Giffin: I agree with that and as a result, I'm hesitant to even say yes, this is okay. If we continue along that path, what change are we talking about? Like Sid said earlier, at least with the first two agenda items there was an acknowledgment of responsibility, corrective actions were taken to the employee that specifically affected the employee financially, as did with Mr. Nguyen, the second agenda item. I may be looking at it incorrectly so please correct me on that. Fuke: It's like a person who speeds and will speed forever and he's lucky if he can afford to pay the tickets. Takase: We don't know what happened to this employee. If that's going to be the rationale, we can try to find out. I think the fine we imposed was standard. Without any explanation, that's what they were going to get. Mr. Nguyen appeared here today and seemed to take his punishment. Giffin: Yes, and he was remorseful, too. Takase: From the Department side, the penalty is pretty much the standard --$2,000 with $1,000 suspended without any explanation, without anything. Maybe we should have gone the other way with Mr. Nguyen, but then we didn't know that he was going to come or what the Licensee was going to do. Fuke: Then again, he's paying the fine to the employer. So the boss is going to pocket $500. It seems unfair unless they find a way to compensate him. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 18 Takase: Maybe you can void the other $500. Fuke: Can you send this letter informing them of the Decision to pay $2,000 with $1,000 suspended? You send them a letter, right? Gonzalez: We have an investigator give them the written Decision, the Findings of Fact. Fuke: Is it possible to incorporate a statement to the effect that the fine is $2,000 with $1,000 suspended, but if there's any subsequent or similar type of violation that the Board would seriously consider suspending the license? Gonzalez: We can include that if that is part of your decision especially. Masuda: There's the Order and there's also the Finding of Fact. You can include that in the Finding of Fact. Gonzalez: We can include that type of language? Smith: I'm supportive of that. Giffin: I am too, because it gives it more depth. Smith: Yes. Takase: Even if the Board goes with what's recommended, if they have a subsequent violation, it'll really be $3,000 we would be collecting. They'll be fined $2,000, no suspended, but we'll also fine them the $1,000 that was suspended in this case. Fuke: It could be a different type of violation. I'm more concerned about the Sale to a Minor. If the next infraction is like the other case where there were people in the establishment after hours, even if it's a different type of violation. Takase: If you listen to the verbage, we're saying that $2,000 with $1,000 suspended for no similar violation. A totally different violation wouldn't kick in. Giffin: Within that period, right? Takase: Yes. I don't know what happened to the employee in this case. We could find out. I would think as the owner, this person is a liability. I know that the managers came in. We didn't get the owner to come in. We informed them what was going to happen. Twelve out of thirteen got the message. That it was the same person that did it both times, I would think if you're the owner, you'd probably terminate them. Fuke: Unless there's a special relationship between the owner and an employee. There's a motion on the floor to accept what the Department is recommending, $2,000 with $1,000 being suspended, with the restoration of that $1,000 for similar infraction. Do you want to amend it? DECEMBER 7, 2017- LIQUOR ADJUDICATION BOARD MINUTES 19 Masuda: You don't have to make it part of the vote. You can vote on the penalty now, and later discuss the Finding of Fact of what you wanted to say is should another violation like this occur not only will the suspended portion be imposed but the Board may also consider suspending the license. Gonzalez: Mr. Chair, I'd like to check with something with the Secretary. My recollection is there was only a motion to find the Licensee in violation of the charge. You merely asked me for my recommendation for a penalty but you didn't put a motion on it. Masuda: I thought he did make a motion. The Secretary indicated that there was a motion to find the Licensee in violation of the charge. Gonzalez: To find in violation, which was done. But there's no motion for imposing any penalty. So you're free to craft the language however you want it. Fuke: The Chair will entertain a motion for a penalty and the recommended penalty by the Department is $2,000 with $1,000 suspended. Is there a motion to that effect? Giffin: I so move. Smith: Second. Ms. Giffin moved that the Licensee in Case No. 2017-013, be assessed a penalty in the amount of $2,000 with $1,000 suspended for one year from the date of service of the Decision and Order on the condition that there are no similar violations to Rule 3-8-D, and that $1,000 is to be paid within 30 days upon receipt of the Decision and Order; seconded by Mr. Smith. Masuda: To clarify, the second thousand engages if there's similar violations. Fuke: That's what I think that Staff's recommendation is, right? Gonzalez: Yes. Fuke: Any discussion on it? As I understand, the motion itself does not have to necessarily include the added verbage about violating again. Masuda: Yes, we can do that. Fuke: All those in favor, say "Aye." The Board Members voted "Aye Fuke: All those opposed, "Nay." There was no opposition by the Board Members. DECEMBER 7, 2017- LIQUOR ADJUDICATION BOARD MINUTES 20 Fuke: Unanimously carried. The motion was unanimously carried. Masuda: As far as the Finding of Fact, would you like verbage to be included that you will sign off as the Chairperson later, that it will include stern language that will state that any similar infraction? Takase: It's going to be in the Decision. Gonzalez: It's in the Decision and Order. Masuda: Yes. Fuke: It'II state that any similar infraction, similar in terms of a sale to a minor, that the Board will seriously entertain the suspension of the license. Giffin: Is that fair? Are we within our purview? Masuda: Yes. Takase: You are, to some extent. You realize that if it's more than a year from now they can still be in a violation but you may have a whole different Board so they're not technically tied to anything that this Board threatens today. Masuda: That's why we separated it. Fuke: Yes. I'II assume that maybe two years from now, we've come and gone but the Department will still be here and will know. Takase: That's why I say, you can do it, but understand that. Fuke: Yes, we understand there will be different decision -makers. And we hope that the decision -makers will ask the same questions of you. Smith: Do we need a motion for that? Takase: You should because we'll put it in the Order. Fuke: Can we have a motion to the effect of inserting stern language that the Board will seriously entertain the suspension of the license in the event there is a similar violation. Giffin: I so move. Smith: Second. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 21 Ms. Giffin moved to insert stern language to the Decision and Order that the Board will seriously entertain the suspension of the license in the event that there is a similar violation; seconded by Mr. Smith. Fuke: All those in favor, "Aye." The Board Members voted "Aye Fuke: Opposed, "Nay." There was no opposition by the Board Members. Fuke: Unanimously carried. The motion was carried unanimously. Fuke: In the case of No. 2017-016, in the Matter of the Accusation Against Blend, Inc., dba Annie's Island Fresh Burgers, located at Kealakekua, Hawaii. It's an informal hearing (Alternative I), relating to the violation of Rule 5-2 of the Liquor Commission, for failure to have a person in active charge of the premises at all times to provide proper supervision in exercise of the liquor license in the accordance to the liquor laws. 4. CASE NO. 2017-016 (2:29 P.M.) In the Matter of the Accusation Against Blend, Inc., dba Annie's Island Fresh Burgers, located at Kealakekua, Hawaii. Informal Hearing (Alternative I) on violation of Rule 5-2 of the Rules and Regulations of the Liquor Commission of the Department of Liquor Control of the County of Hawaii, State of Hawai'i, for failure to have a person in active charge of the premises at all times to provide proper supervision in exercise of the liquor license in accordance with the liquor laws. Fuke: Staff, could you read the Complaint? Gonzalez: Good afternoon, Mr. Chair, Brandon Gonzalez for the Department. The Complaint and Accusation in this case reads: On or about the 21St day of July 2017, in the County and State of Hawaii, the Licensee Blend, Inc., dba Annie's Island Fresh Burgers, did fail to have a person duly approved by the Department of Liquor Control, as a person in active charge of the premises at all times while the premises was open for business, to provide proper supervision in the exercise of the liquor license in accordance with the liquor laws. This is in violation of Rule 5-2 of the Rules and Regulations of the Liquor Commission of the Department of Liquor Control of the County of Hawaii, State of Hawai'i. Licensee has selected Alternative I, admitting to the allegation, stipulating to disciplinary action without their presence, waiving the right to administrate appeal. Thank you. Fuke: Could I have a motion to find the Licensee in violation of the charge? Giffin: I so move. DECEMBER 7, 2017- LIQUOR ADJUDICATION BOARD MINUTES 22 Smith: Second. Ms. Giffin moved that the Licensee in Case No. 2017-016, be found in violation of Rule 5-2 of the Rules and Regulations of the Liquor Commission of the Department of Liquor Control of the County of Hawai`i, State of Hawaii; seconded by Mr. Smith. Fuke: Any discussion? There was no discussion from the Board Members. Fuke: All those in favor say, "Aye." The Board Members voted "Aye." Fuke: Those opposed, "Nay." There was no opposition by the Board Members. Fuke: Unanimously carried. The motion was unanimously carried. Fuke: Can I ask the Staff again, to read the recommended penalty on this matter? Gonzalez: The Department in this case is recommending, Mr. Chair, a $1,000 fine with $500 suspended for one year from the date of service of the Decision and Order, on the condition that there are no similar violations to Rule 5-2, and that $500 is to be paid within thirty days upon receipt of the Decision and Order of said violation, payable to the Department of Liquor Control. The basis for the recommendation is as follows: The license was originally issued on January 12, 2010. There have been no previous violations; however, the circumstances in this case are fairly serious. The only way that we can insure that Licensees are following the liquor laws is if there are people in charge of making sure they're operating according to the laws are actually in the establishment. When they don't have anybody there, it's like a chicken without a head situation. Many things can go wrong for the Licensee and the public. This is the reason that this type of offense is rather serious from the Department's perspective. We are consistent with previous recommendations for Licensees that have violated this. We've had at least twenty-three Rule 5-2 violations in the last five years. Not for this Licensee, they've had none. We are consistent with our recommendation. Fuke: Could I have a discussion on the proposed penalty? There was no discussion from the Board Members. Fuke: Since none, can I have a motion on the penalty? Giffin: I so move. DECEMBER 7, 2017- LIQUOR ADJUDICATION BOARD MINUTES 23 Smith: Second. Ms. Gifffin moved that the Licensee in Case No. 2017-016, be assessed a penalty in the amount of $1,000 with $500 suspended for one year from the date of service of the Decision and Order, on the condition that there are no similar violations to Rule 5-2, and that $500 is to be paid within 30 days upon receipt of the Decision and Order; seconded by Mr. Smith. Fuke: We can discuss the specific penalty. Any questions of Mr. Gonzalez? Giffin: Mr. Gonzalez, is what you said earlier, is that why it's part of the Rule or the law that even when liquor is not being dispensed, there must be a person there? Gonzalez: To answer it simply, yes. But, I have to acknowledge that the Rule itself and the wording about having a person on premise whenever it's open even if liquor is not being sold, is under evaluation. We are trying to determine whether or not that is still relevant in today's times. In this case, I want to make this distinction. The Licensee is not a restaurant. They are a Dispenser General. They are not required to have 30 percent of their sales be food sales. If this were a restaurant, and they serve food as their designation and the "alcohol sales" is in support of that, we would consider them not having to have a person in active charge but they can remain open as a restaurant if they were not to have liquor sales. They are a Dispenser General in this case, so it's a little different. That being said, they do serve heavy pupus, food. The only thing is that they're not saying they're going to have 30 percent of their sales be food. They're a burger place. That's the flip -side. So, can't they continue to sell burgers and lock up their cooler? We are looking at that, maybe having to amend the Rule to be more flexible. Takase: Let me take it one step further. They tried to comply with the law. When the investigator went in, they had signs up saying no liquor service available. To that, we'll give them some credit. But, the fact that they had no managers anymore, which has been going on about a week, we felt they couldn't make that their permanent method of operation. They needed to get somebody in right away. They had failed to do that. We have allowed a Licensee that passed where for some reason you lose a manager on duty that's sick or whatever. They could put up a sign saying liquor sales are being suspended and we would give them the benefit of the doubt. But in this case where the investigator asked them if they could get somebody to come in, he was told that they couldn't because they didn't have any managers, either they left or were fired. Fuke: Have they rectified the problem? Gonzalez: They did. Takase: Yes, now they have. Gonzalez: Immediately after being notified of that, they added at least three people to the list. I agree with the Director. In this situation the Rule as written worked to catch the type of situation it was designed for. It wasn't a spur of the moment or an emergency situation. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 24 Takase: If they had told us the day they lost all their managers and asked if they could get someone else to come in, we probably would have let them continue to operate the way they were. It may be a technical violation, there was no sale taking place as far as we know. When the investigator got there, the signs were up. I can see that from their standpoint they're trying to comply with the Rule, but because they made no effort to get somebody qualified during the interim that we know of, we had to take a harder line with them. Fuke: What's the difference between Dispenser General license and a regular Restaurant license? Takase: A Restaurant license is a variation of Dispenser General. It requires the Licensee to provide at least 30 percent of their total sales in food. The other thing it does is it allows them to cater events off premises. It also used to allow them to re -seal wines, although the law has since changed so that even Dispensers can allow for re -sealing wines. The rationale was so that you don't have people feeling the necessity to chug their wine rather than leave it. Since they bought it, they can take it out with them. We can't really see the difference between a bar and a restaurant in that sense that just because you're a bar, you can't allow that, so now you're going to force those guys to try and finish it. We did away with that distinction. It's really just the catering portion that's the real difference now. There are certain other requirements when they transfer license. It's become much harder for a Dispenser General to transfer a license in terms of notice. When other Licensees transfer their license they can just do notice by publication. But the law is changed for Dispenser Generals. They need to do written notice. It was really meant for hostess bars in Honolulu. It was kind of a catch-all and everyone else joined in. Here, if they can make the food sales, and 30 percent is not too high, they will go to the Restaurant category rather than staying in the Dispenser General. It'll help them on the back end if they have to transfer their license. Giffin: In the end, which is more desirable? Takase: Probably a Restaurant (license) because it gives you a little more leeway in terms of what you can do. More and more catering off premises has become lucrative. Not that they can't cater their food, but they can also cater their liquor. That's the portion they're looking for. Giffin: Interesting. Smith: I remember a couple of years ago, Bite Me was a restaurant here, and they were getting ready to close. They had a similar situation which was they didn't have a person in active charge. The person was supposed to come to work but didn't, so he went down the list and they couldn't find a person to show up. In that instance, I remember we told him that if he had stopped liquor sales he would have been okay. Takase: Yes. Smith: In this instance, even if they had tried to make an effort to show there's no liquor sales, what's the distinction? DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 25 Takase: And that's why I say they made a good effort to try and stop it, and I'm going to assume that they did stop it because they had their signs up without any prompting from us. But the fact that they were going to just let the situation go without—where Bite Me went down the list and he couldn't get anybody in that day, so we'll stop sales for the day, he still had people scheduled to come in the next day. That's the only distinction. It's fine if we're told and they made a good effort. We can recognize that. Smith: What could they have done to stay open that would have been okay? Takase: They could have tried to schedule someone. If they told us they didn't have anybody and they didn't have anybody left, but can I schedule some people for the next class, we probably would have told them, yes, put up the signs and don't serve. But it seemed they weren't going to do anything until we had caught them for it. That's really the distinction between the two. They didn't have any more managers that were going to come in. Fuke: So, they didn't have any intent to have anyone until you told them to. Takase: Yes. Until we caught them. To their benefit, I do think they weren't selling as well. If we go on a technical basis, was there somebody there while sales were being made? I'll say that I don't think they were selling without a manager on duty. We just bring it forward because we thought there's a distinction there. Fuke: Brandon, you were saying earlier that you're looking at that particular provision of the Rules. I was looking at it now and it says that "a person duly approved to serve as a person in active charge of the premises shall be on duty at all times while the premises are open for business even during hours in which liquor is not offered." Essentially, if you are a restaurant, and you have a liquor license and you offer breakfast with no liquor, you still need to have a person in charge, right? And this is also like the second case we haven't heard yet, like in Waikoloa. Gonzalez: Yes. Takase: Yes. We did change the language to clarify it. Previously it just said you need to have a manager on duty. When I came in to the Department that was how they were interpreting the law—even when you open for business but not serving liquor, you should have somebody on duty. We had many violations when I first came on, many were hotels and some condos. It was confusing to them because they were thinking "we're closed for business, the liquor's locked up, we didn't realize we had to have somebody on duty." The reason Brandon says we are re-evaluating now is Honolulu has moved away from that. They felt that it was overly burdensome to the Licensees. If you are closed up then they see no reason to have a manager on duty. We're looking at that as well, saying if there's no access to the liquor then maybe they don't need to have a manager on duty. When we get around to doing the Rules, that maybe one that changes. Fuke: But technically at this point in time, it's still a violation? Takase: Yes. DECEMBER 7, 2017- LIQUOR ADJUDICATION BOARD MINUTES 26 Gonzalez: As the plain language of the Rule says. Fuke: With this and the Waikoloa situation? Gonzalez: Correct. With the Waikoloa one there's even more distinguishing factors for that one. Masuda: Let's not get to the Waikoloa one now. Gonzalez: What I want to focus on in this case is, and in my analysis I was aware of the Bite Me Fish Market case where a $1,000 fine was imposed, $1,000 was suspended also on the condition because they were actually looking to go out of business so their license was going to be relinquished anyway. What struck the investigators and myself in reviewing the case is that it seemed as if the Licensee was taking no action to remedy the situation and my understanding of what the investigator brought forth to me in the investigation, until he walked in there and told them that they should have gotten somebody to take the class, they probably wouldn't have been motivated to do so. No one was there with a card since July 16. Our investigator walked in on the 21St. A few days later they submitted a request to have somebody take the class. There wasn't a request pending with the Department from the five days before when they didn't have anybody. Also, we have had Licensees in the past who have called when they were in a sticky situation and asked what they can do. Usually if it's a one- or two-day situation, we make note of it, we let the investigators know and we work with the Licensee. Masuda: What was the recommendation, again? Gonzalez: $1,000, suspend $500. Fuke: Related to that question, it's interesting because this business has a Dispenser license and they're not selling alcohol and the amount presumably of revenue generated only by the burgers would appear to be proportionately much smaller. Why would they not want to have a person in charge so that they can now sell alcohol both on and off premises. Gonzalez: Yes. I think part of that is highlighted in the fact that people quit, people they had designated before. Fuke: But wouldn't you assume that this is your money maker and the food portion is so small so you'd want to keep the money end? Gonzalez: Because they're not a restaurant, they're not required to submit their food sales. I really don't know. I'm just generally explaining how I distinguish. I see a restaurant where maybe they're known as a chain and they're primary operation is the food side, but who knows? They could have been at 29 percent food and still 71 percent alcohol. Fuke: Do you have any statistics regarding what their alcohol sale was during the month of April, May, June, July and August? DECEMBER 7, 2017 — LIQUOR ADJUDICATION BOARD MINUTES 27 Gonzalez: I don't have that with me. Fuke: Just to see whether there's any so called illegal sales. Takase: We could get the data but it probably wouldn't show. We don't require per day sales. Smith: I have a question. Brandon, this is Annie's in Kailua, right? Gonzalez: Yes. Smith: When the investigator went in there the person he saw in charge was the Chef? Gonzalez: Yes. Smith: And everybody else was no longer employed there? Gonzalez: That was my understanding. Smith: The impression I get from those facts are that this company is having a difficult time paying their employees and they're leaving. They're trying to get by until tomorrow. If they were more organized and more in tune with the laws, they would have done exactly what you suggested, like they would have asked how they could get somebody, "I don't them yet, but I plan to." Maybe their focus is on "I want to stay open tomorrow." Giffin: Survival. Smith: Yes. I think we always try to be supportive of business—I hate to kick somebody when he's down. What is your gut feeling on this? Do you think they got the message? Or they'll be out of business next month? Gonzalez: We don't want them out of business. Takase: I'II say that they did come in since then and got people. Gonzalez: They made the Chef a card holder. Takase: Yes. They rectified the problem. Smith: They didn't hire someone with the card, they told the current (employee to get one). He's probably an owner? Gonzalez: They made Lorenzo the General Manager, I believe. He might have gotten a promotion and he had two more people they hired who were also put on the card list. Smith: So they got the message? Takase: Yes. That's why I'll say it's not the most egregious case out there where they're just flaunting the law. They did make some attempts to follow the law. You were asking DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 28 us why we going forward, we felt there was really no effort by them to do anything. If the Board feels the need to show some leniency, we totally understand. Fuke: We have a motion on the floor which is a fine for $1,000 with $500 suspended. Is there any further discussion on that? Smith: I'm okay with that. Fuke: All those in favor please say, "Aye." The Board Members voted "Aye." Fuke: Those opposed, "Nay." There was no opposition by the Board Members. Fuke: Unanimously carried. The motion was unanimously carried. Fuke: On the last item, Case No. 2017-017, in the Matter of the Accusation against CRH Ocean Club, LLC, dba Ocean Club, located in Waikoloa, Hawaii. Informal hearing, Alternative II on the violation of Rule 5-2 of the Liquor Commission Rules, for failure to have a person in active charge on the premises to provide proper supervision in exercise of the liquor license in accordance with the liquor laws. Mr. Gonzalez? Masuda: Excuse me, Mr. Chairman. This matter was scheduled for 1:30 P.M. This is an Alternative II, it is now 2:45 P.M. Takase: No. They submitted a letter. Denise Young submitted a letter, November 20tH Gonzalez: There was a letter submitted. I do believe they submitted Alternative II, but also submitted a letter with their Answer in the event that they would not be able to have someone attend today. Fuke: Thank you for that clarification. Mr. Gonazalez, the report please? Gonzalez: The Complaint and Accusation in this case reads, Mr. Chair and Members of the Board: on or about the 20th day of September 2017, in the County and State of Hawaii, the Licensee, CRH Ocean Club, LLC, dba Ocean Club, did fail to have a person duly approved by the Department of Liquor Control, as a person in active charge of the premises at all times while the premises was open for business, to provide proper supervision in the exercise of the liquor license in accordance with the liquor laws. This is in violation of Rule 5-2 of the Rules and Regulations of the Liquor Commission of the Department of Liquor Control of the County of Hawaii, State of Hawaii. Fuke: Thank you very much. Is there a motion to find the Licensee in violation of the charge? DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 29 Giffin: I so move, Mr. Chairman. Smith: Second. Ms. Giffin moved to find that the Licensee in Case No. 2017-017, be found in violation of Rule 5-2 of the Rules and Regulations of the Liquor Commission of the County of Hawaii, State of Hawaii; seconded by Mr. Smith. Fuke: Any discussion? There was no discussion from the Board Members. Fuke: Since none, all those in favor please say, "Aye." The Board Members voted "Aye." Fuke: Those opposed, "Nay." There was no opposition by the Board Members. Fuke: Motion carried unanimously. The motion was unanimously carried. Fuke: Since the Licensee is not here, Mr. Gonzalez, can you proceed with the recommended penalty? Gonzalez: The Department in this case is recommending a letter of reprimand. The license was originally issued on December 10, 2008, through a sale and transfer. There have been no previous violations for this Licensee. Also, the basis for the recommendation besides their clean violation history is the fact that this Licensee's premises operates somewhat similar to a hotel where they may have other functions and amenities open and the bar itself is closed but the consumption areas are still accessible. Takase: Yes. To the Board, let me tell you why we're recommending such action. I take it as my responsibility to inform them of the Rules and I think we didn't inform them of the need to have somebody on at all times. They were operating on the assumption that when they're open they need to have somebody on duty which, like I said when I first came on that was my assumption. They never tried to get away from that and even when they're not open for service, they do have employees telling people in the pool area that they're not allowed to bring their own liquor onto the premises. So, even without having the matter (inaudible), they were doing certain things that complied with the laws. l felt that because I can't recall specifically telling them or having this coming up before with them like we did with all the other hotels on this side, we gave them a warning the first time and they did reset their schedules so that they do have somebody scheduled at all times. I felt in fairness to them as we were with the other hotels, we would give them a warning the first time. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 30 Fuke: This would be like doing a compliance check? Takase: Yes, essentially. They didn't have anybody on duty, but they also were not open when the investigator was there. They have also reported that they don't allow people to bring their own drinks to the pool area (it is on Yelp). That's really what they would be doing, compliance wise anyway. I felt that even though they didn't have a manager on duty they are still enforcing liquor laws during the off hours as well. Gonazalez: Since the day of violation they have increased the amount of card holders that they have because they sent in more employees to get training to comply with the law. Smith: I have a question. Hali'i Kai is a private club that you enter through Mauna Lani, you go around the long the driveway? Takase: This is in Waikoloa. Mauka of the Hilton. Fuke: It's adjacent to the Mauna Lani Golf Course. Smith: But it's a private club, so if you're not a member or if you're not an owner, you can't get through the gate, you can't get in there? Fuke: Yes. It's gated. Smith: So they have this liquor license because they serve their own private members? Takase: Yes. Correct. Fuke: Or hotel guests. It's like timeshare or vacation rentals. Smith: It's timeshare? I thought it was owners. Fuke: Vacation rentals. Takase: It's not timeshare but owner -occupied. You could rent a place there. Giffin: As an owner, I can rent it out to somebody else when I'm not there. Smith: I didn't think they allowed that at Hali`i Kai. Takase: It's a specialized situation. It's an enclosed community, but I think they were doing their best to comply whether they realized it or not. That's the distinction between this and the last one and secondly that they were closed, not open directly to the public and advertising as such to the public. Smith: I have a related question. Sometime back when Keauhou Beach Hotel was open. Because they have room service, and because room service was 24 hours at that time, we told them they need to have a person in active charge even if it was 4:00 A.M. and you couldn't sell alcohol even if you have a license. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 31 Takase: Yes. That was the previous interpretation because you had liquor on the premises you had to have somebody on duty. The only ones I would say that you would still require would be probably the retail stores like the 7 -Elevens, the mini marts because they stay open 24 hours. I know that 7 -Eleven locks up their cooler areas, but some of them leave it open. It's really up to the cashier on duty to make sure that no sales are made during those times. Those would probably stay the same because even though they're technically not selling liquor during those hours, their liquor is exposed. That's why I'm seriously considering changing our Rules to day that if you're shut down for liquor service, we're not going to require managers anymore. We have to make a proposal and I'm pretty sure the industry will support it and then it'll be a matter of taking it to the Commission to see if that's where they want to go or not. Fuke: I think that would help. The way it's written now is like if you have a restaurant and you decide not to sell alcohol, sorry but you have to close the restaurant. That's the technical reading of the Rule. Takase: That's the reason I inform the Licensees. Prior to that they'd have to close and I felt that it was unfair because they could still run their restaurant. They just ran into a bind and I wouldn't want to make them close because they didn't have somebody. To me, if you stop selling and you rectify the problem, at least temporarily, it may be okay. With the last case it was really because they seemed to make no effort get somebody in there that we felt we couldn't just treat them like the person who got into a bind for one day. Similarly in this case, they felt they were in compliance, they had managers on duty when they opened for service. I wanted to give them a warning first since that was what I did in the past with the others. Fuke: Any further questions? Brandon, just to clarify again, the recommended penalty? Gonzalez: It was a letter of reprimand reminding them of the requirement. Fuke: Would you entertain any language to the effect that if there's any similar violation there would be a penalty? A monetary fine? Takase: I think they understand that we are giving them a break now. Smith: And they've hired these people, right? Takase: Yes. They felt that whatever we require of them, they'll do. They're good Licensees. Fuke: The recommendation is to send a letter of reprimand. Is there a motion on the recommended penalty? Giffin: I so move. Smith: Second. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 32 Ms. Giffin moved that the Licensee in Case No. 2017-017, be sent a letter of reprimand for the violation of Rule 5-2; seconded by Mr. Smith. Fuke: Any further discussion? There was no further discussion from the Board Members. Fuke: Since none, all those in favor say, "Aye." The Board Members voted "Aye." Fuke: Those opposed, "Nay." There was no opposition by the Board Members. Fuke: Unanimously carried. The motion was unanimously carried. IV. Unfinished Business Fuke: Is there any unfinished business? There was no unfinished business. V. New Business Fuke: New business, Director? 1 Election of Chairperson and Vice Chairperson for the year 2018. Takase: A new Chairman has to be elected. Smith: Mr. Chairman, I'd like to make a motion. I move that our current Vice Chair Mr. Fuke become our Chair for next year and Board Member Giffin be the Vice Chair for next year. Giffin: I cannot second that, right? Takase: Sure you can. Masuda: Somebody has to; you have to. Giffin: I second. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 33 Mr. Smith moved that Sidney Fuke be elected as Chairman of the Liquor Adjudication Board for the year 2018, and Gerri Giffin be elected as Vice Chairman for the year 2018; seconded by Ms. Giffin. Fuke: Any objection? There were no objections from the Board Members. Fuke: Hearing none, all those in favor say, "Aye." The Board Members voted "Aye." Fuke: Those opposed say, "Nay." There was no opposition by the Board Members Fuke: Unanimously carried. The motion was unanimously carried. Gonzalez: Congratulations. VI. Announcements Fuke: Any announcements? Is there a motion to adjourn? Meetings of Liquor Adjudication January 18, 2018, 10:00 A.M., location TBA. February 15, 2018, 10:00 A.M., location TBA. Takase: We have two meetings scheduled, January 18 and February 15, but we'll let you know—we don't have anything pending at this time. Gonzalez: It looks like there's nothing for January 18. Takase: Maybe February. VII. Adjournment Fuke: Motion to adjourn? Giffin: Is it too soon to talk about February? Takase: February 15 is the scheduled date if we do get cases. Please set aside that day. We'II go by where the majority of cases are. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 34 Fuke: Motion to adjourn? Giffin: 1 so move the meeting be adjourned. Smith: Second. Ms. Giffin moved to adjourn; seconded by Mr. Smith. Fuke: All those in favor say, "Aye." The Board Members voted "Aye." Fuke: Those opposed, "Nay." There was no opposition by the Board Members. Fuke: Motion carried. The meeting is adjourned. The motion was unanimously carried. Meeting adjourned at 2:58 P.M. Gerald Takase Director The December 7, 2017, meeting minutes were approved as circulated via e-mail/mail on October 11, 2018, by the Liquor Adjudication Board of the County of Hawaii, on October 18, 2018. DECEMBER 7, 2017 - LIQUOR ADJUDICATION BOARD MINUTES 35