Dynasty ordered to pay $191,400 in civil penalty

U.S. District Court for the NMI Chief Judge Ramona V. Manglona yesterday ordered the owners of the defunct Tinian Dynasty Hotel & Casino to pay $191,400 in civil penalty to the U.S. Labor secretary for their willful and repeat violations of the overtime provision of the Fair Labor Standards Act.

Manglona issued the order in granting the U.S. Labor secretary and co-defendants’ motion for summary judgment as to all three claims filed by the Tinian Dynasty owner, Hong Kong Entertainment (Overseas) Investments Ltd. (HKE), and HKE president Kwan Man.

The judge ruling also affirmed the U.S. Department of Labor’s Administrative Review Board’s final decision issued on Nov. 25, 2014 that assessed such civil money penalty against HKE and Man.

Manglona concluded that, as a matter of law, the compliance agreement entered by HKE and the Labor secretary did not preclude the imposition of civil money penalties for HKE’s violations of the overtime provisions of the FLSA.

Manglona determined that the Labor secretary has demonstrated the absence of a genuine dispute as to a material fact as the propriety of the administrator’s assessment of $191,400 in civil money penalties, as well as the holding of the Labor Administrative Law Judge and the Labor Administrative Review Board upholding the imposition of such penalties.

On Aug. 31, 2007, Terrence Trotter, then-assistant district director for the Hawaii District Labor’s Wage and Hour Division (administrator) assessed the civil money penalties against HKE and Raymond Chan, then-financial controller for Tinian Dynasty and signatory to the compliance agreement, for willful and repeated violations of the FLSA during the period from March 16, 2007 to May 26, 2007.

On Feb. 4, 2011, the administrator assessed the civil money penalties for the same FLSA violations against Man.

Manglona said HKE has failed to show that the Labor’s Administrative Review Board’s decision to affirm the Labor Administrative Law Judge is unsupported by the administrative record, or that it is arbitrary and capricious, an abuse of discretion, or otherwise contrary to law.

In December 2014, HKE and Man filed the lawsuit against then-U.S. Labor Secretary Thomas E. Perez and several other Labor officials for allegedly violating their due process right over their assessment of civil penalty of $191,400.

HKE and Man brought the court action for a judicial review of the decisions of the Labor secretary and other Labor officials.

HKE and Man asked the court to reverse the Labor’s Administrative Review Board’s final decision and order and to set aside the ARB’s order assessing the civil penalty.

The plaintiffs asked the court to remand the matter back to a Labor Administrative Law Judge with instructions to hold a hearing on the merits regarding the propriety of the civil monetary penalty amount assessed against them.

Defendants Labor secretary and co-defendants then asked the court to issue a summary judgment to their favor.

The defendants have asserted, among other things, that the civil money penalty assessment was both fair and reasonable given plaintiffs’ repeat violations of FLSA.