Fifteen former foreign workers of the defunct Tinian Dynasty Hotel & Casino were awarded Friday $800,168 in compensatory and punitive damages in a default judgment.
U.S. District Court for the NMI Chief Judge Ramona V. Manglona found that the owner of Tinian Dynasty, Hong Kong Entertainment (Overseas) Investment Ltd. (HKE), is liable to pay its 15 former workers for fraudulent concealment and wrongful termination.
Manglona awarded a total of $395,168 in compensatory damages to the 15 plaintiffs: Eric F. Dona, $21,650.50; Donny Rivera, $44,601; Melinda Rivera, $19,902; Chung-Liang Chiu, $24,840.20; Shingo Kajiwara, $20,902.26; Han Shao, $21,164.20; Lorenzo Pacia III, $23,132.50; Didith Pacia, $40,601; Ming Yang Yuan, $40,745.50; Chuan Hui Xu, $27,747.50; Flordeliza F. Camiguing, $17,203.50; Jovelyn F. Reyes, $19,382; Richard Julio L. Reyes, $30,632; Ernesto Y. Rivera, $19,902; and Jose C. Cadion Jr., $22,762.
The claims for compensatory damages consist of lost wages and lost benefits as well as claims for mental anguish and punitive damages.
Manglona also awarded plaintiffs $405,000 in punitive damages, in equal amounts of $27,000 each, saying they have shown by clear and convincing evidence that an award of punitive damages is warranted.
This punitive damages amount, Manglona said, considers that HKE has twice been held accountable—in 2002 and 2007—for failure to pay its workers back wages.
In the 2007 administrative action, HKE was assessed civil penalties of $191,400 for having withheld $309,816 in back wages from 348 employees.
Manglona said that given HKE’s history of misconduct, a punitive damages award that is only a factor of two greater than the civil money penalties assessed by the U.S. more than a decade ago is quite reasonable.
The plaintiffs sued HKE and Tinian Dynasty’s management, Mega Stars Overseas Limited, for allegedly lying to them that they were legally authorized to work despite the denial of their CW-1 petitions.
Majority of the 15 plaintiffs have lived in the CNMI for many years and have children who are U.S. citizens.
The plaintiffs have asked the court to issue a default judgment holding HKE and Tinian Dynasty’s management, Mega Stars, liable to pay them $4.2 million in damages.
At the May 9 hearing, 13 plaintiffs were present in the courtroom, along with their attorney Samuel I. Mok.
Two other plaintiffs—Shingo Kajiwara and Chung-Liang Chiu—appeared by telephone. Also present in the courtroom were Japanese and Tagalog interpreters.
Both HKE and Mega Stars previously defaulted in this case and did not appear at the hearing, although they have been notified.
In the default judgment last Friday, Manglona said the plaintiffs have shown that HKE concealed many notices and warnings issued by U.S. Citizenship and Immigration Services that the CW-1 petitions filed on behalf of the plaintiffs were likely to be denied because USCIS did not view HKE as a “legitimate employer.”
According to the notices of intent to deny and notices of intent to revoke, Manglona said, USCIS did not view HKE as a legitimate employer because of its past labor violations for failing to pay employees proper wages and overtime in accordance with federal law as well as for criminal conduct related to violations of the anti-money laundering provisions of the Bank Secrecy Act.
The judge said HKE intentionally concealed these facts from the plaintiffs pursuant to an explicit directive issued by HKE general manager Tom Liu to supervisors in the human resources department because it did not want employees, including the plaintiffs, to transfer to new employers, which would have effectively shut down HKE’s operations.
When the plaintiffs tried to ascertain the status of their CW-1 petitions, HKE lied that their petitions were being processed without issue, Manglona said.
Manglona said plaintiffs would have tried to transfer employers if the various warnings and notices issued by the USCIS prior to the Dec. 8, 2014, denial had been disclosed.
As for the claim for wrongful termination, Manglona said HKE constructively terminated the plaintiffs for their refusal to continue working in contravention of the law after their CW-1 petitions had been denied by the USCIS on Dec. 8, 2014.
In the CNMI, the judge pointed out, it is against public policy for an employer to terminate an employee for refusing to commit an illegal act.
“Plaintiffs’ refusal to work because of fear of the immigration consequences they would incur for employment without legal authorization is conduct worthy of being protected as it promotes the public interest in ensuring compliance and respect for the law,” the judge said.
Manglona, however, denied the plaintiffs’ motion for default judgment on their claim for fraudulent concealment. She said the plaintiffs failed to establish basis for relief on this claim.
Manglona declined to award damages for mental anguish.
On punitive damages, Manglona said Tinian Dynasty’s human resources manager Florine Hofschneider testified that the hotel’s general manager, Tom Liu, directed her not to tell plaintiffs and other alien workers about USCIS’ intent to deny their CW-1 permits, and that Liu told her he would “handle it.”
Manglona said the CW issue was of great concern to plaintiffs, as Mega Stars’ chairman, Wai Chan, acknowledged in a letter dated Jan. 12, 2015, to Tinian Dynasty staff, “because it threatens your legitimate working status in CNMI.”
Furthermore, Manglona said, defendants’ conduct in the course of this four-year litigation has prolonged plaintiffs’ suffering and added to the expense.
Manglona noted that twice, in January 2016 and January 2018, defense attorneys withdrew from the representation because defendants had failed to meet their obligations.
The second withdrawal occurred after defendants had dragged their feet for two years, requiring five amended scheduling orders.
After the second attorney withdrew, defendants refused to hire new counsel and defaulted.
Altogether, Manglona said, defendants’ conduct for which they have been found liable, as well as their conduct in the course of the litigation, has been reprehensible.
Tinian Dynasty’s casino operation stopped in August 2015. The hotel operation halted in March 2016.