Category Archives: Liability

by | February 1, 2013 · 7:45 am

Hospitality Industry Legal Risks: New York Hotel Settles Federal Class-Action Lawsuit For $550,000; “Service And Grutuity Charge” Not Paid To Workers

“…alleged that guests were not told that service charge was part of their bills. The amount of charge varied, depending on the service…in the dining room, standard meals were charged at a certain amount per diner Hospitality Industry Class Action Lawsuitswhether it was $5 or $8 or whatever, per meal, and also that the lodging charges were per night…”

Leatherstocking Corp., owner of the Otesaga Resort Hotel in Cooperstown, has agreed to pay a $550,000 settlement in a federal class-action lawsuit brought by service workers, largely over the distribution of service-charge proceeds. The workers alleged in the suit filed in Albany in 2010 that the hotel’s actions violated New York labor law the federal Fair Labor Standards Act.

The lawsuit also alleged violations of overtime and minimum-wage standards, but the bulk of the case focused on a “service/gratuity” charge that the hotel charged guests and restaurant patrons, according to court papers.

According to court documents, the hotel insisted that it properly distributed all of the service-charge money to employees. The dispute centered on which employees were paid, according to the documents.

The plaintiffs contended that management employees who were not legally entitled to a share of the payments nonetheless received them, while the hotel countered that that all of the people it paid were entitled to a share of the money.

For more:  http://thedailystar.com/localnews/x1746084500/Otesaga-pays-550-000-to-settle-lawsuit

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by | January 30, 2013 · 7:59 am

Hospitality Industry Legal Risks: Michigan Restaurant Group Settles “Class-Action Lawsuit” Alleging “False Advertising Of Halal Food Items”

“…(plaintiff’s) attorney alleged that after the restaurant ran out of Halal chicken, it sold non-Halal chicken…an investigation found that the restaurant had sold non-Halal food masquerading as Halal food “on Hospitality Industry Class Action Lawsuitsmany occasions.” The two filed a class action lawsuit in Wayne County Circuit Court in November 2011…”

McDonald’s and one of its franchises agreed to a $700,000 settlement in a lawsuit claiming that it falsely advertised some of its food as halal. Ahmed Ahmed, a Muslim man from Dearborn Heights, alleged that the chicken sandwich he ordered from the McDonald’s on Ford Road in Dearborn in September 2011 did not meet Islamic dietary standards, despite the franchise’s advertisements that it sells Halal chicken.

McDonald’s and Finley’s Management Co, which owns the franchise, agreed on January 18 to pay the $700,000, which will be split between Ahmed, his lawyers, a health clinic in Detroit and the Arab American National Museum in Dearborn. McDonald’s and Finley’s deny any liability, but say the settlement is in their best interest.

For more:  http://michiganjournal.org/2013/01/29/dearborn-mcdonalds-makes-settlement-in-non-halal-chicken-sandwich-lawsuit/

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by | January 29, 2013 · 7:21 am

Hospitality Industry Safety Risks: Texas Hotel Guest Files “Negligence Lawsuit” After Marble Tile In Elevator Falls On Child Causing “Serious Injuries”

“…as (plaintiff)  stepped off the hotel elevator, a large marble tile fell from a wall and onto the child’s head, Hospitality Industry Lawsuitchest and leg.  His bodily injuries were serious, permanent and disabling…”

An Oklahoma woman claims her son was injured at a Galveston hotel and is seeking damages in a suit against the owner. Shawna Martin filed a lawsuit against Neel Shah Hospitality Inc. on Jan. 25 in Galveston County District Court.

According to the suit, Martin and her 8-year-old son were on vacation in Galveston on Jan. 14, 2007, and the boy was injured at the at the Comfort Inn & Suites in the 6300 block of Seawall Boulevard.

“Allowing a loose tile which was inadequately secured to the wall….. posed an unreasonable risk of harm and the defendant had constructive knowledge of that risk,” the original petition says.

The defendant is blamed for:

  • Failing to properly and adequately secure the mirror to the wall;
  • Failing to perform an adequate inspection to determine whether there was a hazard present;
  • Failing to repair said mirror; and
  • Failing to warn.

For more:  http://setexasrecord.com/news/281053-woman-sues-galveston-hotel-after-marble-tile-strikes-son

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by | January 28, 2013 · 10:29 am

Hospitality Industry Health Risks: Studies Show Restaurants Use Cheaper Fish And Mislabel As Red Snapper And White Tuna; Cheaper Fish Substitutes Are Higher Risks For Food Poisoning

In addition to permitting aquaculture operations to use drugs that are banned by other countries, and permits the sale of species that other countries don’t, the U.S. only minimally oversees imports. A Johns Hopkins study FDA food inspectionsshows that the U.S. inspects a miniscule 2 percent of the seafood that comes into the country. By comparison, Japan inspects 18 percent and the European Union inspects 50 percent.

If you’re a fish eater and you keep an eye on the news, you already know that the “red snapper” special at your local restaurant is probably mislabeled. For years, restaurants have been substituting cheaper, more common species like tilapia for the famed red snapper. Last year, however, DNA analyses showed that the problem is more widespread than anyone suspected: In Los Angeles, New York, New Jersey and Connecticut, studies showed that 100 percent of restaurants were serving cheaper fish and mislabeling them as red snapper. Similarly, white tuna, yellowtail, Dover sole and wild-caught salmon were also often substituted for other species.

Most of the time, price gouging is the only harm that comes from such mislabeling. Sometimes, however, the danger might be a bit higher. Recently, the U.S. Pharmacopeial Convention noted that much of the alleged “white tuna” served in sushi restaurants may actually be escolar, also known as “snake mackerel.” A cheap fish that may cause severe food poisoning with, shall we say, explosive results, escolar is banned in some countries.

For more:  http://www.dailyfinance.com/2013/01/26/fish-food-poisoning-seafood/

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by | January 27, 2013 · 9:59 am

Hospitality Industry Legal Risks: “Severe Food Allergies” Now Classified As A Disability Under ADA Law

“…the agreement says that food allergies may constitute a disability under the Americans With Disabilities Act, if they are severe enough. The definition was made possible under 2009 amendments to the disability law Americans wih disabilities actthat allowed for episodic impairments that substantially limit activity…restaurants who post their ingredients can help those with allergies decide whether they even want to buy the food…”

The new law that now classifies severe food allergy as a disability applies to those severely allergic to gluten, peanuts, shell fish, corn, wheat, and other food allergens. What it translates to is of interest to hospitals, colleges, and other institutions to offer food and put labels on those buffet bars letting people with severe food allergies know what’s in the food. The settlement relates to the disability law. Severe, not mild food allergies can be considered a disability under the law.

A public restaurant also could be liable for a lawsuit by a customer if the business ignored a customer’s request for certain foods. But if the customer had the courage to eat there, even out of spite, and that person became ill knowing the restaurant brushed off the one customer’s request for serving food to which the customer isn’t allergic, or food not containing the ingredient responsible for the severe allergy, that case might be harder to argue because the restaurant might say the customer became sick from food eaten elsewhere.

The restaurant would have to know the customer well enough to have served food for that particular customer enough times that the cooks and food handlers or servers would know the allergy requests of that particular customer. The problem with this argument is that turnover in restaurant employees would throw the customer a curve ball so to speak, since new food handlers or cooks wouldn’t know the customer by face or name unless they were told and remembered or saw where the lists of familiar customers with allergies were posted.

For more:  http://www.examiner.com/article/federal-disabilities-law-may-help-people-with-severe-food-allergies

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by | January 26, 2013 · 7:57 am

Hospitality Industry Theft Risks: Pennsylvania Restaurant Manager Charged With Stealing Over $160,000; Made “Unauthorized ATM Withdrawals, Credit Card Purchases”

“…a certified public accountant’s review found that (he) made a string of unauthorized ATM withdrawals, unauthorized credit card purchases and unauthorized check card purchases totaling $163,601 from the employee theftbusiness accounts of Cosmopolitan…in addition to dinner cruises and visits to a strip club, (he) allegedly spent the money on household items at a retail store…”

A former general manager of Cosmopolitan in Allentown allegedly stole $163,601 from the restaurant and spent it on things like dinner cruises and visits to a strip club.

Cosmopolitan opened in October 2010. Fortunato was hired in September 2010 and promoted to general manager about a month later, District Attorney Jim Martin’s office said today in announcing the charges.

Fortunato’s responsibilities included overseeing the daily operations of the restaurant, handling employee payroll, paying bills to suppliers and collecting receipts for the business.

Fortunato also was given check-signing authority for the restaurant’s various bank accounts and ATM/debit card account at Wells Fargo Bank, a Visa card, an American Express account and access to cash receipts at the restaurant, Martin’s office said.

His responsibilities included using any of the accounts, but only for operations of the restaurant, according to the district attorney’s office.

Last June, Cosmopolitan co-owner Myron Haydt was reviewing the restaurant’s financial records and found a series of suspected unauthorized purchases by Fortunato, according to the statement.

For more: http://www.lehighvalleylive.com/allentown/index.ssf/2013/01/former_manager_of_allentowns_c.html

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by | January 25, 2013 · 9:21 am

Hospitality Industry Property Risks: New York Hotel And Restaurant Suffers “Significant Water Damage” After Frozen Pipe Bursts; $200,000 Damage From Third Floor To Basement

“…A water pipe had frozen and burst early Wednesday morning…the pipe was connected to the facility’s sprinkler system and the malfunction triggered a response from the Geneseo Fire Department…The pipe burst Hotel Water Damageon the third floor, pouring water into a guest room and working its way down to the basement. There was “significant damage” in several parts of the building including two parlors, dining rooms and guest rooms and spaces above and below the rooms…”

The Big Tree Inn, 46 Main St., remains closed after a water pipe burst on Wednesday, flooding several areas of the landmark building and causing significant damage from the third floor to the basement. Big Tree Inn will remain closed through Friday, but Scott is hopeful that at least part of the facility will be able to open some time during the weekend.

Scott estimated repairing the damage will cost $200,000 or more. The restaurant does have insurance.

Facility managers were alerted to a problem by a guest who reported hearing what was believed to be a small leak. An investigation revealed the bigger problem.

For more:  http://thelcn.com/2013/01/24/burst-water-pipe-causes-significant-damage-at-big-tree-inn/

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by | January 24, 2013 · 8:28 am

Hospitality Industry Safety Risks: Alabama Hotel Sued By Guest Trapped In Elevator; “Sustained Injuries During Escape From Broken Machinery”

“…(plaintiff) and several others became entrapped in the hotel’s elevator…(she claimed) the hotel didn’t respond to the emergency call which resulted in two male guests in the elevator prying the door open and Hotel Elevator Accidentcreating an opening to escape…hotel administrators pulled King by the legs through the opening resulting in her falling and suffering physical injuries…”

An Alabama resident is suing a local Marriott-owned hotel after allegedly being trapped in an elevator and sustaining injuries during an escape from the broken machinery. Maureen A. King filed a lawsuit against Marriott Hotel Services, Inc., Renaissance Hotel Management Company, LLC, Renaissance Hotel Operating Company, Sodexo, Inc. and John Doe in the Orleans Parish Central District Court.

The defendant is accused of failing to respond to the emergency elevator alarm, pulling petitioner from the elevator and causing her to fall and failing to seek emergency assistance.

An unspecified amount is sought for past medical expenses, future medical expenses, past lost wages, future lost wages, pain and suffering and mental anguish.

For more:  http://louisianarecord.com/news/248516-renaissance-pere-marquette-hotel-blamed-for-injuries-sustained-by-guest-stuck-in-elevator

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by | January 23, 2013 · 8:11 am

Hospitality Industry Legal Risks: Texas Restaurant Group Settles EEOC “Religious Discrimination Lawsuit” For $25,000; Female Employee Prevented From Wearing Skirt To Work

“…Fries Restaurant Management has  agreed to pay Ashanti McShan $20,000 for “mental anguish and non-wage damages” and an additional $5,000 in lost wages…The restaurant management company also EEOCagreed to post its policy against religious discrimination on employee bulletin boards in every Burger King it operates in the state of Texas…”

A Burger King in Texas has agreed to pay $25,000 to a Pentecostal womanwho wore a skirt to work, court documents state. The payment settles a lawsuit filed in August by the Equal Employment Opportunity Commission (EEOC) against Fries Restaurant Management, LLC, which owns and operates the Burger King in Grand Prairie, Texas. The store allegedly asked a teenage woman to leave work after she arrived in a skirt. The EEOC’s lawsuit against Fries alleged religious discrimination, which is a violation of Title VII of the Civil Right Act of 1964.

In addition, it vowed to hold trainings for managers on federal anti-discrimination laws for the next two years, according to the documents.

McShan was a senior in high school when she came to work at the Burger King wearing a skirt instead of the black pants that are part of Burger King’s uniform.

In August 2010, McShan asked to wear a skirt instead of the restaurant’s uniform pants. Burger King “assured her that she could wear a skirt to work,” the filing says.

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by | January 22, 2013 · 8:17 am

Hospitality Industry Business Risks: Texas Hotel Loses Reservations After Gas Line Damaged By Woman In Stolen Vehicle; Thousands Of Dollars Lost As Property Was A “Crime Scene”

“…the gas company had to shut the gas off and hotel hot water boilers run on gas…(hotel) was without hot water for almost 12 hours and as a result lost 26 reservations…the woman who ran over the gas main will have business interruption insuranceto pay (hotel) back in restitution fees that could be assessed to her in court but that doesn’t mean it’s feasible…”

An Amarillo hotel is out thousands of dollars after it’s forced to shut off it’s gas while police investigate a crime scene on the property. Saturday, the Holiday Inn near I-40 and Ross had to shut off its gas after its gas main was run over by a woman who stole a van.

Normally, a business might turn to its insurance company for damages like these, but not in this case.

“According to our insurance company there was no liability for them because of the fact that it was a crime scene,” added Muse. “It if had been a gas company issue, a faulty main or something, then it would’ve been something we could go to out insurance company for.

“Most of the time, in order to collect stuff, they’ve got to be have the ability to pay for it. With fines, court costs, all of that, restitution, it’s a matter of do they have the ability to pay. So, assessing and collecting are two different things.”

Even if the defendant is able to pay, if they serve any time, probation or parole, it could be years before the person they owe sees any of that money.

“So, even if it’s assessed and could be collected, they could pay, it could be a long time before they actually pay it?” NewsChannel Ten asked Sims. “Correct,” he answered. “And, like I said, probation is like an interest free loan.”

“It looks like we’re just going to be eating the loss,” said Muse.

Muse says he’s fortunate his hotel is older and more established, otherwise this blow to the business’ wallet would’ve hurt them a lot worse.

For more:  http://www.newschannel10.com/story/20609001/crime-scene-investigation-costs-amarillo-hotel

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