Tag Archives: Court Cases

Hospitality Industry Insurance Risks: California Hotel Owner Charged With Workers' Compensation Violations And Fraud

“…accused of dissuading an employee from seeking workers’ compensation after a work injury, fraud and making false claims. He is charged with two counts of insurance fraud, failure to maintain workers’ compensation insurance …”

The owner of a long-troubled Santa Cruz area inn is headed to trial on charges that he mishandled workers’ compensation and committed insurance fraud.

Sanjiv Kakkar, owner of Brookdale Inn and Spa, is accused of dissuading an employee from seeking workers’ compensation after a work injury, fraud and making false claims. He is charged with two counts of insurance fraud, failure to maintain workers’ compensation insurance and passing off bad checks, according to Kelly Walker, a prosecutor with the Santa Cruz District Attorney’s Office.

Kakkar appeared in court Friday with his attorney, Peter Leeming, to set a date of March 12 for a jury trial. A court date was also scheduled for December for a motion to consolidate the case with a second criminal case involving Kakkar. The latter case involves misdemeanor violations of health and safety codes.

Leeming said he is looking forward to finally taking the case to trial after multiple delays.

For more:  http://www.mercurynews.com/central-coast/ci_19167190

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Filed under Claims, Crime, Injuries, Insurance, Labor Issues, Liability, Management And Ownership, Risk Management

Hospitality Industry Liability Risks: Arizona Hotel Found Guilty Of "Negiligence" On Appeal In Death Of Guest As Judges Find "Intended Use Of Stairway Required Center Handrail"; Carpet "Camouflaged" Dangerous Condition

“…An expert for the family testified that construction plans for the hotel, as well as its floor plan, depicted a center handrail where Volner fell… The expert also said that based on the intended use and width of the stairway, as well as applicable city building codes, a center handrail was required…”

“…the pattern on the carpet “camouflaged’’ the stairs, exacerbating the dangerous condition created by the lack of a handrail…”

The state Court of Appeals has upheld a $2.4 million verdict against a Tucson hotel where a woman tripped, fell down the stairs and died.

In a unanimous ruling, the judges rejected arguments by the owners of the Viscount Hotel that evidence of subsequent injuries is irrelevant to whether the business was negligent in this specific incident. They also brushed aside claims by the attorneys for the hotel that such evidence was prejudicial and would unfairly sway jurors against the business.

 Court records show that 78-year-old Harriet Volner was at the hotel in 2007 to have breakfast with friends when she fell at the stairs leading into the hotel’s atrium. She hit her head, went into a coma and died five days later after being taken off life support.

Her four children sued. A jury issued a $3 million judgment. But jurors concluded that Volner was 20 percent liable for her own injuries, reducing the verdict to $2.4 million.

A former hotel employee said there had been a center handrail but it had been removed and the carpeting changed. And an expert witness hired by the hotel agreed that the building code required a center handrail and it was a violation to have removed it.

For more:  http://www.ahwatukee.com/news/valley_and_state/article_a9ac7f01-7345-5d2f-8ebd-89ae0aa1271e.html

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Filed under Claims, Guest Issues, Injuries, Insurance, Liability, Maintenance, Management And Ownership, Risk Management, Training

Hospitality Industry Employee Risks: California Supreme Court To Determine Whether "Non-Exempt Employees Are Entitled To Uninterrupted, Off-Duty Meal Periods Of 30 Minutes For Every Five Hours Worked"

“…At issue in the case is whether California employers must ensure that their employees actually take their meal and rest periods or merely make them available. Guidance is also anticipated regarding the time in the workday in which meal and rest periods must be taken and whether or not legally-compliant meal and rest period policies can protect an employer against class actions even when these policies are unevenly enforced…”

The California Supreme Court will hear oral argument in Brinker Restaurant v. Superior Court (Hohnbaum, et al., real parties in interest) on November 8, 2011, according to the Court docket issued this week. The Court generally issues decisions within 90 days after completion of oral argument and submission of post-argument briefs, if any. A decision is expected by mid-February, 2012.

The decision is extremely important to California employers because meal and rest period claims have been the basis of hundreds of class action lawsuits in California. The Court’s decision could make it more difficult for plaintiffs to bring these claims as class actions, or, depending on the ruling, could establish rigid guidelines which may foster more class actions. Either way, California employers and plaintiffs class action lawyers alike have eagerly awaited this decision since the Supreme Court took up the case in October 2008 and look forward to receiving guidance from the high court.

Under California law, nonexempt employees are entitled to uninterrupted, off-duty meal periods of at least 30 minutes for every five hours worked. While there are certain limited exceptions to this rule (such as a revocable written waiver of the meal period in limited circumstances), employers are required to compensate employees for on-duty meal periods. In addition, California law assesses employers a penalty equal to one hour of pay at the employee’s regular rate for every day there is a meal period violation.

For more:  http://hotellaw.jmbm.com/2011/10/labor_brinker_case.html

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Filed under Insurance, Labor Issues, Liability, Management And Ownership, Risk Management, Training

Hotel Industry Video Surveillance Issues: San Francisco Hotel Video Tapes Are Central In High Profile Court Case Implicating Police Officers In "Illegal Search And Seizure" Charges (Video)

A San Francisco police officer accused of stealing items from a man’s residential hotel room following a drug arrest has been captured on video in a second incident, appearing to leave a residence at the Julian Hotel with property never booked into evidence.

The video, released Tuesday, May 17, by San Francisco Public Defender Jeff Adachi, comes less than a week after Adachi released surveillance footage documenting a similar incident on Dec. 30 at the Jefferson Hotel.

 [youtube=http://www.youtube.com/watch?v=B0pnz670Nj0&feature=player_embedded]

The new footage stems from a Feb. 25, 2011, illegal search and drug arrest by Mission Station officers Ricardo Guerrero, Reynaldo Vargas, Jacob Fegan, Christopher Servat and Adam Kujath. Guerrero, Vargas and Fegan were also involved in the Jefferson Hotel incident.

In the most recent video, officers can be seen walking into the building empty-handed. However, Guerrero is later seen leaving with property that appears to be consistent with a laptop inside a bag, which was confirmed missing from the room later that day along with a camera. Vargas is carrying a second bag containing unknown items. Neither bag was booked into evidence.

Officers arrested resident Jesus “Jessie” Reyes, 64, for possession for sale of methamphetamine. Prosecutors dropped the charges against Reyes May 4 after Guerrero failed to show up to testify despite a subpoena. Reyes had never before been arrested, said his attorney, Deputy Public Defender Cindy Elias.

For more:  http://sfbayview.com/2011/more-videos-reveal-illegal-searches-theft-brutality-by-sfpd/

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Filed under Crime, Guest Issues, Liability, Risk Management, Technology, Theft

Hotel Industry Liability Issues: “Bed Bug” Court Verdicts Have Recently Found Hotel Owners Liable When “Conscious And Deliberate Behavior” Allowed Infestations To Proliferate

The recent surge in bed bugs has created an uptick in litigation against motel owners and landlords alike.  duLac’s article focuses on a Maryland attorney who is filing a series

Bed Beg infestations at hotels can result in guilty verdicts against hotel owners if conscious and deliberate behavior led to infestations going untreated.

of bed bug liability suits.  The typical compensatory damages claim is $200,000, and many of the suits claim punies.  Bed bug suits, in Maryland and elsewhere, generally face three major issues.

First, plaintiff will have to prove notice on the part of the motel owner or landlord.  Actual notice is best, but constructive notice should suffice.  For constructive notice, the focus will be the length of time the condition (bed bugs) has been in place.  The Maryland suits contain mostly conclusory allegations, so discovery will be important.

Second, plaintiff will have to establish compensatory damages.  Bed bugs are nasty creatures, and I have a lot of sympathy for people impacted by them.  Plaintiffs in Mathias got a jury verdict for compensatory damages of $5,000.  A Florida attorney quoted in duLac’s article is leaving the bed bug liability field because the damages are too small.  He noted that he settled one case for $4,000 and another for $10,000.

Finally, a fairly standard punies regime requires a plaintiff to prove some type of conscious and deliberate behavior on the part of the defendant.  In Mathias, the hotel owners were informed about the bed bugs.  Instead of paying for a $500 extermination, the owners allowed the bed bug situation to fester for nearly two years.  It was widely known the hotel had bed bugs.  There were certain rooms that employees were not supposed to rent out because of the bugs, yet the rooms were rented if there were not enough other rooms available.  Guests were informed the bugs were ticks (as if that’s better!).  Under these circumstances, the court upheld a punies verdict of $186,000.  If proving notice in the Maryland cases will require the discovery of significant facts, for punies the bar is even higher.

For more:  http://lawprofessors.typepad.com/tortsprof/2010/11/bed-bug-liability.html

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Filed under Claims, Guest Issues, Health, Liability, Management And Ownership, Risk Management

Hospitality Industry Liability: Hotels Can Be Held Liable For Failing “To Protect Children From Adult Movies”

In October 2007, a Norwalk, California Superior Court Jury found the Value Lodge Hotel, liable for involuntarily subjecting an 8 and 9 year old sisters to hard core pornographic movies. (McCombs vs Value Lodge Enterprises Case VC 047178)

 The guests, a woman from Tennessee and her 8 and 9 year old daughters, checked into the Value Lodge Hotel. After check in, the woman took a shower and told her daughters to watch television.

 The daughters turned on the TV and came across a pornographic television channel, which was unprotected and could be accessed just like any other regular television channel or program. The Mother sued the Hotel for $640,000.

 The Jury awarded the Mother $85,000 in damages. The Judge did not allow punitive damages in this case.

 During the trial, the Mother’s Attorneys presented testimony from a Hotel Expert, who commented that in his thirty years experience, he has never seen a family hotel where some affirmative action was not necessary in order to access adult movies.

 The Hotel argued that there was a sign on the television advising guests to notify the front desk if they did not want the adult movies, but the hotel could not produce a sign as evidence.

 After the trial, the Jury said they did not believe the Hotel in fact had a sign or any other notification in the rooms about the adult movies.

 How does this case affect Hotels with adult movies?

 The facts of this case are very specific. The Hotel’s adult movies were not protected in the usual hotel “movie system”, which requires the guest to push numerous remote buttons, and pass through numerous movie / ordering screens. The adult movies at this Hotel were just one of the regular channels, the same as all of the rest of the television channels.

 The Jury felt the Hotel had a “duty” to protect children from this type of unprotected and simple access to an adult movie. Remember that all lawsuits start with the neglect or failure of a “duty” that is required from one party to another. I think we all would agree that in this specific case, the Hotel did have a “duty” to prevent children from viewing adult movies.

 What is your “duty” if you don’t have immediate access to adult movies, but a Hotel movie system (like LodgeNet or On Command) that requires you to select movies and go through numerous screens and buttons to order a movie?

 The Norwalk Superior Court verdict tells us that Hotels do have a duty to protect children from adult movies. But the Court does not offer any guidance for other adult movie systems that are currently being used in a majority of Hotels.

 I could argue that a “LodgeNet or On-Command” in room Hotel movie system is adequately protected, as the movie system requires numerous selection screens, remote button pushing and ordering screens before a movie can be ordered. There is an automatic defense in common law known as “improper parental supervision”, that can be used if a child’s parent is present, and the child gets injured or otherwise harmed. The defense to the child’s harm can be that the child “was not properly supervised” by the parent who was present. Of course the exact facts of each case would dictate what the “duty” of the Hotel was, and what the “duty” of the parents was, in those very specific circumstances.

 I could also argue that if the Hotel were held liable for what a child sees on a Hotel television, then it would create a “slippery slope” for other television situations. For instance, the Animal Planet channel shows african lions attack and kill a defenseless animal during a nature program. Children could be harmed by seeing an animal they loved being mauled and eaten by another animal, so is the Hotel responsible for that situation? Or, how about a Health Channel showing a real medical operation on a person that shows blood and human body organs? This could also upset a child. As you can see, there is no simple answer to this question.

 And, what about our favorite free movie channels that most Hotels carry like HBO or Showtime? HBO and Showtime are in the TV line up as regular television channels and often carry very provocative and sexual oriented programming, but these channels are not protected or blocked in any way.

 So, What Should You Do?

 Train your staff to ask guests at check in if they would like any of “the movies” turned off in the room. Especially if you see the guest is with children at check in, or the guest is asking for a crib etc. This includes HBO etc.

  1. Post a sign or small placard on the television advising the guest that the hotel has adult programming, and to call the front desk if they would like those channels blocked. Include this advisement in your guestroom directory along with all of the other Hotel, menu and attraction information.
  2. Turn off all adult movies to all Hotel rooms. This would require the guest to specifically call the front desk and request the movies to be turned on, which now protects you from accusations of negligence. This step will increase your front desk work load, as they will have to respond to dozens of calls every night asking for movies. This might also upset the Guest, as it becomes inconvenient to have to call for movies, so you should consider all of the consequences to having the movies turned off all of the time.
  3. If a Guest calls and informs you they are receiving “free movies” which they didn’t ask for or pay for, then make sure your staff reacts quickly to turn off the movies. Don’t take a guest complaint of getting “free movies” lightly. Have maintenance respond to the guest room to ensure the problem is solved.
  4. Regularly check your movie system to ensure it is working properly. Recently I was staying in a large hotel that was under renovation, and I was receiving all movies, including adult movies free, as I channel surfed. It was obvious that the movie system had been compromised as part of the renovation, so all of the pay movies were being broadcast to rooms without restrictions.

 Todd Seiders CLSD, is Director of Risk Management, Petra Risk Solutions, Hospitality Insurance and Risk Management experts, you can contact Todd at: todds@petrarisksolutions.com, or (800) 466-8951.

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Filed under Liability, Training