comscore Don Ho's owner vows to reopen | Honolulu Star-Advertiser

Don Ho’s owner vows to reopen

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    Star-Advertiser Don Ho's Island Grill has suspended daily operations, although its owner says the restaurant is "not closed."

  • Don Ho’s Island Grill faces myriad financial problems, but its owner is optimistic.

Don Ho’s Island Grill is "not closed," said owner Phillip Johnson, who established parent company PJJ Restaurant LLC to buy the Aloha Tower Marketplace restaurant in September. While "daily operations have been suspended through August," the space will continue to open for private parties, fundraisers and concerts that have been scheduled with a catering company providing food. The new operational status has the approval of Aloha Tower Marketplace officials, he said, though they did not return Star-Advertiser calls.

Johnson is busying himself with "restructuring of the business" through partnerships with other businesses that will provide full bar and daily food service operations. "We’ve had some setbacks, but I’m excited" about new opportunities that have resulted from the challenges, he said. The restaurant also is to undergo maintenance after a late-June water leak from Bikini Cantina upstairs, he said.

Water was not the only type of leak affecting the restaurant and its operations.

Several employees have had multiple paychecks bounce due to the restaurant’s insufficient funds.

"Personally, I have four (unpaid) paychecks," said Mike Maielua, operating partner and general manager. "I couldn’t see myself cashing any until employees get theirs cashed." While Maielua is not liable financially for company debts, he "unfortunately" can’t separate himself from the parent company, he said, "but as far as day-to-day things, I’m done."

Former manager John "Bo" Perez was unable to cash his June 15 paycheck but said, "I’m more hurt for the people under me" who tried unsuccessfully to cash checks for $70, $120 and $150. He estimates about a dozen ex-employees are "holding checks."

The first indication that Don Ho’s was headed for trouble came one month into Johnson’s ownership. "He was taking too many vacations," said Perez.

Johnson plans to make good on the last two paychecks’ worth of wages, he said. "I have no employees right now, just myself. I’m behind $26,000 in payroll and I’m doing everything I can in my power to be able to provide that back."

In addition to filing for unemployment, Perkin Lee, another former manager, said he and others who worked with him have filed complaints with the state Department of Labor and Industrial Relations over unpaid wages.

The restaurant’s other debts include unpaid bills to vendors, such as food distributors and other providers of supplies and services, but Johnson said he has "no idea" how much he owes them.

"The easiest thing … I could do is claim bankruptcy, but I believe 100 percent in this venue," Johnson said.

Employee health coverage was suspended for nonpayment in April, Perez said.

"We (the managers) started hiding money on the side to pay the purveyors … but you could only do that for so long," he said.

Maielua, a 20-year hospitality industry veteran, said he was offered a partnership in PJJ Restaurant so that Aloha Tower Marketplace would accept Johnson as a tenant because Johnson lacked restaurant industry experience. "I cannot talk bad about anybody, but let’s just say it was a challenge from the beginning," Maielua said.

"No matter what Mike told him, no matter what any of us told him, he would not follow our advice," Lee said of Johnson.

Employees and managers the Star-Advertiser interviewed said that despite the restaurant’s slide they stayed on out of loyalty to Maielua, who expressed similar loyalty to his former co-workers.

Johnson disputes previous owner Fred Livingston’s statement that revenues were at $2 million annually and characterized Don Ho’s as a failing restaurant when he took over. He cited all-day Monday sales of $1,200 and said "after you pay out for employees, food and alcohol, we’re in the hole."

Uncertain whether he is "going to be able to use the name Don Ho’s any more," Johnson is working on new names for the venue. The restaurant’s use of the iconic entertainer’s name is licensed by the late Don Ho’s estate, for which Johnson agreed to pay $500 a month. "But there’s been no support from the trustees. … The name Don Ho’s been tainted with the fight within the family" after the entertainer’s death, Johnson said.

Attorney Paul Maki, who represents the estate, said he would relay a message to the trustees. No calls were received.

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