UNITE HERE! LOCAL 5, Plaintiff-Appellant, vs. PACREP LLC and PACREP 2 LLC; CITY AND COUNTY OF HONOLULU, a municipal corporation, Defendants-Appellees.

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The above-captioned case was set for oral argument on the merits at:

Supreme Court Courtroom
Ali‘iōlani Hale, 2nd Floor
417 South King Street
Honolulu, HI 96813

The oral argument was also livestreamed for public viewing via the Judiciary’s YouTube channel at YouTube.com/hawaiicourts and ʻŌlelo Community Television olelo.org/tv-schedule/.

Attorneys for Plaintiff-Appellant UNITE HERE! LOCAL 5:
     Gregory W. Kugle and Clint K. Hamada of Damon Key Leong Kupchak Hastert

Attorneys for Defendants-Appellees PACREP LLC and PACREP 2 LLC:
     Terence J. OʻToole, Sharon V. Lovejoy, and Maile S. Miller of Starn OʻToole Marcus & Fisher

Attorney for Defendant-Appellee CITY AND COUNTY OF HONOLULU:
     Brad T. Saito, Deputy Corporation Counsel

NOTE: Order granting Application for Transfer, filed 11/08/23.

COURT: Recktenwald, C.J., McKenna, Eddins, Ginoza, and Devens.

Brief Description:

Unite Here! Local 5 (“Local 5”), an organized labor union, filed a complaint in the First Circuit Court for the State of

Hawaiʻi (“circuit court”) against PACREP LLC and the City and County of Honolulu’s (“C&C”). PACREP is the developer of two condominium hotel projects located at 2121 Kuhio Avenue (“2121 Project”) and 2139 Kuhio Avenue (“2139 Project”) (collectively, “the Projects”) in the Waikiki Special District (“WSD”) on the island of Oʻahu. The C&C’s Department of Planning and Permitting (“DPP”) accepted the Final Environmental Assessments (“FEA”) for the Projects and issued findings of no significant impact (“FONSI”), subject of this litigation.

The 2121 Project and 2139 Project are adjacent lots, treated and recognized as one zoning lot for development purposes. At first, PACREP began looking at developing the 2121 Project. During the environmental review process for the 2121 Project, PACREP looked into acquiring the 2139 lot. After much back and forth between PACREP and the DPP over drafts of the 2121 Project EA, the DPP ultimately accepted the 2121 Project FEA and issued a FONSI. The FEA provided that the 2121 Project would be a “condominium hotel” with 459 units. With this acceptance, PACREP moved forward with acquiring permits and variance approvals within the WSD and began construction.

Shortly after approval of the 2121 Project, PACREP acquired the 2139 Kuhio lot from the Food Pantry and began the environmental review process for the 2139 Project. The 2139 Project was proposed to be a condo-hotel with 280 units, sharing an eight-story podium containing residential services, recreational amenities, vehicular access, and off-street parking with the adjacent 2121 Project. The 2139 Project FEA was ultimately accepted and a FONSI was issued. A final certificate of occupancy was issued for the Projects in 2021. Today, all units in the Projects have been sold and the development is owned and run by the Ritz-Carlton Waikiki.

Local 5 filed suit in the circuit court after each respective FEA acceptance, and the cases were consolidated for administrative purposes only. PACREP filed motions for summary judgment arguing that the FEAs and FONSIs were proper and the Projects were not improperly segmented. Local 5 filed counter motions for summary judgment essentially asking the circuit court to find that the Projects’ FEAs were insufficient because they: (1) failed to account for the possibility of long-term residential use of units; (2) lacked mitigation measures to require the 2121 Project to operate as a hotel and provide jobs in perpetuity; and (3) failed to consider the impact of the 2121 Project’s building height and orientation on public views identified in the WSD design guidelines.

Local 5 also asked the circuit court to find the FEAs insufficient because the Projects were improperly segmented – the FEAs should have considered the impact of the Projects together. Local 5 argued that declaring the FEAs insufficient would thereby make any approvals and permits subsequent to the FEAs void and the Projects inoperable.

PACREP also filed a supplemental motion for summary judgment arguing that the cases were moot because the Projects had already been completed and the units sold. The C&C joined all of PACREP’s motions. The circuit court ultimately held that the Projects were not improperly segmented, the FEAs and FONSIs were proper and sufficient, and the case was moot.

In 2022, Local 5 filed notices of appeal in both cases. After consolidation at the ICA, the cases were then transferred to this court.

There are four main issues presented: (1) whether the circuit court erred when it found that the Projects were not unlawfully segmented; (2) whether the circuit court erred in finding the Projects’ FEAs sufficient; (3) whether the circuit erred when it determined that the projects did not require an EIS; and (4) whether Local 5’s claims are moot.