"BEFORE THE LIQUOR CONTROL COMMISSION - DOC"
BEFORE THE LIQUOR CONTROL COMMISSION 1 OF THE STATE OF OREGON 2 In the Matter of the ) FINAL FINDINGS OF Application for a Limited ) FACT, CONCLUSIONS OF 3 On-Premises Sales (L) license by: ) LAW, AND ORDER ) 4 Star Sushi, LLC ) OLCC-01-L-015 Hyon Suk Nam, Member ) OLCC-01-L-015-A 5 Ricky Nam, Member ) OLCC-01-L-015-B dba STAR SUSHI ) 6 2800 SW Cedar Hills Blvd ) Beaverton, Oregon 97005 ) 7 8 On July 25, 2001, the Oregon Liquor Control Commission (OLCC) 9 issued a Proposed Refusal of License to Star Sushi, Inc. and Members 10 Hyon Suk Nam and Ricky Nam (Applicants) (Exhibit A). Through their 11 attorney, Michael Reed, Applicants filed a timely request for hearing 12 (Exhibit B). On August 27, 2001, the Notice of Hearing was mailed to 13 Applicants and their attorney (Exhibit C). On August 29, 2001, 14 Applicants’ attorney notified OLCC that he resigned as attorney for 15 Applicants (Exhibit F). 16 On September 4, 2001, a Postponement Order was issued, postponing 17 the hearing two days to September 13, 2001 (Exhibit D). The hearing 18 was scheduled in Portland, Oregon, before Administrative Law Judge 19 (ALJ) Lawrence S. Smith. OLCC appeared and was represented by Chris 20 Hansen, program technician, with Jan Oliver and Lora Lee Grabe as 21 witnesses. Applicants did not appear. When the Hearing Officer Panel 22 telephoned them about 20 minutes after the starting time of the 23 24 25 Page 1 of 13 - FINAL ORDER 26 1 hearing, Applicants said they would not appear. Applicants were 2 therefore held in default. A hearing to establish a prima facie case 3 was held, as required by OAR 137-003-0670. 4 / / / / / 5 A Proposed Order was issued October 22, 2001. Licensees filed 6 Exceptions to the Proposed Order on November 7, 2001. 7 On December 3, 2001, the Commission considered the record of the 8 hearing, the applicable law, the Proposed Order of the Administrative 9 Law Judge, and Exceptions to the Proposed Order of the Administrative 10 Law Judge. Based on this review and the preponderance of the 11 evidence, the Commission enters the following: 12 ISSUE 13 Whether Applicants provided material false or misleading 14 information to OLCC and therefore, their application for a Limited On 15 Premises Sales (L) License should be refused pursuant to OAR 845-005- 16 0325(6).1 17 RULING 18 Exhibits A through F, C-1 through C-11 and C-14 through C-22 were 19 1 “License Refusal Reasons: Applicant Qualifications. If any 20 of the following criteria apply, the Commission will deny a license unless the applicant shows good cause that overcomes 21 the criterion involved: * * * (6) The applicant provides material false or misleading information to the Commission.” 22 OAR 845-005-0325(6). 23 24 25 Page 2 of 13 - FINAL ORDER 26 1 made part of the record without objection. 2 FINDINGS OF FACT 3 1. On March 30, 2001, OLCC received an application for a Limited 4 On Premises Sales (L) License from Star Sushi, LLC, and members Hyon 5 Suk Nam and Ricky Nam (Applicants) (Exhibit C-20). They sought a 6 license to sell beer, wine and cider at the sushi restaurant they were 7 opening at 2800 SW Cedar Hills Boulevard, Beaverton, Oregon. They 8 proposed that Hyon Suk Nam’s son, Mario Camacho, would be the manager 9 and included with their application Individual History forms from 10 Members Hyon Suk Nam and Ricky Nam (Exhibits C-1 and C-2) and from 11 manager Camacho (Exhibit C-19). 12 2. On their Individual History forms, Members Hyon Suk Nam and 13 Ricky Nam checked “No” when asked if they had ever been criminally 14 convicted and when asked if they ever had a warning, violation, 15 suspension, fine or cancellation as a licensee or service permittee. 16 An OLCC investigator interviewed them on April 20, 2001 and confirmed 17 that they understood the questions and that their answers were still 18 “No” to those questions (Exhibit C-4). Later during the interview, 19 Member Ricky Nam confirmed that he and Member Hyon Suk Nam had 20 operated the Gardenia Lounge in Maui, Hawaii from 1985 until August 21 1999 and admitted that a customer of the Gardenia Lounge had filed a 22 complaint against them with the liquor commission in Hawaii. 23 24 25 Page 3 of 13 - FINAL ORDER 26 1 3. On June 6, 1985, Members Hyon Suk Nam and Ricky Nam’s license 2 to operate the Gardenia Lounge became effective. During the time 3 Members Hyon Suk Nam and Ricky Nam operated the Gardenia Lounge, they 4 received the following discipline: a notice of caution on August 31, 5 1985 for serving a minor; a reprimand on January 30, 1987 for allowing 6 patrons to consume after hours; a fine on February 1, 1989 for 7 allowing an employee to work without registration; a caution on March 8 12, 1989 for alleged improper sexual activity on premises; a fine in 9 March 1989 for over-service; a fine on April 12, 1989 for two 10 employees, including Hyon Suk Nam, consuming alcohol on premises; a 11 reprimand on May 17, 1993 for allowing a patron to consume before he 12 was cited for DUII; a fine on December 7, 1993 for two employees, 13 including Ricky Nam, consuming alcohol on premises; a fine on August 14 1, 1994 for over-service; and an administrative notice on April 19, 15 1995 for allowing an employee to consume on premises (Exhibit C-3). 16 4. Later in the meeting on April 20, 2001, the investigator 17 showed Member Ricky Nam the record of compliance compiled by the 18 Hawaii liquor commission for the Gardenia Lounge, which listed the 19 above incidents. Member Ricky Nam said he did not remember these 20 incidents, but recalled one incident in which a customer cut his hand 21 with a cork screw and filed a complaint. 22 23 24 25 Page 4 of 13 - FINAL ORDER 26 1 5. The OLCC investigator interviewed Members Hyon Suk Nam and 2 Ricky Nam again on July 9, 2001, this time with their attorney. The 3 Members submitted hand-written statements that outlined their prior 4 criminal convictions and liquor law violations (Exhibit C-5, pages 3 5 and 4). In his statement, Member Ricky Nam said he did not remember 6 being fined for drinking on duty. He admitted to fighting with his 7 wife and being arrested once for it, but orally denied that he had 8 been drinking alcohol before he was arrested. In her statement, 9 Member Hyon Suk Nam said she and Ricky had fought more than once and 10 she called the police once. 11 6. On February 18, 1998, Member Ricky Nam was arrested for 12 domestic assault against Member Hyon Suk Nam. He was later criminally 13 convicted of a misdemeanor for this assault. In their reports, the 14 arresting officers noted a strong odor of alcoholic beverage on Member 15 Ricky Nam’s breath and his slurred speech (Exhibit C-7, page 5). 16 7. On April 18, 2001, Members Hyon Suk Nam and Ricky Nam and 17 manager Mario Camacho attended a server education class. There were 18 only seven people in the class. During the test to obtain their 19 permit, the instructor allowed Mario Camacho to sit near Members Hyon 20 Suk Nam and Ricky Nam so that he could translate the questions from 21 English to Korean for Members Hyon Suk Nam and Ricky Nam. The 22 instructor told them that Mario Camacho could only translate the 23 24 25 Page 5 of 13 - FINAL ORDER 26 1 questions and not give the answers. They were asked to sit in the 2 back so their talking would not disturb the others. They wrote down 3 identical answers on the test and each received the same test score of 4 86 on the 50 question test (Exhibits C-16, C-17 and C-18). The OLCC 5 investigator later asked them about the their identical answers on the 6 tests. Members Hyon Suk Nam and Ricky Nam denied sharing the answers. 7 Member Hyon Suk Nam claimed she did not sit near the others. 8 8. OLCC has about 10,000 licensees and relies on its licensees 9 to regulate themselves. OLCC expects truthful and honest statements 10 from its licensees and applicants. If Applicants had provided all the 11 correct information about their past compliance history on their 12 Individual History forms, their application would probably still be 13 denied initially due to Member Ricky Nam’s criminal conviction that 14 was related to alcohol use. 15 9. On his Individual History form, Mario Camacho checked “No” 16 when asked if he had ever been criminally convicted. He later 17 admitted he was a convicted felon and was withdrawn as manager. 18 10. On his Information History form, Member Ricky Nam denied the 19 use of any other names. He has gone by the name of Kwang Nam in the 20 past, before operating as a licensee in Hawaii. 21 / / / / / 22 23 24 25 Page 6 of 13 - FINAL ORDER 26 1 CONCLUSION OF LAW 2 Applicants made intentionally false and material statements on 3 their Individual History forms and to OLCC’s investigator. 4 OPINION 5 OLCC will deny an application if the applicant provides material 6 false or misleading information. OAR 845-005-0325(6).2 See also ORS 7 471.313(4)(b), which says in part: “[OLCC] may refuse to license any 8 applicant under the provisions of this chapter if the commission has 9 reasonable ground to be believe * * * [t]he applicant has made false 10 statements to [OLCC].”3 11 Material evidence is defined as that which has a “logical 12 connection” with an issue in the case. 7455 Incorporated, Jiggles, 13 OLCC-85-L-013, February 1987, affirmed 7455 Inc. v. Oregon Liquor 14 Control Commission, 94 Or App 780 (1989); affirmed on other grounds, 15 310 Or 477 (1990). OLCC alleges that Applicants’ false and misleading 16 information was: (1) Applicant Ricky Nam’s denials of any prior 17 criminal conviction on his Individual History form and when first 2 18 “License Refusal Reasons: Applicant Qualifications. If any of the following criteria apply, the Commission will deny a license 19 unless the applicant shows good cause that overcomes the criterion involved: * * * (6) The applicant provides material false or misleading information to the Commission.” OAR 845-005-0325(6). 20 3 The Proposed Refusal of License did not refer to this statutory 21 section, but it is on point and controlling. The rule says OLCC “will” deny, while the statute says OLCC “may” deny, but otherwise the 22 language is very similar. 23 24 25 Page 7 of 13 - FINAL ORDER 26 1 orally asked about prior convictions; (2) Applicant Ricky Nam’s 2 initial denial that he had been drinking at the time of the crime and 3 his later claim that he was not drunk at that time; (3) Applicants’ 4 denials of prior liquor law violations; and (4) Applicants’ denials 5 that they cheated on the test for a Service Permit. The materiality 6 of these false statements is considered below. 7 (1) Applicant Ricky Nam’s denial of prior criminal conviction 8 This information regarding Applicant Ricky Nam’s prior conviction 9 was not per se material because OLCC did not establish that his past 10 conviction would be a basis for denial of Applicants’ application. 11 ORS 471.313(4)(d) states OLCC may refuse to license an applicant when 12 the applicant “Has been convicted of violating any of the alcoholic 13 liquor laws of this state, general or local, or has been convicted at 14 any time of a felony.” Member Ricky Nam’s conviction was not a 15 violation of the alcoholic liquor laws of this state and was not a 16 felony. The conviction in and of itself was not a material fact in 17 regards to the grounds for refusal of license based on a prior 18 conviction. 19 (2) Applicant Ricky Nam’s initial denial that he had been 20 drinking at the time of the crime 21 Applicant Ricky Nam later admitted that he had been drinking 22 before he was arrested, but denied he was drunk. OLCC claims the 23 24 25 Page 8 of 13 - FINAL ORDER 26 1 above conviction and his initial denial of drinking alcohol at the 2 time of his offense is evidence that Member Ricky Nam has problems 3 with alcoholic liquor. He also denied prior problems with his 4 Hawaiian liquor license, but had been cited for drinking on duty. All 5 these facts are material in regards to determining whether Applicant 6 Ricky Nam is “in the habit of using alcoholic beverages * * * to 7 / / / / / 8 excess”, one of the grounds for license refusal under ORS 9 471.313(4)(a). 10 (3) Applicants’ denials of prior actions taken against their 11 liquor license in Hawaii ORS 471.313(4)(g) states that another ground 12 for possible refusal is not having “a good record of compliance with 13 the alcoholic liquor laws of this state and the rules of the 14 commission when previously licensed.” The rule does not refer to 15 compliance history in another state. Therefore, the information about 16 Applicants’ lack of compliance in Hawaii was not material information 17 in regards to refusal of license under this section. 18 (4) Applicants’ denials that they cheated on the test for a 19 Service Permit. 20 Applicants’ denials that they cheated on the test is evidence of 21 their untruthfulness, but does not fit under any of the grounds for 22 denial pursuant to ORS 471.313. Therefore, their denials were not 23 24 25 Page 9 of 13 - FINAL ORDER 26 1 material in regards to refusal of license under ORS 471.313. 2 In summary, denials of alcohol use by Applicant Ricky Nam were 3 material in regards to the issue whether he was in the habit of using 4 alcoholic beverages to excess, as explained above. The other false 5 statements that do not relate to a specific ground for license refusal 6 under ORS 471.313 may still be considered material if they were 7 intentionally false. See AM/PM Market No. 756, OLCC-95-L-031, July 8 1996, in which OLCC concluded, On the facts of this case, the Commission adopts an 9 additional test of materiality and concludes that an intentional false statement is a material false statement. 10 The Commission must be able to rely upon licensees’ honesty in dealing with the Commission and enforcing alcoholic 11 liquor laws and rules. Commission licensees are expected to police themselves, enforce commission rules and regulations, 12 and to ensure that liquor law violations do not occur. Honesty in dealing with Commission staff is essential to 13 accomplish this. An applicant who deliberately withholds information cannot reasonably be relied upon to effectively 14 enforce Commission laws and rules as a licensee. The Commission concluded that an intentional false statement 15 provides a basis to refuse this license because an intentional false statement is a material false statement.” 16 17 Based on this precedent, the Applicants’ intent when making these 18 statements is considered. 19 In Royal Inn Restaurant, OLCC-96-L-018, May 1997, OLCC held that 20 the applicants’ statements were not intentionally false because the 21 applicants could not read English and relied on the flawed translation 22 of their son. Applicants Hyon Suk Nam and Ricky Nam did not appear at 23 24 25 Page 10 of 13 - FINAL ORDER 26 1 the hearing to establish this or any other defense. During their 2 second interview with the inspector, they claimed they did not 3 understand the questions, but during the first interview, they said 4 they did understand, especially after the inspector read the questions 5 to them and confirmed the same answers. Applicants have not 6 established that they did not understand the questions. Based on 7 their repeated denials of problems and implausible claims that they 8 forgot about the conviction and repeated liquor license violations, 9 Applicants must have intended to mislead OLCC with this false and 10 material information. OLCC has about 10,000 licensees and lacks the 11 resources to monitor all of them closely, so OLCC relies on its 12 licensees to be truthful. Applicants repeatedly provided material 13 information to OLCC with the intent of misleading OLCC into granting 14 their application. 15 For these reasons, their application for a Limited On-Premises 16 Sales (L) license should be refused. 17 OLCC also alleged that Manager Mario Camacho provided false and 18 material information on his Information History form with the intent 19 of misleading OLCC by denying any prior criminal convictions. He 20 later admitted he was a convicted felon and was withdrawn as manager. 21 While this information was with Applicants’ application and Member 22 Hyon Suk Nam should have known her son was a convicted felon, 23 24 25 Page 11 of 13 - FINAL ORDER 26 1 Applicants did not fill out Mario Camacho’s Information History form, 2 so Mario Camacho’s answers will not be attributed to Applicants, at 3 least in regards to materiality or intent. 4 OLCC also alleged that Applicants provided false and material 5 information when Member Ricky Nam denied on his Information History 6 form use of any other names. In Punjab Tavern, OLCC-91-L-015, April 7 1992, OLCC concluded that an applicant’s use of a false name indicates 8 that the applicant would not be a good risk for compliance because the 9 false statement would inhibit OLCC’s ability to conduct an 10 investigation into the applicant’s eligibility for a license. 11 Applicant Ricky Nam has gone by the name of Kwang Nam in the 12 past, but OLCC has not established that this omission inhibited its 13 ability to conduct an investigation into his eligibility for licensure 14 or would have resulted in evidence of another ground for license 15 refusal. OLCC has also not established that his failure to list this 16 name was willful. Therefore, this information was not material and is 17 not considered as a ground for refusal of license. 18 / / / / / 19 FINAL ORDER 20 The Commission orders that the application for a Limited On- 21 Premises Sales (L) license by Star Sushi, LLC, and Members Hyon Suk 22 Nam and Ricky Nam (Applicants), dba STAR SUSHI, 2800 SW Cedar Hills 23 24 25 Page 12 of 13 - FINAL ORDER 26 1 Blvd., Beaverton, Oregon, be REFUSED pursuant to OAR 845-005-0325(6). 2 It is further ordered that notice of this action, including the 3 reasons for it, be given. 4 Dated this 28th day of December, 2001. 5 /s/ Pamela S. Erickson 6 Pamela S. Erickson Director 7 OREGON LIQUOR CONTROL COMMISSION Mailed this 28th day of December, 2001. 8 THIS ORDER IS EFFECTIVE 20 DAYS AFTER THE MAILING DATE. 9 NOTICE: You are entitled to judicial review of this Order. Judicial 10 review may be obtained by filing a petition for judicial review within 60 days from the service of this Order. 11 Judicial review is pursuant to the provisions of ORS Chapter 183. 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Page 13 of 13 - FINAL ORDER 26