Fox v. The Ritz-Carlton Hotel Co.

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MICHAEL FOX, on behalf of himself and all others similarly situated, Plaintiff, v. THE RITZ-CARLTON HOTEL COMPANY, LLC, Defendant.

MIAMI DIVISION

No. 17-CV-24284-COOKE

United States District Court, S.D. Florida, Miami Division

August 11, 2022

REPORT & RECOMMENDATION ON DEFENDANT'S MOTION FOR SUMMARY JUDGMENT [ECF NO. 98]

MELISSA DAMIAN UNITED STATES MAGISTRATE JUDGE

THIS CAUSE is before the Court on Defendant, Ritz-Carlton's (“Defendant” or “Ritz-Carlton”) Motion for Summary Judgment (the “Motion”), filed December 3, 2021. [ECF No. 98]. This matter is before the undersigned pursuant to an Endorsed Order of Referral by United States District Judge Marcia G. Cooke. [ECF No. 123]. See 28 U.S.C.§ 636(b)(1)(B).

The undersigned has considered the Motion, the Response [ECF No 107 (the “Response”)], and the Reply thereto [ECF No. 120 (the “Reply”)], as well as the documents submitted in support of the parties' filings, including Ritz-Carlton's Statement of Material Facts (“Ritz SMF”) and Mr. Fox's Responses thereto (“Fox SMF”) [ECF Nos. 99, 108], the pertinent portions of the record, and all relevant authorities, and is otherwise fully advised in the premises. For the following reasons, the undersigned recommends that Defendant's Motion for Summary Judgment [ECF No. 98] be granted in part and denied in part.

I. BACKGROUND

Plaintiff, Michael Fox (“Plaintiff” or “Mr. Fox”), filed this consumer class action on behalf of himself and all others similarly situated against Ritz-Carlton for its alleged violations of the Florida Unfair and Deceptive Trade Practices Act, Section 501.202, et seq., Florida Statutes (“FDUTPA”), based on violations of Section 509.214 of the Florida Statutes, which requires every public food establishment^[1] that includes an automatic gratuity or service charge in the price of the meal to provide notice of the automatic gratuity on both the food menu and on the face of the bill provided to the customer, and of Section 8A-110.1 of the Miami-Dade County Code, which requires that if a restaurant in Miami-Dade County adds an automatic tip, it must post a notice “conspicuously, either on a sign or in a statement on the business's menu or price listing in the same form and manner as the other items on the menu or price listing, and written in a legible manner in English, Spanish and Creole.”

Counts One and Two of the Amended Complaint allege per se and traditional violations of FDUTPA, respectively, for Ritz-Carlton's alleged violations of Section 509.214, and Counts Four and Five seek a declaratory judgment and injunctive relief under FDUTPA, respectively.^[2] [ECF No. 18].

Ritz-Carlton avers that it is entitled to summary judgment as to all of Plaintiff's claims in the Amended Complaint.

The background and facts relevant to Mr. Fox's allegations in this lawsuit are detailed in previous orders entered by the undersigned. See ECF Nos. 127, 130-132. Only those facts relevant to the determination of the Motion now before the Court are set forth below.

A. Relevant Material Facts

From April 4 through April 7, 2017, Mr. Fox stayed at the Ritz-Carlton Key Biscayne in Miami, Florida, and, while there, he ordered food and beverages from three separate public food service establishments located on the hotel property: Lightkeepers, Cantina Beach, and Key Pantry. Ritz SMF at ¶ 9. It is undisputed that during the time Mr. Fox stayed at the Ritz-Carlton Key Biscayne, all food and beverage outlets on the property added an 18% automatic suggested gratuity (which appears on bills presented to customers as an “18% Service Charge” or “Added Grat %”) to all bills. Ritz SMF at ¶¶ 1, 22, 30; Fox SMF at ¶ 1. Ritz-Carlton claims that since it began adding the automatic gratuity, it has been the policy and practice of all Ritz-Carlton Key Biscayne restaurants to give customers notice of the automatic gratuity on menus, bills, and receipts. Ritz SMF at ¶ 3. Mr. Fox disputes that Ritz-Carlton Key Biscayne gives notice on all menus, bills, and receipts on grounds that at least one menu in use during his stay did not provide any notice of the automatic gratuity and that the notices that were given were inadequate. Fox SMF at ¶ 4.

It is undisputed that Mr. Fox did not ask to modify or remove the automatic gratuities either at the time he signed his bills (in which he charged his meals to his room) or at the time he checked out of the hotel and paid his final bill. Ritz SMF at ¶¶ 35, 39; Fox SMF at ¶¶ 3540. And Mr. Fox does not dispute that by the time he checked out of the hotel, he was aware that automatic gratuities had been added to his restaurant checks. Ritz SMF at ¶ 38; Fox SMF at ¶ 38. Mr. Fox does dispute, however, whether he was aware that there was anything he could do about the charges or whether it was possible to have them removed from his restaurant bills or his final hotel bill. Fox SMF at ¶¶ 36-40.

Mr. Fox alleges that each of the Ritz-Carlton Key Biscayne establishments failed to provide adequate notice of automatic gratuities or services charges on its menus and bills in violation of Section 509.214, Florida Statutes, and Section 8A-110.1 of the Miami-Dade County Code. Mot. at 3.

B. Procedural Background

Mr. Fox filed the original complaint on November 28, 2017, and, after Ritz-Carlton filed a motion to dismiss, Fox filed the operative Amended Complaint on February 15, 2018. [ECF No. 17]. On January 22, 2019, District Judge James Lawrence King dismissed the case sua sponte for lack of subject-matter jurisdiction on grounds Mr. Fox lacked standing to sue on behalf of customers who paid automatic gratuities at Ritz-Carlton restaurants that Mr. Fox did not visit and because Mr. Fox's class claims did not meet the $5 million threshold amount of damages for jurisdiction under the Class Action Fairness Act (“CAFA”). [ECF No. 31]. Mr. Fox appealed the dismissal order. [ECF No. 32].

The United States Court of Appeals for the Eleventh Circuit reversed the order dismissing Counts One, Two, Four, and Five, affirmed the dismissal of Count Three, and remanded the case for further proceedings. See ECF No. 39 at 22. The Eleventh Circuit held that Mr. Fox had alleged standing for each of his claims because he alleged he was injured by the Ritz-Carlton when it charged him illegal automatic gratuities. Id. at 12. The Eleventh Circuit also held that Mr. Fox has standing to bring claims on behalf of the class even though he himself did not dine at the other Ritz-Carlton restaurants in Florida because his alleged injuries and the injuries allegedly suffered by the class are identical. Id. at 12-13. The court also held that Mr. Fox sufficiently alleged, in good faith, that the class damages were more than $5 million. Id. at 16.

The case was reassigned to Judge Cooke after remand. [ECF No. 41].

On December 3, 2021, both parties filed motions for summary judgment. [ECF Nos. 92, 98]. In his Motion for Partial Summary Judgment [ECF No. 98], Mr. Fox argued that he is entitled to judgment as a matter of law as to his claims based on violations of the Miami-Dade County Ordinance because it is undisputed that Ritz-Carlton's menus used during the time Mr. Fox visited the Key Biscayne restaurants did not comply with the requirements of the County Ordinance by failing, for example, to include notices of the gratuities in the same form and manner as the items listed on its menus. In a separate Report and Recommendation, the undersigned recommended denying Mr. Fox's Motion because the County Ordinance is preempted by state law and, therefore, cannot serve as a predicate for a FDUTPA claim. [ECF No. 135 at 9].

In the Motion now at issue, Ritz-Carlton moves for summary judgment as to all of Mr. Fox's claims. See Mot. at 1-2.

II. APPLICABLE LEGAL STANDARDS

A. Summary Judgment

“A party may move for summary judgment, identifying each claim or defense-or the part of each claim or defense-on which summary judgment is sought.” Fed.R.Civ.P. 56(a). “The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Id. In reviewing a motion for summary judgment, the Court is “required to view the evidence and all factual inferences therefrom in the light most favorable to the non-moving party, and resolve all reasonable doubts about the facts in favor of the non-movant.” Feliciano v. City of Miami Beach, 707 F.3d 1244, 1247 (11th Cir. 2013) (quoting Skop v. City of Atlanta, 485 F.3d 1130, 1143 (11th Cir. 2007)). Importantly, “at the summary judgment stage the judge's function is not himself [or herself] to weigh the evidence and determine the truth of the matter,” but only “to determine whether there is a genuine issue for trial.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986). Summary judgment may be appropriate where the only issue presented is purely a question of law. See Austin v. Judge, 851 F. App'x. 173, 174 (11th Cir. 2021) (citing Groendyke Transp., Inc. v. Davis, 406 F.2d 1158, 1162 (5th Cir. 1969)).

B. FDUTPA

The Florida Deceptive and Unfair Trade Practices Act (“FDUTPA”) provides: “Unfair methods of competition, unconscionable acts or practices, and unfair or deceptive acts or practices in the conduct of any trade or commerce are hereby declared unlawful.” Fla. Stat. § 501.204(1). FDUTPA provides for individual rights of action to “obtain a declaratory judgment that an act or practice violates this part and to enjoin a person who has violated, is violating, or is otherwise likely to violate this part.” Fla. Stat. § 501.204(1).

To prevail on a FDUTPA claim, a plaintiff must show (1) a deceptive act or unfair practice, (2) causation, and (3) actual damages. Dolphin LLC v. WCI Communities Inc., 715 F.3d...