Web site settlement costs state $20,000
By Sean Hao
Advertiser Staff Writer
The Hawai'i Tourism Authority said yesterday that it paid a Maui businessman $20,000 to settle a lawsuit that the tourism authority itself initiated in January and then decided not to pursue.
In addition to the $20,000, the HTA spent $45,000 in legal fees, as reported earlier, in the failed case over ownership of the Internet address www.hawaiiconventioncenter.com.
The unsuccessful lawsuit renews concern over how the tourism authority oversees and accounts for its $56 million budget, which is financed through the state hotel room tax.
State Sen. Donna Mercado Kim, D-14th (Halawa, Moanalua, Kamehameha Heights) chairwoman of the Senate Tourism Committee, said she plans to hold a hearing on the matter during the next legislative session.
"This gets to whether that money is being spent appropriately and the kind of decisions that are being made," she said. "Probably this is an issue in which they should have gotten better advice from the attorney general's office. Certainly, I would not like to see us get into this kind of issue again."
The HTA sued John Hendrickson in state circuit court to compel him to forfeit ownership of the domain name, which he had registered in 1997. Hendrickson said he registered the name to promote his destination management service and not to profit by reselling it, as the state agency asserted.
In discussing terms of the settlement on Monday with The Advertiser, authority executive director Rex Johnson did not disclose the $20,000 payment, which still needs legislative approval. Johnson said he didn't intend to hide the matter.
The settlement of the lawsuit, which involved counterclaims by Hendrickson, was reached late last month with no fanfare from either side. Johnson said he could not remember whether the attorney general's office, the HTA board or the Hawai'i Convention Center pushed for the lawsuit.
"It was discussed back and forth and it was decided we should try to chase this thing down," he said. "Maybe the decision wasn't correct, but when attorneys make these judgments, they go based on what was known right at that time."
Hendrickson said the $20,000 would pay only a portion of his legal bills, which he declined to specify. He considered the payment an acknowledgment by the state that it was wrong to pursue the case.
"Although it was unclassified, I can only identify it as (payment) for defamation damages," Hendrickson said. "It was a malicious suit that was brought for no reason other than to damage me as a businessman."
Despite Hendrickson's claims, Johnson was unapologetic over HTA's actions. "I have a hard time understanding that," he said. "Hawaiiconventioncenter.com sounds to me like a Web site that should be owned by the convention center."
In the end, Hendrickson will continue to own www.hawaiiconventioncenter.com, and the Hawai'i Convention Center will stick to its current Internet address, www.hawaiiconvention.com.
Reach Sean Hao at shao@honoluluadvertiser.com or 525-8093.
