Roland S. Guieb v. Robert S. Guieb

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Electronically Filed
Intermediate Court of Appeals
CAAP-XX-XXXXXXX
07-AUG-2024
08:40 AM
Dkt. 132 MO

NO. CAAP-XX-XXXXXXX

IN THE INTERMEDIATE COURT OF APPEALS

OF THE STATE OF HAWAI‘I

ROLAND S. GUIEB, individually and
derivatively on behalf of GUIEB INCORPORATED, Plaintiff/
Counterclaim Defendant-Appellant/Cross-Appellee,
v.
ROBERT S. GUIEB, Defendant-Appellee/Cross-Appellant,
and
GUIEB INCORPORATED, a registered Hawaii corporation,
Defendant/Counterclaimant-Appellee/Cross-Appellant,
and
PACIFIC WELDING AND MANUFACTURING, LLC; GUIEB GROUP LLC; RSG
ENTERPRISES, LLC, a registered Hawaii limited liability company,
Defendants-Appellees/Cross-Appellants,
and
JOHN DOES 1-20; JANE DOES 1-20 and DOE ENTITIES 1-20, Defendants

APPEAL FROM THE CIRCUIT COURT OF THE FIRST CIRCUIT
(CASE NO. 1CC171001045)

MEMORANDUM OPINION
(By: Leonard, Acting Chief Judge, Wadsworth and Guidry, JJ.)

Plaintiff/Counterclaim Defendant-Appellant/Cross-
Appellee Roland Guieb (Roland) appeals from the First Amended
Final Judgment (Judgment) entered by the Circuit Court of the
First Circuit (circuit court), on October 25, 2021.1
Defendants/Counterclaimant-Appellees/Cross-Appellants Robert

1 The Honorable John M. Tonaki presided over the jury trial and
some pretrial proceedings. The Honorable James S. Kawashima presided over
motions filed from May 30, 2019 through July 19, 2019.
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Guieb (Robert), and Guieb Incorporated (GI), Pacific Welding and
Manufacturing, LLC (Pacific Welding), Guieb Group LLC (GG), and
RSG Enterprises, LLC (RSG) (collectively referred to as the
business entities) cross-appeal from the Judgment.
On appeal, Roland raises ten points of error,
consolidated as follows, in which he contends that the circuit
court erred by:2
1. Denying his motions for summary judgment, and
Judgment as a Matter of Law (JMOL) on GI's
counterclaim (points of error 1, 10);
2. Granting Robert's motions for summary judgment and
JMOL on Roland's claims for breach of fiduciary
duties based on kinship, conspiracy, unfair business
practices, and punitive damages (points of error 2,
3, 4, 5);
3. Denying him prejudgment interest, and delaying entry
of the judgment (points of error 6, 8);
4. Denying him a preferential dividend so that all
damages awarded by the jury go to him (point of
error 7); and
5. Denying him attorney's fees and costs (point of
error 9).
Robert and the business entities raise three points of
error, contending that the circuit court erred by:3

2 In addition to the Judgment, Roland appeals from the circuit
court's Order Denying Defendants'/Counterclaimant's Motion for Attorneys'
Fees and Costs (Non-Hearing Motion Filed September 9, 2020), entered
October 26, 2020; Findings of Fact and Conclusions of Law and Order, entered
July 2, 2020; and Order Denying Plaintiffs' Renewed Motion for Judgment as a
Matter of Law, Filed Feb. 5, 2020, entered April 2, 2020.

3 In addition to the Judgment, Robert cross-appeals from the: (1)
Order Denying Defendants' Renewed Motion for Judgment as a Matter of Law,
Filed Feb. 5, 2020, entered April 2, 2020; (2) Order Granting in Part and
Denying in Part Plaintiffs' Motion to Dismiss Their Count I (Dissolution), or
Additionally/Alternatively, Plaintiffs' Motion To Enter Final Judgment and
(continued . . .)
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1. Denying their Renewed JMOL on Roland's claims;
2. Allowing Roland to dismiss his claim for corporate
dissolution without imposing conditions; and
3. Denying them attorney's fees and costs.
Upon careful review of the record and relevant legal
authorities, and having given due consideration to the arguments
advanced and the issues raised by the parties, we resolve their
points of error as follows.
I. Background
This case involves a business dispute between two
brothers, Robert and Roland Guieb. On June 19, 2018, Roland
filed a First Amended Complaint (FAC), in which he alleged he
was the minority shareholder of GI, his brother Robert was the
majority shareholder and an officer and director, and that
Robert took opportunities and assets of GI to benefit himself
and his other businesses, Pacific Welding and GG. He alleged
that RSG, held equally by Roland and Robert, owned the real
property that served as GI's principal place of business, and
Pacific Welding was conducting business from RSG's property
without paying for its use. Roland also claimed that Robert
misappropriated GI's trade name, "Exhaust Systems Hawaii," that
Robert used GI's trade name for a shop he opened in Kalihi (the
Kalihi Shop), and that Robert took GI's Honolulu shop for
himself.
The FAC asserted claims for: (1) judicial dissolution
of GI; (2) usurping corporate opportunity/conversion/unjust
enrichment; (3) breaches of fiduciary duties; (4) breaches of
fiduciary duties arising out of kinship; (5) accounting/audit;
(6) fraud/misrepresentation/nondisclosure; (7) "Squeeze Out"

for [Hawai‘i Rules of Civil Procedure (HRCP)] Rule 54(b) Certification, Filed
May 15, 2020, [Dkt. 286], entered July 10, 2020; and (3) Order Denying
Defendants'/Counterclaimant's Motion for Attorneys' Fees and Costs (Non-
Hearing Motion Filed September 9, 2020), entered October 26, 2020.
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Roland from GI causing damage to Roland; (8) "Squeeze Out"
Roland from GI causing damage to GI; (9) conspiracy to "Squeeze
Out" Roland causing damage to Roland; (10) conspiracy to
"Squeeze Out" Roland causing damage to GI; (11) trade name
infringement; (12) Unfair and Deceptive/Unfair Competition under
Hawaii Revised Statutes (HRS) §§ 480-2 and 481A-3; (13) wanton,
willful and fraudulent usurpation of corporate opportunity; (14)
conspiracy to usurp corporate opportunity; and (15) breaches of
fiduciary duties; aiding and abetting the breaches.
In July 2018, Robert and the business entities
answered the FAC, and GI filed a counterclaim against Roland.
GI's counterclaim alleged that Roland, GI's treasurer for
decades, used corporate funds to pay personal expenses totaling
more than $800,000. The counterclaim asserted claims for: (1)
misappropriation and conversion of corporate funds; (2) breach
of fiduciary duty; (3) fraud/fraudulent concealment; (4)
negligence; (5) breach of contract-Bylaws; (6) unjust
enrichment; (7) judicial removal of Roland as director; (8)
declaratory relief; and (9) injunctive relief.
In May 2019, Roland moved for partial summary
judgment, contending that Robert breached his fiduciary duties.
In June 2019, Robert and the business entities moved for partial
summary judgment, contending that Roland breached his fiduciary
duties. The circuit court denied both motions.
In October 2019, Roland moved for dismissal of GI's
counterclaims, or in the alternative for summary judgment,
contending that Robert did not have corporate authority to file
the counterclaim. The circuit court denied the motion.
In November 2019, Robert and the business entities
moved for partial summary judgment on the FAC Counts 4, and 9-
15. The circuit court granted the motion in part on Counts 4,
9, 10, 12, 14, and 15, and on Count 13 to the extent it alleged

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aiding and abetting. The circuit court reasoned that kinship by
itself is insufficient to establish a fiduciary relationship,
and there was no evidence that Robert conspired with anyone to
harm Roland. The circuit court also concluded that, because GG
and GI were selling the same product and service, Roland could
not prevail on his unfair and deceptive trade practices claim
because he would be unable to establish that GG was "passing off
goods or services" as being that of GI. The circuit court
denied summary judgment on the trade name infringement claim.
Jury trial began on December 16, 2019.
On December 26, 2019, Robert and the business entities
moved for JMOL. During argument on the motion, the circuit
court denied Roland's request to strike GI's counterclaim. The
circuit court dismissed Roland's claim for punitive damages.
On December 30, 2019, the jury returned its verdict in
favor of Roland on the fraudulent non-disclosure claim, and
awarded him damages of $42,000 against Robert, and $28,000
against GG. The jury awarded GI damages of $10,000 against
Robert, and $20,000 against GG for trade name infringement. The
jury awarded GI damages of $42,000 against GG for unjust
enrichment.
On GI's counterclaim, the jury found that Roland
breached his fiduciary duties (Count 2) and contractual duties
arising from the Bylaws (Count 5), and awarded nominal damages
of $1 on each count.
The jury denied all other claims.
In February 2020, Roland filed a Renewed Motion for
Judgment as a Matter of Law, or Alternatively, to Reconsider,
Alter or Amend Judgment, and/or Motion for New Trial, and for
Attorney's Fees and Costs. Also in February 2020, Robert and
the business entities filed a Renewed Motion for Judgment as a

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Matter of Law. The circuit court denied both motions in April
2020.
In May 2020, Roland moved to dismiss his corporate
dissolution claim (Count 1 of the FAC), or alternatively for
[HRCP] Rule 54(b) final judgment certification. The circuit
court dismissed Counts 1 and 5 of the FAC with prejudice, and
denied the request for [HRCP] Rule 54(b) certification as moot.
In July 2020, the circuit court entered findings of
fact and conclusions of law on the equitable relief requests in
GI's counterclaim. The circuit court denied the request that
Roland be removed as GI Director because the jury verdicts in
Roland's favor on the fraudulent non-disclosure, trade name
infringement, and unjust enrichment claims established that
Robert had unclean hands. Moreover, the circuit court concluded
that Roland's breaches of fiduciary duty, as found by the jury,
were caused by animosity between the brothers, rather than
"fraudulent or dishonest conduct or gross abuse of authority or
discretion" directed at GI, and the requests for declaratory and
injunctive relief were moot.
Final Judgment was entered on August 26, 2020. In
September 2020, Robert and the business entities filed a motion
for attorneys' fees and costs, which the circuit court denied,
ruling that "[e]ach party shall bear its own attorney's fees and
costs."
This appeal and cross-appeal followed.4
II. Discussion
A. Roland's Points of Error
1. GI Counterclaim

4 On September 29, 2021, this court entered an order remanding the
case to the circuit court for entry of an amended judgment resolving Count 4
of the FAC. The circuit court entered a First Amended Final Judgment on
October 25, 2021.
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Roland contends that the circuit court should have
granted summary judgment in his favor, by dismissing GI's
counterclaim, because Robert lacked corporate authorization to
file the counterclaim in GI's name or should have filed in a
derivative capacity after first making a demand on GI's board of
directors. Roland's claim lacks merit.
The record reflects that GI is a closely held
corporation, and that the only shareholders and officers are
Robert and Roland. Roland's filing of a lawsuit, seeking the
dissolution of GI, threatened an immediate and vital injury to
the corporation. Chun v. Bd. of Trs. of Emps.' Ret. Sys.,
87 Hawaiʻi 152, 165, 952 P.2d 1215, 1228 (1998) ("[P]ractical
necessity has dictated the rule that the president as chief
officer of a going concern may[,] even in the face of
deadlock[,] take steps to protect corporate interests where
immediate and vital injury threatens.") (citation omitted).
Under these circumstances, it would have been futile for Robert
to seek Roland's approval to file a counterclaim against a
lawsuit that was brought by Roland himself. Fujimoto v. Au,
95 Hawai‛i 116, 149, 19 P.3d 699, 732 (2001) (cleaned up) ("When
the futility of seeking the desired action from the alleged
wrongdoers is patent, . . . efforts to obtain action by the
directors and shareholders are not necessary, and the
allegations of wrongdoing themselves adequately establish the
reasons for not making the effort to obtain corporate action.")
(citation omitted). We therefore conclude, on this record, that
the circuit court properly denied Roland's summary judgment
motion seeking dismissal of GI's counterclaim.5

5 We decline to address Roland's additional argument that there is
no cause of action for breach of corporate bylaws, an argument that Roland
did not assert below. HRS § 641-2(b) (2016) ("The appellate court may
correct any error appearing on the record, but need not consider a point that
was not presented in the trial court in an appropriate manner.").
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2. Breach of Fiduciary Duties
Roland contends that the circuit court erred in
granting summary judgment on his claims for breach of fiduciary
duties based on kinship, conspiracy to breach fiduciary duties,
and unfair business practices, and for JMOL on his claim for
punitive damages. We address Roland's contentions as follows:
(1) We conclude that the circuit court erred in
granting summary judgment on Roland's claim for breach of
fiduciary duties based on kinship.
To claim breach of fiduciary duty, a plaintiff must show
that a fiduciary relationship existed between the parties,
the defendant breached a fiduciary duty to the plaintiff,
and the breach proximately caused injury to the plaintiff.
A fiduciary relationship exists when there is a
relationship of trust and confidence.

Swift v. Swift, No. CAAP-XX-XXXXXXX, 2016 WL 3573970, at *33
(Haw. App. June 30, 2016) (mem. op.) (citations omitted).
Roland attested below that he "had a very good and
trusted relationship [with Robert] from way back in
childhood[,]" that Robert told him that "the 55%-45% division
would have absolutely no effect on how we ran [GI]" and he
"completely trusted and believed [Robert], and therefore
accepted (transacted) a 45% interest in [GI]." Robert and
Roland started their business in 1985 as a partnership, and
incorporated in 1991. Roland further attested that Robert later
used his majority shareholder status to eliminate Roland's
check-writing authority, reduce his salary, and misappropriate
GI's King Street shop and other assets. Accepting Roland's
allegations as true, a jury could find that Robert only acquired
majority ownership of GI because Roland, on the basis of a
confidential familial relationship, relied on the
representations of his brother. We find that Roland satisfied
his burden of establishing a genuine question of material fact
regarding breach of fiduciary relationship based on kinship.

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(2) We conclude that the circuit court did not err in
granting summary judgment on Roland's conspiracy claims.6 Roland
relies on Robert's Hawaii School Bus, Inc. v. Laupahoehoe
Transp. Co., 91 Hawaiʻi, 224, 253, 982 P.2d 853, 882 (1999)
(citations omitted), superseded by statute on other grounds as
stated in Calipjo v. Purdy, 144 Hawaiʻi 266, 277 n. 23, 439 P.3d
218, 229 n. 23 (2019), for the proposition that "when officers
of a corporation act for their own personal purposes, they
become independent actors, who can conspire with the
corporation." Roland's reliance on Robert's Hawaii is
misplaced, however. There, the court ruled that because a
corporate officer shared the same economic interest as the
alleged co-conspirator corporations (he was the 94% owner of the
corporations' holding company), he could not conspire with the
corporations for purposes of HRS §§ 480-4 or 480-9. Robert's
Hawaii, 91 Hawaiʻi at 253, 982 P.2d at 882. Here, it was
undisputed that Pacific Welding and GG were owned solely by
Robert, and "the portion of RSG controlled by Robert" was the
portion (i.e., 50%) that he owned. In these circumstances,
Robert shared the same economic interest as his alleged
corporate co-conspirators, and the circuit court did not err by
determining as a matter of law that Robert could not conspire
with them.
(3) We conclude that the circuit court erred in
granting summary judgment with regard to Roland's Unfair or
Deceptive Acts or Practices (UDAP) claims. Roland asserted
claims pursuant to HRS §§ 480-2 and 481A-3. HRS § 480-2(a)
(2008) states that "[u]nfair methods of competition and unfair
or deceptive acts or practices in the conduct of any trade or

6 FAC Counts 9 and 10 asserted conspiracy claims against Robert,
Pacific Welding, GG, and "that portion of RSG controlled by . . . Robert."
FAC Count 14 asserted a conspiracy claim against Robert and GG.
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commerce are unlawful." A deceptive act UDAP claim requires the
plaintiff to prove "(1) a representation, omission, or practice
that (2) is likely to mislead consumers acting reasonably under
the circumstances where (3) the representation, omission, or
practice is material." State ex rel. Shikada v. Bristol-Myers
Squibb Co., 152 Hawaiʻi 418, 443, 526 P.3d 395, 420 (2023)
(citation omitted). An unfair act UDAP claim requires a showing
that an act (1) offends public policy, (2) is immoral,
unethical, oppressive, or unscrupulous, or (3) substantially
injures Hawaiʻi consumers. Id. at 445, 526 P.3d at 422.
HRS § 481A-3 (2008) states, "[a] person engages in a
deceptive trade practice when, in the course of the person's
business . . . the person . . . (3) [c]auses likelihood of
confusion or of misunderstanding as to affiliation, connection,
or association with, or certification by, another[.]" HRS
§ 481A-4(a) allows the court to grant an injunction against a
deceptive trade practice, which is "in addition to remedies
otherwise available against the same conduct under the common
law or other statues of this State." HRS § 481A-4(c).
The circuit court granted summary judgment in favor of
Robert on Roland's UDAP claim, reasoning that Roland would not
be able to establish that GG was "passing off goods or services"
as GI's because GG and GI were selling the same product.
However, Robert's own expert, Eddy N. Kemp, represented in a
valuation report that "[GG], which does business as Exhaust
Systems Hawaii Kalihi-Kai, could be viewed as a competitor to
[GI], which does business as Exhaust Systems Hawaii":
The [GI] website address is
https://www.exhaustsystemshawaii.net/. Reviewing the
website, it could appear that Exhaust Systems Hawaii and
Exhaust Systems Hawaii Kalihi-Kai are one entity as all the
shops are listed. There is nothing on the website to
delineate the two different ownership groups. In practice,
if there are services the Kailua or Waipahu shops are
unable to provide, the work is referred to [GG's] Kalihi-
Kai shop.
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On this record, we conclude that the circuit court
should have allowed Roland's UDAP claim to go to the jury. See
Hungate v. Law Off. of David B. Rosen, 139 Hawaiʻi 394, 410, 391
P.3d 1, 17 (2017), abrogated in part State ex. Rel. Shikada, 152
Hawai’i at 445-46, 526 P.3d 1t 422-23.
(4) We conclude that the circuit court erred in
granting JMOL in favor of Robert on Roland's punitive damages
claim. We review the circuit court's ruling on JMOL de novo.
In re Est. of Herbert, 90 Hawaiʻi 443, 454, 979 P.2d 39, 50
(1999). Punitive damages are an extraordinary remedy. Fisher
v. Grove Farm Co., 123 Hawaiʻi 82, 119, 230 P.3d 382, 419 (Haw.
App. 2009). Pursuant to Masaki v. Gen. Motors Corp., 71 Haw. 1,
6, 780 P.2d 566, 570 (1989), a defendant's wrongdoing must be
intentional and deliberate and have the character of outrage
frequently associated with a crime.
Roland testified that, in 1985, he left a restaurant
job to become partners with Robert in a muffler shop business in
Waipahu. The business incorporated in 1991 as GI, opened
additional locations in Kailua and on King Street, and did
business as Exhaust Systems Hawaii. After 25 years, Robert told
Roland he was opening a separate business, Pacific Welding,
which initially operated from GI's Kailua shop before moving to
GI's Waipahu shop.
In January 2017, Roland learned that GI no longer
owned the King Street shop, and that it was owned by GG. Robert
did not inform him that he was taking the King Street shop for
GG; Roland learned of the transfer in ownership through parts
deliveries for GG. Larry Anderson, Roland and Robert's
bookkeeper, testified that Robert did not notify him that the
King Street shop was being transferred to GG, and that he
learned of the transfer after inquiring about the drop in GI's
revenue. The King Street shop had the largest net income of
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GI's three locations. The jury found in Roland's favor on the
fraudulent non-disclosure, unjust enrichment, and tradename
infringement claims. Given the record evidence, the jury should
have been allowed to consider awarding punitive damages.
3. Prejudgment Interest
Roland contends that he should have been awarded
prejudgment interest because Robert misappropriated the King
Street shop from December 31, 2016, and more than three years
had passed by the time the circuit court entered Judgment on
August 26, 2020. The grant or denial of prejudgment interest is
reviewed for abuse of discretion. Tri-S Corp. v. W. World Ins.
Co., 110 Hawaiʻi 473, 489, 135 P.3d 82, 98 (2006).
HRS § 636-16 authorizes the circuit court, in its
discretion, to correct injustice when a judgment is delayed for
a long period of time for any reason. Metcalf v. Voluntary
Emps.' Benefit Ass'n of Hawaiʻi, 99 Hawaiʻi 53, 61, 52 P.3d 823,
831 (2002). It is not an abuse of discretion to deny
prejudgment interest where there is no evidence that the
defendant's conduct unduly delayed the proceedings or if there
has been no extraordinary delay in entry of judgment. Amfac,
Inc. v. Waikiki Beachcomber Inv. Co., 74 Haw. 85, 137, 839 P.2d
10, 36 (1992); Page v. Domino's Pizza, Inc., 80 Hawaiʻi 204, 209,
908 P.2d 552, 557 (App. 1995). Here, less than three years had
passed from the time Roland filed his FAC on June 19, 2018, and
the entry of Judgment on August 26, 2020. The record does not
reflect that this constituted undue delay or abuse of the
circuit court's discretion.
4. Attorneys' Fees and Costs
Relying on HRS §§ 607-14 and 414D-90(e), Roland
requested that the circuit court award him attorney's fees and
costs in the amount of $204,303.68 – twenty-five percent of his
$817,214.72 pre-suit demand from Robert – because he
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successfully defended the counterclaim. On appeal, Roland
additionally cites HRS § 414-242, which permits a corporation to
indemnify directors that are made a party to a lawsuit under
certain circumstances. The grant or denial of attorneys' fees
and costs is reviewed for abuse of discretion. Enoka v. AIG
Hawaii Ins. Co., 109 Hawaiʻi 537, 544, 128 P.3d 850, 857 (2006).
The circuit court did not abuse its discretion in
denying Roland's claim for fees. The record reflects that
Roland did not submit an itemized fees request. Counsel stated
that he was "currently preparing their supporting information
for an award of attorney's fees, which is rather voluminous."
(Underscoring omitted). Nothing further was submitted.
"Parties seeking attorneys' fees bear the burden of
demonstrating the fees requested are reasonable." Gurrobat v.
HTH Corp., 135 Hawaiʻi 128, 135, 346 P.3d 197, 204 (2015).
Without an itemization, the circuit court did not abuse its
discretion in denying Roland attorney's fees.
However, the failure to award Roland costs, without
explanation, is an abuse of discretion. Wong v. Takeuchi,
88 Hawaiʻi 46, 52, 961 P.2d 611, 617 (1998), held that reducing
costs without explanation is an abuse of discretion unless the
reason is plain from the record. Due to the Covid-19 pandemic,
the circuit court did not hold a hearing on Roland's fees and
costs request, and its order does not explain the reason for
denial. Roland requested $4,335.70 in costs, consisting of
$3,229.82 in copying costs, $31.41 for court reporter
transcript(s), $515.00 for filing fees, $25.42 for postage,
$188.50 for sheriff fees, and $345.55 for video equipment
rental. A party requesting an award of costs must provide a
receipt of proof of the amount for all outside or third-party
costs. Tortorello v. Tortorello, 113 Hawaiʻi 432, 444-45,
153 P.3d 1117, 1129-30 (2007). It appears that the copying
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costs and postage were in-house, not outside expenses, and that
the amounts incurred by Roland were verified through counsel's
declaration.
The circuit court erred in denying Roland's motion for
costs without explanation.
5. Preferential Dividend
Roland contends that the circuit court erred in
denying him a preferential dividend. A preferential dividend is
an equitable remedy.
The relief granted by a court in equity is discretionary
and will not be overturned on review unless the circuit
court abused its discretion by issuing a decision that
clearly exceeds the bounds of reason or disregarded rules
or principles of law or practice to the substantial
detriment of the appellant.

Aickin v. Ocean View Invs. Co., 84 Hawaiʻi 447, 453, 935 P.2d
992, 998 (1997) (cleaned up).
On this record, we conclude that Roland fails to
establish an abuse of discretion by the denial of a preferential
dividend. The jury found that Roland breached duties owed
pursuant to the bylaws and as treasurer, and the circuit court
found that Roland refused Robert's requests for information and
the breakdown in communications between the brothers led to the
lawsuit. Given Roland's own culpability, the circuit court did
not abuse its discretion in denying him the equitable remedy of
a preferential dividend.
B. Robert's Points of Error
1. Denial of Renewed Motion for Judgment as a Matter of Law
on Roland's Claims

A trial court's rulings on motions for JMOL are
reviewed de novo. Est. of Herbert, 90 Hawaiʻi at 454, 979 P.2d
at50. "Verdicts based on conflicting evidence will not be set
aside where there is substantial evidence to support the jury's
findings." Nelson v. Univ. of Hawaii, 97 Hawaiʻi 376, 393, 38
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P.3d 95, 112 (2001) (citation omitted). We conclude that the
circuit court was not wrong in denying Robert's motion:
(1) Robert contends that there is insufficient
evidence to establish that he failed to disclose, and profited
from, the transfer of the King Street shop. To prevail on a
fraudulent non-disclosure claim, Roland was required to
establish by clear and convincing evidence that Robert failed to
disclose a material fact that justifiably induced Roland to act
or refrain from acting in a business transaction that resulted
in damages. See Santiago v. Tanaka, 137 Hawaiʻi 137, 149, 366
P.3d 612, 624 (2016) (citing Restatement (Second) of Torts § 551
(Am. Law Inst. 1977)). A party who enters into a contract as a
result of a fraudulent misrepresentation may have the contract
rescinded or seek damages for the fraud. Exotics Hawaii-Kona,
Inc. v. E.I. Du Pont De Nemours & Co., 116 Hawaiʻi 277, 290-91,
172 P.3d 1021, 1034-35 (2007). The damages awarded on a fraud
claim should "put the plaintiff in the position he would have
been had he not been defrauded." Id. at 298, 172 P.3d at 1042
(citation omitted).
The record reflects that the testimony of Roland and
Larry Anderson support the breach of fiduciary and punitive
damages claims. Moreover, the record further reflects that
Robert prepared and signed a purchase agreement through which
GI, without Roland's knowledge, purportedly sold the King Street
shop to GG for $7,260. Robert did not inform Roland of the King
Street shop transfer. And the day after Roland sent Robert a
proposal for the dissolution of GI, Robert removed Roland as an
authorized signatory on GI checks.
Eddy Kemp, Robert's expert, testified that the King
Street shop was not performing as well as the other locations.
However, Robert's tax returns, which were introduced into
evidence, show that GG reported a loss of $14,470 in 2016 (the
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year prior to the transfer of the King Street shop), followed by
a profit of $83,658 in 2017, and $4,473 in 2018. Given the
mixed evidence, we conclude that the jury could choose to credit
Roland's evidence that Robert benefitted from the undisclosed
transfer of the King Street shop.
(2) Robert contends that there was insufficient
evidence to support the jury's finding that Robert unjustly
enriched himself at the expense of GI. To prevail on a claim
for unjust enrichment, the plaintiff must prove that he
conferred a benefit on the defendant and it would be unjust for
the defendant to keep the benefit. See Durette v. Aloha Plastic
Recycling, Inc., 105 Hawaiʻi 490, 504, 100 P.3d 60, 74 (2004)
(citation omitted).
Robert's contention lacks merit. In addition to the
evidence suggesting that Robert and GG benefitted from GG's
acquisition of the King Street shop, Roland introduced evidence
that GI employees were being used to take delivery of parts for
GG at GI's Waipahu shop. Moreover, the record reflects that
Robert directed that the Kalihi Shop, which was solely owned by
Robert pursuant to a 2014 settlement, would be included on
advertisements with Hawaiian Telcom at GI's expense. Robert
also re-registered to himself the tradename "Exhaust Systems
Hawaii," which had been used by all four shops and had
originally been registered to GI in December 1994, and demanded
a license to continue using the trade name at no cost. We
conclude that the record reflects substantial evidence for the
jury to find that GG was unjustly enriched by the use of GI's
assets.
(3) Robert and the business entities contend that they
were entitled to JMOL on the trade name infringement claim
because the "Exhaust System Hawaii" trade name is generic, there
was no evidence of customer confusion resulting from the alleged

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infringement, the damages awarded were speculative, and the
remedy for infringement is a fine and injunctive relief, not
damages.
"In Hawaii, the registration and protection of
trademarks, prints, labels and trade names is governed by HRS
chapter 482 (1976, as amended)." Carrington v. Sears, Roebuck &
Co., 5 Haw. App. 194, 197-98, 683 P.2d 1220, 1225 (App. 1984).
To prevail on the trade name infringement claim, Roland needed
to show that Robert and his business entities used their mark or
label in a manner likely to confuse consumers. "A likelihood of
confusion exists when consumers confronted with products or
services bearing one label or mark would be likely to assume
that the source of the products or services is the same as or
associated with the source of a different product or service
identified by a similar mark." Id. at 199, 683 P.2d at 1225-26
(citation omitted). Judgment for the defendant may be granted
only if there is no likelihood of confusion after examining the
evidence in light of the following factors: (1) similarity of
the marks; (2) similarity of the goods; (3) relationship between
the parties' channels of trade; (4) relationship between the
parties' advertising; (5) class of prospective purchasers of the
products; (6) evidence of actual confusion; (7) defendant's
intent in adopting its mark; and (8) strength of plaintiff's
mark. Id. at 199-200, 683 P.2d at 1225-26 (citation omitted).
The record reflects that Robert registered "Exhaust
Systems Hawaii" as a trade name for GI in December 1994. Robert
re-registered the "Exhaust Systems Hawaii" trade name to himself
in 2019. Roland testified to receiving an invoice from Cutter
Dodge for the Kalihi shop, and that he was concerned people
would not know that GI and GG were two different companies
because all of the business entities were using "Exhaust Systems
Hawaii." Moreover, Robert's own expert, Eddy Kemp, acknowledged

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based on the company's website that, "it would appear that
Exhaust Systems Hawaii and Exhaust Systems Hawaii Kalihi Kai are
one entity, as are all [the] shops are listed. . . . There is
nothing on the website to delineate the two different ownership
groups and practice." On this record, we determine there is
substantial evidence to support the jury's finding that Robert
infringed on the "Exhaust Systems Hawaii" trade name.
We affirm the circuit court's order denying Robert's
Renewed Motion for Judgment as a Matter of Law.
2. Withdrawal of Corporate Dissolution Claim
We conclude that the circuit court did not err in
allowing Roland to withdraw his claim for corporate dissolution
of GI. A court should deny a motion for voluntary dismissal if
the defendant will be seriously prejudiced, taking into account
the expense and inconvenience to the defendant. Tagupa v.
VIPDesk, 135 Hawaiʻi 468, 475, 353 P.3d 1010, 1017 (2015)
(citations omitted). Alternatively, if the defendant will be
prejudiced, the court may impose terms and conditions on the
dismissal, to ensure that substantial justice is accorded to
both parties, which may include requiring the plaintiff to pay
the defendant's fees and costs or other conditions. Id. at 476-
77, 353 P.3d at 1018-19 (citations omitted).
In moving for dismissal of his claim for dissolution,
Roland claimed financial hardship, which was worsened by the
Covid-19 pandemic, and expressed his desire to wait on
dissolution for values to stabilize. Robert contended that he
had already endured three years of litigation, would be
prejudiced by additional delays, and, alternatively, that
dismissal should be with prejudice with Roland ordered to pay a
reasonable portion of fees and costs. On appeal, Robert
additionally contends that the circuit court, by granting the

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dismissal, required him to remain in a business relationship
that both he and Roland agree should end.7
On this record, we conclude that the circuit court did
not abuse its discretion in granting Roland's request to
withdraw his corporate dissolution claim without prejudice. In
its ruling, the circuit court expressly noted its concern
regarding the impact that dissolution would have "in the current
economic situation," not only on Roland and Robert, but on
company employees. Two GI employees who had testified during
trial voiced concerns about retaining their jobs.
We affirm the circuit court's order allowing Roland to
withdraw his corporate dissolution claim.
3. Attorneys' Fees and Costs
The grant or denial of attorneys' fees and costs is
reviewed for abuse of discretion. Enoka, 109 Hawaiʻi at 544,
128 P.3d at 857. We conclude that the circuit court did not err
in denying Robert and the business entities' request for
attorneys' fees and costs.
Robert claims that he was entitled to an award of
attorneys' fees and costs pursuant to HRS §§ 607-148 and 414-

7 We note that Robert did not include a claim for corporate
dissolution in his counterclaim.

8 HRS § 607-14 (2016), which authorizes attorneys' fees in actions
in the nature of assumpsit, etc., provides, in relevant part,

In all the courts, in all actions in the nature of
assumpsit and in all actions on a promissory note or other
contract in writing that provides for an attorney's fee,
there shall be taxed as attorneys' fees, to be paid by the
losing party and to be included in the sum for which
execution may issue, a fee that the court determines to be
reasonable; provided that the attorney representing the
prevailing party shall submit to the court an affidavit
stating the amount of time the attorney spent on the action
and the amount of time the attorney is likely to spend to
obtain a final written judgment, or, if the fee is not
based on an hourly rate, the amount of the agreed upon fee.
The court shall then tax attorneys' fees, which the court
(continued . . .)
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177(2) and (3).9 Robert claims that he was the prevailing party
because Roland recovered on only three of the fifteen claims in
the FAC, and was awarded damages of only $142,000 even though he
claimed damages of $9 million during discovery. Robert also
claims that he prevailed on his counterclaim because the circuit
court and the jury agreed that Roland breached his fiduciary
duties.
The circuit court did not abuse its discretion in
denying Robert's and the business entities' fees motion because
Roland was the prevailing party. We affirm the circuit court's
order denying Robert's motion for attorney's fees.
III. Conclusion
For the foregoing reasons, we vacate the Judgment in
part, and remand for (1) trial on Roland's claims of breach of
fiduciary duty based on kinship, UDAP, and punitive damages
claims, and determination of damages, if any, (2) consideration

determines to be reasonable, to be paid by the losing
party; provided that this amount shall not exceed twenty-
five per cent of the judgment.

9 HRS § 414-177 (2004) authorizes that a court "may" require payment
of attorneys' fees upon the termination of a derivative proceeding:

§414-177 Payment of expenses. On termination of the
derivative proceeding the court may:
. . . .
(2) Order the plaintiff to pay any defendant's reasonable
expenses (including counsel fees) incurred in
defending the proceeding if it finds that the
proceeding was commenced or maintained without
reasonable cause or for an improper purpose; or
(3) Order a party to pay an opposing party's reasonable
expenses (including counsel fees) incurred because of
the filing of a pleading, motion, or other paper, if
it finds that the pleading, motion, or other paper
was not well-grounded in fact, after reasonable
inquiry, or warranted by existing law or a good faith
argument for the extension, modification, or reversal
of existing law and was interposed for an improper
purpose, such as to harass or cause unnecessary delay
or needless increase in the cost of litigation.

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of Roland's request for costs, and (3) for further proceedings
consistent with this memorandum opinion.
DATED: Honolulu, Hawaiʻi, August 7, 2024.
On the briefs: /s/ Katherine G. Leonard
Acting Chief Judge
Fred Paul Benco,
for Plaintiff/Counterclaim /s/ Clyde J. Wadsworth
Defendant-Appellant/Cross- Associate Judge
Appellee.
/s/ Kimberly T. Guidry
John D. Ferry III, Associate Judge
for Defendants-
Counterclaimant-Appellees/
Cross-Appellants.

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