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AOKI, 1286
Acting Corporation Counsel
DUANE W. H. PANG, 4176 Electronically Filed
Deputy Corporation Counsel FIRST CIRCUIT
City and County of Honolulu 1CCV-20-0000073
530 South King Street, Room 110 15-JAN-2020
Honolulu, Hawaii 96813 11:24 AM
Telephone No.: (808) 768-5230
Email: dpang1@honolulu.gov
STATE OF HAWAII
LOUIS M. KEALOHA,
Defendant.
COMPLAINT
1. Plaintiff City and County of Honolulu (“City”) is political subdivision of the State
of Hawaii with the authority to sue and be sued on its own behalf.
DEFENDANT
City and County of Honolulu, and the former Chief of the Honolulu Police Department, City and
County of Honolulu.
3. This court has jurisdiction over this action to enforce an agreement between the
for relief arose in this circuit and Defendant is domiciled in this circuit.
FACTUAL BACKGROUND
5. Haw. Rev. Stat. § 52D-1 creates a police commission for each county, with the
powers, duties and functions of each police commission to be prescribed by the charter for each
county.
authority of the Revised Charter of the City and County of Honolulu 1973 (2017 Edition)
(“RCH”) § 6-1605.
7. The Commission has the authority to appoint the Chief of Police of the Honolulu
8. RCH § 6-1603 provides that the Commission shall appoint the Chief of Police to a
five-year term.
9. Under RCH § 6-1603, the Commission has the authority to remove or suspend the
Chief of Police at any time prior to the expiration of the five-year appointment.
12. On or about December 19, 2016, Kealoha informed the Commission that he
received a letter from the United States Department of Justice that informed him that he was the
13. On December 19, 2016, the Commission administratively removed Kealoha from
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14. On or about January 18, 2017, in lieu of taking action to remove Kealoha from the
position of the Chief of Police, the Commission approved a retirement agreement (“Agreement”)
between Kealoha and the Commission to allow Kealoha to voluntarily retire as the Chief of
Police.
15. The Agreement provided that the Commission would pay Kealoha a severance
payment in the amount of $250,000 in exchange for the Chief retiring as the Chief of Police on
16. The Agreement further provides that “in the event that, within seven (7) years
following execution of the Agreement, you are convicted of, plead guilty to, or plead nolo
contendere to any felony under State or Federal law, which conviction or plea relates to or arises
from or in connection with, your employment with HPD, or arises from an event or events that
occurred during the time you were employed with HPD, you must repay to HPD the entire
amount you received under Paragraph 2(a) [$250,000] of this Agreement within sixty (60)
calendar days of the date on which such conviction is affirmed by the last court of appeal and/or
17. On or October 19, 2017, a criminal indictment entitled United States of America
v. Katherine P. Kealoha (1), aka Katherine E. Kealoha, aka Kathy Kealoha, aka Kat, aka Alison
Lee Wong, Louis M. Kealoha (2), Derek Wayne Hahn (3), Minh-Hun Nguyen (4), aka Bobby
Nguyen, Gordon Shiraishi (5), and Daniel Sellers (6), Case No. 17CR0582 JMS-RLP, was filed
in the United States District Court, District of Hawaii. The indictment contained 20 separate
criminal counts including Conspiracy (18 U.S.C. § 371); Counts 2-6, Obstruction of Official
Proceeding (18 U.S.C. § 1512(c)(2)); Counts 7-8, False Statements to Federal Officer (18 U.S.C.
§ 1001); Count 9-16, Bank Fraud (18 U.S.C. § 1344); and Counts 17-20, Aggravated Identity
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18. On March 22, 2018, a First Superseding Indictment was filed (“First Superseding
Indictment”). The First Superseding Indictment identified the same named Defendants with 23
separate Counts to include Count 1, Conspiracy (18 U.S.C. § 371); Counts 2-8, Obstruction of
Official Proceeding (18 U.S.C. § 1512(c)(2)); Counts 9-11, False Statements to Federal Officer
(18 U.S.C. § 1001); Count 12 - 19, Bank Fraud (18 U.S.C. § 1344); and Counts 20-23, Aggravated
19. On March 24, 2018, a federal grand jury then returned a Second Superseding
Indictment (“Second Superseding Indictment”) against Katherine P. Kealoha and Louis M. Kealoha
only. The Second Superseding Indictment included only Counts 12-23 of the First Superseding
Indictment and was given a new case number, CR. No. 18-00068 JMS-RLP. The Second
Superseding Indictment includes the following Counts: Counts 1- 8, Bank Fraud (18 U.S.C.
§ 1344); Counts 9-12, Aggravated Identity Theft (18 U.S.C. § 028A); and Counts 13-14,
20. On or about October 29, 2018, the United States District Court issued an order
clarifying the various indictment, granted various motions to sever the various counts in the
21. On or about June 27, 2019, after a lengthy criminal trial, the jury found Kealoha
guilty of conspiracy to obstruct justice, and of three counts of attempt to obstruct an official
proceeding.
22. On or about September 19, 2019, a Third Superseding Indictment was filed against
Kealoha, which included the following Counts: Count 1-8 Bank Fraud (18 U.S.C. § 1344); Counts
9-12 Aggravated Identity Theft (18 U.S.C. § 1028A) and Counts 13-14 Obstruction of Official
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23. On or about October 22, 2019, Kealoha entered a Plea Agreement relating to all
a. That from January 1, 2009 through December 31, 2014, Defendant and his
wife Katherine P. Kealoha (“K. Kealoha”) spent more than $591,000 on their extravagant lifestyle,
which was derived from: (1) stolen proceeds from a reverse mortgage obtained by Florence Puana;
(2) stolen funds belonging to Ransen Taito and Ariana Taito; and (3) loan proceeds obtained
through banks and credit unions based upon the fraudulent scheme derived below.
b. That between 2007 and 2016, Defendant and K. Kealoha knowingly devised,
with intent to defraud, schemes to defraud multiple financial institutions and obtain funds by means
c. Their schemes included falsely claiming assets that belong to others, falsely
inflating their monthly income, and falsely denying derogatory credit in order to convince financial
25. By entering into the Plea Agreement, Kealoha further agreed to plead guilty to
Count Four of the Third Superseding Indictment, charging Kealoha with Bank Fraud, in violation of
18 U.S.C. § 1344.
26. The Plea Agreement further provides that Kealoha knowingly waives all rights to
27. On or about October 23, 2019, the Commission, through its attorneys, the
Department of the Corporation Counsel, demanded repayment of the severance amount of $250,000
28. Kealoha has not responded nor has he returned the severance payment of $250,000,
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CLAIM FOR RELIEF: BREACH OF CONTRACT
29. Plaintiff re-alleges the allegations set forth in Paragraphs 1-28 above and
30. On June 22, 2019, Kealoha was found guilty by a jury of Federal felony criminal
violations and on October 22, 2019, Kealoha pled guilty to additional felony criminal violations,
which relate to or arise from or in connection with, Kealoha’s employment with HPD or arise
from events or events that occurred during the time he was employed by HPD.
32. As of the filing of this complaint, Kealoha has not made repayment of the
34. The City conferred a benefit upon Kealoha in the form of the severance payment
of $250,000 with repayment of the amount required upon the occurrence of certain conditions.
37. The City is entitled to the repayment of the $250,000 made to Kealoha.
WHEREFORE, the City and County of Honolulu prays for judgment against Louis M.
Kealoha as follows:
A. Entry of judgment in favor of the City and County of Honolulu and against
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B. Prejudgment interest at the statuary rate from the time payment was due.
D. Any and all other legal and equitable relieve that may be available under the law.
PAUL S. AOKI
Acting Corporation Counsel
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IN THE CIRCUIT COURT OF THE FIRST CIRCUIT
STATE OF HAWAII
LOUIS M. KEALOHA,
Defendant.
Pursuant to HRCP Rule 38, Plaintiff by and through its attorney, hereby demand a jury
PAUL S. AOKI
Acting Corporation Counsel
plaintiff’s attorney, whose address is stated above, an answer to the complaint which is herewith served upon you, within
20 days after service of this summons upon you, exclusive of the date of service. If you fail to do so, judgment by default
will be taken against you for the relief demanded in the complaint.
THIS SUMMONS SHALL NOT BE PERSONALLY DELIVERED BETWEEN 10:00 P.M. AND 6:00 A.M. ON
PREMISES NOT OPEN TO THE GENERAL PUBLIC, UNLESS A JUDGE OF THE ABOVE-ENTITLED
COURT PERMITS, IN WRITING ON THIS SUMMONS, PERSONAL DELIVERY DURING THOSE HOURS.
A FAILURE TO OBEY THIS SUMMONS MAY RESULT IN AN ENTRY OF DEFAULT AND DEFAULT
JUDGMENT AGAINST THE DISOBEYING PERSON OR PARTY.
J reasonable accommodation for a disabilty please contact the ADA Coordinator at the Circuit Court Administration Office on
OAHU- Phone No. 808-539-4400 TTY 808-539-4853, FAX 5394402 at least ten (10) work ng days prior to your heanng or
appointment
In accordancedate.
with the Americans with Disabilities Act, and other applicable state and federal laws, if you require a