Sagami Phila, a Japanese restaurant, opened Friday in Chestnut Hill.
Although it is unrelated to Sagami in Collingswood, the region’s most honored Japanese restaurant, it does seem to have a link to Osaka, the restaurant in the same building that closed in September 2019 after the city revoked its commercial-activity license over unpaid taxes.
Osaka, which was open for 16 years at 8605 Germantown Ave., also caught the attention of the U.S. Department of Labor. In February 2019, on the first day of a trial in U.S. District Court, Osaka’s owners agreed to pay $1 million to settle federal allegations of stealing tips from 201 employees and not paying overtime. A year after the agreement, the debt remains unsatisfied, a Labor Department spokesperson said, and it is not clear how much, if anything, has been paid. The spokesperson declined to specify the terms of the agreement.
Osaka owner Kwang Bum Kim, who with his son James was named in the federal lawsuit, denied being involved with Sagami Phila and declined to comment on the $1 million settlement during a brief telephone conversation in January, interpreted by his friend. The attorneys for Osaka and the Kims did not return The Inquirer’s emails and multiple calls seeking comment.
Sagami Phila’s city health inspections, conducted March 2 and March 5 before its opening, include the names Kwang B. Kim and Rebekah Wolf as persons in charge of the restaurant, whose corporation is Sagami Philly LLC. The reports identify the corporate officer as Young Gum Lee.
Wolf was a longtime Osaka manager. During a brief interview on March 7 at the restaurant, she said the new owner, whom she identified as Young Hee Lee, had found her number and invited her to work at Sagami Phila.
Wolf said Kim and his wife, Sun Ja Kim, only own the building. The Kims own another Osaka restaurant in Lansdale. Wolf did not explain who Young Gum Lee is.
During an Inquirer visit to the Chestnut Hill restaurant in late January during renovations, Wolf also had said Young Hee Lee was the owner. Records show that Young Hee Lee, who lives in Horsham, is a sister of Kwang Bum Kim, 73, who lives in Blue Bell. The Inquirer asked Kim about the apparent family tie, and he declined to comment.
The corporate registration for Sagami Philly LLC, filed with the state in February, does not show the name of the owner.
City officials would not comment on the possibility that Kim might be involved with a new business at the same location as one that was ordered to close. A city spokesperson said Osaka’s commercial license remains revoked because of back taxes. Under state law, details about a tax liability are confidential, the spokesperson said.
A spokesperson for the U.S. Department of Labor would not address actions the department was taking to collect the settlement.
Of the $1 million settlement, about $935,000 was earmarked for 201 workers who are owed back wages and damages for what the Labor Department called "willful violations” of U.S. Fair Labor Standards Act minimum-wage and overtime requirements. The restaurant owners also agreed to pay a $65,000 penalty.
The government has several options when pursuing a debt, including garnishing pay and seizing assets.
The Labor Department’s Wage and Hour Division has fined several Philadelphia-area restaurants following investigations responding to workers who believed that their pay was shorted.
At Osaka, investigators said they found that from at least Sept. 1, 2013, the employers deducted and pocketed 15% of customer tips charged on credit cards, well in excess of the 4% fee charged by credit-card processors, the division said in a statement.
“The employers also failed to notify tipped employees, including servers, bartenders, bussers, and hosts, that the restaurants were claiming a portion of their customer tips as a credit toward the minimum wage,” according to the Labor Department.
The agency said the restaurants also violated overtime law, since at least Sept. 1, 2013, adding that hourly tipped employees received straight time for all hours worked, even when their time records showed them working more than 40 hours. The employers also paid sushi chefs, hibachi chefs, kitchen cooks, and dishwashers flat daily rates ranging from $80 to $150 for all hours worked, even when their time records showed them working upward of 50 to 60 hours per week, the department said.