A restaurant server’s lawsuit against a prominent Denver restaurant group is set to be resolved in arbitration, according to the plaintiff’s lawyer.
Marianna White sued Culinary Creative Group last year over its service charge policy, which adds a 20% fee to customers’ bills. The lawsuit argued that the policy diverted money that should have gone straight to servers as tips.
“People think that they're paying 20% so that everyone is getting paid on the floor — and they're not,” White said in an earlier interview.
White was a server at the high-concept Japanese restaurant Kumoya in Highland. CCG operates several other restaurants, like Tap & Burger and Señor Bear.
Lawyers for White and CCG jointly filed to dismiss the case last week. White’s attorney, Adam Harrison, said the dispute will now move to binding arbitration, where Harrison aims to secure “legal remedies” for her and other employees. It’s unclear if that could include a financial payout.
“It’s a win in the sense that we are going to resolve everything in arbitration,” he said.
Harrison added that the case would be “a win for everybody in Colorado,” since the two sides agreed on a proposed new standard for service charges.
The company did not comment on whether arbitration could result in a settlement.
“We are pleased that the lawsuit has been dismissed, and are tying up loose ends in arbitration,” said Richard Flaherty, the new CEO of Culinary Creative Group, in the written statement.
The fight over service charges, explained
Service charges are additional fees that are tacked onto the final bill at a restaurant. They’re an increasingly popular option for restaurant owners, offering a way to pay wages and other costs without raising prices on menus.
They’re often described as a way to ensure chefs, dishwashers and others get more money. But many staffers dislike the charges, since customers may refuse to tip in addition to the charge. Unlike tips, service charges don’t exclusively go to front-of-house staff. They can be used to pay management’s salaries and other expenses.
Harrison had argued that the service charges were misleading, with menus saying they were “distributed to staff in an equitable manner.” Harrison argued that restaurants were committing wage theft, since customers might expect that they were actually paying a tip to front-of-house staff. He said that “staff” should not include managers.
Other Kumoya employees, like Faith Lindstrom, told Denverite that they made far less money than they expected at CCG restaurants.
In the wake of the lawsuit, CCG added more explicit language that explains service charges are different from tips.
A recent receipt from Kumoya stated: “The 20% service charge on your check enables us to fairly compensate every team member who contributes to your experience. It is not a tip or gratuity. Any tip you leave is given entirely to the front-of-house team under Colorado law. Thank you for helping us uphold an equitable pay model.”
“Providing clarity to our guests is very important to us and when we identify opportunities to improve, we act. Following the lawsuit, the language regarding the service charge was modified,” Flaherty said in the statement.
What impact will the case have on CCG or service charges going forward?
The case did not result in any finding of misconduct by the restaurant chain, nor will it have any immediate legal impact.
Harrison had hoped that the case would yield a better legal definition of the difference between service charges and tips. He had unsuccessfully asked the court to make a determination of law that would define several requirements for service charges. That definition would have included that:
- The charge is mandatory and cannot be changed or removed upon request
- The employer must clearly communicate to customers and staff that the charge is not a tip
- The employer cannot use the service charge as a justification to claim the tip credit, which is a way to reduce base wages for tipped employees
The two parties disagreed about whether CCG originally met all those requirements, but they agreed that the company did meet the requirements as of March 2026. CCG’s lawyers agreed with the proposed new definition of service charges, according to a court filing.
“[B]oth parties in this case, and Colorado employees and employers at large, remain in need of clarity with regard to service charges,” Harrison wrote in the filing.
Judge Sarah Block Wallace did not ultimately make a determination of law, writing that the court might not have jurisdiction. Without a determination, the case is less likely to affect future disputes over service charges. Still, Harrison said it could provide a template.
“People with very differing opinions … were able to compromise on a legal standard that will add transparency to restaurants,” he said.
Each side has agreed to pay its own legal fees and costs. The case was dismissed without prejudice.
