Five Years On, Oregon Still Struggles to Collect Some Pandemic-Era Fines

Most people agree that the restrictions during the Covid-19 pandemic were a drag. Wearing facial coverings, social distancing and not hanging indoors with others were disruptive necessities in curbing the spread of the virus, which ultimately killed about 1.2 million Americans. Like elsewhere in the state, some Central Oregon businesses were slow in adopting then-Gov. Kate Brown’s mandated Covid restrictions, resulting in nearly 30 establishments, mostly restaurants, being cited and fined for non-compliance by Oregon Occupational Safety and Health, the agency tasked with enforcing the state’s workplace safety and health rules.

In half of those instances in Central Oregon, OSHA handed down fines averaging around $300 for certain protocols not being followed. OSHA worked with operators to comply, and virtually all those minor citations were paid. Statewide, 73% of employers cited for Covid restriction violations never appealed, according to OSHA.

OSHA levied larger fines, however, at Central Oregon establishments that demonstrated “willful” disregard of these restrictions. These fines total more than $197,000 and have not been collected from eight Central Oregon businesses, according to OSHA records the Source requested and reviewed. In the instance of most outstanding debts, appeals are moving slowly through a backlogged system, while others have funneled through and into collections.

Nearly five years in, OSHA still hasn’t received debts from establishments in Crook and Deschutes counties whose violations the agency found intentional. In Redmond, those places are Full-Body Fitness a.k.a. Redmond Athletic Club ($17,800), Mehan & Sons ($9,440), Mo’s Egg House ($26,700), We’re the Wurst ($135) and Sno Cap Drive In #2 ($347 remain unpaid on $8,900); in Sisters, Cork Cellars Wine & Bistro ($17,800); and in Bend, Kevista Coffee, which operated in the city until summer 2025. The coffee shop Fox & Fern has taken over Kevista’s space, retaining some of the same management, according to a Fox & Fern social media post featuring Kevista owners Kevin and Krista Lauinger.

The Sno Cap Drive-In #2, in Redmond, has nearly made good on its state fine of $8,900 for willful violations of Covid restrictions. Credit: Peter Madsen

Throughout the Covid pandemic, willful restriction violations such as those were rare, says Aaron Corvin, an Oregon OSHA spokesman.

“Given the nature of a willful violation — which occurs when an employer shows plain indifference to the Oregon Safe Employment Act’s requirements to protect workers — it is not surprising that some employers have chosen to continue to contest their citations,” Corvin wrote in an email.

The Safe Employment Act, enacted in 1973, ensures a lot of things, yet the crucial component here is its mandate that employers maintain a safe place of employment and comply with safety and health orders, decisions and rules.

In the instance of each appeal, of which 15 were filed by Central Oregon establishments, the case was transferred before an administrative law judge of the Workers’ Compensation Board, and, in the instance of Mehan & Sons and Mo’s Egg House, a subsequent appeal was then transferred to the Oregon Court of Appeals.

Kevista Coffee, whose holding company is Laui Life Coffee, Inc., also appealed each of its three fines, which total $116,470 for violations that include willfully letting customers sit inside and not enforcing facial coverings for employees and customers. Kevista’s fines are the second-highest levied at any Oregon business, according to OSHA records. Salem’s Courthouse Club Fitness was fined $126,749 in January 2021. As with Courthouse Club, the fines’ severity owes to the Lauingers’ repeated refusal to comply with Covid restrictions, as demonstrated by OSHA documents and the statements against Covid restrictions the Lauingers made on a political podcast and during interviews with OSHA inspectors.

Those appeals are now before the Workers’ Compensation Board. OSHA wasn’t able to ballpark a timeframe for the resolution of Kevista’s contested cases, nor those of other establishments.

When an employer requests an appeal, they may choose to have an informal conference, which is the chance to discuss the OSHA inspection that led to the citation, share their thoughts and potentially offer new information, Corvin said. Appealed citations are often settled at this stage. If a settlement isn’t reached, then the case may go before an administrative law judge at the WCB.

“It’s important to note that, regardless of whether an appeal is filed, Oregon OSHA requires employers to correct serious violations of workplace safety and health requirement,” Corvin said. “Our civil penalties serve both as a tool of deterrence and to move employers into compliance — but they are not our only tool. Our work is rooted in prevention; we don’t give advance notice of inspections, and we require employers to address hazards.”

The cost of Covid appeals

Oregon OSHA can’t quantify the hours and money spent as these cases have wound their way through the appellate process, Corvin said. Yet he reinforced the point: these appeals aren’t costing taxpayers money directly, because OSHA isn’t funded by the Oregon’s general fund. The agency’s resources come from the Premium Assessment Operating Account, along with other parts of the workers’ compensation system. The PAOA is the worker’s compensation premium assessment, which employers pay to their insurer for workers’ compensation coverage, according to OSHA.

“Penalty collections make up a small part of PAOA revenues,” Mark Peterson, the public information and communications director for the Oregon Department of Consumer and Business Services wrote in an email. He added that litigation costs, however, are budgeted. “As cases resolve themselves, the same amount of resources are applied to the next cases. Covid cases don’t change Oregon OSHA’s budget.”

And OSHA says the resources spent to enforce these fines won’t make employers’ premiums go up. According to a report by the Oregon Department of Consumer and Business Services, on average, state employers will pay less for workers’ compensation coverage in 2026. The downtick in costs marks 13 years of average decreases in the pure premium rate — the base rate insurers use to determine the amount employers have to pay for medical costs and lost wages, according to the agency.

Oregon OSHA is a part of the state’s workers’ compensation system that also includes the Workers’ Compensation Division and the Workers’ Compensation Board, which handles disputes over Oregon’s workers’ compensation and workplace safety laws — particularly the violations related to Covid restrictions.

OSHA’s backlog of appeals is unique to the Covid pandemic. Prior, appeals were resolved within several months, often before the formal litigation process. The pandemic put a wrench in that process, Corvin says.

A “peaceful protest“

In March 2021, in the middle of the Covid-19 lockdown, word had spread about the “peaceful protest” that two owners of a westside Bend coffee shop had enacted in the face of the “overreach” of Brown’s mandated Covid restrictions.

By that time, Kevin and Krista Lauinger, the married owners of Kevista Coffee — a portmanteau of their first names — had racked up not just notoriety and a business advantage in letting patrons sit indoors without wearing facial coverings, but $36,370 in fines stemming from two Covid restriction violations from the state.

But while the Lauingers publicized their protest, they had already been approved for a $32,185 loan by the federal government’s Paycheck Protection Program, on April 29, 2020. In his application, Kevin Lauinger specified that the loan would go toward payroll expenses, according to ProPublica’s database of all PPP loan recipients. The PPP was created by the federal government to provide hundreds of billions of dollars in financial support to banks to make low-interest loans to companies and nonprofit organizations in response to the economic devastation caused by the coronavirus pandemic.

In a sign taped to the front door of Kevista in March 2021, the owners wrote that they “must stay open to support our employees and their families, our business and community.”

On June 20, 2021, the business’ loan was forgiven to the amount of $32,560, allowing for accrued interest. It’s not immediately clear if PPP recipients who remained open during lockdown would incur any legal or financial penalties, yet a U.S. Small Business hotline exists to report fraud.

Of the nearly 116,000 PPP recipients in Oregon, Kevista Coffee was one of 101,415 that received amounts less than $150,000, according to the ProPublica database. Some loans ranged between $5 and $10 million, of which there were 48 in Oregon. All told, these PPP loans in Oregon totaled more than $10 billion. More than 87% of the funds (about $1.2 billion), remained unforgiven as of early 2022, according to reporting by The Oregonian.

Bend’s Black Bear Diner (whose holding company is Bucc N Dulge) received two PPP loans, totaling $792,285. Those loans were forgiven in February and November of 2021. Yet in April 2021, OSHA fined Black Bear Diner in Bend for willfully failing to follow prohibition of on-site consumption of food and drink and for failure to implement a safety committee. Black Bear Diner appealed the first citation, which resulted in a settlement of $8,900; the safety committee violation wasn’t appealed. Black Bear Diner made good on its fine.

Other Central Oregon establishments that still have outstanding OSHA fines received forgiveness on their PPP loans, including Full Body Fitness ($35,000, forgiven May 2021), and Richi’s Place ($12,407, forgiven June 2021).

Bad timing — for anyone

The Lauingers opened Kevista on Jan. 17, 2020, just as Covid-19 was becoming a global pandemic. In Oregon, Brown mandated facial coverings in July of that year.

That same month, after an unannounced inspection, OSHA fined Kevista Coffee $8,900 for “willfully failing to implement face coverings per sector-specific guidance for bars and restaurants,” according to a report provided by OSHA.

Later, in December, Kevista Coffee began allowing indoor dining — about eight months into lockdown, according to OSHA. That happened during the same time that the state’s risk protection framework placed Deschutes County in the “Extreme Risk” category, which prohibited indoor dining in order to help slow the spread of Covid-19, the Source reported.

Yet Kevista remained open, unfettered by state mandates requiring facial coverings, health hazard controls and reduced occupancies.

By March 2021, the Lauingers were publicizing their opposition with a handwritten sign on Kevista’s front door: “…by owners, staff and patrons against [then-Governor Kate] Brown’s ordering of unequal application under the law by ordering some businesses to close or reduce service without just compensation.”

During that same month, Kevista incurred a more-severe fine of $27,400 for “willfully failing to follow prohibition of on-premises consumption of food or drink.” That was three times the minimum penalty allowed for such violations, OSHA representatives stated in a press release at the time. OSHA also cited Kevista for a serious violation for failing to implement an infection control plan and a serious violation for failing to conduct an exposure risk assessment. According to OSHA records, that fine remains the heaviest the agency has handed a restaurant in Oregon.

“The decision reflects the need to ensure a more appropriate deterrent effect where employers insist on disregarding health and safety standards,” OSHA stated.

On June 20, 2021 — the same month that Kevista’s $32,560 PPP loan was forgiven by the federal government, the coffee shop received a third fine of $80,100 for “two willful violations, one for failing to ensure all employees and customers wore facial coverings. The other was for not following the prohibition of on-premises consumption of food and drink, despite capacity limitations established for ‘extreme risk’ counties,” according to OSHA.

“During the inspection, the owners of Kevista said they chose to re-open the coffee shop even though they were aware that it went against workplace health requirements,” the OSHA inspector wrote in the report.

As it did the first two, Kevista appealed the third citation, which, like the others, was then transferred to the Workers’ Compensation Board. With $116,470 in fines hanging in the balance, the resolution may take many more months before being resolved, OHSA’s Corvin estimated.

In December 2024, Kevin Lauinger registered Kevista Coffee with the Idaho Secretary of State, opening in Eagle in January 2025.

Fox & Fern, a coffee shop in Bend, now sits in the space once occupied by Kevista Coffee, which owes the state $116,470 for willful violations of Covid restrictions. Kevista Coffee has since relocated to Eagle, Idaho. Credit: Peter Madsen

In a May 1, 2025, Instagram video, Kevin and Krista Lauinger sit with Fox & Fern owner David Cox in Bend. Cox owns the retail space once occupied by Kevista, along with four spaces onsite through the Moran Holding Company. The three explain the handoff of the space to their landlord.

Krista Lauinger renewed Kevista Coffee’s Oregon business registration two months later, on July 14, 2025, according to the Oregon Secretary of State business registry.

Moving to a different state doesn’t protect a business owner from these fines. A search through Oregon’s Bankruptcy Court filings show no evidence of Kevista filing for protection.

In response to email requests for comment, on Feb. 16, Kevin Lauinger said Kevista’s “attorney has advised us against answering any questions at this time since it is ongoing litigation.”