When a Kauai-based company went to federal court last year to challenge the century-old shipping law many people blame for Hawaii’s high prices, it never claimed that the odds were good. It claimed the costs were unbearable, unsustainable, and shared by everyone who lives in or visits the islands.
That long-shot effort ended this week, and the outcome reinforces a reality that Hawaii travelers encounter on every trip. Prices are not coming down, and the courts are not going to be the place where that gets changed.
The lawsuit that tried to open the door.
The case was brought by the Koloa Rum Company, a Kauai-based business that has grown from a small island operation into an internationally distributed brand while keeping production rooted in Hawaii. Its CEO, Bob Gunter, is also a longtime friend of Beat of Hawaii, which is in part why we followed this case closely from the start rather than treating it as an abstract policy fight.
From the beginning, Gunter framed the lawsuit around day-to-day Koloa Rum economics rather than ideology. This was not about theory but rather about invoices, freight bills, and math that no longer works.
At the center of the case was the Jones Act, a federal shipping law that requires goods moved between U.S. ports to travel on vessels that are American-built, American-owned, and American-crewed. Hawaii, separated from the mainland by thousands of miles of ocean, feels that restriction more acutely than any other state.
Foreign-flag ships that move cargo cheaply across the Pacific cannot legally carry goods between Hawaii and the mainland, even when they are already cruising nearby. That restriction limits competition and drives up shipping costs for everything from raw materials to finished products.
Gunter argued that the burden falls on everyone. Hawaii businesses pay more for bottles, packaging, equipment, and spare parts. Families pay more for groceries and household goods. Exporters then get hit a second time when they try to ship Hawaii-made products to other parts of the United States. Visitors pay in everything from restaurants to grocery stores.
The company highlighted a comparison that effectively captured the imbalance. Shipping rum from Kauai to Los Angeles costs nearly three times more than shipping the very same product from Los Angeles to Australia. That kind of situation is not unique to rum and appears in food, construction materials, retail goods, and hotel supplies.
Why the court shut it down.
Chief Judge James Boasberg of the U.S. District Court for the District of Columbia dismissed the lawsuit on two grounds that leave little room for revival.
He ruled the case was time-barred. Under federal law, constitutional challenges generally face a six-year statute of limitations. The court concluded that the clock started when Koloa Rum began operating in 2009, not each time the company paid a shipping bill or watched costs rise further.
Second, the judge rejected the constitutional argument outright. The Jones Act, he wrote, does not discriminate against Hawaii specifically. Instead, it applies uniformly across the United States as part of what he described as a long-standing tradition of laws that reserve domestic shipping for domestic carriers.
That distinction is significant. If Hawaii is not singled out under the law, courts are unlikely to intervene simply because the law produces harsh economic outcomes when applied.
The federal government defended the statute, and Matson Navigation intervened in support of keeping the law intact. From the court’s perspective, this fight was over long before it began.
What this means for Hawaii travel costs.
For visitors, nothing changes operationally, but everything familiar stays very expensive. The Jones Act continues to sit beneath nearly every cost travelers encounter upon arrival.
Groceries cost more because they cost more to ship. Restaurants charge more because ingredients, packaging, and equipment all arrive at highly inflated rates. Rental cars are more expensive because parts and vehicles are subject to the same constraints. Hotels pay more for furniture, linens, maintenance supplies, and construction materials, and those costs eventually show up in nightly rates and resort fees.
Earlier this year, interisland freight rates jumped a whopping 26%, and businesses passed those increases straight through. The Jones Act is not the only factor behind Hawaii’s high prices, but it is a structural one that makes every other cost worse.
For travelers wondering why Hawaii feels increasingly out of reach, this ruling confirms that one of the most frequently cited causes that has been mentioned across hundreds of BOH comments is not going away.
A reader question that still hangs.
When we first covered the lawsuit, a reader named Susan from San Diego raised a skeptical but fair question. Even if the Jones Act were changed, she asked, would businesses actually lower prices, or would they simply keep the savings?
The court never reached that debate. The law did not change, so the question stays just a theory for now. What is no longer theoretical is that prices tied to shipping will continue to remain high.
For Hawaii travelers, that means airfare is only part of the cost equation. The prices of food, lodging, and everyday services will continue to reflect a supply chain designed around protection rather than competition.
Why Congress is the only remaining path.
With the courts closed off, the only avenue for any meaningful Jones Act reform runs through Congress. Bills like the Open America’s Water Act could repeal the domestic shipping restrictions outright, but they have gone nowhere for years.
The political forces behind the law are entrenched, backed by maritime unions, shipbuilders, and domestic carriers that benefit from keeping the status quo. Hawaii’s geographic reality gives it the most to gain from reform, but not enough leverage to force it to happen.
For now, the Jones Act stays in place, and so does the cost structure it creates. If relief ever comes for Hawaii’s high prices, it will not come from judges. It will come, if at all, from lawmakers willing to challenge a 105-year-old law that few visitors know by name but everyone pays for once they arrive.
When you look at Hawaii’s prices today, does this ruling change how you think about what is really driving the cost of a trip, or does it simply confirm what you already suspected?
Lead Photo: Honolulu Harbor.
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