Motion to dismiss lawsuit vs Kan Pacific, BSI placed under advisement

Superior Court Associate Judge Teresa Kim-Tenorio has placed under advisement the owner of Mariana Resort & Spa’s motion to dismiss the lawsuit filed by e-gaming facility Club 88 Mariana against the company and Best Sunshine International, Ltd.

Kim-Tenorio conducted the hearing Monday on Kan Pacific Saipan Ltd.’s motion to dismiss the lawsuit filed by Saipan Entertainment LLC, the owner of Club 88 Marianas.

Kan Pacific counsel Joseph J. Iacopino argued the motion to dismiss. Attorney Daniel T. Guidotti opposed the motion as counsel for Saipan Entertainment.

Also present at the hearing were Imperial Pacific counsel, Viola Alepuyo and Department of Public Lands counsel assistant attorney general Christopher C. Timmons.

Saipan Entertainment is suing Kan Pacific, Imperial Pacific International (CNMI) LLC, which is doing business as Best Sunshine International, for allegedly not informing the company of Best Sunshine’s negotiation to purchase the resort.

DPLS Secretary Marianne C. Teregeyo was also named as co-defendant.

Saipan Entertainment is suing Kan Pacific for breach of contract, unjust enrichment, and fraudulent nondisclosure.

Saipan Entertainment is suing DPL and its secretary in order to enjoin the CNMI government from consenting to any assignment of the resort lease or the resort property until the controversy surrounding the validity of the resort lease is resolved.

Saipan Entertainment is suing Imperial Pacific for intentional interference with contract.

At the hearing, Iacopino noted, among other things that in a paragraph of the complaint Saipan Entertainment admits that Kan Pacific has not yet breached the subject contract with Saipan Entertainment.

Iacopino said Saipan Entertainment in the same paragraph states that Kan Pacific and Imperial Pacific “have not yet consummated the transfer of the resort lease and the resort property to Imperial Pacific….”

“So there’s no transfer according to the complaint,” Iacopino said.

Iacopino said there has been no breach of Saipan Entertainment’s purported sublease.

Iacopino said Saipan Entertainment is asking the court to get involved in a matter that is “premature, not ripe, hypothetical and speculative.”

He said plaintiff Saipan Entertainment has claimed for breach of contract that has not occurred yet, therefore there is no justification for such claim.

Iacopino pointed out that the essential elements to a cause of action for a breach of contract are the existence of a contract, acts or omissions constituting a breach, and damages.

The lawyer said if any one of these elements is not alleged in the complaint, the lawsuit is deficient and must be dismissed by the court.

He said the complaint does not allege that Kan Pacific has breached contract and instead, it alleges that Kan Pacific “intends” to breach a contract.

“This is not an adequate pleading to support a cause of action for a breach of contract,” Iacopino pointed out.

Iacopino added that the complaint does not alleged that Saipan Entertainment has sustained actual damages and instead, alleges what might happen “if” there is a breach someday.

Guidotti said they have good basis in their complaint as it was reported in the newspapers, indicating that Imperial Pacific or Best Sunshine was interested in purchasing Kan Pacific’s 2.5 years under the resort lease.

Guidotti said news stories also indicated that Imperial Pacific and Kan Pacific “signed” an agreement obligating Kan Pacific to assign its remaining interest in the resort property to Pacific Imperial.

Guidotti stressed that they did not entirely rely on news reports.

Guidotti said they have to have a good faith basis in bringing the complaint.

Iacopino said there is no allegation that there’s lack of performance on Kan Pacific’s part pertaining to its sublease deal with Saipan Entertainment.

“They’re still there enjoying its business without interruption,” Iacopino said, adding that this case is based on a big “if.”

On Dec. 18, 2013, Kan Pacific and Saipan Entertainment entered into a commercial sublease agreement. Under the deal, Kan Pacific agreed to lease a commercial space at Mariana Resort to Saipan Entertainment for its Club 88 Mariana facility. Club 88 began its business operations on Nov. 20, 2015.

Guidotti requested the court to allow him to submit an audio recording in their last hearing and have the judge hear for herself.

Iacopino objected to such filing, saying without filing a notice it’s entirely improper.

Iacopino said he has never seen this happen in his 35 years of law practice to have a judge hear a recording without a notice for such filing.

Guidotti said the audio recording matter is not outside of the motion to dismiss and is “absolutely relevant.”

Guidotti said the audio recording is important because Iacopino made representation to the court that is contrary to what was shown in the last hearing.

Guidotti asked the judge to just listen to the audio as he has own transcript of the hearing, then decide for herself.

Kim-Tenorio denied Guidotti’s request.

Guidotti said they allege in the complaint that Imperial Pacific offered $3.5 million to Kan Pacific plus other consideration, conditioned in part on Kan Pacific entering into one or more oral or written agreements that obligate Kan Pacific to deliver the premises to Imperial Pacific free of any claims by Saipan Entertainment.

Guidotti said they have evidence of loss of profit.

Asserting that the complaint will survive a motion to dismiss, Guidotti also noted that they have also claims for fraud and declaratory action.

But Iacopino said until there is real breach of contract, it doesn’t matter.