DPL lawsuit over leaseback agreement settled for $1M

Kan Pacific Saipan Ltd. and Imperial Pacific International (CNMI) LLC have settled for $1 million Department of Public Lands Secretary Marianne C. Teregeyo’s $10.5-million counterclaims and cross claims against the two companies.

Attorney General Edward Manibusan announced yesterday that in dismissing all claims brought in Teregeyo’s lawsuit, Kan Pacific and Imperial Pacific agreed to each pay $500,000 to DPL to resolve the claims.

“The Office of the Attorney General takes anti-competitive agreements seriously and will pursue these claims in the public interest whenever they arise,” Manibusan said.

DPL Secretary Teregeyo, through OAG, filed the antitrust against Kan Pacific and Imperial Pacific, which is the parent company of Saipan casino licensee Best Sunshine International, Ltd.

In that suit, Teregeyo alleged that an attempted assignment and leaseback agreement executed by Kan Pacific and Imperial Pacific was an attempt by Imperial Pacific to eliminate competition in connection with DPL’s request for proposal to lease public lands where the Marianas Resort and Spa is located.

Manibusan said Commonwealth and federal laws prohibit collusion in connection with bids for public contracts.

In the lawsuit, Teregeyo alleged that the agreement between Imperial Pacific and Kan Pacific violated those laws.

Manibusan said the parties mediated their disputes and resolved all claims.

Teregeyo recently filed the counterclaims and cross claims against Kan Pacific, Imperial Pacific, and Saipan Entertainment LLC.

Saipan Entertainment owns the e-gaming facility Club 88 Mariana located at Mariana Resort & Spa in Marpi. Kan Pacific owns Mariana Resort & Spa. Imperial Pacific is doing business as Best Sunshine International, Ltd.

Saipan Entertainment sued Kan Pacific and Imperial Pacific for allegedly not informing the company of Best Sunshine’s negotiation to purchase the Mariana Resort. Teregeyo was also named as co-defendant.

Last March, Superior Court Associate Judge Teresa Kim-Tenorio dismissed Saipan Entertainment’s breach of contract claim against Kan Pacific.

Teregeyo filed the counterclaims and cross claims against Kan Pacific, Imperial Pacific, and Saipan Entertainment for declaratory judgment; and malicious prosecution against Saipan Entertainment.

Teregeyo has filed counterclaims for breach of contract against the three companies. She also filed counterclaims for anticipatory repudiation and restraint trade in violation of the Sherman Act and Clayton Act against Kan Pacific and Imperial Pacific.

The Sherman Act provides that every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce is declared illegal.

A private right of action for violation of the Sherman Act is created by the Clayton Act.

Teregeyo, through assistant attorney general Christopher M. Timmons, asked the Superior Court, among other things, to hold Kan Pacific and Imperial Pacific jointly liable to pay her/DPL $10.5 million for allegedly colluding to restrain trade in violation of Commonwealth and federal law.