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$5.6M judgment to Pellegrino, MRC resolved through tax credit program
Dotts says judgment expected to be fully paid off by September
Though a tax credit program the CNMI government has resolved the 2005 Superior Court judgment that awarded $5.6 million to the late businessman Anthony Pellegrino and his Marine Revitalization Corp., according to attorney Michael Dotts yesterday.
Replying to Saipan Tribune’s inquiry, Dotts, counsel for Pellegrino’s estate, said he handled the hearing on the final distribution for Pellegrino’s estate about a week ago and that the estate is now closed.
Dotts said he cannot provide any real details about the tax credit program that resolved the judgment because there is a confidentiality clause that applies.
“I can say that at this point the MRC judgment has been substantially paid off and that we expect it will be fully paid off by September,” he said.
With the MRC judgment, Dotts said, they reached an agreement with the CNMI government to let them sell it as tax credits.
“We have sold almost all of it now,” the lawyer said, adding that the remaining money from the MRC judgment is going into Pellegrino’s trust.
In April 2015, Dotts informed the court that the government still owes over $4 million to the Pellegrino estate. At that time, Dotts pointed out that as there is no provision for paying court judgments, the CNMI budget is in violation of the CNMI Constitution.
Dotts said all these court judgments against the government are debts of the CNMI.
In 2010, the government’s debt to Pellegrino and his MRC had ballooned to $8.5 million.
The government’s debt, however, was reduced to $5 million after the CNMI Supreme Court took away about $3 million in interest. The high court ruled that judgments against the CNMI don’t accrue interest.
Pellegrino established MRC to build the $3.5-million Outer Cove Marina in the mid-1990s. MRC and the government’s dispute began in 2001 after the Department of Lands and Natural Resources not only failed to bar commercial vessels from renting slip space at Smiling Cove but also actively solicited commercial lessees.
In 2005, DLNR agreed to a court judgment ordering it to pay $5.6 million to Pellegrino or MRC. DLNR did not comply with the order, resulting in three judgments in favor or MRC.
Pellegrino passed away in June 2013.
One of the assets of Pellegrino’s estate is the MRC judgment against the CNMI.
Dotts stated in 2015 that the reason why the judgment that reached over $8 million is now only over $4 million because the CNMI Supreme Court decided that judgments against the government don’t earn interests.
