IPI seeks dismissal of CCC’s counterclaim

The Imperial Pacific International (CNMI) LLC has asked the federal court to dismiss the Commonwealth Casino Commission’s counterclaim against IPI.

CCC’s counterclaim seeks court’s order requiring IPI to pay as indemnification if the court determines that CCC is liable to pay damages for releasing confidential information of IPI’s subsidiaries.

IPI, through counsel Viola Alepuyo and Phillip J. Tydingco, asserted that CCC’s counterclaim is legally defective as the complaint of IPI’s subsidiaries does not allege a claim for damages that is cognizable under the law.

Alepuyo and Tydingco argued that the claim for damages of IPI’s subsidiaries—Grand Marianas (CNMI) LLC and Imperial Pacific Properties LLC—against CCC based on Commonwealth law is barred as the subsidiaries have not complied with the mandatory administrative prerequisite for filing a suit for damages against CCC.

That means CCC’s counterclaim is procedurally incorrect, they said.

“The proper procedural pleading is a third-party complaint filed in response to the intervenors complaint and not a counterclaim based on IPI’s complaint,” Alepuyo and Tydingco said.

The intervenors in this case are IPI’s two subsidiaries.

CCC, through assistant attorney general Benjamin K. Petersburg, asked the court to hold IPI liable to pay CCC damages, court costs, and attorneys’ fees.

Petersburg said IPI provided information to the CCC pursuant to a CCC order that included information about Grand Marianas (CNMI) LLC and Imperial Pacific Properties LLC.

Last July 12, Grand Marianas and IPP filed a complaint as intervenors in IPI’s lawsuit against CCC.

Petersburg said Grand Marianas and IPP allege various causes of action against the CCC related to the public availability of the information provided by IPI to the CCC pursuant to the order which Commonwealth law specifically declares not confidential.

Petersburg said IPI knew, at the time it provided information to the CCC, that the information would be made publicly available. Thus, he said, CCC cannot be faulted for disclosing or making public any information related to IPI’s subsidiaries.

In IPI’s motion to dismiss filed Thursday, Alepuyo and Tydingco said a District Court may dismiss a claim where there is an absence of sufficient factual statements establishing a facially plausible claim to relief or when the pleading fails to allege a viable or cognizable legal theory.

Alepuyo and Tydingco said if the pleading cannot be cured as matter of law, then the dismissal should be with prejudice. That means CCC cannot re-file the counterclaim.

The lawyers said a claim for damages pursuant to a statute, Section 1983, can only be brought against a person.

Section 1983 creates a remedy for violations of federal rights committed by persons acting under color of state law.

Alepuyo and Tydingco said CCC is not a person for Section 1983 purposes. Thus, they said, the subsidiaries have not, at this time, alleged a viable claim for damages under Section 1983.

Moreover, they said, even if CCC had named various CCC members or agents in their individual capacities, the subsidiaries have not requested any damages, and as no damages are required, their claim, of any, are not ripe.

Nevertheless, Alepuyo and Tydingco said, even if the subsidiaries had alleged a proper claim for damages under Section 1983 or if they amend their complaint to allege a claim for damages against a person, then CCC’s counterclaim would still be improper as federal law does not allow a claim for indemnification based on a Section 1983 claim for damages.

Nevertheless, the lawyers said, the subsidiaries’ non-federal claims are barred under Commonwealth law for failure to exhaust the mandatory administrative remedies.

Alepuyo and Tydingco said the subsidiaries claim for damages against CCC based on Commonwealth law is barred as subsidiaries have not complied with the mandatory administrative perquisite for filing a suit for damages against CCC.

IPI is suing CCC to prohibit CCC from disclosing publicly confidential income tax information that is the subject of a dispute between IPI and CCC.