IPI, subsidiaries, CCC drop court actions

Imperial Pacific International (CNMI) LLC, its two subsidiaries, and the Commonwealth Casino Commission have agreed to dismiss all their court actions in federal court.

IPI, IPI subsidiaries Grand Marianas (CNMI) LLC and Imperial Pacific Properties LLC, and CCC asked the court last Friday to dismiss all their claims with prejudice. That means the parties can no longer re-file their claims.

That means IPI is dropping its lawsuit against CCC; IPI’s subsidiaries as intervenors in IPI’s lawsuit against CCC; and CCC’s counterclaim against IPI.

All agreed to each shoulder their own attorney’s fees and costs.

Attorneys Viola Alepuyo and Phillip J. Tydingco signed the stipulation as counsel for IPI. Attorneys Matthew Gregory and Braddock Huesman signed as counsel for subsidiaries Grand Marianas and IPP. Assistant attorney general Michael Ernest signed as counsel for CCC executive director Edward Deleon Guerrero, while assistant attorney general Benjamin Petersburg signed as counsel for CCC.

Last Monday, Aug. 26, the U.S. Court of Appeals for the Ninth Circuit denied IPI’s motion to stay the U.S. District Court for the NMI’s preliminary injunction order that allowed CCC to disclose IPI’s confidential income tax information that is subject of a legal dispute.

Ninth Circuit judges A. Wallace Tashima and Milan D. Smith Jr. denied IPI’s motion to stop CCC from disclosing IPI’s unredacted financial statements while the appeal is pending.

Tashima and Smith had previously temporarily prohibited CCC from disclosing IPI’s confidential income tax information after IPI filed the emergency motion.

In a 25-page decision last Aug. 6, U.S. District Court for the NMI Chief Judge Ramona V. Manglona ruled that IPI and its subsidiaries have not met their burden for a preliminary injunction.

Manglona, however, declined in that order to address “at this time” the motion to remand IPI’s lawsuit against CCC to the Superior Court that was filed by IPI and its subsidiaries, as the issues of abstention and supplemental jurisdiction raised in the motion will be further briefed and argued.

IPI and its subsidiaries have asked the federal court to prevent the disclosure of unredacted financial statements because, in their view, those statements contain confidential information protected from disclosure by provisions in the CNMI tax code and the Open Government Act, and by guarantees of privacy in the U.S. and Commonwealth Constitutions.

In order to obtain such protection, IPI filed a petition for preliminary injunction prohibiting CCC from releasing the unredacted financial statements while this case is pending.

The dispute arises from the OGA request filed with CCC by Rep. Edwin K. Propst (Ind-Saipan) on June 13, 2019.

Propst asked for information regarding the 2017 and 2018 audit reports for IPI/Best Sunshine that was prepared by Ernst & Young; all business gross revenue tax payments made by IPI/Best Sunshine to date, with amounts and date; and all corporate income taxes paid by IPI/Best Sunshine.

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

Grand Marianas and IPP alleged 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.

Last July 24, CCC, through the Office of the Attorney General, filed a counterclaim in federal court against IPI.

If the CCC is determined by the District Court to be liable for releasing the information of IPI’s subsidiaries, then IPI should indemnify CCC, Petersburg said.