Judge will hear IPI’s motion to suspend execution of $6.9M judgment

U.S. District Court for the NMI Chief Judge Ramona V. Manglona granted last week Imperial Pacific International (CNMI) LLC’s request to hear its motion to stay the execution of the court’s $6.9-million judgment in favor of IPI’s former contractor pending a resolution of IPI’s appeal of that ruling.

Meanwhile, at a status conference Thursday in a separate lawsuit filed by seven former workers against IPI, Manglona ordered IPI to pay per day the $2,000 sanction to the court from May 17 until such time it files certification of full compliance that the sanctions order is satisfied.

On Wednesday, Manglona set the hearing on IPI’s motion to stay the execution of judgment for this Thursday, June 4, at 9:30am.

Pacific Rim Land Development LLC was allowed to submit any the motion to oppose the stay by today, Monday. If it does, IPI is given until Wednesday, June 3, to reply.

Manglona extended to Thursday, June 4, the automatic stay of the court’s judgment.

IPI, through counsel Michael W. Dotts, said if Pacific Rim begins to collect on the $6.9-million judgment, IPI will not be able to make payroll or pay taxes. IPI currently has 1,066 employees, mostly working on the construction of its hotel.

Pacific Rim obtained last April 27 a judgment for breach of contract in excess of $6.8 million against IPI and was allowed begin executing on the judgment last Tuesday, May 26. Last Thursday, U.S. District Court for the NMI clerk of court Heather L. Kennedy amended the judgment, increasing the amount to $6,909,333, including interests and costs. IPI has appealed to the U.S. Court of Appeals for the Ninth Circuit to reverse the judgment, but lacks the ability to pay for a bond.

Dotts said IPI has identified about $9 million worth of real property leases that it can mortgage to Pacific Rim to secure payment of the judgment pending appeal. IPI asked the court to be allowed a stay of proceedings pending appeal.

Last Tuesday, Manglona denied without prejudice IPI’s first request to shorten time to hear IPI’s motion to stay. That means the court does not prohibit IPI from raising the same issue in the future. IPI then re-filed the request.

Last Wednesday, Pacific Rim, through counsel Colin Thompson, filed an application for writ of execution before the federal court that will direct the U.S. Marshal to seize IPI’s money from several banks in an amount not to exceed $5.65 million. Pacific Rim asked the court to issue the writ of execution to transfer money owned or controlled by IPI from the Bank of Saipan, City Trust Bank, Bank of Guam, and First Hawaiian Bank to be held in the court’s registry or account until after a hearing on exemptions, if any.

Pacific Rim is suing IPI and five unnamed alleged co-conspirators, claiming that IPI owes it payment for the work that it did on the casino/resort project. IPI has filed counterclaims against Pacific Rim for promissory fraud, fraud in the inducement as to the promissory note, violation of Consumer Protection Act, and breach of contract.

With respect to the seven former workers’ lawsuit, Manglona’s order last April 16 found IPI in civil contempt for violating the court’s two orders regarding discovery in connection with the lawsuit filed against IPI and two others by the seven former workers.

Manglona granted the former workers’ motion to sanction IPI. She informed the parties in this case that if IPI fails to comply with the deadlines ordered that day, April 16, 2020, a monetary sanction of $2,000 a day will be imposed until IPI complies.

The judge ordered IPI to file a certification of compliance to avoid sanctions.

The plaintiffs, who are now based in China, are suing IPI and its contractor, MCC International Saipan Ltd. Co., and subcontractor, Gold Mantis Construction Decoration (CNMI) LLC, over the alleged injuries they suffered during accidents at the worksite of IPI’s casino/resort project in Garapan.

The plaintiffs alleged, among other things, that they were forced to work long hours for below minimum wage under extremely dangerous conditions at the casino-resort worksite.

IPI has denied the allegations.