Court denies sale of IPI’s real property

The U.S. District Court for the NMI has denied USA Fanter Corp. Ltd.’s motion for the appointment of a receiver for the sale of Imperial Pacific International (CNMI) LLC’s real property.

Following a receivership hearing last week, District Court for the NMI Chief Judge Ramona V. Manglona denied without prejudice the motion filed by USA Fanter’s attorney, Colin Thompson, for the court to appoint a receiver for the sale of IPI’s real property.

However, Manglona did grant the motion for the limited appointment of a receiver for the sale of IPI’s liquid assets, including cash, its gaming machines, vehicles, liquors, and more. She informed the parties that she would issue the order within 24 hours following the hearing.

Back in August 2021, Manglona granted the request of USA Fanter to appoint Hong Kong-based Clear Management Ltd. to administer, collect, or sell any casino gaming property in which IPI has an interest; and to perform any other acts required to satisfy the judgment of $2,089,345.28. On Sept. 9, USA Fanter, through Thompson, asked the federal court to appoint a receiver for the sale of IPI’s real property, arguing that IPI’s liquid assets continue to diminish in value by the day and may not be enough to satisfy the $2.1 million judgment and its over 15 other creditors.

However, IPI filed its opposition last week through its lawyer, Stephen Nutting. “The appointment of receiver is a drastic remedy that is to be deployed only sparingly in the most extreme circumstances upon a proper evidentiary showing,” he said.

Nutting argued that a writ of execution has been issued over assets valued by USA Fanter at $3.25 million ($1 million more than USA Fanter’s judgment with interest), and only two months ago, a receiver was appointed to liquidate many of these assets.

“USA Fanter now seeks the appointment of a second receiver to seize and liquidate separate assets that lie at the core of IPI’s casino and resort project. Overall, USA Fanter fails entirely to indicate why [its] already appointed receiver is not adequate to provide a basis for the extraordinary relief sought,” he said.

USA Fanter sued IPI for its failure to pay the full amount due under a construction contract for labor and materials provided for the improvement of IPI’s real property.

USA Fanter claims that IPI only paid USA Fanter $300,000 and the unpaid balance due was not less than $2,089,345.28.