Over $200K default judgment vs IP OK’d

The U.S. District Court for the NMI has granted USA Fanter Corp. Ltd.’s request for default judgment in the amount of over $200,000 against Imperial Pacific International (CNMI) LLC in its lawsuit alleging breach of contract against the casino investor.

During a motion hearing yesterday, District Court for the NMI Chief Judge Ramona Manglona entered default judgment in favor of the plaintiffs in the amount of $226,127.05 plus post-judgment interest.

According to her official order, Manglona said she decided in favor of a default judgment because she found that USA Fanter’s complaint sufficiently alleged facts to establish the four breach of contract claims for IPI’s failure to pay; rent in the amount of $61,600; $87,772.55 for the change order work performed; $15,462 for quarry materials and their delivery; and $61,292.50 for the heavy equipment rentals.

“Plaintiff established the amount of damages prayed for through financial consultant Antonio Muña’s declaration and numerous invoices signed by IPI. Therefore, having considered the Ninth Circuit’s Eitel factors, and pursuant to Federal Rule of Civil Procedure 55(b)(2), the court granted plaintiffs motion for default judgment in the principal amount of $226,127.05 plus post-judgment interest under the federal rate, which is at 4.76%,” the judge stated.

At the motion hearing, attorney Colin Thompson appeared on behalf of USA Fanter while IPI was represented by Tao Xing.

Last week, USA Fanter applied for a default judgment against IPI for its failure to acquire counsel or defend itself in this matter leading to the first entry of default on Nov. 15.

Court documents state that USA Fanter sued IPI for its failure to pay a construction staging lease agreement and construction contract that involved quarry products and heavy equipment rentals.

Without factoring interest or late fees, IPI allegedly owes USA Fanter $61,600 for unpaid property rent; $87,772.55 for the unpaid change order work; $15,462 for unpaid quarry materials; and $61,292.50 for unpaid heavy equipment rentals—for a total of $226,127.05.

The lawsuit further states that on or about Dec. 15, 2015, IPI leased the property owned by USA Fanter by the execution of a staging lease agreement, with the term commencing on Feb. 22, 2016, and ending on Dec. 31, 2018, with no right to extend the term of the lease. Pursuant to the lease, IPI agreed to pay plaintiff rent on or before the 25th day of each month.

Thompson said IPI did make some payments to USA Fanter on a month-to-month basis for its occupancy of the property.

However, when IPI transitioned into a holdover occupancy of the property after the lease agreement ended, the monthly payments were reduced to only $5,600 per month. Thompson said the last payment IPI made to plaintiff for its holdover occupancy of the portion of the property was for July 2019.

The lawyer said USA Fanter served IPI with invoices for the amounts outstanding for the occupancy and use of the property but IPI has not responded to these invoices or demands for payment.

Meanwhile, Thompson said USA Fanter and IPI also executed a written construction contract for construction of off-site improvements that was beyond the scope of their previous construction contract.

On Nov. 20, 2018, plaintiff submitted to IPI a change order proposal detailing the cost breakdown for the additional work, which totaled $87,772.55. On March 28, 2019, IPI sent USA Fanter a letter agreeing to the change order and agreeing to pay plaintiff $87,772.55 upon completion of the change order work. On July of 2019, USA Fanter completed all of the work pursuant to the change order but IPI allegedly refused to make the $87,772.55 payment.

As for the complaint regarding the nonpayment of quarry products and heavy equipment rental, Thompson said IPI ordered that USA Fanter procure and deliver quarry products to the defendant on different occasions and that they’d pay for the products. IPI allegedly failed to pay these orders and rentals that totaled $61,292.50.