Torres disappointed with court ruling

Lawyer Vincent Deleon Guerrero Torres said yesterday he is obviously disappointed with the Superior Court’s decision that dismissed three of the four claims in his lawsuit against E-Land World Co. Ltd. and others.

Asked for comments about the dismissal order, Torres said the court’s order states that he should file the claim as derivative lawsuit on behalf of the corporation, but that as far as he is concerned there are only two shareholders of Suwaso Corp.

A derivative action refers to a lawsuit brought by a shareholder of a corporation on behalf of the corporation to enforce or defend a legal right or claim.

E-Land is the majority shareholder of the Coral Ocean Point Golf Resort. Suwaso Corp. owns COP.

Torres said Yusuke Fumoto sold all of his shares to Micronesian Resort Inc., which leaves only him (Torres) and MRI as the shareholders of Suwaso Corp.

“I am suing MRI for committing perpetration acts in this case. Since I am the sole minority shareholder and since the perpetrator is MRI, the majority sole shareholder, I should be entitled to sue MRI directly,” he said.

The lawyer said he has two options: file a motion for reconsideration or appeal to the CNMI Supreme Court.

In an order on Monday, Associate Judge Joseph N. Camacho dismissed Torres’ claims for fraudulent concealment and usurpation of corporate opportunity, breach of fiduciary duty, and assisting a breach of fiduciary duty.

Camacho ruled that shareholders lack standing to maintain claims for corporate harms as direct actions, and such claims must be brought derivatively, regardless of the size of the corporation.

Torres sued the defendants for allegedly failing to provide a proper accounting, embarking upon a scheme to misappropriate business opportunities and funds, and negotiating loans of over $5 million without proper authorization.

Named as defendants in Torres’ lawsuit are E-Land World Ltd., Suwaso Corp., MRI., and Dennis Seo.

In 2012, Marianas Resort Inc. and Yusuke Fumoto agreed to sell his 85 percent ownership interest in Suwaso to MRI. Torres remains a minority shareholder of Suwaso stock, holding a 15% ownership interest.

Torres originally filed the suit in the Superior Court. The defendants then asked to transfer the lawsuit to the District Court. The defendants also asked the District Court to compel all Torres’ claims to arbitration before the American Arbitration Association.

In April 2017, U.S. District Court for the NMI Chief Judge Ramona V. Manglona granted Torres’ motion to remand the case to the Superior Court as to his four remaining claims.

Manglona granted the defendants’ motion to compel arbitration as to Torres’ first cause of action, fraudulent misrepresentation.

Robert T. Torres, Lee H. Rubin, and Justin I. Park are counsel for the defendants. (Ferdie De La Torre)