Saipan Tribune

Sunday, May 26, 2013

Friday, March 22, 2013

Wiseman vacates injunction order vs PPA contractor SDLLC

Superior Court Associate Judge David A. Wiseman yesterday ruled that the court lacks the power to stop the actions of Saipan Development LLC, the Delaware-based contractor of a controversial $190.8 million power purchase agreement it signed with former governor Benigno R. Fitial.

Wiseman vacated the preliminary injunction he issued in August 2012 against Saipan Development LLC. That injunction stopped Fitial and co-defendants, including SDLLC, from “continuing, pursuing, and/or performing on the power purchase agreement.”

In the same order yesterday, Wiseman amended the preliminary injunction to exclude SDLLC and set out the scope of the injunction.

The amended injunction now applies to just Fitial, Attorney General Joey P. San Nicolas, the Commonwealth Utilities Corp., and their officers and agents. It bars them from performing on the Aug. 3, 2012, power purchase agreement and all associated agreements.

Wiseman prohibited Fitial, San Nicolas, and CUC from spending funds to further the performance of those agreements, including any expenditure related to designing and building a new power substation.

Wiseman enjoined Fitial, San Nicolas, and CUC from increasing CUC rates so it could raise revenue to perform on the power purchase agreement.

The judge still included Fitial in the injunction as the Office of the Attorney General's motion to substitute the CNMI government for Fitial as defendant remains pending.

The Senate, Rep. Janet U. Maratita (IR-Saipan), and Sen. Ray A. Yumul (IR-Saipan) are suing Fitial, San Nicolas, CUC, and SDLLC over the alleged illegal PPA and sought a preliminary injunction to stop it.

Wiseman granted the preliminary injunction on Aug. 31, 2012.

On Dec. 3, 2012, SDLLC, through counsel William Fitzgerald, filed a motion to vacate the preliminary injunction, arguing that the court lacked personal jurisdiction.

In his order yesterday, Wiseman said SDLLC, a private company, is neither a government entity, nor an instrumentality of the CNMI government and that it has no power or ability to spend public funds and no fiduciary duty to taxpayers.

“As such, the court lacks power to enjoin the actions of SDLLC,” said Wiseman in vacating the preliminary injunction as to SDLLC.

With respect to the injunction against Fitial, San Nicolas, and CUC, Wiseman said the plaintiffs have shown a likelihood of irreparable harm.

The judge said should CUC be forced to build a power substation, the cost to the ratepayers, many of whom are taxpayers, would be extremely difficult to calculate.

“This is because of the human costs associated with having no electricity. Given the high price of power in the CNMI, and the struggling economy, this concern is not merely speculative,” Wiseman said.