Court dismisses IPI suit vs. CCC and Palacios

The U.S. District Court for the NMI has granted the notice to dismiss Imperial Pacific International (CNMI) LLC’s lawsuit against the Commonwealth Casino Commission and Gov. Arnold I. Palacios.

Chief Judge Ramona V. Manglona granted Tuesday IPI’s notice to dismiss without prejudice its lawsuit against CCC and Gov. Palacios. That means the case can be refiled at a later time if the plaintiff chooses to do so.

IPI filed its notice of dismissal last Tuesday. The plaintiff did not mention why they have decided to drop their case, but a separate Saipan Tribune article about a recent Commonwealth Casino Commission meeting quoted CCC executive director Andrew Yeom as saying that IPI has agreed to drop its two lawsuits against CCC and others as they are in the middle of settlement talks, which Yeom has said is “making progress.”

In her order, Manglona stated that pursuant to the Federal Rules of Civil Procedure, the plaintiff has the right to voluntarily dismiss an action if their complaint isn’t answered by the opposite party.

“IPI filed its notice of dismissal pursuant to federal rule of civil procedure…to dismiss all claims without prejudice. [The rule] permits a plaintiff to voluntarily dismiss an action without a court order by filing a notice of dismissal before the opposing party serves either an answer or a motion for summary judgment. Generally, such dismissal is without prejudice unless the notice states otherwise. Here, defendants have neither filed an answer nor a motion for summary judgment. As such, pursuant to plaintiff’s notice of dismissal…plaintiff’s claims in this matter are hereby dismissed without prejudice. The Clerk of Court is directed to close this action,” states Manglona’s order.

The original lawsuit showed IPI suing Gov. Arnold Palacios, CCC chair Edward C. Deleon Guerrero, vice chair Rafael S. Demapan, CCC commissioners Mariano Taitano, Martin Mendiola, and Ramon M. Dela Cruz, and CCC executive director Andrew Yeom in their official and personal capacities.

In it, IPI alleged that CCC and the CNMI administration deprived the casino investor of its constitutional rights by requiring it to pay “excessive and unlawful fees.”

IPI claimed in its amended complaint that, acting under the color of Commonwealth law, the defendants caused it to suffer a substantial deprivation of its contract rights, in violation of the U.S. and Commonwealth constitutions.

“The regulatory fee statute imposed additional fees for doing business in the CNMI, which constitutes a substantial and unconstitutional impairment of the Casino License Agreement. IPI was and is still required to pay the $3-million annual regulatory fee as a prerequisite to exercising its existing contractual and property rights set forth explicitly in the CLA, rights for which it already has compensated [the] CNMI. In essence, defendants are double-charging IPI. The annual regulatory fees are substantial, and the impairment to the express and implied terms of the CLA is direct. The later imposed regulatory fees, Commission Order 2021-002, and the most recent demand for immediate payment by defendants effectively nullify the explicit terms of the CLA and impose completely unexpected and new liabilities and limitations on the operation of IPI. IPI has incurred and will continue to incur attorney’s fees and costs because of these proceedings, in amounts that cannot yet be ascertained,” IPI argued.

The defendants did not file a response as it was supposed to last Jan. 26.