Commonwealth Casino Commission board chair Edward Deleon Guerrero is skeptical about an investor that has put up $5.59 million as a security deposit on behalf of Imperial Pacific International (CNMI) LLC when the latter’s mother company in Hong Kong is not willing to do that.
“Why would a third party put its own resources when the parent company [of IPI] is not willing to do the same?” Deleon Guerrero asked IPI chief executive officer Donald Browne during the CCC board’s monthly meeting.
He also asked if Browne has a copy of the agreement between IPI and the investor, Pacific International Property Management LLC, which put up the $5.59 million in an investment portfolio for the purpose of securing a stay and paying on the court’s judgment in connection with a contractor’s lawsuit against IPI.
Deleon Guerrero is baffled whether the $5.59 million is an investment or a loan and if this deal would allow IPI to open up a bank account.
In response, Browne said they operate in an investment community where some believe in them and some don’t and that the agreement between IPI and PIPM is a matter of public record. He said that IPI lawyer Michael Dotts will present to CCC whatever documents they submitted in court relating to the agreement between IPI and PIPM.
Browne did say that the money is a loan or a pledge. “We’re not using it for anything. It’s just sitting in an account,” he said.
Browne said the whole theory behind this deposit from PIPM is that IPI needs a bank account. “It’s not our money. The money pledged on our behalf would help our operation now. Is there just going to be $50 million that jumps into the account? I would highly doubt that,” he said.
However, he said, that pledge would prepare them for funds to be delivered so they don’t have to go to other people to pledge money on their behalf.
PIPM is not owned by IPI. Right now, there is no other available information about the company’s background.
With PIPM’s deposit as a security fund, U.S. District Court for the NMI Chief Judge Ramona V. Manglona last week denied IPI’s former contractor Pacific Rim Land Development LLC’s request to auction IPI’s assets to satisfy the court’s $5.52 million judgment.
Pacific Rim is suing IPI and five unnamed alleged co-conspirators for breach of contract (construction and promissory note), and unjust enrichment.
Pacific Rim claimed to have substantially completed or completed the agreed-upon construction work at the casino on Sept. 30, 2018.
IPI then brought counterclaims against Pacific Rim for promissory fraud, fraud in the inducement as to the promissory note, violation of Consumer Protection Act, and breach of contract.
IPI then filed an amended lawsuit against Pacific Rim for promissory fraud, fraud in the inducement as to the promissory note, breach of contract, and unjust enrichment.
IPI counsel George Hasselback alleged, among other things, that due to the delays associated with the unworkmanlike performance of Pacific Rim, IPI lost approximately $89,342,352 in operations revenue at the casino.
Last April 27, Manglona entered a judgment in favor of Pacific Rim in the amount of $5.65 million against IPI for breach of promissory note. She later amended the judgment to incorporate pre-judgment interest and attorneys’ fees. The clerk then entered an amended judgment in the amount of $6.9 million plus post-judgment interest.
Last July 15, Manglona issued an order granting Pacific Rim’s motion to release to Pacific Rim IPI’s $1,383,869 that was seized through writs of execution.
Pacific Rim counsel Colin Thompson said the judgment remains unsatisfied in the amount of $5,525,463.