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Couple appeals case’s dismissal to 9th Circuit
The owners of Victoria Hotel in Garapan have appealed the federal court’s dismissal of their racketeering lawsuit against a bank in Guam to the U.S. Court of Appeals for the Ninth Circuit.
Jesus T. Lizama, his wife, Victoria L.G. Lizama, and their J&JEV Enterprises Inc., through counsel Juan T. Lizama, filed their notice of appeal on Friday.
The appeal seeks to reverse the court’s dismissal of their lawsuit against ANZ Guam Inc., formerly known as Citizens Security Bank (Guam) Inc., which the Lizamas accused of operating in the CNMI without a license.
U.S. District Court for the NMI Chief Judge Ramona V. Manglona had dismissed the Lizamas’ seventh cause of action—violation of the Racketeer Influenced and Corrupt Organizations Act—citing failure to state a claim.
In a 22-page order granting ANZ Guam’s motion to dismiss, Manglona declined to exercise supplemental jurisdiction over the Lizamas’ remaining state law claims, saying the RICO claim provided the sole basis for the court’s original jurisdiction over the lawsuit.
The lawsuit stems from foreclosure proceedings brought by ANZ Guam against the Lizamas, and J&JEV Enterprises in the CNMI Superior Court.
Manglona said the plaintiffs’ entire RICO claim is premised upon the assertion that ANZ needed a full-service banking license in the CNMI when it executed the mortgage agreement in Guam and instituted foreclosure proceedings in the CNMI.
“ANZ did not need a full-service CNMI banking license when it executed the mortgage agreement in Guam and, in fact, had one when it instituted foreclosure proceedings over the CNMI real properties,” the judge pointed out.
The Lizamas and ANZ entered into a loan agreement in Guam on Jan. 9, 1997. ANZ agreed to loan the Lizamas $1.8 million, with 1.75 percent interest, to build the Victoria Hotel in Garapan.
The loan was converted into a business loan in 1999, together with a promissory note in the increased amount of $1.99 million.
When plaintiffs defaulted on the loan, ANZ tried to foreclose mortgage against plaintiffs in the Superior Court in June 2000.
In 2001, the Superior Court issued an amended default judgment and order directing the Lizamas to pay ANZ $2.2 million in principal and interest.
ANZ, through counsel Joyce Tang and Robert T. Torres, moved to dismiss the racketeering lawsuit.
