E-Land World Co. Ltd., the majority shareholder of Coral Ocean Point Golf Resort, and three others who are being sued by attorney Vincent DLG. Torres, are asking the federal court to compel all his claims to arbitration before the American Arbitration Association.
E-Land World Co. Ltd., Micronesia Resort Inc., Suwaso Corp., and Kwang Won Seo, through counsel Richard W. Pierce, said the arbitrator should decide any dispute on Torres’ claims.
Pierce asked the U.S. District Court for the NMI to dismiss Torres’ lawsuit in its entirety.
In the alternative, Pierce said, the court should stay the lawsuit pending the resolution of the arbitral proceedings, if any, brought before the American Arbitration Association.
If the lawsuit is stayed, Pierce said, the parties should submit to the court a joint report as to the status of the arbitration proceedings.
Pierce said Torres is legally bound by the broad arbitration agreement in the Purchase and Sale Agreement of Capital Stock of Suwaso Corp.
The agreement, Pierce said, was executed on Aug. 23, 2012, and amended on Oct. 12, 2012, by Yusuke Fumoto, an individual residing in Japan, and Micronesia Resort Inc., an entity incorporated under the CNMI laws.
Pierce said Torres negotiated the agreement on behalf of Fumoto.
The agreement, he said, effectuated the transfer of a majority ownership interest in Suwaso Corp. from Fumoto to Micronesia Resort Inc.
Pierce said Fumoto, however, continues to be the record holder of a minority interest in Suwaso Corp.
Thus, Pierce said, the agreement is commercial in nature and not entirely between citizens of the United States, and is governed by the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.
Pierce cited that Article 2 of the New York Convention declares that a court “shall, at the request of one of the parties, refer the parties to arbitration, unless it finds that the said agreement is null and void, inoperative or incapable of being performed.”
Pierce said Torres’ claims against defendants trigger the very broad, mandatory provision in the agreement that, according to
Torres’ own complaint, he personally negotiated to make defendants his business partners to save his investment in Suwaso Corp. and to procure other benefits for himself and Suwaso’s shareholders.
Pierce said unhappy with the agreement’s aftermath, Torres filed the lawsuit against defendants and sought to resolve this international dispute by jury trial in the Superior Court.
Pierce said the agreement underlying Torres’ claims, however, contains a sweeping arbitration clause that renders any judicial forum an improper venue.
Pierce recently filed the corporate disclosure statements for his clients—E-Land World Co. Ltd., Micronesia Resort Inc., and Suwaso Corp.
According to Pierce, E-Land World Co. Ltd. has no parent corporation.
Pierce said the Micronesia Resort Inc. is owned by non-party E-Land Park Ltd. and by Sompo Japan Nipponkoa Insurance Inc.
The lawyer disclosed that E-Land Park Ltd. owns a majority of Micronesia Resort Inc.’s shares, while Sompo Japan Nipponkoa Insurance Inc. owns the minority remainder of Micronesia Resort Inc.’s shares.
Pierce said Suwaso Corp. is owned by Micronesia Resort Inc. and by Torres and a non-party individual.
Pierce said the Micronesia Resort Inc. owns majority of Suwaso shares, while Torres and a non-party individual are the other shareholders of record.
The lawyer said no publicly held corporation owns 10 percent or more of the stock of any of the entities.
Torres sued E-Land World Co. Ltd., Suwaso Corp., Micronesia Resort Inc., and some of its current and former directors and employees for allegedly failing to provide a proper accounting, embarking upon a scheme to misappropriate business opportunities and funds, and negotiating loans over $5 million without proper authorization. The case was originally filed in the Superior Court.
The defendants moved to transfer the lawsuit to the U.S. District Court for the NMI.