U.S. District Court for the NMI designated Judge Frances Tydingco-Gatewood wants to resolve the issue on whether the NMI Settlement Fund is a tax-exempt entity.
Tydingco-Gatewood also wants to hear Settlement Fund trustee Joyce C. H. Tang’s motion to enforce final judgment approving Betty Johnson’s class action settlement agreement against Northern Marianas College.
The judge ordered that the matters be set for hearing on Tuesday, March 8, at 9am.
NMC counsel may appear at the courthouse on Saipan.
Tydingco-Gatewood said she will hold the hearing by video teleconferencing.
The issues were originally set for a hearing last Jan. 21, but because of the judge’s scheduling needs, the proceeding was vacated.
According to Tang and Johnson’s class counsel, Robert M. Hatch, the Settlement Fund is tax-exempt because the settlement agreement in the class action expressly provides for the appointment of a “person to act as an officer of the District Court to be the trustee of the Settlement Fund.”
Tang said the audit for the Settlement Fund for fiscal year 2014 by Ernst & Young began in January 2015 and has been completed.
However, Tang said, because of a disagreement between the CNMI government and the Settlement Fund on the tax issue, the completion of the audit has been delayed.
The Office of the Attorney General asked the court to hold off on deciding the tax issue, saying it should refer that decision to the director of Revenue and Taxation.
However, if the court proceeds with deciding the issue, the CNMI government’s position is that the Settlement Fund is a tax-exempt entity, according to assistant attorney general Teresita Sablan.
On the NMC issue, the college is opposing Tang’s request to compel it to comply with the settlement agreement in Johnson’s class action by paying employer contributions and penalties in the amount of $75,080.79.