TRO vs Managaha access placed under advisement

After a marathon two-day hearing, Superior Court associate judge Joseph N. Camacho placed yesterday under advisement the bid of five marine sports operators to prevent the Department of Public Lands from barring them access to Managaha Island.

Camacho said he will issue a decision on the matter “with the highest priority.”

Marine sports operators are asking the court to bar DPL from prohibiting them from picking up customers on Managaha unless they are Tasi Tours or its subcontractors.

Representatives of these marine sports operators testified yesterday that they will be forced to shut down their business following DPL’s decision to prohibit them from picking up customers on Managaha for their tours.

Tasi Tours, however, claimed that when these marine sports operators take customers off Managaha for banana boat and parasail tours, the company’s average profit loss is $1,477 per day. Tasi Tours also stated that the average daily profit loss for its subcontractor, Advance Marine Saipan Inc., is $1,930.

In his closing arguments, Mark Scoggins, counsel for five marine sports operators, said that Tasi Tours should be ashamed for trying to kill his clients’ businesses by monopolizing access to Managaha.

In the first place, Scoggins said, Tasi Tours should not have been allowed to intervene in the lawsuit since it is purely an administrative matter. He pointed out that DPL flipped-flopped on this issue four times.

Tasi Tours’ lawyer, Rexford Kosack, said the silent defendants in this case are people of NMI descent who are stakeholders in the Tasi Tours’ agreement with DPL.

Kosack said that DPL simply restated the regulations, which have been in existence for over 18 years. He said DPL told the marine sports operators to stop their activities on Managaha because there is a concession agreement between Tasi Tours and DPL for exclusive rights to all commercial concessions on the island.

Camacho allowed Tasi Tours to intervene in the lawsuit on Monday, saying it is proper for Tasi Tours to intervene as it satisfies the four-element test of intervention.

Camacho granted a TRO last week at the request of five marine sports operators: Island Marine Sports Inc., Aquatic Marine Co. Inc. doing business as Amigo Aquatic Sports, Automarine Inc., Seahorse Inc., and BSEA Inc. The five are suing DPL to invalidate the department’s rule promulgated on Dec. 13, 2011 and June 14, 2012.

On Monday’s hearing, Kosack argued that if Tasi Tours is not permitted to intervene, it will be forced to file a lawsuit against each of the plaintiffs for intentional interference with contract and file a lawsuit against DPL for breach of contract.

Kosack said the plaintiffs are seeking to nullify Tasi Tours multi-million dollar contract with the government or DPL.

“This is a lawsuit that affects substantial rights, involves complex contracts, and affects multiple parties,” Kosack said.

Scoggins argued, however, that the lawsuit does not throw Tasi Tours’ contract out the window but is a very simple Administrative Procedure Act case against DPL for improperly changing the rules and Tasi Tours’ interests are not impaired in the lawsuit.

Scoggins described Tasi Tours as a bully that is intimidating and trying to run his clients out of business. “They want a monopoly of marine sports.”

Scoggins said they believe that there’s political pressure on DPL. “It appears to us in the beginning there’s a political pressure,” he added.

David Pangelinan, president and owner of Island Marine Sports, testified that he has been in marine sports for 30 years and that this was his first time to hear about this DPL regulation.

The 73-year-old Pangelinan said if DPL continues enforcing the regulations he may close the business. “Why should I continue the business when it’s losing?” he asked.

Before DPL regulation, Pangelinan said they used to have 40 to 50 customers a day. After the DPL rule, he said they are lucky to have four or five customers a day.

Pangelinan said he invested $600,000 in their company and that if he had known about the DPL rule, he would not have engaged in the business.

Pangelinan stressed that they never do business or recruit customers on Managaha.

Manuel Alvarez of Seahorse Inc. testified that DPL’s rule will have a big impact on the company’s operations. “If the rule stands I have to reduce my employees,” said Alvarez who has been in business for 26 years.

He said they have invested $900,000 in their business and that he would not have done so if he knew that DPL would change the rule.

The marine sports operators want the court to issue a judgment declaring the DPL rule and interpretation invalid for failing to follow the requirements of the Administrative Procedure Act and to issue an order finding DPL’s interpretation of its concession agreement unenforceable.

Marine sports tour operators provide services such as jet ski rental, parasailing, banana boating, and other activities.

Scoggins said the five companies have engaged in Managaha to Managaha water sports for many years, some for 20 years or more.

Ferdie De La Torre | Reporter
Ferdie Ponce de la Torre is a senior reporter of Saipan Tribune. He has a bachelor’s degree in journalism and has covered all news beats in the CNMI. He is a recipient of the CNMI Supreme Court Justice Award. Contact him at

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