THE litigation between the Commonwealth Ports Authority and Star Marianas Air Inc. will continue despite the CNMI senators’ mediation efforts.
On Thursday, CPA and Star Marianas appeared before Superior Court Associate Judge Joseph N. Camacho who heard CPA’s motion to dismiss Star Marianas’ complaint.
In December 2020, Star Marianas filed a complaint alleging breach of contract against CPA. Star Marianas also alleged that CPA imposed “excessive charges not based on fair market value.”
The airline likewise accused CPA of “economic discrimination” for failing to provide an analysis of its landing fee charges between fiscal years 2009 and 2014.
Attorney Joe Hallahan argued the motion for CPA while Mark Scoggins represented Star Marianas.
Judge Camacho took the matter under advisement and directed each party to submit proposed order/rulings by May 28, 2021.
CPA said Star Marianas owed the ports authority over $2.5 million in enplanement and miscellaneous fees as of March 19, 2021.
Last month, the Senate leadership attempted to bring CPA and Star Marianas together and come up with a settlement agreement. The senators were concerned about the impact of the dispute on residents who travel between Saipan, Tinian and Rota.
Reneging
Three days before the motion hearing, CPA, through its attorney, Robert Torres, accused Star Marianas of “reneging on its sign of good faith.”
Torres said during the meeting with the senators, Star Marianas owner Robert Christian expressed willingness to engage in settlement discussions and mediation with CPA.
But Torres said Star Marianas is also demanding an audit of CPA prior to mediation.
According to the lawyer, CPA believes that Star Marianas is attempting to use the audit as a premature discovery request in the pending litigation to tee up its damage claim against CPA.
Torres said CPA responded that it would treat Star Marianas’ demand for the audit as a request under the Airline Use Agreement, and would be amenable to such an audit.
He said CPA also called for a settlement conference anytime from April 5 to 9.
But he added that Star Marianas would only meet with CPA if CPA provides the airlines with an audit report, saying that the information from the audit would “assist in refining the computation process to provide a mutually acceptable accounting process regarding CPA’s rates.”
For its part, CPA asked Star Marianas to confirm that it understood that the purpose of mediation would be for settlement of the issues agreed upon by the parties, specifically, the $2.5 million that Star Marianas owes to CPA; and that mediation would not be used as a forum to revise CPA’s rates and methodology, Torres said.
CPA accepted Star Marianas’ gesture of “good faith” to continue the hearing on April 15, 2021, and sent a draft stipulation to continue the hearing for 45 days.
On April 11, 2021, Star Marianas said the stipulation was sufficient and its officials would review CPA’s letter.
Less than 10 minutes later, Torres said Star Marianas requested CPA to hold off on filing the stipulation to continue the motion hearing.
On the morning of April 12, he said, Star Marianas advised CPA that it had decided to proceed with the motion hearing.
Torres said this was “in direct contradiction to Star Marianas’ promise that it would stipulate to continue the motion hearing as a sign of its good faith in order to give mediation an opportunity to succeed and to minimize further legal expenses for both sides prior to mediation.”
He said, “CPA takes Star Marianas’s reneging of its ‘sign of good faith’ as a reneging of all of Star Marianas’ claims that it wishes to engage in mediation in good faith. Again, disappointingly, but unsurprisingly, Mr. Robert Christian’s claims in the Senate meeting on March 23, 2021, that Star Marianas wanted to engage in mediation with CPA in good faith were insincere and disingenuous.”
