ATTORNEY Michael Chen told the federal court that Imperial Pacific International has no income and has no funds in its bank accounts.
On Tuesday, IPI responded to Joshua Gray’s petition asking the District Court for the NMI to issue an order to show cause why it should not enter an order holding IPI and its executive director, Howyo Chi, in contempt for not complying with a previous order.
IPI requested the court to deny Gray’s petition.
IPI’s former director of operations, Gray successfully sued the company for racial discrimination and wrongful termination.
Represented by attorneys Aaron Halegua and Bruce Berline, Gray was awarded by the federal court a total of $5.68 million in compensatory and punitive damages.
After the court allowed Gray to participate in the receivership proceedings, he applied for a writ of execution, which the court granted.
Gray wants an order to show cause directing IPI to compensate Gray for the liquor stolen from the casino; impose a daily fine of $10,000 until IPI complies; incarcerate Chi if IPI’s noncompliance persists; and direct IPI to pay Gray reasonable attorneys’ fees and costs resulting from its disobedience.
But according to Chen, since the closure of its casino operations in March 2020, IPI has had very limited resources and no income.
“To maintain security at Imperial Pacific Resort, IPI has been borrowing funds to pay the current security guards,” Chen said.
“IPI has great difficulties in finding a lender who is willing to extend any credit to IPI to cover its ongoing operating expenses. IPI has no funds in its bank accounts. IPI has no liquid assets other than assets which are under the control of Clear Management,” Chen added, referring to the court-appointed limited receiver.
He said “IPI is paying $8.25…per hour for the security guard. It would cost at least $47,520…to hire eight security guards 24/7 for 30 days. IPI has no financial resources to fund this level of security.”
The only party that disobeyed a specific and definite court order is Clear Management, IPI’s attorney said.
“Clear Management has not yet complied with the court’s specific order to file the supplemental inventory list, in spite of its own commitment to do so,” Chen said.
Moreover, he said, the “alleged loss of the liquor was not due to the security measures provided by IPI since Clear Management had exclusive control over the liquor.”
“The cause of the loss of the liquor may never be known. To ask IPI to compensate plaintiff for the loss of the liquor is to ask IPI to be the insurer of the loss, that is beyond the scope of the court order where IPI is asked to provide security only,” he added.
IPI has done everything possible to comply with the court order, Chen said.
“IPI has exhausted all available assets within its control and even borrowed funds in order to comply with the court order, IPI has taken all reasonable steps within its power to comply with the court’s order to fund the security of the subject property. IPI reserves the right to petition the court to order the limited receiver and plaintiff to reimburse the costs for providing security, which benefits plaintiff only,” he added.
“The mere possibility that a third party, including the parent company of IPI, its shareholders, officers, and directors, may chip in to help IPI financially from time to time is not a ground to find IPI in contempt if IPI is unable to convince such third party to extend a loan to cover certain expenses when IPI itself cannot do so with its own assets,” the lawyer said.
IPI’s parent company, Imperial Pacific International Holdings Ltd., has been ordered by the High Court of Hong Kong to be “wound up” with a provisional liquidator appointed, according to GGRAsia, a Macau-based website and newsletter that reports on the Asian gaming industry.
On Saipan, IPI’s casino license has been suspended since 2021 and the Commonwealth Casino Commission, which will meet on April 22, is seeking to revoke it.
