THE Calvo & Clark law firm yesterday asked the CNMI Supreme Court to intervene in the Bank of Saipan proceedings, saying that the receivership case “is out of control.”
Calvo & Clark, on behalf of Bank of Saipan, Inc., filed a separate motion in Superior Court that requested Presiding Judge Edward Manibusan to stop the receivership proceedings pending the Supreme Court’s action.
Meanwhile, Bank of Saipan’s major shareholders former Guam Gov. Paul M. Calvo, Thomas J. M. Calvo and Edward M. Calvo are claiming that they had already paid $210,000 last May 17 to the bank through its temporary receiver, attorney Randall T. Fennell.
The Calvos said B.D. Montgomery paid them $1.5 million through the bank for the purchase of their stocks. But the Calvos said they had “problems” giving the balance of $1.3 million to the bank because of another claim.
In court papers filed in the Supreme Court, attorney Robert Goldberg of Calvo & Clark described the state of the receivership proceedings as “shocking.”
Goldberg asked the Supreme Court to issue an order mandating Manibusan to remove Fennell as temporary receiver, vacate all the judge’s orders and appoint a “non-conflicted” temporary receiver.
Goldberg cited the “private briefing” of Manibusan by Fennell despite the bank’s written objections.
Fennell is a “seriously conflicted temporary receiver working in unlawful collusion with the government,” Goldberg claimed.
“The result is a massive denial of due process and fundamental fairness likely to shock the conscience of the (Supreme Court),” Goldberg said.
Attorney Rodney J. Jacob, also of Calvo & Clark, asked the Superior Court to stop all the hearings and preserve the status quo in the receivership pending the high court’s action on their petition.
A receivership hearing was set for today at 10 a.m. before Manibusan.
On Nov. 16, 2001, the Calvos entered into a stock purchase agreement with Montgomery to sell their shares of stock for $18 per share for a total of $1,546,758.
Montgomery was among four persons later indicted in federal court for allegedly conspiring to defraud the bank of over $6.6 million.
On Dec. 3, 2001 the Calvos were paid $1,546,758 by Montgomery through the bank and JLH, another major shareholder, also received $2,041,128 on that day.
Attorney Perry Inos said that although the Calvos initially believed the money was paid by Montgomery, they subsequently learned that Montgomery had only deposited $3.1 million into the bank.
Inos said that last May 17, the Calvos paid $210,000 to the bank through its receiver, Fennell.
Inos said his clients had terminated the stock purchase agreement and continued to hold their shares.
The Calvos are willing to pay the bank $1,336,758 as balance of the money they received from Montgomery for the purchase of their stock, Inos said.
However, the lawyer said, they are faced with competing and inconsistent claims.
David Schmidt, through attorney Timothy H. Bellas, has demanded $700,000 from the money paid to the Calvos by Montgomery.
Schmidt is an investor of UFX, a brokerage company in California. UFX claims that the $3.1 million deposited into the bank by Montgomery was its money fraudulently obtained.
