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Recycling company denies accepting stolen construction materials

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FSM Recycling Corp. has denied the accusation of Imperial Pacific International that FSMRC accepted construction materials stolen from the IPI warehouse and resold them for profit.

FSMRC also filed a counterclaim against IPI for business disparagement, invasion of privacy, placing the company before the public in a false light, and abuse of process.
IPI, through attorney Robert J. O’Connor, filed its complaint in Superior Court on March 20, 2020 and named as defendants FSMRC, its principals Fnu Cha and Eric Cruz; Ricky Reyes; and 15 other John Does.

IPI sued the defendants for conversion and has asked the court to award it damages in an amount to be proven at trial as well as punitive damages in excess of $50,000, including attorney’s fees and costs.

The complaint stated that around “Feb. 2020 FSMRC, Cha Cruz, Reyes, and unnamed defendants formed a conspiracy to steal construction materials belonging to IPI from its warehouses, and to sell or recycle stolen items through FSMRC for monetary gains.”

According to the lawsuit, “in furtherance of the conspiracy, Reyes broke into one or more of IPI’s warehouses located in Tanapag, cut the padlock on at least one of the containers stored there, stole construction materials (including without limitations, copper fixtures and spools of copper wire) from the containers, and then put a new padlock on the containers to cover up the break-in.”

Reyes then allegedly transferred possession of the stolen items to the recycling company.

On March 20, 2020, IPI sent its agent to FSMRC’s office and met with Cha and Cruz who denied ever receiving items stolen from IPI, and refused to let the agent of IPI inspect FSMRC’s storage space.

In response to the lawsuit, FSMRC attorney Robert T. Torres “denies the formation, existence, and execution of any criminal conspiracy to commit theft, receive stolen property or civil conspiracy for conversion or any other tort.”

Citing CNMI laws and regulations, Torres said FSMRC maintains records of its purchases, and with regard to materials offered for sale that are made of or combined with copper, the company follows a procedure to document each purchase.

Torres said, “FSMRC reports all copper purchases to the Department of Commerce on government required forms…complying with all regulations governing the sale, purchase, and shipping of recycled and copper materials and has never before been accused of a single violation.”

He said FSMRC does not accept copper from all sellers, especially if
the copper “offered for sale is new; if the copper does not appear to have been used; or if the copper originated from the Commonwealth Utilities Corp.”

Torres said, “to the best of its knowledge, FSMRC has never accepted copper for purchase from IPI or its personnel, copper from the IPI hotel project, or any other IPI-related project.”

Torres said on March 30, IPI attorney O’Connor was allowed to meet with the FSMRC owner “on the false pretense that he wanted to do scrap business.”

After admission into the office, O’Connor then disclosed that he had not come as a purchaser, but on behalf of IPI regarding copper wire, which FSMRC purchased from persons who had stolen it from IPI. O’Connor demanded to look for them in FSMRC’s lot.

O’Connor told Cha that an IPI employee reported that FSMRC purchased copper wire from persons who had stolen it from IPI.

O’Connor also told Cha that if he did not agree to the inspection IPI would sue his company.

Cha denied taking IPI’s property and asked the IPI attorney to provide him a list of items, a bill of lading for the materials, and some photos of the alleged stolen items.

Cha told O’Connor to bring the documents on March 23 with a Department of Public Safety officer.

But on March 23, O’Connor did not come and no DPS officer arrived at the lot, Torres said.

He added that at no time up to the present had any police officer come to investigate any report of copper wire theft sold to FSMRC beyond the complaint of IPI’s attorney.
FSMRC also sued Reyes for defamation.

Torres said Reyes on March 23 prepared a handwritten statement that stated that in early 2020, he and another individual would cut approximately 10 feet of copper wire from spools owned by IPI and take the wire to FSMRC where he alleged that Cha would pay him somewhere between $120 and $130.

Reyes said he brought 10 feet of wire about six times to FSMRC and most of the sales took place in February 2020 and always during daylight.

FSMRC denies Reyes’ allegations, Torres said, adding that his client also wants the court to deny IPI’s request for relief.

FSMRC said the court should rule in its favor and award it actual punitive damages, and attorney’s costs and fees.

In addition, FSMRC wants a retraction from Reyes and for the court to refer him to the Attorney General’s Office for criminal prosecution.

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