IPI says investor will deposit $5.59M to pay Pacific Rim

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IMPERIAL Pacific International, LLC is requesting the federal court to allow its investor to deposit $5,599,975 in a CNMI bank to secure the payment of judgment issued by the court in favor of Pacific Rim Land Development, LLC.

IPI has appealed the judgment so it is also asking the  court “to enter an order restricting the bank account designated to secure Pacific Rim….”

Should IPI prevail on the appeal, its attorney, Michael Dotts, said the funds can be released back to the investor, Pacific International Property Management LLC.

Should Pacific Rim prevail on the appeal, then all restrictions placed on the funds can be lifted and Pacific Rim will have been fully paid, Dotts added.

At the same time, Dotts said, IPI is also opposing Pacific Rim’s request for an order authorizing it to auction IPI’s gaming machines and vehicles.

Dotts said if Pacific Rim’s motion is granted “[it] will cause irreparable harm to IPI.”

There is now a better alternative, he added.

“IPI now has an investor who has placed on deposit $5,599,975.00 in a CNMI bank and who is willing to allow this account to be used or transferred to secure payment of the judgment pending appeal,” he said.

This way Pacific Rim is fully secured, and no more harm needs to be done to IPI’s business in the process of Pacific Rim executing on its judgment, Dotts said.

He added that many of the vehicles are used daily by IPI’s remaining employees.

“The value of the vehicles as carried on IPI’s audited books is about $6,000,000,” Dotts said. “The hope of IPI is that they will produce at auction 25% of that ($1,500,000). A more realistic estimate of what will be obtained is about $300,000. When IPI reopens many of the vehicles that Pacific Rim seeks to have auctioned off will need to be replaced, and this could be difficult for IPI both financially and logistically.”

As for the sale of IPI’s heavy equipment, Dotts said it could “result in the delay of construction and possibly render completion impossible. Replacement of heavy equipment will be particularly difficult as it is logistically difficult to ship such equipment to Saipan.”

Regarding IPI’s gaming equipment, Dotts said it will likely be sold at only a fraction of its cost because casinos are closed worldwide, and there is no market for this equipment.

“The gaming equipment is carried on IPI’s audited books at a value of more than $20,000,000, but the best estimate is that will sell for $2,000,000. No one but IPI can legally own it on Saipan so it will all need to be sent away. To reopen, IPI will have to purchase all of its gaming equipment again,” Dotts said.

He added that the court should also reconsider its denial of the motion for stay of execution pending appeal.

“When the first motion for a stay pending appeal was filed IPI had no cash on hand to offer as security…. IPI has now the cash…IPI has now that other security.”

Reconsideration is appropriate here, Dotts added.

Pacific Rim, through attorney Colin Thompson, recently moved the court for an order for turnover, assignment, and judicial sale of IPI’s gaming machines and heavy equipment and vehicles for the purpose of reducing the judgment amount entered against the casino investor.

Pacific Rim said the balance due on the judgment is not less than $5,525,363.98.

Pacific Rim sued IPI for breach of contract for refusing to pay $5.65 million for substantially completed or completed agreed-upon construction work for the IPI casino- resort project on Sept. 30, 2018. 

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