Posted on: August 18, 2022, 07:17h.
Last updated on: August 18, 2022, 10:59h.
Imperial Pacific International (IPI) is no closer to figuring out how to keep control of the Imperial Palace casino in Saipan. As a result, a previous court order to auction assets in order to pay down its debt is back in motion.
A Commonwealth of the Northern Mariana Islands (CNMI) court approved an asset sale last year. It appointed Clear Management as a legal receiver as IPI’s unpaid debts mounted.
However, IPI then won a legal reprieve to halt the sale. It asserted that it was negotiating financing deals that would make all its troubles disappear. That still hasn’t happened, and Clear Management could soon begin accepting bids for Imperial Palace casino equipment, according to Marianas Variety.
IPI’s Unending Pattern of Neglect
After IPI won its stay against the sale order — in place since March of last year — Clear Management had to put its auctions on hold. The embattled casino operator owes more than $100 million to the CNMI, as well as millions more in outstanding private debts and lawsuit settlements.
One lawsuit was with USA Fanter Corporation, which carried out construction work at Imperial Palace. After IPI didn’t pay its bills, the company sued for compensation and won a judgment of $2.1 million.
The saga becomes more convoluted at that point. But CNMI Chief Judge Ramona Manglona has lifted the stay that prevented Clear Management from holding its auctions. This is after IPI has failed to show that it has secured the $150 million in financing it promised months ago.
Clear Management can now list the items that it was previously going to offer through a series of six auctions. IPI has two weeks to object to any item listed, with Manglona having the final approval on all objects.
The lack of evidence showing that IPI is closer to finalizing the funding deal could cost it even more. There’s a possibility that it could soon permanently lose its casino license in Saipan.
CNMI Finds Funding
The inability of IPI to pay its debts has resulted in financial pressure for the CNMI year after year. As of this October, if the company doesn’t find money, it will be in arrears for more than $103 million.
The US-controlled territory counted on that money for a number of programs. One is a fund for government retirees, of which the government provides 100% of the money. Some 25% of it comes from the money IPI should pay through its $15-million licensing agreement and other considerations with the CNMI.
The government found a way last year to cover the difference. However, it was going to come up short for the next rounds.
Lawmakers have figured it out. Marianas Variety reported yesterday that the Senate president, Jude U. Hofschneider, has promised that the government will cover the full 100%.
CNMI Governor Ralph DLG Torres has the legal authority to reroute certain monies. As a result, the retirement fund is going to be covered fully for the last three quarters of the current fiscal year.