Image by Alexander Schimmeck

Imperial Pacific Claims to Have “Insufficient Funds” to Pay Debts by March 1

Article by : Helen Feb 15, 2021

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Updated: Dec 20, 2021

It’s the same old story: the court orders Imperial Pacific to pay its debts, but the Chinese-owned investment holding company claims it has no money to do so.

The U.S. District Court for the NMI Chief Judge Ramona Manglona ordered Imperial Pacific to settle its $1.3 million debt to former workers – as the company agreed to do by signing a consent judgment in 2019 – and pay its current employees what they are owed ($788,022.54). If the company fails to meet the deadline (March 1), Judge Manglona will appoint a receiver to collect and sell its assets to cover the expenses.

According to the court’s ruling, Imperial Pacific will also have to establish an escrow fund and deposit $800,000 to it in order to ensure future employees get paid on time even if the company is in financial trouble.

As per usual, the company’s attorney, Michael Dotts, told the court that “IPI lacks funds to make the deposit that the U.S. Department of Labor has requested” by March 1 and requested a payment plan. As for the escrow fund, he stated that “no agreement has been reached” regarding the deposit.

Yet just a day after Dotts’ statement made the news, Imperial Pacific was reported to plan to dismantle one of its cranes at the Garapan construction site to gain access to a $2.3 million crane litigation fund. The crane litigation fund is currently deposited with the CNMI Superior Court. Judge Manglona allowed this despite the stop-work order that is still in force, stating that the order is forbidding “work on the improvement, construction, and development of the IPI hotel-casino only.”

Imperial Pacific’s attorney, apparently, did not know about the company’s plans to get their hands on the crane litigation fund. He claimed he found out about crane removal because the leader of Imperial Pacific’s subcontractor team, Glenn Bell, filed a notice for the court regarding the works.

The U.S. Department of Labor isn’t the only one demanding Imperial Pacific to pay its debts. Xerox Corp Saipan went to court against the company on December 23, 2020, because it failed to pay for the services and equipment Xerox provided to Imperial Pacific.

Even though Imperial Pacific was notified about the lawsuit on December 31, 2020, the company didn’t respond with a plea or a motion within the time limit established by federal law. So, Xerox has asked the court to enter a default judgment on the matter and require Imperial Pacific to pay $182,905.88 in damages plus late charges and interest. The court is yet to issue a ruling on the case.

To add insult to injury, Imperial Pacific parent company’s chair may be found in contempt once more. Cui Li Jie has reportedly evaded a subpoena to provide necessary documents in a lawsuit filed by seven construction workers.

Their attorneys claim that, although Cui Li Jie didn’t make a presence for a deposition at their office on January 26, Imperial Pacific’s executive sent one of them intimidating text messages threatening “legal trouble” and demanding him to take back the subpoena. The following day, an Imperial Pacific employee returned the document to the attorney’s office.

Should the court rule in favor of the attorneys’ request to find Cui Li Jie in contempt again, she will be fined $10,000 per day as a contempt sanction. Cui Li Jie, together with Imperial Pacific International and its parent company, Imperial Pacific International Holdings, was found in contempt because they failed to act on the consent judgment to pay its former workers more than $2 million that they were owed.