Imperial Pacific International’s Saipan casino exclusivity still pending
Imperial Pacific International (IPI) has been at loggerheads with the Commonwealth of the Northern Mariana Islands (CNMI) for years over the exclusivity of its casino on Saipan. A recent ruling by the Supreme Court of the Northern Mariana Islands shows that no one in this farce that has been going on for more than five years knows how to take a stand.
Local media outlet Marianas Variety reported this week that the Supreme Court of the Northern Mariana Islands has ruled that IPI no longer has a certain level of casino exclusivity. This echoes previous court decisions and may help resolve the ongoing controversy surrounding the Palace Casino, which has been vacant for years.
However, the decision is not a complete victory for the Commonwealth of the Northern Mariana Islands and the Commonwealth Casino Commission (CCC). The Supreme Court also found that the gambling regulator had made some errors in doing so and that IPI could regain its exclusivity if it settled its outstanding debts.
Near the end of the flagpole
Just over two years ago, the CCC suspended IPI's license (even though the Forbidden City was not operating) after missing several mandatory payments. Ultimately, the troubled casino operator will owe regulators hundreds of millions of dollars, and failure to do so will force the CCC to cease operations.
Meanwhile, IPI also owes millions of dollars in legal claims, exacerbating the situation and forcing regulators to take action. The casino operator challenged the CCC’s decision to suspend its license. But the Northern Mariana Islands Supreme Court ruled in favor of the regulator.
However, this did not stop IPI from continuing to fight, and the case reached the Supreme Court. In its ruling last week, the Supreme Court ruled that while the regulator was right to take action, it should also comply with an amendment to the gaming contract that resulted in IPI taking longer to make certain payments.
This extension allows operators until 2025 to balance their mandatory Community Benefit Fund, the account through which wages are paid to certain government employees. At the same time, the court ruled that CCC must give IPI more time to pursue any outstanding payments.
The IPI argued that COVID-19 was the cause of the palace's closure, but other judges disputed this. However, the Supreme Court ruled that there was a case of "force majeure" on the part of the operator. Although the legal and tax issues began long before the pandemic.
This is despite the U.S. Court of Appeals for the Ninth Circuit ruling siding with the CCC. It is therefore clear that there is no consistent explanation for the IPI casino contract or its devastating impact on the CNMI.
The future is still uncertain
IPI does not currently have a valid license with the CNMI. That could change if it finds a way to pay off all its outstanding debt. Given that many of the Palace's assets have been "moved away" to pay off some of its debts, the casino is still far from reopening.
CCC is trying to get more money from IPI, which may be as difficult as any other attempt. The company will reportedly have to pay an additional $100,000 in costs related to the ongoing legal case and has asked the Northern Mariana Islands District Court to intervene.
The money was reportedly withheld by the court as a deposit that IPI must pay if regulators begin legal proceedings against the company. With the CCC having to close offices, lay off employees, and operate on a non-existent budget, it needs all the help it can get to stay afloat.
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Source: www.casino.org
