Lawyer: IPI pleads poverty when asked to comply with court orders  

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AARON Halegua, one of the two attorneys of seven construction workers who have sued Imperial Pacific International LLC, is asking the federal court not to grant the motion of IPI to set aside the default judgement against it.

IPI said it is willing to pay all outstanding sanctions, but needs time to pay.

According to Halegua, however, while “IPI seemingly has funds to hire new lawyers to defend itself in other matters and to engage a new Electronically Stored Information or ESI vendor, IPI pleads poverty when it is asked to comply with any of the [previous] orders in this case.”

Halegua said IPI has yet to comply with orders to produce responsive emails, produce mobile phone data, or produce WeChat or WhatsApp messages.

“Nonetheless, after plaintiffs expended more than 500 hours preparing their damages submission for a default judgement, IPI now recycles the arguments already rejected by this court to request that the default be set aside,” Halegua said.

He said the only bases that IPI provides for setting aside the default are (1) its compliance with two court orders not even mentioned in the Order to Show Cause — to produce paper documents from 53 boxes and to produce bank statements — and (2) that it lacked the funds to comply with the court orders.

Halegua said production efforts of IPI are hardly impressive. IPI needed an extension of time to produce documents from the boxes, most of which are of marginal relevance and many of which were previously produced, he added.

As for the bank records, Halegua said: “It took numerous court hearings even to get statements and checks for just a two-year period, and thousands of the checks it produced are not even legible. IPI’s arguments about its inability to pay have already been rejected, and it offers no reason to upset the court’s decision.”

IPI  fails to establish the “good cause” required under Rule 55(c) to set aside a default, Halegua said.

“Specifically, whereas IPI must satisfy its burden of establishing three factors to demonstrate good cause, IPI has not met its burden for even one factor. IPI did not demonstrate that it lacked culpability. IPI has not adequately articulated a coherent, potentially meritorious defense; instead, it mostly offered general denials. IPI has not shown that plaintiffs are not prejudiced by the lost evidence and

witnesses,” Halegua said.

Therefore, he added, the motion of IPI fails and should be denied.

Halegua said the IPI argument that it “acted expeditiously” is without merit and does not warrant setting aside the default.

The court found that the “extreme sanction” of a default was warranted by persistent noncompliance of IPI, and IPI has offered no compelling reason to reconsider this finding Halegua added.

“If anything, IPI’s behavior since the entry of default, such as ignoring the court’s order to pay Litigation Edge while engaging a new vendor, or ignoring court orders to investigate the unsigned letter delivered to the court, further underscore the appropriateness of that sanction,”  Halegua said.

The lawyer was referring to a letter on the IPI letterhead stating that Chief Judge Ramona V. Manglona should recuse herself from  cases involving IPI.

At a hearing on June 26, the court ordered IPI attorney Michael Dotts to obtain an answer as to whether or not IPI issued the unsigned letter.

On June 12, 2020, Judge Manglona entered a default judgment against IPI for its “repeated failures to comply with discovery orders.”

Represented by Halegua and attorney Bruce Berline, the plaintiffs in the lawsuit are Tianming Wang, Dong Han, Yongjun Meng, Liangcai Sun, Youli Wang, Qingchun Xu, and Duxin Yan.

They have asked the court to award them $3.86 million in compensatory damages and $7.72 million in punitive damages.

IPI and its former contractor and subcontractor MCC International Saipan Ltd. Co. and Gold Mantis Construction Decoration (CNMI) were sued by the plaintiffs for forced labor, negligence, and liability for employees of subcontractors.

The plaintiffs were employed by MCC and/or Gold Mantis.

 

 

 

 

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