In August 2020, Asia Pacific Airlines, a subsidiary of Tan Holdings Corp.,  sued Mercury GSE for failing to deliver  two cargo loaders.

Mercury, represented by attorney Sean Frink,. stated that the lawsuit incorrectly named the defendant Mercury GSE, Inc. instead of just “Mercury GSE.”

Frink asked the court to issue an order dismissing the lawsuit due to lack of personal jurisdiction and improper venue.

He said Mercury “simply has had no contact with the Commonwealth of the Northern Mariana Islands much less the purposefully established ‘minimum contacts’ required by the U.S. Constitution.”

The plaintiff essentially admits this, Frink said, by “making no real allegations of Mercury’s contact with the CNMI in its complaint.”

He said the “plaintiff instead appears to rest its jurisdiction and venue argument wholly on the facts that [the] plaintiff, a Guam corporation, regularly does business in the CNMI and is owned by a CNMI corporation and that [the] plaintiff claims that it intended to use the equipment it was to purchase from Mercury in the CNMI as well as other locations in the Western Pacific region.”

Frink said jurisdiction over a defendant is determined by looking at the defendant’s contacts with the jurisdiction (or lack thereof), not the plaintiff’s.

“Because Mercury has no contacts with the CNMI, and never intended to have any contacts with the CNMI, jurisdiction over Mercury does not exist,” the lawyer said.

Similarly, the venue for this matter before this court is improper because Mercury has had no contacts with the CNMI, Frink added.

“Respectfully, the entire case should, therefore, be dismissed for lack of jurisdiction and improper venue over Mercury,” Frink said.

“If the court does not grant either of Mercury’s motions to dismiss for lack of jurisdiction or improper venue, Mercury seeks  transfer of this matter to the United States District Court in Los Angeles, California, which is the United States District Court nearest to defendant’s home office,” he added.

Asia Pacific, through attorney Steven Pixley, sued Mercury GSE alleging breach of contract, restitution, and conversion.

Asia Pacific is demanding a jury trial and is seeking damages and the return of $144,000 that the plaintiff said it paid for security deposit.

The complaint also asks the court to award Asia Pacific pre-judgment and post-judgment interest, costs and other awards as permitted by law; and for such other and further relief the court deems just and proper.

The lawsuit stated that on or about June 25, 2018, Adam Ferguson, president of Asia Pacific, met with James Spiegel, a sales representative employed by Mercury GSE, and Bob Travis, its chief operating officer in Torrance, California to discuss the purchase and repair of two 2000 FMC Commander 15 cargo loaders.

They also discussed the repair of a used Lantis Loader KL-206 and the shipment of this cargo loader from the Seattle airport to Mercury GSE’s Santa Fe Springs facility.

On July 24, 2018, Spiegel sent an email to Adam Ferguson offering to sell two cargo loaders “fully serviced, repaired and painted” for $165,000 each, Pixley said.

On July 26, 2018, Spiegel sent an email to Ferguson wherein he represented that Mercury GSE would sell the two cargo loaders “refurbished and painted for $160,000 each.” Furthermore, Spiegel represented that “this work will start after the beginning of September once we have completed the move. We estimate the lead time of 8-10 weeks for the completion of both units. We are requiring a 45% deposit to start work on all orders.”

The email discussed the costs of rebuilding the Lantis Loader KL-206, the lawsuit added.

In reasonable reliance upon the representations of Mercury GSE, Pixely said on July 27, 2018, Asia Pacific wired the sum of $158,028 from its Bank of Guam account to Mercury GSE’s account in Hawthorne, California.

“The amount of $144,000 from the wire transfer was expressly identified as security deposit for the two cargo loaders. The remaining $14,028 was payment for shipping costs for the Lantis Loader KL-206,” Pixley said.

On May 20, 2019, Adam Ferguson spoke with Mercury’s CEO regarding the status of the two cargo loaders.

Following this telephone conversation, Ferguson learned that no work had been done on the two cargo loaders and that upon information and belief the two cargo loaders had been sold to a third party, Pixley said.

Since then, he added, the parties have attempted to resolve the matter. However, to date, he said Mercury has failed to return the deposit and is maintaining the legal position that no enforceable contract existed between the parties.

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