AG instructed to drop Marisco case appeal

Gov. Lolo Matalasi Moliga has instructed the Attorney General to withdraw, or seek a dismissal in the government’s appeal pending at the federal court relating to more than $800,000 the American Samoa Government owes the Honolulu based Marisco Ltd. Additionally, the AG is to seek to dismiss or withdraw any legal actions still pending in the High Court of American Samoa against Marisco or Bank of Hawai’i and “to cease further objections to the garnishment by Marisco of ASG funds held” at BoH, according to a statement released late yesterday morning by the governor’s office. “The Lolo and Lemanu Administration intends to honor the government’s obligations, whether arising from contract or court order,” said Lolo in the media statement. “We will stop the practice of using the courts to help manage the government’s cash flow.”Early last December, ASG appealed with the U.S. Ninth Circuit of Appeals in San Francisco two orders of the Honolulu federal court in the legal battle between ASG and Bank of Hawai’i. ASG is appealing the lower court’s order to garnish $811,000 held by BoH in the ASG account as well as the court’s order to deposit the garnished funds into the federal registry of the court. The garnish amount was the Honolulu federal court judgement against ASG for failure to pay services provided by Marisco, who sought a garnishment order, arguing that ASG has a history of not paying its debts. The federal appeal’s court record does not show when the cases are to be heard and Marisco plans to demand its payment, saying that the company will no longer negotiate the outstanding judgement. ASG’s two separate lawsuits against BoH remain pending in the High Court following an order by the Honolulu federal court barring ASG and its representatives from any further proceedings on this matter until the federal appellate court issues a ruling. ASG had argued in documents filed with the Honolulu federal court late last year, that it’s the High Court of American Samoa, and not the federal court, that has jurisdiction over the ASG bank account, which was opened at BoH in Utulei. Lolo told lawmakers last month that of the total $10.33 million in legal liability obligations — including court judgements — $835,788 is owed to Marisco. (The judgement for Marisco also calls for an interest rate set by the court based on federal law)Since late last year some lawmakers believe that actual ASG expenses involved in this case should be around $2 million, if attorney fees — for those who represented ASG at the federal level — are added to the Marisco debt. A law firm in Hawai’i is representing ASG in the Marisco case and it remains unclear as to the total amount of money the government has paid in attorney fees, which were initially paid by the Attorney General’s Office. The governor said in the media statement yesterday that the Marisco debt is the first of many past due obligations owed by the government that his administration will be dealing with in the coming weeks and months. “In this time of financial uncertainty we can’t immediately address all the past due obligations of the government,” he said. Lolo has instructed the ASG Treasurer to work on finding available funding to support supplemental appropriations.“...I have asked the Attorney General, where possible, to try to negotiate settlements that can be met through periodic payment plans, taking into account the government’s cash flow,” he said. ASG’s largest known legal obligation is $7.94 million to Progressive Insurance Inc., the insurer of the old Laufou Shopping Center destroyed by fire several years ago. The High Court ruled in favor of the insurance company, who sued ASG for negligence. The High Court judgement is $6 million plus post judgement.

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