ASEDA moves for dismissal of bond complaint filed by three faipule
Pago Pago, AMERICAN SAMOA — The American Samoa Economic Development Authority (ASEDA) has filed a motion to dismiss the complaint for declaratory relief filed by three faipule in the Trial Division of the High Court this week.
Assistant Attorney General Alexandra Zirschky representing the ASEDA, the defendant in this case, filed the motion. Private attorney Thomas Jones of Thomas B. Jones and Associates is representing the plaintiffs: Reps. Larry S. Sanitoa, Andra T. Samoa, and Vesiai Poyer S. Samuelu, of Tualauta District #15; Fofo District #13; and Pago Pago District #9, respectively.
The plaintiffs’ complaint concerns approximately $50 million in bonds issued by ASEDA in late 2018 to fund government projects. The Series 2018 Bonds were issued to fund the Hawaiki broadband internet cable, and the Fono reconstruction project. After 20 days of prior public notice, which included the intended uses of proceeds, it passed without objection, and the bonds were brought to market. The plaintiffs’ lawsuit was filed nearly a year later.
ASEDA is now moving for immediate dismissal of the complaint, asserting that the Court lacks subject matter jurisdiction to entertain the plaintiffs’ action because the plaintiffs, who are individual legislators with no particularized injury, lack standing to commence such action.
ASEDA argues that the plaintiffs’ claims are moot, their requested relief cannot legally or practically be effectuated, and the claims are untimely, as the plaintiffs failed to object within the prescribed time period.
Further, plaintiffs have also failed to state a claim for which relief can be provided by this court, according to ASEDA, adding that the underlying claims fail to relate to any recognized cause of action, and are inappropriate for declaratory relief.
It also argues that ASEDA’s actions were expressly authorized by the legislature, the defendant claims, adding that ASEDA is a non-justiciable entity entitled to the protections of sovereign immunity.
THE COURT HAS NO SUBJECT MATTER JURISDICTION
Plaintiffs cannot maintain any claim for relief without standing, ASEDA argues. “A party has no standing to sue without an injury-in-fact, or a direct stake in the controversy. A plaintiff must have a substantial, direct, and immediate interest in the suit.”
ASEDA says the plaintiffs “did not plead, nor can they show that as private citizens, they were affected by ASEDA’s action in a manner distinct from all other territorial residents. Thus, they must demonstrate legislative standing to proceed.”
According to ASEDA, given the general standard for standing, both the High Court and the U.S Supreme Court have taken a narrow view of “legislative standing”. Individual legislators can rarely demonstrate a sufficiently particularized injury when objecting to action by the executive branch.
ASEDA was statutorily created by the Fono to fund specific initiatives, spur economic growth, and meet government obligations, claim the defendants. ASEDA’s authorizing statute begins by vesting ASEDA with “comprehensive and extensive powers.” These powers expressly include the power to “refinance or refund any existing obligation of the Territory or Government,” and to “provide for financing of facilities for agencies of the government.”
The legislature went so far as to grant ASEDA the following authority: “(d) The Legislature finds that the public policies and responsibilities of American Samoa as set forth in this section cannot be fully achieved or attained without the use of public financing and that such public financing can best be provided by establishing the ASEDA, vesting it with comprehensive and extensive powers herein to provide financing or refinancing for housing projects, agricultural businesses, industrial enterprises, commercial enterprises, utilities, health care facilities, educational facilities, government facilities and other facilities, and to acquire real property wherever situated to promote and develop the extension of existing employment and the establishment of new agricultural business, industrial enterprises, commercial enterprises, residential housing, health care facilities, educational facilities, facilities for agencies of the government, and any other facility, and that all of the foregoing are public purposes and uses for which public moneys may be borrowed, expended, advanced, loaned, and granted.”
CLAIMS ARE BARRED BY THE STATUTE LIMITATIONS
ASEDA says the plaintiffs’ claims are untimely, as they failed to bring their claims within 20 days of publication of the bond notice. To protect ASEDA issued bonds, the legislature adopted a narrow statute of limitation to bring any claims that challenge either the bonds or the provisions made for payment of the bonds.
ASEDA points out that on Nov. 23, 2018, a “Notice of Bonds To Be issued” was broadcast on KVZK-TV. Subsequently, on Nov. 26, 2018, a corrected “Notice of Bonds To Be Issued” was published in Samoa News.
Once the bonds are sold, the government is bound by covenants to the purchased and by the restrictions of A.S.C.A 11.1909, ASEDA points out. “…Plaintiffs have structured their complaint to loosely obscure the fact that they are directly challenging the legality of ASEDA’s Series 2018 Bonds and repayment plans, by claiming they challenge ASEDA’s abuse of the general budget process.”
According to ASEDA, plaintiffs’ claims are now moot, and accordingly must be dismissed, as the court cannot effectuate the requested relief. Furthermore, plaintiffs’ requested relief cannot be granted because it is in direct conflict with the ASEDA statute.
The Series 2018 Bonds have been issued, and substantial portions of the revenue derived from the sale were spent prior to Dec. 31, 2018, to finance the projects identified in the bond disclosure documents. “The court cannot order the relief because it directly conflicts with another statue. If ASEDA were ordered to comply with the Budget Procedure Act with respect to the bond revenues, the Fono could substantially adjust or disapprove the allocation of any remaining revenues for the previously issued Series 2018 Bonds.”
FAILURE TO STATE A CLAIM
ASEDA says the plaintiffs have failed to state a claim upon which relief can be granted, because the legislature granted express authority to ASEDA to take the actions the plaintiffs allege. The Representatives allege no violation of contractual obligations or tortious action, but rather, that ASEDA has operated outside of their legislature mandate.
“The Plaintiffs reach this conclusion by pleading that ASEDA violated the Budget Procedure Act. By a plain reading of the law as excerpted above, in conjunction with the facts pled, ASEDA was legislatively authorized to sell bonds, allocate the revenues, and expend bond monies without the interference the Representatives seek,” ASEDA argues.
ASEDA is therefore moving to have the matter dismissed immediately.
A hearing is set for Nov. 26th.