Court rules IPI bankruptcy stay does not cover missing liquor case

Judge Ramona V. Manglona has ruled the missing liquor was no longer part of IPI’s debtor estate.

Northern Mariana Islands.- The US District Court for the Northern Mariana Islands has ruled that Imperial Pacific International (IPI)’s automatic bankruptcy stay does not apply to a civil contempt proceeding involving stolen liquor bottles. Chief judge Ramona V. Manglona noted that, when the bankruptcy was filed, the stolen liquor was no longer part of IPI’s property.

The dispute over the stolen liquor came from a petition filed by Joshua Gray, an IPI creditor, against the company and its executive director, Howyo Chi. Gray, a former IPI director, won US$5m after suing the company for discrimination and wrongful termination. His petition sought to hold IPI and Chi in contempt for the stolen liquor as well as a daily fine of US$10,000 for non-compliance and legal fees. 

The court’s ruling deemed the contempt proceedings to be outside the scope of the automatic stay, allowing them to proceed independently. Clear Management was appointed as the limited receiver for the sale of IPI’s property, including liquor inventory. Gray’s petition claimed that IPI did not ensure proper security for the liquor, leading to theft. However, IPI has argued that the receiver was responsible.