January 09, 2009

The Kaselehlie Press

Palikir, Pohnpei - The company that won the bid to handle FSM infrastructure projects has asked for a court injunction to halt action on the 29 infrastructure projects in the FSM in response to a civil complaint filed against them by the FSM government.

In January of 2008 the FSM government notified GMP and Associates by letter that they were terminating the company's contract for cause. During the same month they fi led a civil action (2008-004) against the corporation for breach of contract amongst other claims.

In October of 2008 GMP filed its response to the suit and added a counterclaim against the FSM and Robert Wester field in his official capacity as contracting officer's representative for the Department of Transportation, Communication, and Infrastructure.

The FSM, in its 105 page response to GMP's counterclaim, filed in December of 2008, lists at least four reasons why they say Wester field cannot be sued by GMP. The first is a procedural problem in GMP's filing of the counterclaim which required them to fi le a third party complaint on him and to serve him with a summons. The other three reasons they list involve immunities Wester field has as a function of his position. They say he cannot be sued because he is an individual acting on behalf of the US Government with respect to the activities of a recipient of US Compact Grant money.

GMP, for their part, complained that their rights were violated by both Westerfield and the FSM government both under civil statutes and under the FSM Constitution.

The GMP counterclaim listed 12 causes for action the last of which asks the court to keep FSM from hiring other contractors to do the work it was hired to do (they are seeking an injunction). It says that the FSM's actions in wrongfully terminating the contract between GMP and FSM are "causing great and immediate irreparable injury. If the FSM is permitted to continue on its course of actions in terminating the services of GMP pursuant to the contract and replacing GMP with one or more engineering firms and duplicating the work and payments thereto, such actions will cause delay in the fiscal year funded 04-05-06 projects, (and) increase the costs of those projects harming not only GMP but harming the four State Governments and the general public."

The FSM government in its response and motion to dismiss the counterclaim says that the request for an injunction comes too late as the actions have already been taken. They say that injunctions are used to preserve the status quo, to keep things the way they are. GMP waited too long to file their motion for injunction because the FSM has already hired other contractors to do GMP's work.

The FSM further argues that the request for injunction does not meet any of the four tests required before an injunction can be issued. A plaintiff requesting an injunction must show that if an action is allowed to proceed they will suffer irreparable injury. FSM argues that the Supreme Court has already determined by precedent that loss of profits and contract money damages are not irreparable damages.

GMP must show that the public would benefit by the issuance of an injunction. The FSM attorney says that the public interest favors the continuation of all of the Compact infrastructure development projects.

If the court does grant an injunction GMP would be required to put up a very large bond or provide other security. The FSM says that since GMP is requesting to block all public infrastructure projects in the FSM the amount of the bond would likely be enormous.

GMP says that besides the monetary damages it has sustained due to the cancellation of the contract by the FSM, it continues to sustain damages to its reputation. The counterclaim says that FSM and Wester field initiated the publication in The Kaselehlie Press of false, defamatory, and misleading information that was in a US Department of Interior Office of the Inspector General (DOI OIG) memorandum released on July 31, 2006. It says that the defendants knew that the material was erroneous when they released it. They have claimed libel and slander against the FSM and Wester field.

FSM argues that the FSM government did not write or publish the Memorandum which is the subject matter of the complaint. Wester field was not even hired by the FSM Government at the time of publication and had nothing to do with it. The FSM claims that "everything in the DOI OIG memorandum is true" and that truth is an absolute defense against a defamation case.

Many laymen would find the court filings to be complex as did The Kaselehlie Press. The Kaselehlie Press did not obtain all of the paperwork surrounding the case but what we did obtain stands 3 inches tall. The FSM's response to GMP's counterclaim is 105 pages long they say because rather than simply give precedent citations they explained the rulings they refer to in their arguments in an attempt to avoid confusion.

GMP and Associates says that their rights have been violated and that they have been severely damaged by the actions of Wester field and the FSM.

The FSM says that their claims should be dismissed because they raise "unjusticiable political questions." Their filing spends several pages explaining that concept though the Justices at the Supreme Court quite likely understand the concept well.

Essentially, the political question doctrine means that a court will not hear a case when the issues raised are committed to another branch of government by the Constitution. For instance, Foreign Affairs is a function of the Executive and Legislative Branches of the FSM government, not the Judicial Branch and the court will not interfere in matters of foreign affairs.

The FSM government said in a summary of their "brief" that "most of all of GMP's causes for action are based upon 1) the 'termination' of the Contract for Consulting Services by the US Department of the Interior when it wrote to the FSM Government and stated that no more Compact grant money could be used to fund the GMP Contract and 2) the internal US Government memo written by DOI Office of Inspector General which was critical of the FSM Government and GMP's contract."

It says among other things that the FSM Supreme Court does not have jurisdiction, authority or power to grant GMP's requests because it cannot tell the US Department of the Interior to fund GMP's contract. It says that the US Government is an indispensable party to the claims of GMP which cannot be named due to the terms of the Compact treaty. "Therefore, based on Rule 19, the matter should be dismissed because it is unfair to litigate this case against the FSM Government when it was the US Government which pulled the plug on funding GMP's contract and wrote the alleged defamatory memorandum."

All parties in the complicated case before the court have a great deal at stake. The case has in no way been decided at the FSM Supreme Court.