Oct. 27, 2005 – After a series of reverses in five different mainland courts, Jeffrey Prosser‛s Innovative Communications Company has struck back against one of its adversaries with a $200 million suit filed against its longtime lenders, the Rural Telephone Finance Cooperative, a Virginia-based nonprofit bank.
(See "Prosser's Adversaries Win in Another Mainland Court").
ICC owns the Virgin Islands telephone system that, in turn, is one of the territory's largest employers.
That suit was filed in the Virgin Islands Federal District Court, according to ICC; the press release did not mention the location of the filing.
The release said that the suit had been filed against both RTFC, and two of its officers. It stated: "the suit accuses them of maliciously using the courts for improper purposes with an agenda of destroying one of its borrowers of good standing and current on all loan payment obligations."
The release continued: "this is an extraordinary case in which a lender filed claims against one of its best borrowers when it knew the charges had no merit and the only purpose was to ruin Innovative by publicizing allegations to prevent it from disclosing RTFC's mismanagement and possible fraud, said Lanny Davis of Orrick, Herrington & Sutcliffe, attorneys for Innovative."
The Washington-based Davis had been one of President Clinton‛s lawyers during the efforts to impeach him.
In earlier press statements ICC has said that RTFC, which grew out of New Deal efforts to spread electricity and phone service to rural America, was not really a nonprofit. Except for ICC‛s charges, the media have not reported any other allegations about RTFC activities.
RTFC has a major lawsuit pending in the V.I. Federal District Court seeking the repayment of the $500 million plus it has lent to ICC, charging that the latter had violated a number of terms of the loan agreements. It also has a lesser lawsuit, for $10 million, pending against ICC in the U.S. District Court, Eastern District of Virginia.
The $200 million in damages, incidentally, is the same amount of damages that ICC is seeking in an international arbitration proceeding in Toronto. That case is against the Central American nation of Belize. ICC had sought to purchase the monopoly phone company of that nation, had secured control of it for a while, and then lost it when the government seized the firm following ICC‛s nonpayment of $57 million to complete the purchase. Many legal suits followed in Miami, in Belize, and, on appeal, in Atlanta.
The arbitration case had been blocked by a lower court decision in Belize enjoining the government from participating in it. On October 26 ICC appealed that decision to a higher Belize court.
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