July 25, 2008 — A dispute over potentially tens of millions of dollars in V.I.-related money has been moved, for the moment, to Great Britain's Privy Council by an American court in Miami.
The argument is between the Central American nation of Belize on one side and Jeffrey Prosser, former owner and CEO of Innovative Telephone — and his creditors — on the other. (See "Prosser and His Creditors Win a Round in Belize.")
Each side says the other owes it millions as a byproduct of Prosser's failed effort to secure control of the monopoly phone company in what used to be British Honduras. The government says that it was not paid in full for shares in the company purchased by Prosser, while Prosser's lawyers say Prosser lost millions when he was wrongly denied control of the local phone company. Both sides allege other damages, as well.
Money raised from the sale of preferred stock in Vitelco played a key role in the operation.
The contending parties fought each other in both the U.S. courts and in those of Belize. Recently the U.S. Court of Appeals for the 11th Circuit remanded the American case back to the federal district court in Miami, where it had first been argued.
On July 24, a federal judge in Miami ordered a delay of action in U.S. District Court there until action is taken by the Judicial Committee of the Privy Council, the supreme court for many former British colonies. The London body, a subset of the historic House of Lords, is sometimes called the Law Lords. In making the stay, Judge Ursula Ungaro noted that an appeal is pending from a court decision in Belize.
In its decision, the U.S. appeals court discussed the importance of U.S. courts paying attention to overseas decisions before making American rulings on such matters.
Bankruptcy lawyers on all sides of the Prosser bankruptcy cases are following the Belize situation, but none are involved in it — at least not yet.
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