Guam – Superior Court Judge Michael Bordallo has taken a temporary restraining order filed by DFS Guam over the controversial Guam Airport concession contract under advisement.
Attorneys for DFS, winning bidder Lotte Duty Free and The Guam Airport Authority duked it out in court today. DFS continued to maintain that the contract was improperly awarded, while Lotte argues otherwise.
DFS Attorney Maurice Suh began by accusing both Lotte Duty Free and Guam International Airport Authority of conspiring against DFS to get them out of the aiport and get Lotte in. He makes this allegation on three separate points in the form of protests that have already been filed with the airport.
The first, he notes, is the alleged bribe that took place when Lotte gave about $300 in makeup and a bag to airport board members. The second is when Lotte allegedly improperly increased it’s proposed MAG rent after it had already submitted its original proposal and the third is on lack of operating procedures.
“The body, the government agency that is responsible for evaluating fairly those bids for the public’s benefit, is [usually] not involved. Unfortunately the allegations and what the evidence show, through the tapes, transcripts and actually what occurred is that at the very least the airport had some involvement in what Lotte was trying to do,” argues Suh.
“Unfortunately the evidence is showing that there is at least some effort or some willingness to turn a blind eye towards what Lotte has done here,” he adds.
But even Judge Bordallo says he found it implausible that a mere $300 gift is evidence that a conspiracy took place that would entice the airport to award a potential $15 billion contract over 10 years to Lotte. Suh acknowledges that, however, he says that it also ties in with protests two and three. He also points out that while Lotte has claimed that they would suffer more harm and injury if a TRO is granted, DFS, on the other hand, won’t be able to recover at all from potential harm if the TRO is denied.
“This is not a financially motivated or driven lawsuit. It’s a lawsuit driven by the fact that DFS really wants to maintain the integrity of this process and to not suffer the very injury related to being ostensibly kicked out for failing to have provided a service or quality of service to the people of Guam and the travelers of Guam,” says Suh. “That injury, even if we were to prevail later on and seek damages for it, that injury we, can’t recover from and that injury really is what we are seeking to prevent.”
Guam Airport Attorney William Herbert, however, denies the conspiracy charge. He also informed Judge Bordallo that there was nothing unlawful about the way the contract was awarded. He explains that the Airport evaluating committee chose Lotte as the appropriate winner and in fact, hired an independent expert consultant Lee, Fisher and Associates to analyze the proposals.
“This was the first competitive bid for the duty free concession in 30 years. The revenue, this non airline revenue, is extremely important for the airport,” Herbert points out. “They hired Lee, Fisher and Associates which is a worldwide airport consultant, one of the best in the world. Lee Fisher took the four proposals and did a financial comparisaon. Based upon proposals themselves, the interviews and that independent financial analysis, which did not by the way, take into account this alleged increase MAG number and looked at the $13 million MAG number, Lotte came out on top,” Herbert argues.
However, DFS later disputed that claim. Citing the Lee Fisher report themselves, Suh quotes certain portions of the report that purportedly considered the increased mag number of $15.4 million into their choice for the winning bidder.