Page Airways, Inc. was a New York corporation that maintained its principal offices in Rochester, New York. Page's common stock was registered with the SEC and traded in the over-the-counter market. Page was the world-wide distributor of the Gulfstream II, an executive jet aircraft manufactured by Grumman Corporation, and derived substantial revenues from its aircraft outfitting and sales operations which were closely coordinated with Grumman sales efforts.
James P. Wilmot was, and at the time of the filing of the Complaint had been for over 20 years, the Chairman and Chief Executive Officer of Page and a Director since 1939. Gerald G. Wilmot was, and at the time of the filing of the Complaint had been for over 10 years, the President and Chief Operating Officer of Page and a Director since 1941. Douglas W. Juston was the Executive Vice President of Page and the individual in charge of Page's Gulfsteam II sales operations. He was a Director of Page since 1971. Ross C. Chapin was named President of Page's wholly-owned subsidiary, Page Gulfstream, Inc., in 1971 and was a Vice President and Director of Page since 1973. James P. Lawler was the Chief Financial Officer of Page since 1967. T. Richard Olney commenced employment with Page in 1968 as a Vice President of the company. In 1973, Olney terminated his employment with Page, but returned in 1975 as Vice President of Page Gulfstream.
According to the allegations in the Complaint, from at least 1971 to 1978, Page acting as the sole distributor and principal outfitter for Gulfstream II aircraft and the individual defendants participated in cooperative sales efforts with Grumman Corp. and its affiliates and employees to sell Gulfstream II aircraft throughout the world. In connection with these sales efforts, the defendants made direct and indirect payments to government officials and employees in Gabon, Malaysia, Ivory Coast, Saudi Arabia, Morocco, and Uganda. During this time period, more the $2.5 million in payments were made in connection with over $60 million of sales of goods and services by Page.
On April 12, 1978, the SEC filed a four count Complaint in the District of Columbia against Page, J. Wilmot, G. Wilmot, Juston, Chapin, Lawler, and Olney alleging three counts of securities fraud and one count of violations of the books & records provisions of the FCPA. Though the complaint alleges the payment of over $2.5 million in bribes on $60 million in sales revenue, the single FCPA count applies only to the conduct in Uganda. This appears to be because the other instances of bribery occured before the enactment of the FCPA in 1977. Thus, only the conduct in Uganda, which occured between 1975 and 1978, would be illegal under the FCPA. On November 18, 1978, the venue was moved from the District of Columbia to the Western District of New York. On April 8, 1980, Page entered into a settlement agreement with the SEC. Without admitting or denying the allegations in the Complaint, Page consented to the to entry of a permanent injunction prohibiting the company from further violations of Section 13(a) and 14(a) of the Exchange Act and to retention of an independent monitor. Futhermore, under the terms of the agreement, the SEC also stipulated to the dismissal with prejudice of the charges against all the individual defendants. It was further noted that the SEC considered the concerns raised by another U.S. government agency regarding matters of national interest.
