Boeing

Business the island way

AFTER SEVEN YEARS OF TRYING, a Canadian businessman has won a multimillion-dollar judgment in a federal lawsuit that spawned international criminal investigations into allegations of bribery and kickbacks by the Boeing Co. in the Bahamas. But both the businessman and Boeing are appealing the Florida court decision.

Aircraft executive Craig Dobbin, who alleged that Boeing put him out of business by using illegal tactics to undercut his plane sales, had sought $900 million but was awarded only $2.8 million. (See "Awkward Partner," SW, 3/20/96.) He's appealing for more money; Boeing doesn't want to pay any.

The case dates to a loan-default and foreclosure dispute with McDonnell Douglas: Dobbin claimed his Aviaco Traders aircraft-leasing business was harmed by McDonnell's improper tactics. He also sued Boeing (which has since absorbed McDonnell), alleging that then-CEO Frank Shrontz and president Ron Woodard approved a $786,000 bribery scheme to grease the $64 million sale of Boeing's Canada-made De Havilland jets to BahamasAir in 1989. The FBI and Canadian Mounties probed the claims but found no solid proof. But a 1993 Bahamian government investigation (aided by Scotland Yard) did conclude that Boeing had in fact paid a dapper sales "consultant" named Duncan Rapier $1.4 million "for the corrupt purpose of passing on a bribe" as part of the deal. (Boeing's motives in hiring the well-connected Rapier as an aircraft salesman left skeptics laughing: He knew little about airplanes other than that he thought them big and pretty, and he was once nabbed by US agents in Miami for trying to sell $25 million in bonds stolen by the Irish Republican Army in London.) Dobbin argued that the Boeing bribe undercut his pending deal to lease planes to the government-owned airline, putting him out of business.

The case is now before the 11th Circuit Court of Appeals in Florida. A district court jury originally awarded Dobbin $12.2 million last fall, but Judge K. Michael Moore reduced the amount as unsupported by the evidence. Boeing never announced the jury's finding, but did note it in a recent Securities and Exchange Commission filing. A check last week of federal documents in Miami shows that 22 volumes of pleadings and 10 volumes of transcripts from the hefty case were sent to the appeals court May 13. Boeing had no comment on the ruling, but in its recent SEC statement said the "company does not expect [the Dobbin] litigation to have any future material adverse effect on its earnings, cash flow, or financial position."

 
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