For allegedly posing as dummies of foreign investors who gained effective control and ownership of Nextel Philippines, the NBI ordered Nextel’s corporate officers and directors to answer charges that they violated the Constitution, Section 2 of the Anti-Dummy Law (Commonwealth Act No. 108), and other Philippine laws. The 1987 Constitution reserves the ownership of public utility firms like Nextel to Filipino citizens or companies whose ownership is at least 60 percent Filipino.
An NBI team served subpoenas to Nextel executives during the company’s board meeting at Nextel’s headquarters in Ortigas Center, Pasig City.
As this developed, a demonstration was held outside Nextel’s main office to denounce the firm’s alleged constitutional violations. Over 300 protesters from a group called Citizen’s Movement for Protectionism and Reform (CMPR), claimed that Americans – not Filipinos – have effective control and ownership of Nextel through several holding companies.
Filed by Paquito Sta. Maria de Jesus, the anti-dummy suit charged the officers and board members of the following Nextel corporate stockholders: Infocom Communications Network (Infocom), predecessor of Nextel Communications Philippines, Inc.; Nextel International, Inc.; Accra Investments Corp. (Accrain); Gamboa Holdings, Inc.; Accrain Holdings Corp. (Accraho); Emerald Investments, Inc.; East Holdings, Ltd.; Top Mega Enterprises; Joyce Link Holdings Ltd; and Foodcamp Industries and Marketing.
Impleading 43 persons, including several John Does, de Jesus said these individuals "through the use of dummy corporations actively, feloniously, intentionally and falsely simulated the existence of the minimum stock or capital owned by citizens of the Philippines."
Among those cited were: Brian Vincent and Heng-Pin Kiang, both directors of Top Mega; and Nextel officials Robert Harmon, director; John Jones, president Asia-Pacific; Rudolph Steve E. Jularbal, director; Joe Alejandro, director; and Nena Radoc, director.
Nextel USA officials led by Daniel F. Akerson, chairman of the board; Lo Van Gemert, president; Keith D. Grinstein, vice chairman of the board; John J. Jones president Asia-Pacific; and directors William E. Conway, Timothy M. Donahue, Steven P. Dussek, C. James Judson, Thomas C. Lynch and Dennis Weibling.
In his 17-page complaint, de Jesus alleged that Nextel International, the US-based mother company of Nextel Philippines, "employed a deceptive and misleading design of indirect purchases" through a combination of local and foreign conduit firms to acquire a 59-percent stake in the Philippine trunk radio operator. This, he said, was admitted by Nextel International in its report to the United States Securities and Exchange Commission.
It appeared in Nextel International’s US disclosure that the companies involved in the acquisition of stakes in Nextel Philippines are its wholly owned subsidiaries, de Jesus stressed.
For the simulation of minimum capital stock or violation of the Section 2 of Anti-Dummy Law, the accused, if found guilty, "shall be punished by imprisonment of not less than five nor more than 15 years, and by a fine not less than the value of the right, franchise or privilege, enjoyed or acquired in violation hereof but in no case less than five thousand pesos."