Records show that five former Philcomsat directors and officers were indicted before Branch 64 of the Metropolitan Trial Court (MTC) of Makati City for violation of Section 144 of the Corporation Code and Article 318 (Other Deceits) of the Revised Penal Code. The lawsuit accused Manuel Nieto Jr. Lourdes Africa, Luis Lokin Jr., Benito Araneta and Ronaldo Salonga of conspiring with one another for their mutual aid and benefit with deliberate intent in defrauding the company in the amount of P874 million.
Records also showed that the information was filed as a consequence of the criminal complaint instituted by Philcomsat lawyer Samuel Divina. Divina said the accused banded themselves into an executive committee and passed a resolution authorizing Nieto Jr. to enter into an illegal memorandum of agreement with ANSEAR Realty and Development Corp. and Anronio Araneta. According to Divina, Philcomsat and Philcomsat Holding Corp., a subsidiary of the former, precipitatedly released the amounts of P265 million and P125 million, respectively, without obtaining the approval of Philcomsat and the PHC Board nor the ratification or approval of the stockholders of the firms which was in gross violation of the provisions of the Corporation Code.
Said acts, Divina said, clearly constitute a mockery of the judicial ruling already issued by both the Court of Appeals and the Supreme Court declaring the rump board-held election on Aug. 27, 1998 by the said Nieto-led group as illegal. He also said it was the intention of the said group to represent themselves as the alleged directors of Philcomsat and to further sow chaos and confusion to perpetrate themselves in power as they have managed to do so in PHC, a publicly-listed corporation, 81 percent of the shares of which is owned by Philcomsat.