Kirton moves to dismiss Florida action filed by Cel Star Caribbean
November 27, 2003
Wesley Kirton, Chief Executive Officer of Cel Star Guyana, says his desire not to see the GSM licence granted to Cel Star Guyana Inc "wasting" resulted in its board, controlled by three Kirtons, issuing the shares in Cel Star Guyana in his name.
In an affidavit filed in support of a motion to a Florida court to dismiss the case against him by Cel Star Caribbean Inc for forum non conveniens, Kirton said he believed it was his "fiduciary duty to attempt to save the GSM License which was in danger of wasting" after Blue Sky Communications out of Georgia, USA, which had acquired Cel Star Caribbean from SMM, went out of business.
Kirton is seeking a dismissal on grounds that Florida is not the right jurisdiction in which any action should be filed.
In the affidavit, he said Cel Star Caribbean was listed as the incorporator of the Cel Star Guyana but the latter was not a subsidiary but a separate legal entity.
Cel Star Caribbean Inc's owner SMM, he said, sold 100% of Cel Star Caribbean to Blue Sky in June 2001 and with it the responsibility to fund the build-out of Cel Star Guyana. However, Blue Sky later went out of business.
"As of November 2001, Cel Star Guyana Inc remained uncapitalised and no shares of the company were issued to anyone. Blue Sky abandoned the cellular network project under the GSM licence with Cel Star Guyana, disclaimed any obligations to Cel Star Guyana Inc and left Cel Star Guyana Inc owing debts in Guyana and facing impending deadlines for the initiation of cellular service by May 2002, without any institutional funding or support," Kirton said.
Kirton said he contacted Blue Sky officials who said they had no obligations to Cel Star Guyana and he wrote Hartmut Lademacher, Presi-dent of SMM, on December 10, 2001 seeking that firm's compliance with earlier representations to provide institutional funding and support for Cel Star to meet its obligations under the GSM Licence. Kirton said Alexander Stopps on behalf of SMM called in response to his letter and indicated that SMM had no obligations to Cel Star and referred him back to Blue Sky.
"At this time, the Prime Minister was calling me for a report on Cel Star Inc's progress under the GSM Licence project, noting that he had not seen any construction taking place and it appeared that Cel Star Guyana Inc would be unable to comply with its obligation under the required timeframe of the licence," Kirton deposed.
The licence was granted on February 21st 2001 and had to be activated within 15 months or face substantial penalties and possible forfeiture.
He said, Klaus Knappe, an associate of SSM and a director of Cel Star Guyana, informed him in December 2001 that he was returning to Germany to live and encouraged him, Kirton, to take all necessary actions to preserve the licence and to take the lead to complete the project.
"Knappe and I agreed that by so doing, the company would not cause the government's reputation to suffer due to Cel Star Guyana Inc's non-performance of its obligation under the licence," said Kirton.
He said Knappe agreed to help find new international partners to finance the project and referred to him two potential investors in 2002. But Kirton said Knappe never responded to his letters or emails subsequently and he did not hear from him again until July 2003 at which time he was informed that Knappe had been hospitalised for almost a year in Germany.
In order not to lose the GSM licence, Kirton said he wrote the Prime Minister and the PUC and explained that Blue Sky, Cel Star Caribbean and SMM had abandoned Cel Star Guyana, the GSM licence and the GSM cellular project.
Kirton said he personally paid off many of Cel Star Guyana's debts and expenses and sought to obtain investors for the project.
"I believed that it was essential to the attraction of investors to formally issue the initial shares of Cel Star Inc so that they could be transferred to an equity investor," Kirton said.
He said the inaugural meeting of the Board of Directors of December 27, 2001, saw two other directors being named to the board, which then authorised the first and only valid issuance of all of the shares in Cel Star Guyana Inc to him. He says all corporate formalities required under Guyana law for the approval, signature and recordation of the initial issuance of the shares were observed.
He said following the reorganisation of Cel Star, he acted to preserve the GSM licence, got an extension of the time from the Prime Minister to implement the cellular network system and searched for an international partner which he found in Trans-World Telecom Caribbean.
He agreed to transfer all his shares to that company in exchange for the reimbursement of his out-of-pocket expenses and the opportunity to invest in the company at a future date. He earned no profit from the transfer, he said.