News: Colby Fiesta Corp (Outlaw Sentence 1983)

Contact: Kathleen E. Englebretson

Email: kathy@wiclarkcountyhistory.org

Surnames: Outlaw, Brush

---Source: Marshfield News-Herald (15 October 1983)

Madison -- The former president of Colby's Fiesta Corp. was sentenced to three years in federal prison and was placed on three years probation Friday in U.S. District Court here.

J. Raymond Outlaw, who brought the firm to Colby, was sentenced on two accounts of using mail to defraud the federal government of defense contract money.

The sentence carries a $2,000 fine and an undetermined amount of restitution which will depend on the amount received from the sale of inventory from his bankrupt company, according to Thomas Brush, Madison, Outlaw's attorney.

Outlaw, who resides in Hillsboro, North Carolina had testified in Federal District Court that he mailed certified requests for progress payments to the defense department and then used the contract money for personal use.

The case began nearly two years ago when Fiesta Corp filed for reorganization under federal bankruptcy laws. The reorganization request was filed on November 10, 1981. Outlaw was charged this summer with using part of $3.3 million in federal progress payments for defense contract payments for his own use between April 1, 1980 and May 30, 1981, when control of Fiesta Corp was taken away from him.

Thirteen other charges, including bankruptcy fraud had been dismissed earlier.

Brush said he thought U.S. Judge John Shabaz' sentence was harsh because of pre-sentence allegations made by governement-employed investigators that Outlaw could have turned Fiesta Corp around "given enough elbow room."

Fiesta Corp.'s name recently was changed to C-Way Industries and a buyer is being sought for the firm which manufactures engine heaters and air conditioners for the military.