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Saturday, February 15, 2025

NC oil company pays $700,000 settlement for violating safety regulations

An Elizabethtown-based oil company has agreed to a $700,000 settlement resolving allegations that it conducted charter flights violating safety regulations.

The United States District Attorney’s Office filed a complaint in March 2023. It alleged that from as early as April 2017 to March 2019, Campbell Oil Co., Executive Aircraft Services, Inc., Brian D. Campbell and David Taylor Stephens illegally operated over 150 paid, passenger-carrying flights using “sham dry leases.”

There two types of aircraft leases: “dry leases” and “wet leases.” Under a dry lease, aircraft lessors provide just the aircraft, while wet leases provide crew and air transportation services as well.

The Federal Aviation Administration requires that wet leases and “commercial operators” those willing to provide transportation for compensation — fulfill additional safety and certification standards.

However, the complaint claimed that these “sham dry leases” were essentially wet leases.

Through President Brian Campbell, Campbell Oil and EAS leased aircraft alongside pilot services offered by David Stephens without satisfying the heightened regulations.

In addition, “Defendants allegedly also held themselves out to the public as offering air charter services, including by paying commissions to Stephens for soliciting customers for the air charter business,” according to the U.S. Attorney’s Office

According to the release, the defendants are no longer operating the aircraft leasing business.

The U.S. Attorney’s Office for the Eastern District of North Carolina mentions that “The United States’ factual and legal assertions are allegations only, and there has been no admission or judicial determination of liability. The civil settlement agreement is not an admission of any liability by defendants, nor a concession by the United States that its potential claims were not well-founded.”

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