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Tuesday, October 27, 2015


Original Story: wsj.com

A banker and a former politician from Kazakhstan tried to launder tens of millions of dollars of stolen money through New York real-estate holdings, a civil lawsuit alleges.

The men allegedly conspired with New York developer Joseph Chetrit to hide at least $40 million by investing in a former Manhattan hotel and the Cabrini Medical Center, according to a complaint filed on Oct. 12 by Kazakhstan’s largest city, Almaty, and one of the nation’s biggest lenders, BTA Bank. A New York commercial real estate lawyer provides professional legal counsel and extensive experience in many aspects of commercial real estate law.

The Kazakh men, ex-BTA chairman Mukhtar Ablyazov and former Almaty mayor Viktor Khrapunov, are separately under investigation for criminal fraud in Kazakhstan, the complaint says. Mr. Ablyazov is alleged to have stolen billions of dollars from BTA and Mr. Khrapunov is alleged to have stolen about $300 million from Almaty, according to the complaint, filed in federal court in Manhattan.

The Kazakh men parked “corrupt assets” in New York City real estate to avoid the scrutiny of escalating international investigations, the complaint alleges. Mr. Chetrit, also a defendant in the lawsuit, was aware of the criminal investigations of the Kazakhs when he agreed to use their money for his projects, according to the complaint. The suit seeks damages of up to $18 billion and was filed by law firm Boies, Schiller & Flexner LLP. A New Orleans commercial real estate lawyer is following this story closely.

Mr. Ablyazov, who is being held by authorities in France, couldn’t be reached for comment. Previously, he has said he is innocent of any criminal wrongdoing and all accusations against him are ungrounded and politically motivated.

Peter Sahlas, an attorney for the Ablyazov family, said the former bank chairman had not been served and was unaware of the New York lawsuit.

The family would consider the suit “just another instance of a corrupt and kleptocratic foreign regime availing itself of the U.S. legal system to carry out its political vendettas,” Mr. Sahlas said in an interview.

A spokesman for Mr. Khrapunov said: “Having obtained nothing after years of proceedings in Switzerland and the United States, Kazakhstan is trying again to use the legal system of a Western country to harass and destroy political opponents.” A Las Vegas commercial real estate lawyer represents clients in commercial real estate defense claims.

Mr. Chetrit and his lawyer didn’t respond to requests for comment.

The suit represents a rare specific legal allegation of money laundering through U.S. real estate.

Foreign buyers in recent years have flooded into major markets like Manhattan, particularly attracted to high-end condominiums, as they seek stable, long-term investments, property analysts say.

But with few disclosure requirements in the U.S. for real-estate transactions—wealthy buyers often preserve their anonymity by making purchases using limited liability companies—money-laundering experts warn the area is ripe for abuse by those looking to park ill-gotten gains. A Greenville commercial real estate lawyer is reviewing the details of this case.

Because the use of corporate structures to buy real estate has become commonplace, including by legitimate buyers who want to protect their privacy or other assets from liability, a sale to an LLC doesn’t necessarily raise red flags.

Banks and brokerages are far more regulated than real estate and are required to report suspicious activity. Real estate doesn’t face such requirements, which is an “enormous loophole in our financial system,” said Louise Shelley, director of the Terrorism, Transnational Crime and Corruption Center at George Mason University.

Mr. Chetrit has done numerous high-profile deals, including for the former Sony Building on New York’s Madison Avenue, which he bought with partners for $1.1 billion in 2013. He previously was a co-owner of the Willis Tower, the former Sears Tower, in Chicago. A Louisville commercial real estate attorney has managed a variety of commercial real estate cases for a wide range of clients.

Mr. Chetrit sold the Kazakh men, through their special purpose vehicle, stakes in two Manhattan properties now closed and being converted into condo buildings, according to the complaint: the Flatotel and the Cabrini Medical Center.

Mr. Chetrit referred to one of the Kazakhs’ contacts with code names like “Jose” and “Pedro” in conversations secretly recorded by an associate of the Kazakhs, according to the complaint.

As chairman of BTA, Mr. Ablyazov directed the bank to make a series of loans to companies under his control that were never repaid to BTA, according to the complaint. BTA in 2009 defaulted on debt held by foreign investors, the complaint says.

Since the default, BTA has filed 11 proceedings against its former chairman and his associates, according to the complaint. U.K. courts have awarded BTA more than $4 billion in damages for claims against Mr. Ablyazov and his associates, the suit says.

In 2012, a U.K. court sentenced him to 22 months imprisonment “for his numerous actions in contempt of court,” the complaint said. Mr. Ablyazov is challenging that judgment at the European Court of Human Rights in France, according to Mr. Sahlas.

The Kazakh banking executive is being held in a French jail, where he has been denied bail three times and is fighting extradition, according to the complaint.

Mr. Khrapunov was mayor of Almaty from 1997 to 2004, coming to power six years after his country declared independence from the former Soviet Union. The complaint alleged he transferred city money to himself and his family through various schemes, including sales of city-owned real estate to his spouse and friends at below-market prices.

Mr. Khrapunov and Mr. Ablyazov pooled their money and initially moved the proceeds to Switzerland in 2007, according to the lawsuit.

The partners created a special purpose vehicle, called Triadou SPV S.A., which was incorporated in Luxembourg, the lawsuit said.

An associate of the two Kazakhs met with Mr. Chetrit in Geneva and said that Mr. Chetrit “expressed sympathy” and said his own family had faced political sanctions in Morocco, according to the complaint.

Friday, October 16, 2015


Original Story: freep.com

Pharmaceutical giant Eli Lilly's stock tumbled 8% Monday after the company said it will discontinue development of a key cholesterol drug.

Lilly said it has ended late-stage development of evacetrapib, which was part of a costly study involving 12,095 patients at 540 sites in 37 countries. The therapy was in Phase 3 development — the final stage before a drug can be submitted to the Food and Drug Administration for approval. Warren elder care providers offer assistance to seniors living at home.

The failure to bring the drug to the market reflects a significant setback for Lilly, which saw shares fall more than 10% to $77 in pre-market trading before regaining some ground.

An independent data monitoring committee "suggested there was a low probability the study would achieve its primary endpoint based on results to date," Lilly said in a statement.

The drug, which was supposed to treat people at a high-risk of atherosclerotic cardiovascular disease, displayed "insufficient efficacy" the company said. Private duty nurses in Clinton Township are ready to serve even the most advanced medical needs.

The company emphasized that the study was not halted because of safety problems.

"We're obviously disappointed in this outcome, as we hoped that evacetrapib would offer an advance in treatment for people with high-risk cardiovascular disease. We'll be working with investigators to appropriately conclude these trials," David Ricks, Lilly senior vice president and president of Lilly Bio-Medicines said in the company statement. "We remain confident in our pipeline as we prepare for launches in other therapeutic areas with significant unmet needs."

The company expects to take a $90 million pre-tax charge to account for the drug's discontinuation.

Just days before Lilly discontinued the drug, Credit Suisse analyst Vamil Divan told investors that he was "cautiously optimistic" about the drug, saying that "much of the investor focus" was on evacetrapib and another therapy. Citing the company's diverse portfolio, Divan had upgraded his target price on Credit Suisse shares from $89 to $105. A Delaware securities lawyer is following this story closely.

But after Monday's news, Divan lowered his target to $99. He said that Lilly is still well-positioned with a diverse lineup of drug candidates despite the setback.

“They have a number of attractive products in their late-stage portfolio,” Divan said in an interview. “I don’t think it fundamentally changes the company or their overall story.”

In the past, pharmaceutical companies have shed jobs and cut other costs in the wake of a major disappointment in the lab. Divan said he’s not expecting big cuts at Lilly, although he noted that the industry is always seeking to make its operations more efficient.


Original Story: cnbc.com

Dell announced a deal Monday with MSD Partners and Silver Lake to buy cloud computing company EMC for roughly $67 billion in cash and stock.

"We're creating an unbelievable powerhouse of an enterprise company," Dell Chairman and CEO Michael Dell told CNBC's "Squawk Box." "This is really all about bringing together complementary technologies and helping our customers address the challenges and opportunities that this digital future is creating." A Houston securities lawyer is experienced in the effective resolution of securities lawsuits as related to stocks, bonds, and debentures.

EMC stockholders will receive about $33.15 per share in cash and a type of stock that is linked to "a portion of EMC's economic interest" in its VMware business, which will remain an independent, publicly traded company, the companies said in a statement Monday.

The transaction marks the largest technology sector deal on record, topping U.S. chipmaker Avago Technologies' $37 billion offer for rival Broadcom. That deal is still in process. A Salt Lake City securities lawyer is following this story closely.

The acquisition of EMC is seen helping Dell diversify from the stagnant personal computer market and give it the scale to attack the faster-growing and more lucrative market for managing and storing data for businesses.

EMC will have a "go-shop" provision that will allow the data storage company to seek out other buyers and give EMC a discounted breakup fee if it finds a more desirable deal, EMC Chairman and CEO Joe Tucci said on "Squawk Box." A Las Vegas contract lawyer is reviewing the details of this story.

"We will do our duty to make sure we get the best deal for our shareholders and time will show," he said.


Original Story: cnbc.com

The world's two biggest beer brewers edged one step closer to a takeover deal Tuesday with an announcement that they have agreed to a "pact in principle."

The agreement states that Belgium's Anheuser-Busch InBev would buy South Africa-based brewer SABMiller with the latter's shareholders being entitled to receive £44 per share ($67.60) in cash. A Boston contract lawyer represents business clients in contract matters.

The press release on Tuesday morning also said that AB InBev would agree to a "best efforts" commitment to obtain any regulatory clearances required before the transaction. This included $3 billion payable to SABMiller in the event that the transaction fails to close as a result of the failure to obtain regulatory clearances or the approval of AB InBev shareholders.

The statement hedged that there can be no certainty that a formal offer will be made, adding that a further announcement will be released when appropriate. A Las Vegas contract lawyer is reviewing the details of this story.

Reports in the U.K. on Monday said Anheuser-Busch InBev had raised its proposed takeover offer for SABMiller to £43.50 a share, upping the stakes in the takeover battle after several failed attempts.

InBev brews beers such as Budweiser and Stella Artois while SABMiller's brands include Miller, Fosters, Grolsch and Peroni. The potential deal would create the world's most dominant brewing company and would be worth around £68 billion ($104 billion), according to Reuters.

The new proposal means that AB InBev now has until Oct. 28 to make a more formal offer. Shares of SABMiller rose more than 8 percent Tuesday, and its suitor's stock price was up 2 percent.

John Colley, a professor at the U.K.'s Warwick Business School, told CNBC via email that AB InBev had offered a "reasonably full price" for SABMiller. A Columbia SC contract attorney is following this story closely.

"Overall for once I would have said it is a decent deal for both shareholders as AB InBev probably will extract the synergies and consolidate a declining market." he said.

However, he said he expected substantial redundancies and cost savings over the next year and said product ranges are likely to be reviewed for possible consolidation.

Thursday, October 15, 2015


Original Story: bloomberg.com

In April 2011, Stanford’s Graduate School of Business threw a party at its brand-new $345 million campus in Palo Alto. Thousands of students, alumni, and staff swayed to gospel singers and the Stanford band, sampled tofu banh mi on bamboo plates, and took cell phone-guided tours of the eight wood-and-glass buildings spread over a dozen palm tree-dotted acres.

The day’s keynote, “What it takes to get to the top,” featured a debate between two of the school’s best-known professors. Joel Peterson, who’s also chairman of JetBlue Airways, told a packed auditorium of 800 that trust and respect for others are essential in leadership; intimidation and manipulation always fail in the end. Jeffrey Pfeffer, who’s taught a popular class on power at the school for 36 years, said odds are you can’t be nice, honest, fair, and also successful; the path to power is paved with ruthless self-promotion. A Boston employment lawyer assists business clients in setting up policies and systems to avoid legal problems in labor and employment matters.

Although begun under his predecessor (with a $105 million gift from Nike co-founder and alum Phil Knight), the new campus reflected the ambition of the school’s visionary dean, Garth Saloner. He’s transformed the school, known by its acronym, GSB, into a hub of management innovation worldwide. What the dean called an “inflection point” at the campus’s inauguration has proved true: The school trains executives in Bangalore, Beijing, London, New York, Santiago, and São Paulo. It steals top academics from rival Harvard, boasts the world’s lowest admission rate, 7 percent, and the highest median base salary for MBA graduates, $125,000 a year. Yet one of the nation’s top-ranked management schools is struggling with a management problem of its own.

On Sept. 14, Saloner, 60, shocked the Stanford community when he announced he was resigning his post at the end of the school year. (He will remain at Stanford as a tenured business professor.) A South African-born economist, he’s renowned for his work on how Internet network effects provided early entrants in a tech market with insurmountable advantages, and he was instrumental in persuading the U.S. Department of Justice to sue Microsoft for antitrust violations in the 1990s. He’s led a substantial overhaul of the school’s curriculum, emphasizing global studies and critical-thinking skills, and reeled in the GSB’s biggest gift ever, a $150 million grant to fight poverty by educating local entrepreneurs in places such as Ghana. His cryptic resignation flashed on students’ iPhones just as the first-years took part in a mandatory orientation session on the Stanford code of conduct. A Memphis employment discrimination lawyer represents clients in workplace rights matters.

Saloner’s statement said only that he didn’t want “a baseless and protracted lawsuit related to a contentious divorce between a current and former member of our faculty” to harm the school’s reputation. Later that day, an article published by Poets & Quants, a website that covers business schools, broke the news of a 17-month-old discrimination lawsuit against Saloner and the university. Filed by a former professor, James Phills, 55, the suit alleges that Saloner, a widower, conspired with the dean’s lover, Deborah Gruenfeld—Phills’s estranged wife and also a GSB professor—to push Phills out of his GSB job and kick him out of his campus home. The claims, pending in Santa Clara County Superior Court in San Jose, turn on whether Saloner, after informing Stanford Provost John Etchemendy of his relationship with Gruenfeld, 53, properly recused himself from any decisions regarding the separated couple. Also at issue is whether Etchemendy made sure Saloner took no part in decisions relating to Phills and Gruenfeld, in accordance with state law and school policy. The suit claims Phills, who is black, has suffered “a hostile workplace and ongoing retaliation by Saloner” and faced discrimination based on his marital status, race, and gender.

The suit has thrust the GSB’s personnel practices into public view. In a Facebook exchange between Gruenfeld and the dean in November 2012, shortly after they began seeing each other, Gruenfeld asked Saloner about Etchemendy’s reaction to learning of their romance. Phills, who got the messages by using his wife’s Facebook password, filed them as evidence in divorce-court proceedings. Judges in both cases have denied requests by Gruenfeld, Saloner, and Stanford to keep personal texts and e-mails private. A Tulsa employment lawyer is following this story closely.

Gruenfeld: “So I guess we aren’t sneaking out tonight.”

Saloner: “How? Where?”

Gruenfeld: “Dunno. Just can’t let go of it. Oh—speaking of blow by blow—what did Etch say exactly?…”

Saloner: “He basically ignored what I said about the two of us and, not in these words, that he trusts me to make any decisions regarding Jim [Phills]. That is his style. It is almost as though he pretends he hasn’t heard, although of course he has. I think it is his way of saying, ‘you have done what the policy says you have to do, I appreciate it, but the policy wasn’t written with you/this in mind and so I’m respecting your privacy and ignoring it.”

Gruenfeld: “Love that. So discreet and respectful.”

Saloner: “He is a class act all around. He never ever disappoints me in the way he approaches things.”

Saloner and Stanford deny Phills’s allegations of discrimination and say they upheld all laws and university policies. Gruenfeld, Phills, and Etchemendy declined to comment for this article. Stanford, in a written statement, says Saloner properly recused himself from decision-making about the couple and that the university terminated Phills this year because he chose not to return from leave in favor of more lucrative employment at Apple. Phills was treated “fairly and equitably,” Stanford says, and the GSB, under Saloner, “continues to perform at exceptionally high levels.” A New York employment lawyer is reviewing the details of this case.

At the business school, reaction to Saloner’s resignation, and the love-hate triangle that engulfed him, is divided. Many faculty members are disappointed to see Saloner go. Since his appointment in 2009, he’s expanded the faculty by 15 tenured professors, to 124. Many like that he consolidated programs, tightening the purse strings in the dean’s office so he could free up money from the school’s $220 million annual budget for recruiting and research. “The prevailing mood is disappointment and dismay that we’re having a transition when we have so much momentum,” says finance professor Peter DeMarzo.

Saloner has fewer admirers among the school’s 440-person nonfaculty staff, the people who make the GSB run. To many of them, as well as a dozen or so bitter critics whom he fired or drove out over the years, the dean is the embodiment of Pfeffer’s cold-blooded theory. They describe an administration ruled by fear, with a dean who browbeats subordinates who challenge him, defunds programs that don’t fit his agenda, and drums out longtime managers on the thinnest of pretexts. These detractors exult at Saloner’s fall—at what Peterson described in the debate against Pfeffer as the inexorable self-destruction visited upon ruthless leaders. Says Sharon Hoffman, a former associate dean who ran the MBA program from 2001 until she was demoted and quit in 2012: “When Garth came in, it went from morning in America to Soviet Russia.”

Saloner, with jowly cheeks, frameless glasses, and a full head of graying brown hair, is the rare Silicon Valley stalwart who wears blue blazers and freshly ironed shirts. His voice still carries a faint South African ring from his Johannesburg childhood. Colleagues describe him as a fierce intellectual fighter and a reluctant listener. “Get your flak jacket on,” says Bethany Coates, a GSB assistant dean who’s worked for Saloner for six years and finds his combative manner highly effective.

Saloner earned an MBA at the University of the Witwatersrand in Johannesburg and his doctorate in economics at Stanford in 1982. He taught at MIT for eight years, then returned to the GSB in 1990 and never left. Saloner and his wife, Marlene, raised three daughters; all three attended Stanford, two earned MBAs there.

An expert on game theory and mathematical modeling, Saloner did some of the earliest work showing how the effects of computer networks can lock in customers. That’s because first movers often establish technical standards, such as operating-system software, to which consumers and developers become attached. Saloner’s ideas helped Netscape’s lawyer Gary Reback finally persuade federal prosecutors that Microsoft’s use of its clout in operating systems to tie computer makers to its browser software was unfair to competitors. Saloner, a charismatic lecturer with a knack for explaining arcane material, has won the GSB’s Distinguished Teaching Award twice, one of only two professors to do so.

Under Saloner, the GSB only grew in its role as a finishing school for billionaires in training. Every year dozens of MBA students, nurtured by professors and thousands of alumni in nearby tech companies and venture capital firms, start companies. Mary Barra, chief executive officer of General Motors, was in the class of 1990, and EBay’s first full-time employee, Jeffrey Skoll, got his Stanford MBA in 1995. Former Microsoft CEO Steve Ballmer dropped out of the GSB in 1980 to become the first business manager for his dropout friend from Harvard, Bill Gates. A Richmond labor and employment attorney defends clients in employment related matters involving instances of detrimental labor conditions or discriminatory employment practices.

In the inner sanctum, Saloner scares people, staff members say. A former program executive director, Kriss Deiglmeier, says he shouted her down at a meeting in front of more than a dozen colleagues, even after the budget at issue had been approved by his office. Shortly after his appointment, he fired Erica Richter, the director of alumni education, who’d recently recovered from cancer. She’d worked for the school for 14 years and was eligible for retirement in eight months. “I asked Garth if there were any other jobs I could do to keep my health insurance until I retired, and he said, ‘Nope, nope. I’m going in a different direction,'” Richter says. (A school official close to the dean but not authorized to speak by the school said Saloner didn’t know about Richter’s health at the time.)

Early on, Saloner pushed Sharon Hoffman, the director of the MBA program, to crack down on the GSB’s party culture. According to a former associate dean not authorized to speak by Stanford, drunken GSB students on a class trip to Las Vegas were led off a plane before takeoff. This person also says a pilot on another trip threatened to divert in the air if they didn’t settle down. “We became rules girls,” Hoffman says, nixing midweek ski trips and the rescheduling of exams to accommodate Ultimate Frisbee tournaments in Florida. After angry students lashed out at Saloner at a town hall meeting, he called Hoffman into his office and, she says, furiously accused the associate dean of setting him up. She’d warned Saloner’s top deputy what to expect, but he never told the boss for fear of angering him, Hoffman says. “‘You have a new charter for the year,’” Saloner told her later. “‘From now on we say yes to students!’”

In a written statement, Saloner said, “I’ve been very ambitious and passionate about advancing the mission of the school.... I strongly believe in getting the whole team aligned behind a focused vision. I have to acknowledge that, although it was definitely not my intention, the process of achieving alignment was sometimes harder on people than I realized.”

Gruenfeld goes by Deb and has a wide smile and shoulder-length brown hair. A social psychologist with a doctorate from the University of Illinois, she’s one of the world’s leading experts on the psychology of power. She’s shown how it corrupts in unintended ways, emboldening people to act heedlessly on their desires. She teaches a course called “Acting with Power,” which uses theatrical techniques to help students “who have trouble ‘playing’ authoritative roles.”

Phills, a heavyweight wrestling champion at Harvard who competed into his 40s, has a soft, freckly face, the body of a linebacker, and the warmth of a teddy bear, friends say. He earned his Ph.D. from Harvard in organizational behavior and went on to teach at the Yale School of Management.

The two met at a conference in 1994. Phills was at Yale, and Gruenfeld was teaching at Northwestern’s Kellogg School of Management. They became a couple five years later. Gruenfeld avoided “marriage material” during the first 12 years of her academic career, worried a husband “would be the end of my independent thinking, my independent self,” she wrote in a 2011 e-mail to her life coach, while trying to save her marriage. The e-mail was filed as evidence in the divorce case.

Gruenfeld and Phills married in 1999. In the 2011 e-mails to her life coach, she wrote that her fears came true. “I backed away from work, fearing that my continued successes would intimidate him and he would be resentful.… I am lost; I have made Jim my God and he has nothing to offer.” A Los Angeles employment lawyer help clients minimize the risks of employment litigation.

The couple moved to Stanford a year into their marriage and bought a house on campus with a low-interest loan from the university tied to Gruenfeld’s job. They had two daughters while there. A popular teacher and prolific writer, Gruenfeld was appointed to faculty committees that revamped the school’s curriculum and selected Saloner to be dean. She became friends with Facebook Chief Operating Officer Sheryl Sandberg and joined the Lean In board.

Phills, meanwhile, became a faculty director of the GSB’s Center for Social Innovation, which ran management training programs for government and nonprofit leaders. He was co-director of the center for a decade, co-founded and edited the field’s leading journal, and designed and taught six training courses. “Jim bridged the chasm for me between the social sector and business,” says Diane Solinger, head of employee social responsibility at Google, who took Phills’s executive-education course. “His training was one of the most formative things I’ve done in my career. I still use the framework with my team.”

The Center for Social Innovation attracted lots of students and alumni support, but Saloner thought the social-impact focus did not directly serve business students and faculty, says Deiglmeier, the center’s executive director from 2004 until last year, when she left to become CEO of Tides Foundation. In 2012, Saloner gutted the center’s budget, and Phills lost a big chunk of his teaching income when the center stopped doing executive training sessions. In May of that year, four months before Saloner and Gruenfeld started seeing each other, Phills took a leave from Stanford to teach management at Apple. The GSB restarted the training program later under a different professor, which Phills alleges was part of the Saloner-Gruenfeld conspiracy to keep him from returning.

Gruenfeld left Phills in June 2012. That same month, Saloner’s wife, Marlene, died after living with cancer for more than a decade. Two months later the dean, in an e-mail to Gruenfeld about one of her committee assignments, mentioned he was doing better and hadn’t forgotten about Gruenfeld’s suggestion for yoga. “Hope to be in (mental) shape to reach out soon,” Saloner signed off.

A few weeks later he asked her out for coffee, and they met for a walk. “Thanks for this morning. It felt really good spending that time with you,” the dean e-mailed afterward. After a few more dates, they drew closer—close enough, they agreed, that Saloner ought to tell the provost.

He e-mailed Etchemendy on Halloween morning. Saloner disclosed he’d seen Gruenfeld “a few times socially,” and though he wasn’t sure where the relationship was heading, he wanted the provost to know “out of abundance of caution.” Gruenfeld was on leave and didn’t have any pressing employment issues, but “Jim is a different matter.” Phills was due to decide soon whether to come back to Stanford full time. The negotiations would be handled by Saloner’s deputies. “It is possible that I will be asked to weigh in at some point, and at a minimum will certainly be asked to ratify their recommendations,” the dean said. “I propose to ask you to approve our thinking on whatever we decide (and perhaps to weigh in more substantively, depending on what we recommend).” The provost responded two hours later: “I am absolutely supportive of everything you decide with regards to Jim. I’d be very sorry to lose Deb.” In his deposition, Etchemendy said: “Remember, Jim has his appointment because we were recruiting Deb. So, you know, if we lost Jim, it would not have been a tragedy. Losing Deb, on the other hand, would be.”

Saloner and Gruenfeld kissed for the first time a few days later, according to Gruenfeld’s deposition. On Nov. 4 the GSB’s senior assistant dean notified Phills that, with Gruenfeld not living with him, Phills needed to repay about $750,000 that Stanford had lent the couple years earlier. “It would be cleanest if you jointly sold the house,” the assistant dean advised. Phills asked if he could get an exception to remain in the house with his daughters and elderly mother. The assistant dean, after conferring with Saloner, said no.

Phills followed his wife’s deepening relationship with Saloner from the beginning, reading her e-mail and Facebook accounts with passwords he had acquired during their marriage. Gruenfeld knew he was spying on her, but her efforts to block him were unsuccessful. When she tried, he sent her taunting messages that said he could still see her communications, Gruenfeld said in a divorce-court filing. (She would later state in the filing that Phills “gave himself access to my devices by owning them, registering them in his name, buying special applications, and using iCloud.”) Saloner set up a new Facebook account to chat with Gruenfeld under the pseudonym Jeni Gee.

Phills blames the bitter turn in the divorce negotiations on Saloner, citing a Facebook chat on the eve of a key divorce negotiation. Gruenfeld: “Maybe he’s staying at Apple.”

Saloner: “Let’s hope. We deserve something good tomorrow. We’ve earned it.?…”

Gruenfeld: “Sadly, deserving has not bought me much so far.”

Saloner: “The universe owes us. Big time.”

Gruenfeld: “I agree. Maybe we’re turning a corner on that.”

In another exchange on Facebook about the divorce negotiations, Saloner told Gruenfeld that “you and your advisers (therapist and lawyer) are approaching this too much as women (ouch!) You are being rational and generous.” He said Gruenfeld should express her anger at Phills to make her a less predictable and rational adversary. “He would pout, posture and do the elephant seal thing. But it would push him back like a right to the jaw.”

The divorce got nasty about four months after Gruenfeld and Saloner started dating, according to a court filing by Gruenfeld. When she was dropping off the kids in Phills’s driveway one afternoon, Phills came charging out of the house, insisting he needed to speak to her. Gruenfeld resisted, and he briefly held on to her car door to prevent her from leaving. That night, Saloner took her to file a report with the Stanford police. She obtained a temporary restraining order against Phills a few days later, claiming his online spying was terrorizing her and that he drank too much, owned guns, and posed a danger to Gruenfeld and their daughters. Phills denies the allegations. Nine months later the judge, based on an evaluator’s report, dismissed the order as unwarranted.

Saloner had other adversaries to contend with. When Deiglmeier and two other women left Stanford early last year, Phills threw them a goodbye party at his Stanford home. The margaritas, and the war stories, flowed. What emerged several weeks later was a letter to the provost endorsed by 46 current and former GSB employees, about half of whom still worked at the school. It complained of a “hostile work environment—especially to women and individuals over 40—ruled by personal agendas, favoritism and fear.” The letter urged the provost not to reappoint Saloner to a second five-year term, and noted his romance with a subordinate, who was married to another subordinate, set a “poor example” for students and was “stereotypical of the behavior of many discredited CEOs.”

Etchemendy met with representatives of the signatories in the spring of 2014 but told them he’d reappointed Saloner as dean, though it hadn’t been announced. Stanford hired outside lawyers to look into the letter’s claims. They found no evidence of discrimination but noted “a persistent underlying theme” of tension between GSB staff and the school’s leadership. The dean was perceived as “arrogant and disrespectful,” with questions “legitimately raised” about his fairness and communication style. Some comments in employee surveys from 2013 and 2014 were “consistent” with these complaints, they said. In a written statement, Stanford said the GSB has been addressing the investigators’ suggestions.

The dean got a new term in office. Phills got a lawyer and sued.

Gruenfeld and Saloner are still together. Phills’s discrimination suit is mired in the discovery phase, with both sides demanding documents and Stanford and Saloner trying desperately to preserve a modicum of privacy for the dean’s and Gruenfeld’s personal communications. The divorce, too, drags on. Gruenfeld is supervising Ph.D. students and teaching. Saloner has no plans to step down before spring. Phills still lives in the couple’s campus home, fighting Stanford over the loans. He teaches at Apple, where, thanks to stock options, he has quadrupled what he made at Stanford, earning more than $1 million a year for the past few years.

In a Facebook chat between Gruenfeld and the dean, Saloner imagined a climactic resolution to the cinematic version of their story, like the one in the 1976 Japanese-French film In the Realm of the Senses. It ends with the heroine severing the penis of her lover, whom she has just suffocated during frenzied sex. Saloner’s rewrite for Phills included just six words: “Knife. Penis. Town Square. Got it.” (Town Square is the outdoor commons area on the GSB’s campus.)

Gruenfeld demurred, suggesting her own vision of how their triangle should end. “I’m thinking more like you and I stroll off into the sunset looking gaga, and he has to live with a mountain of shame and regret.”

Faculty members are debating whether the Saloner affair will tarnish the GSB. Is this the inescapable takedown of a man and institution that lost their way, as Peterson would predict? Or is Pfeffer right, that power is won and sustained through baser instincts? Peterson declined to comment, except to say “all three people involved are terrific, and this makes me so sad.” Pfeffer says the GSB will bounce back; institutions are bigger than single individuals.

“The only difference between Stanford and Google is we have a higher profit margin,” says Pfeffer. “This school is a success story.”


Original Story: usatoday.com

DuPont, which has been in an on-going battle with activist Nelson Peltz to boost the company's stock price, announced Monday that CEO Ellen Kullman will retire.

DuPont said CEO Kullman will retire on October 16th after 27 years with the company. Edward Breen, a member of the board of directors, will take over as interim chair and CEO while the board searches for a full-time replacement. A New York securities lawyer provides professional legal counsel and extensive experience in many aspects of securities law.

DuPont also lowered its expectations for operating earnings for the year to $2.75 a share compared to prior guidance of $3.10. The company said the revised outlook reflects continued "strengthening of the U.S. dollar versus currencies in emerging markets."

Still, shares of the chemical giant shot up 4% to close at $51.27 a share on the news.

In May, Kullman defeated efforts by Peltz, the billionaire chairman of restaurant chain Wendy's, to win board seats. Peltz wanted seats on the board to better position himself to push for changes that he said would boost company's stock price, such as splitting the company into several pieces.

Despite losing his bid, Peltz has continued to make noise at DuPont, where he has held a 2.7% stake. In July, Peltz said aid he's not giving up on DuPont despite losing his board battle. He also complained about DuPont's stock price and warned that he could wage another proxy contest next year if the stock declines continued. A Houston securities lawyer is experienced in the effective resolution of securities lawsuits as related to stocks, bond, and debentures.

Shares of DuPoint are down 25% over the last six months. A spokeswoman with Trian declined to comment on Kullman's retirement, or what it might mean for the stock.

Separately, Peltz's hedge fund, Trian Fund Management, disclosed a $2.5 billion stake in General Electric Monday.

The investment is expected to add pressure to CEO Jeff Immelt to improve GE's performance — a process that has included the piecemeal sale of the company's various financial and banking businesses.

GE is now Trian’s largest investment, the hedge fund said. A New York investment lawyer is following this story closely.

"We invested in GE because it is undervalued and underappreciated by the market despite what we believe is a transformation that will allow its world-class industrial businesses to drive attractive shareowner returns," Peltz said in a statement. "Our recent discussions with Jeff and his team have solidified our belief that they are highly motivated to fully deliver on GE’s transformation and share much common ground with Trian on ways to improve long-term shareowner value.”

Peltz and his partner Ed Garden "have a longstanding relationship" with Immelt, they said. And they have "periodically engaged in informal dialogue with GE’s management team" since 2013, they said.

Shares of GE jumped 5.3% Monday to $26.83.

Wednesday, October 14, 2015


Original Story: foxnews.com

Abby Lee Miller, of the Lifetime hit show "Dance Moms," has been indicted on charges of bankruptcy fraud, United States Attorney David J. Hickton of the Western District of Pennsylvania said in a statement. A Lexington bankruptcy lawyer is reviewing the details of this case.

The 20-count indictment includes charges related to concealment of bankruptcy assets and false bankruptcy declarations. Miller faces up to five years in prison and up to $5 million in fines, since each count carries a possible $250,000 fine.

According to the indictment, Miller filed a Petition to Reorganize her dance studio in December 2010. It states that the reality star concealed her income between 2012 and 2013 from her show as well as her spin off TV shows, Masterclass dance sessions and merchandise sales. A Louisville bankruptcy lawyer is following this story closely.

The indictment alleges Miller created bank accounts to conceal her income and made multiple false declarations in monthly operating reports. It states $755,492.85 as the total amount of income she hid.

Thursday, October 8, 2015


Original Story: cnbc.com

Trian, the $13 billion activist hedge fund run by Nelson Peltz, on Monday unveiled a roughly $2.5 billion investment in General Electric.

"We invested in GE because it is undervalued and underappreciated by the market despite what we believe is a transformation that will allow its world-class industrial businesses to drive attractive shareowner returns, "Nelson Peltz, CEO and a founding partner of Trian, said in a statement. "Our recent discussions with Jeff and his team have solidified our belief that they are highly motivated to fully deliver on GE's transformation and share much common ground with Trian on ways to improve long-term shareowner value." A San Diego securities lawyer is reviewing the details of this case.

The GE investment is the largest in Trian's history, but unlike many of the fund's more combative positions, the stake in GE and Trian's approach towards it is being described as supportive of current management.

Trian, which has been in active discussions with GE's chief executive Jeffrey Immelt, has not asked the company for a board seat and has made it clear it supports the current strategy being pursued by Immelt.

That strategy has focused GE as an industrial infrastructure company that will derive more than 90 percent of its earnings from those businesses once the divestment of GE Capital is completed in the next two years.

Trian believes GE's share price does not reflect the drastic change in its profile or the consistent earnings growth that change will bring.

Ed Garden, Trian's chief investment officer and a founding partner, said in a statement: "Trian believes GE has significant long-term potential and that its implied target value per share, including dividends,could be $40 to $45 by the end of 2017 based on our view that GE can deliver EPS of at least $2.20 in 2018." An ESOP lawyer is following this story closely.

GE's stock price continues to trade well below the level it was at prior to Immelt's ascension to CEO more than fourteen years ago and has a offered total return of only 10 percent over the past 10 years. (Get the GE latest quote here.)

Those lousy numbers are not lost on Immelt, who has been frustrated with the relatively tepid response GE shares have received from investors since the company announced its decision to largely exit its financial business last Spring.

It was GE's decision to divest most of the assets of its GE Capital unit that attracted Trian to its stock.

Trian's investment, while welcomed by GE, is not without risk for current management. While Trian has taken a number of so-called friendly positions through the years, it is far better known for its fights.

Its most recent battle, with chemicals giant Dupont, left Trian without any board seats after a bruising proxy fight that could be revisited in the not too distant future.

In its paper explaining the GE investment, Trian asks that management continue cost reductions so that operating margins reach at least 16 percent by 2018. It asks management to commit to roughly $20 billion of incremental leverage and explore share repurchases beyond GE current guidance and it notes that, while it did not ask for a board seat, it "expects management to deliver on its commitments."

GE has not publicly shared margin targets for 2018 or discussed further repurchases of its shares beyond the current plan.

In a statement on Monday, GE's Immelt said: "We welcome Trian's significant investment in the Company. GE maintains an open dialogue with our shareholders and enjoys productive, collaborative relationships with them. I have known Trian Principals Nelson Peltz and Ed Garden for many years. Trian has a strong track record of working with companies to build long-term shareholder value, and has been an engaged shareholder. We appreciate their perspectives and look forward to a constructive ongoing dialogue with Trian as we execute our strategy to reshape the Company.

Immelt added: "GE is focused on improving margins and returns,reducing costs and the size of corporate, returning capital to shareholders and realigning our portfolio, most recently with the announced exit of most of GE Capital. Significantly, we have a plan to return more than $90 billion to investors through 2018 and are on track to complete our goal of closing $100 billion of GE Capital asset sales in 2015. We are transforming GE into a focused infrastructure and technology company, leading the intersection of the physical and analytical worlds. "Our businesses are performing well in a volatile environment. In the second-quarter earnings announcement, GE raised its full-year Industrial operating earnings per share guidance to $1.13-1.20 and is on track for that goal. We are confident our strategy will further enhance shareholder value and continue to position GE for long-term growth and success."

More On GE

CLEVELAND, Ohio -- General Electric announced Wednesday that it will start a new company called Current, an energy company that integrates LED, solar, energy storage and electric vehicle businesses. An environmental lawyer represent clients in litigation and regulatory and permitting issues.

Maryrose Sylvester, who is president and CEO at GE Lighting at Nela Park in East Cleveland, has been selected to lead the new enterprise, according to a press release from GE. Sylvester will continue to oversee the local GE Lighting operations as well. 

It is unclear at this time what other impact, if any, that Current may have on the East Cleveland icon.

"We are still working through the details, but there are no plans to make any significant changes at this time," said Christopher Augustine, director of global communications and public affairs for GE Lighting. "Over the coming months we will work through the transition plans and share updates as appropriate."

Sylvester has been leading the 100-plus-year-old GE Lighting, a $3 billion enterprise, since 2011. In her new role, she is expected to scale Current from a $1 billion startup to a $5 billion business by 2020, the press release read.

Current will be headquartered in the greater Boston metropolitan area, with an additional presence in the Silicon Valley. It is expected to create roughly 200 new jobs focused on software, selling and energy product management over the next few years.

"Current combines GE's products and services in energy efficiency, solar, storage, and onsite power with our digital and analytical capabilities to provide customers – hospitals, universities, retail stores, and cities – with more profitable energy solutions," said Jeff Immelt, chairman and CEO of GE in a written statement. "The creation of a new company within GE reinforces our commitment to take energy to the next level, focusing on custom outcomes for our Commercial & Industrial customers, municipalities and utility partners, and delivering a platform that can be upgraded as technology advancements are made."

Current will begin with more than $1 billion of revenue and build on GE's legacy in energy and deep roots in technology.

Walgreens, Simon Property Group, Hilton Worldwide, JPMorgan Chase, Hospital Corporation of America (HCA), Intel and Trane, a brand of Ingersoll Rand, are already signed on as Current customers, the press release read.


Original Story: amsterdamherald.com

The Dutch Crude Oil Company (NAM) has been ordered to carry out a new safety audit of the Groningen gas fields to address concerns about the effect of earthquakes in the region.

The company has already agreed to limit production to 42.5 billion cubic metres for the next three years – a reduction of 21 per cent – and temporarily shut down five boreholes in the worst affected area around Loppersum. A Tulsa oil & gas lawyer is following this story closely.

The state mining regulator SodM has asked the NAM to do a risk assessment of the entire gas field. The company plans to compensate for the lost production in Loppersum by extracting more gas elsewhere, but residents are concerned this will increase the risk of damage to buildings and life.

Last week an earthquake measuring 3.0 on the Richter scale hit Loppersum, the ninth of magnitude 3.0 or greater since 2003.

There has been growing disquiet in Groningen about the side-effects of gas extraction as the number of earthquakes has increased significantly in the last few years.

The government agreed last month to limit gas production, but it is concerned not to damage an industry that is worth €12 billion a year. A Tulsa oil & gas attorney represents individuals and business clients seeking representation in the energy matters of oil and gas.

Bart van de Leemput, director of the NAM, promised to compile the safety report as fast as possible, mindful of the fact that the new guidelines will take effect next month.

Local residents, businesses and council officials will then have six weeks to raise objections to the proposed scheme.

Royal commissioner Max van den Berg said: “We need to have as accurate a picture as possible of the safety risks across the entire earthquake region before we can move forward.” A Cleveland environmental lawyer provides professional legal counsel and extensive experience in many aspects of environmental law.

Industry experts have admitted they are preparing for the possibility of quakes measuring between 4.5 and 6.0, strong enough to cause serious damage to buildings. The strongest quake in the region so far, measuring 3.6, hit the village of Huizinge in August 2012.


Original Story: forbes.com

As the prospects of bankruptcy for American Apparel have shifted from “if” to “when,” the company is faced with mounting legal baggage. A bankruptcy filing would automatically pause all lawsuits against the company, but its docket has grown in recent months with complaints from vendors, employees, shareholders and its infamous former CEO, Dov Charney – himself the target of a series of sexual harassment suits. A Toledo bankruptcy lawyer is reviewing the details of this case.

Last week, the New York Stock Exchange notified the company that it is at risk of being delisted from the exchange. The company has until November 15 to come into compliance with listing standards, but will likely be in bankruptcy court before then. American Apparel is ironing out the preliminary details of a restructuring plan that would see it skip a $14 million coupon payment due October 15 and use the 30-day grace period to drum up revenues during its pivotal Halloween shopping period before filing for Chapter 11, sources have told Debtwire.

Outside the small world of lawyers and bankers who have long eyed a restructuring for the company, American Apparel is as well known for Charney’s antics as it is for its clothing. A 2004 Jane magazine profile described Charney repeatedly masturbating in front of its reporter during interviews, and other stories followed that Charney referred to women as “sluts” and demanded that his store managers fire “ugly” employees. Lawsuits followed, alleging sexual harassment against many of the company’s female employees. A Boston M&A lawyer represents business clients in company restructuring and acquisitions.

American Apparel’s board of directors ousted Charney as chairman in June 2014, with cause – accusing him of refusing to take sexual harassment training and using company funds as hush money for former employees. The board highlighted the mounting legal expenses the company faced while defending lawsuits aimed at Charney, and said that potential financing sources would not deal with the company while Charney was involved.

Following his dismissal, Charney pursued a hostile takeover of American Apparel, reaching a deal with hedge fund Standard General to increase its hold on the company’s stock to 43% and potentially prop up Charney to retake control of the company.  This May, a group led by Eliana Gil Rodriguez, a former American Apparel employee and friend of Charney’s, sued the company in Delaware claiming that the board had concealed a plot to fire Charney after its reelection in June 2014 by issuing false and misleading statements.

But the alliance of Charney and Standard General was short-lived, as Charney filed a suit in June accusing Standard General and American Apparel of conspiring to remove him from the company. The hedge fund filed a lawsuit in July claiming that Charney had not met the financial conditions of the deal.

In September, American Apparel shareholders sued Standard General and board member Joseph Magnacca, the former CEO of RadioShack, claiming that the hedge fund is using the same vulture tactics on American Apparel that it used when it bought RadioShack debt to keep the company out of Chapter 11 before acquiring half its stores in bankruptcy. American Apparel’s shareholders claim that Magnacca and Standard General are too entangled, with Magnacca allegedly texting Standard General’s leader that he would be “anyplace anytime” for the hedge fund.

Vendor The Knit House Corp also sued the company last month, seeking $53,667 it claims was never paid on a fabric merchandise agreement. In June, BSG Tech LLC sued the company for infringement of its sound technology patents. More than 200 employees filed a class action against the company in April, claiming that they were laid off without proper legal notice. A Minneapolis class action lawyer is experienced in the effective resolution of class actions lawsuits as related to damage inflicted upon groups of people.

As bankruptcy fast approaches, shareholders are going after Standard General and Magnacca, Standard General and Charney are pursuing each other following their breakup, and Charney at this point is on no one’s team while he continues to make noise. Now Charney’s declaration of good faith at the time of his joining with Standard General has an ironic echo as the family drama comes under the jurisdiction of a bankruptcy judge. A Kansas City bankruptcy lawyer is following this story closely.

“The least important thing was me,” Charney said at the time. “I know that will be dealt with fairly later.”

Tuesday, October 6, 2015


Original Story: amsterdamherald.com

A court has ruled that two cannabis farmers who supplied coffeeshops in Groningen should not be punished because they effectively ran a legitimate business.

The 49-year-old man and his 39-year-old female partner cultivated cannabis on two plantations in Bellingwolde and Bierum. The court heard they used approved biological techniques, paid their electricity bills and even had an arrangement with the tax office. A Sacramento tax lawyer is reviewing the details of this case.

The prosecution service asked for work orders of 180 and 120 hours to be imposed on the couple, but the court decided they should not be penalized despite finding them guilty. Judges found that the plantations were run responsibly and had no links with the criminal fraternity.

The judgment was greeted with applause and cheering from the public gallery.

Campaigners described the judgment as a “groundbreaking” moment for Dutch drugs policy, which coffeeshop owners have been lobbying for decades to reform.

Officially cannabis is illegal, but the sale of small quantities is permitted under tightly controlled conditions in licensed “coffeeshops”. However, production and supply remain outlawed, leaving cannabis cafes no choice but to buy their wares on the black market. A Melbourne business lawyer represent corporations and small businesses in all areas of general business law.

The judges noted: “The fact that the sale of soft drugs from these coffeeshops is tolerated implies that the coffeeshops have suppliers and, by extension, there are cultivators to meet the demand for produce. The policy does not make clear how this process of supply should take place.”

Magda Berndsen, MP for the centrist-liberal D66 party, told NRC: “This decision by the court is groundbreaking, it opens up the back door for the coffeeshops. [Justice] minister Opstelten’s decision to keep cannabis cultivation illegal is now untenable in the light of this judgment.

“Regulating cannabis production is the only solution to most of the problems that municipalities are struggling with. It will bring down the health risks, free up policy capacity for other priorities

But justice minister Ivo Opstelten, in an initial reaction, signaled that the government had no plans to change its policy.  He described the judgment as surprising, but explained: “I don’t want to say too much more because I don’t want to tread on the prosecution service’s toes.”

The investigation began in 2009 when police seized more than 2500 plants and eight kilograms of hemp from the two plantations. The couple who ran them chose to contest the case as a “matter of principle”. A Westchester County criminal defense lawyer is following this story closely.

“Prosecuting us is hypocritical,” they told NRC Handelsblad. “Smoking weed is allowed and coffeeshops that sell it are tolerated by the municipality. But anyone who cultivates plants and supplies coffeeshops at the back door is committing an offence. It doesn’t make sense.”

In recent years several municipalities have tried to set up legal supply chains to break the link between coffeeshops and criminality.  But the government in The Hague has blocked all attempts to extend the policy of official tolerance to growers.

Last year the city of Utrecht set up its own cannabis growers’ club and asked the ministry of justice for an exemption, but the public health ministry overruled the initiative.

Monday, October 5, 2015


Original Story: cnbc.com

A company backed by billionaire Elon Musk on Friday said it will produce the world's most efficient solar panel.

The new panel by SolarCity, the biggest US home solar power installer, will convert sunlight into electricity at a 22.04 per cent rate, topping the 21.5 per cent made by rival SunPower, the company said. The industry average stands around 16 to 17 per cent. A Houston energy lawyer is following this story closely.

SolarCity, which was conceived by Mr Musk and his cousin Lyndon Rive while on their way to the Burning Man festival in 2004, started out installing and supporting solar systems for homes, businesses and schools.

But last year, with the acquisition of start-up Silevo, the company expanded into making the panels as well, claiming it would build more efficient systems to cut the costs of its products. A Pittsburgh environmental lawyer represents clients in environmental law matters.

"At the time, people probably thought: 'wow, that's stupid'," said Mr Musk of his foray into solar panel production. "I kind of like counterintuitive moves."

SolarCity is betting on solar power becoming more widely popular, after the costs of solar panels have dropped dramatically in the past few years amid a boost in Chinese production.

The average cost of a solar electric system has dropped 50 per cent since the start of 2010, the Obama administration said in August when announcing plans to support solar, wind and renewable energy projects.

Nearly 600,000 US homes have solar panels, according to GTM research.

Mr Rive said that as costs continue to fall he expects solar power will become the dominant source of energy by 2040, and the higher power output from each of its new panels will cut costs even further, by 15 to 20 cents per watt. A real estate development lawyer in Pittsburgh provides professional legal counsel and extensive experience in many aspects of real estate law.

"When done right, high efficiency and low cost end up being the same thing," said Mr Musk. "There's limited space on rooftops, so you want to generate as much energy as you can from that given space, to compete with natural gas or coal."

SolarCity last year announced plans to build one of the world's largest solar panel plants in upstate New York, bucking the trend of solar manufacturing being dominated by Asia.

Mr Musk said he wants to dispel beliefs that solar energy is not a viable replacement for fossil fuels. "For a long time with Tesla [the electric cars manufacturer], they said we couldn't make it. By acting first.....this helps shift big players in the industry in the right direction." A Tennessee automotive lawyer is reviewing the details of this case.

Speaking at a SolarCity event in New York, Mr Musk also touched on his ambitions to colonise Mars by sending a fusion bomb to create "two tiny pulsing suns" to warm the planet. "A lot of people don't appreciate that our sun is a giant fusion explosion."

Shares in SolarCity — of which Mr Musk holds a 23 per cent stake — climbed 7 per cent on Friday, but have fallen 20 per cent in the past year.


Original Story: cnbc.com

Global information services group Experian announced Thursday that one of its business units had been hacked. The breach occurred on a server that contained data on behalf of one of its clients, T-Mobile.

The data includes personal information for a combination of about 15 million customers and applicants in the U.S. who at one point may have applied for T-Mobile service. The company said that the incident did not impact its own consumer credit database.

The data also included applicants requiring a credit check for service or device financing from Sept. 1, 2013 through Sept. 16, 2015, Experian North America said in a statement.

The ADRs of Ireland-headquartered Experian closed Thursday up nearly 1.7 percent to $16.38, while shares of T-Mobile were down more than 1 percent in extended trading.

In a letter to consumers, T-Mobile CEO John Legere said the following:

"Obviously I am incredibly angry about this data breach and we will institute a thorough review of our relationship with Experian, but right now my top concern and first focus is assisting any and all consumers affected. I take our customer and prospective customer privacy VERY seriously. This is no small issue for us. I do want to assure our customers that neither T-Mobile's systems nor network were part of this intrusion and this did not involve any payment card numbers or bank account information."

Legere also said that any customers concerned that they may have been impacted can sign up for two years of free credit monitoring and identity resolution services at Experian's "Protect My ID" program.

Experian said it took immediate action upon finding the breach: it secured the server, initiated a comprehensive investigation and notified U.S. and international law enforcement.

The data stolen included names, dates of birth, addresses and Social Security numbers. No payment card or banking information was acquired, the company said.

"We take privacy very seriously and we understand that this news is both stressful and frustrating. We sincerely apologize for the concern and stress that this event may cause," said Craig Boundy, CEO of Experian North America. "That is why we're taking steps to provide protection and support to those affected by this incident and will continue to coordinate with law enforcement during its investigation."


Original Story: freep.com

The National Labor Relations Board says mortgage giant Quicken Loans overly restricts its employees' free speech and filed a complaint that could have long-ranging effects on what workers are allowed to say about their companies on social media sites such as Facebook and Twitter. A Boston employment lawyer assists business clients in creating policies and systems to avoid legal problems in labor and employment matters.

The NLRB complaint is to go to trial in Detroit before a federal administrative law judge on Nov. 2.

Quicken has denied that its work rules spelled out in an employee handbook are overly restrictive. The Detroit-based company is fighting the complaint. Aaron Emerson, a Quicken spokesman, called the complaint "completely absurd."

"Quicken Loans stands firmly behind its common-sense employment policies ... Quicken Loans will fight this baseless case and strongly believes justice will prevail," he said. An Atlanta employment lawyer is reviewing the details of this case.

The Quicken employee rules, known as the Big Book, is a set of internal regulations that cautions workers against speaking to the media and restricts any other conduct the company deems damaging to its interests.

The NLRB complaint against Quicken says its worker rules violate the National Labor Relations Act that permits workers to discuss pay and other policies for the purposes of organizing for collective bargaining. The agency is not seeking monetary damages but wants Quicken to rewrite its employee rules and educate employees about their rights under the law.

In recent years, the NLRB, the New Deal-era federal agency created to safeguard the rights of employees to join unions, has sparred with various companies over restrictions on worker free speech, including use of social media to comment about their workplaces. The board settled recently with Wendy's International, for example, over employee rules it says restricted speech. A Greenville employment lawyer is following this story closely.

The complaint by the NLRB’s Detroit regional office was filed in July and has been generating legal paperwork in the months since. It has been overshadowed by the U.S. Justice Department’s pending lawsuit against Quicken for allegedly abusing the federally backed mortgage rules to generate more profits.

Marick Masters, a professor and director of labor studies at Wayne State University, said the NLRB generally allows companies to protect their trade secrets but not to bar employees from discussing more routine matters such as their salaries or wage levels.

“Their tendency is to take a pretty dim view of policies that are over-broad,” Masters said. “If you tell an employee that they can’t complain to other employees about their working conditions, you’re going to get in trouble for that. If you tell an employee that they can’t talk to people on the outside about their working conditions, you’re going to get in trouble for that.”

The NLRB case stems from a complaint by a former Quicken employee, Hugh MacEachern, 61, of Taylor. MacEachern was hired at Quicken in July 2013 after working there for several months as a temporary employee. He was fired in December 2014 after he told Quicken he was speaking with the Communications Workers of America about starting a union at Quicken. He claims Quicken fired him as retribution.

But Terry Morgan, the director of the NLRB's regional office in Detroit, said her office, after investigating, has declined to file a case over MacEachern’s firing. But it did file a complaint against Quicken over its employee handbook rules. Morgan said MacEachern is likely to be a witness for the government in the upcoming hearing. A Toledo labor and employment attorney defends small businesses, insurance companies, and large corporations in employment law matters.

The NLRB has been focused lately on enforcing federal law that ensures the rights of workers to discuss general employment topics, such as pay and workplace complaints, to each other or through social media channels.

In a March 18 memo to all NLRB field officials, Richard Griffin, the board's general counsel in Washington, D.C., offered guidance on recent cases involving employer rules. He noted that the NLRB had recently settled cases against Wendy's International and other companies, and said that "employees have a ... right to discuss wages, hours, and other terms and conditions of employment with fellow employees, as well as with non-employees, such as union representatives."

Griffin's memo continued: "Thus, an employer's confidentiality policy that either specifically prohibits employee discussions of terms and conditions of employment — such as wages, hours or workplace complaints — or that employees would reasonably understand to prohibit such discussions, violates the Act."

Among the types of overly restrictive rules from various cases that Griffin's memo called unlawful were such restrictions as "(I)f something is not public information, you must not share it" and "Sharing of (overheard conversations at the work site) with your coworkers, the public, or anyone outside of your immediate work group is strictly prohibited."

Griffin noted in his memo that employees have the right to criticize or protest their employer's labor policies or treatment of employees, and even to express that dissatisfaction in ways that might be considered disrespectful, negative or rude. Employer rules that restrict that free speech "will be found unlawfully over-broad."