Original Story: USAToday.com
Labor advocates are claiming a big victory after a federal agency said Tuesday that McDonald's central, corporate operations can be lumped in with its thousands of franchises for liability purposes.
The world's largest fast-food chain promises to fight a National Labor Relations Board decision that it says "changes the rules for thousands of small businesses."
"HUGE victory for labor & fast food workers!" tweeted the Service Employees International Union. The union was responding to news as relayed in a The New York Times report that McDonald's corporate apparatus must address workers' complaints that they were fired or disciplined for participating in protests calling for higher wages.
U.S. Chamber of Commerce spokesman Randy Johnson says in a news release the NLRB move "upends existing law and is part of a larger agenda at the NLRB to overturn the joint-employer standard."
Another Chamber exec, Glenn Spencer, calls it "a ploy that could threaten nearly 800,000 franchise businesses and the millions of people who work for them."
The key phrase in the NLRB decision is "joint employer" -- that's the term that the agency's general counsel, Richard Griffin Jr., says can apply to the corporate entity, thus linking it to the franchises. Griffin is a former NLRB board member and served on the board of directors for the AFL-CIO lawyers coordinating committee.
The NLRB has determined that 43 of 181 complaints filed since November 2012 have merit to proceed, the agency says on its website. Of those "43 cases where complaint has been authorized, McDonald's franchisees and/or McDonald's, USA, LLC" -- the central, corporate entity -- "will be named as a respondent if parties are unable to reach settlement."
It is not clear from the NRLB statement how many of the cases involve franchised locations. Sixty-eight cases were found to have no merit, while "64 cases are currently pending investigation," the NLRB says.
Protests over pay at McDonald's have gained traction in recent months. SEIU President Mary Kay Henry was among those arrested in a protest preceding McDonald's shareholders meeting in May. Several McDonald's workers -- among a crowd brought in by 32 buses, police said -- were arrested as well.
The Rev. Dr. William Barber II, head of the NAACP's North Carolina chapter, led the protest march onto McDonald's headquarters campus in Oak Brook, Ill., telling USA TODAY that a "living wage is a moral mandate, and it's time for McDonald's to pay fast-food workers their just due now."
McDonald's has about 3,000 franchises in the U.S., according to the company's website. The company has a total of about 14,000 restaurants in the U.S.
"Wrong" is McDonald's way of describing the decision.
"McDonald's also believes that this decision changes the rules for thousands of small businesses, and goes against decades of established law regarding the franchise model in the United States," says Heather Smedstad, speaking on behalf of the company.
Smedstad, senior vice president over human resources in the U.S., says in a release that the fast-food giant "as well as every other company involved in franchising, relies on these existing rules to run successful businesses as part of a system that every day creates significant employment, entrepreneurial and economic opportunities across the country."
Thursday, July 31, 2014
UPS INVESTS $175 MILLION IN HOLIDAY SEASON
Original Story: USAToday.com
After a holiday shipping fiasco that left thousands of customers without packages in time for Christmas last year, United Parcel Service will invest $175 million in peak operations for the rest of 2014, the company announced Tuesday as part of its second quarter earnings statement. Let Hennion Walsh provide you with financial services.
Company shares fell 3.7% on Tuesday to $99.86.
The stock has fallen 2.3% since the beginning of the year, while the Standard & Poor's 500 index has climbed 7.1%. However, the stock has risen 18% in the last 12 months.
UPS said it will increase operating expenses for "capacity and peak related projects," including for operations on Black Friday and software that optimizes delivery routes.
UPS outraged holiday shoppers in December when it couldn't keep up with package shipments and many gifts were delayed Furious customers took to social media and UPS found itself repeatedly apologizing and providing refunds and gift cards to customers.
UPS acknowledged at the time that it was overwhelmed by package volume and wasn't prepared to handle the number of shipments it received.
"Demand was much greater than forecast," UPS spokesperson Natalie Godwin told USA TODAY in December.
CEO Scott Davis said in a release about second quarter earnings that "2014 is the year of investing for the customer. We are providing new capabilities and expanding capacity to ensure UPS meets the rapidly growing needs of the marketplace."
UPS net income declined by nearly 58% in its second quarter, missing analysts' expectations.
UPS reported net income of $454 million, or 49 cents a share, down from $1.07 billion, or $1.13 a share, in the second quarter of 2013. Hennion and Walsh Inc offers a free bond guide.
Earnings, adjusted for non-recurring costs, were $1.21 a share, compared to $1.13 last year. The average per-share estimate of analysts surveyed by Zacks Investment Research was for profit of $1.24.
UPS said a transfer of post-retirement liabilities for some union employees to defined contribution healthcare plans resulted in an after-tax charge of $665 million, contributing to the decline in profits.
Revenue was up 5.6% to $14.3 billion, from $13.5 billion in the same quarter last year. That beat Wall Street forecasts.
UPS said e-commerce and international export growth contributed to a 7.2% increase in global package shipments.
After a holiday shipping fiasco that left thousands of customers without packages in time for Christmas last year, United Parcel Service will invest $175 million in peak operations for the rest of 2014, the company announced Tuesday as part of its second quarter earnings statement. Let Hennion Walsh provide you with financial services.
Company shares fell 3.7% on Tuesday to $99.86.
The stock has fallen 2.3% since the beginning of the year, while the Standard & Poor's 500 index has climbed 7.1%. However, the stock has risen 18% in the last 12 months.
UPS said it will increase operating expenses for "capacity and peak related projects," including for operations on Black Friday and software that optimizes delivery routes.
UPS outraged holiday shoppers in December when it couldn't keep up with package shipments and many gifts were delayed Furious customers took to social media and UPS found itself repeatedly apologizing and providing refunds and gift cards to customers.
UPS acknowledged at the time that it was overwhelmed by package volume and wasn't prepared to handle the number of shipments it received.
"Demand was much greater than forecast," UPS spokesperson Natalie Godwin told USA TODAY in December.
CEO Scott Davis said in a release about second quarter earnings that "2014 is the year of investing for the customer. We are providing new capabilities and expanding capacity to ensure UPS meets the rapidly growing needs of the marketplace."
UPS net income declined by nearly 58% in its second quarter, missing analysts' expectations.
UPS reported net income of $454 million, or 49 cents a share, down from $1.07 billion, or $1.13 a share, in the second quarter of 2013. Hennion and Walsh Inc offers a free bond guide.
Earnings, adjusted for non-recurring costs, were $1.21 a share, compared to $1.13 last year. The average per-share estimate of analysts surveyed by Zacks Investment Research was for profit of $1.24.
UPS said a transfer of post-retirement liabilities for some union employees to defined contribution healthcare plans resulted in an after-tax charge of $665 million, contributing to the decline in profits.
Revenue was up 5.6% to $14.3 billion, from $13.5 billion in the same quarter last year. That beat Wall Street forecasts.
UPS said e-commerce and international export growth contributed to a 7.2% increase in global package shipments.
LET DIVORCE BE AN ENTREPRENEURIAL SPRINGBOARD
Original Story: USAToday.com
Hi Gladys, I am 55 and recently divorced. I have two kids who are both in college. During my marriage I work at various part-time jobs. But I can't say that I really did anything significant. Now I am in a situation where there is nothing to hold me back from really doing something with my life. I would like to start a small business but most of the business magazines I read seem to focus on young entrepreneurs. Sometimes I feel like I have waited to long. My friends keep telling me that it's never too late. But I don't know about that. -- M. L.
I agree with your friends, it's never too late. As long as you are living and breathing there is no reason to avoid venturing into new things.
Arriving at the mid-point in life has many rewards that you can bring to the world. You have gathered information and knowledge as a result of your experience during your life. And you have come to understand many things and most often that understanding leads to wisdom. And how that wisdom can be applied is unlimited.
You say that you haven't done anything significant, but I would say that raising kids, keeping a household running and working at any type of job outside of your home is significant. I often tell people who feel like you to make a list of all of the things that they have learned in life and in nearly every case they have expressed surprise at the things that life has taught. And even more important they have found several gems in their list that can be turned into a successful business
Taking care of a family is not an easy task. Each family member has his or her own personality and traits and must be dealt with individually and yet collectively. Facing divorce or the death of a spouse teaches one to learn to cope with change and uncertainty. And to handle your household while working outside of your home also gives you added skills.
My friend Marta worked in a part-time clerical position for years while raising her two kids and at the age of 59 she decided to enroll in a theological seminary to study theology and religion. After a several years of dedication and hard work she graduated with a degree and soon after was appointed to pastor a small church.
I have another friend who returned to school to get a Masters in Fine Arts so that she could sharpen her acting skills. Also at the age of 59, she received her degree and packed up her Volkswagen after selling her house and headed to California to find her way into acting. And so far she has managed to find quite a few acting jobs and she is often hired to perform in stage plays.
Keep in mind that Margaret Mead's career flourished in her mid-life and after divorce, as did Martha Stewart's.
The important thing is to have confidence in yourself and stop questioning your ability to reinvent yourself.
Hi Gladys, I am 55 and recently divorced. I have two kids who are both in college. During my marriage I work at various part-time jobs. But I can't say that I really did anything significant. Now I am in a situation where there is nothing to hold me back from really doing something with my life. I would like to start a small business but most of the business magazines I read seem to focus on young entrepreneurs. Sometimes I feel like I have waited to long. My friends keep telling me that it's never too late. But I don't know about that. -- M. L.
I agree with your friends, it's never too late. As long as you are living and breathing there is no reason to avoid venturing into new things.
Arriving at the mid-point in life has many rewards that you can bring to the world. You have gathered information and knowledge as a result of your experience during your life. And you have come to understand many things and most often that understanding leads to wisdom. And how that wisdom can be applied is unlimited.
You say that you haven't done anything significant, but I would say that raising kids, keeping a household running and working at any type of job outside of your home is significant. I often tell people who feel like you to make a list of all of the things that they have learned in life and in nearly every case they have expressed surprise at the things that life has taught. And even more important they have found several gems in their list that can be turned into a successful business
Taking care of a family is not an easy task. Each family member has his or her own personality and traits and must be dealt with individually and yet collectively. Facing divorce or the death of a spouse teaches one to learn to cope with change and uncertainty. And to handle your household while working outside of your home also gives you added skills.
My friend Marta worked in a part-time clerical position for years while raising her two kids and at the age of 59 she decided to enroll in a theological seminary to study theology and religion. After a several years of dedication and hard work she graduated with a degree and soon after was appointed to pastor a small church.
I have another friend who returned to school to get a Masters in Fine Arts so that she could sharpen her acting skills. Also at the age of 59, she received her degree and packed up her Volkswagen after selling her house and headed to California to find her way into acting. And so far she has managed to find quite a few acting jobs and she is often hired to perform in stage plays.
Keep in mind that Margaret Mead's career flourished in her mid-life and after divorce, as did Martha Stewart's.
The important thing is to have confidence in yourself and stop questioning your ability to reinvent yourself.
Monday, July 28, 2014
WALGREENS EYES LOOPHOLE END RUN AROUND TAXES
Original Story: USAToday.com
DIXON, Ill. — The Walgreens drugstore chain proudly touts itself as "the pharmacy America trusts."
But many here in this small river town where the founder of the company got his start complain that the drugstore chain is on the precipice of turning its back on the USA.
Walgreens, the USA's largest drugstore chain, with more than 8,500 stores, soon will decide whether to take advantage of a loophole in U.S. tax law that would allow it to save billions of dollars by moving its headquarters to Europe, where it is on the verge of acquiring controlling interest in Alliance Boots, a Swiss-based company that operates drugstores in Britain. A Tulsa Business Tax Lawyer said that giant corporations often look to move overseas for the purpose of cutting there taxes.
From the shareholders' perspective, making the move is a no-brainer: It could save the company roughly $4 billion over the next five years.
But here in this town of 16,000 where just about everybody can tell you about company founder Charles Walgreen's impact on the community, such a move seems out of step with how the Walgreen family conducted business.
"I think he'd be rolling in his grave if he knew what was going on today," says Bill Jones, who runs the Northwest Territory Historic Center in Dixon and worked closely with the Walgreen family on building an exhibit at the museum honoring the founder.
The loophole is known as tax inversion, a controversial tactic that allows a company that does most of its business in the USA to cut its federal tax bill by merging or buying an overseas company in a lower-tax country and then nominally relocating its headquarters there.
Despite years of on-and-off efforts by lawmakers in Washington and the IRS to close the loophole, dozens of American companies have used it — several in recent months.
The first corporate inversion to capture attention occurred in 1982, when oil-and-gas company McDermott moved its headquarters to Panama. It wasn't until 1994, after cosmetics company Helen of Troy moved to Bermuda, that the IRS raised concerns that such restructurings were motivated by the desire to dodge taxes.
This year alone, eight major U.S. companies — including AbbVie, Medtronic and Mylan — have announced plans to shift their headquarters overseas in an effort to trim their corporate tax rate, which hovers around 35% in the U.S. and is among the highest in the world.
Earlier this week, President Obama called inversion an "unpatriotic tax loophole" and pressed Congress to pass legislation to stem the flow of corporations that are effectively renouncing their U.S. citizenship. Inversion could cost the Treasury nearly $19.5 billion over the next decade, according to Congress' Joint Committee on Taxation.
Analysts say perhaps no company with a Main Street profile that matches Walgreens' — the country's largest pharmaceutical chain, with $72 billion in annual sales — has used the loophole, and Walgreens' pending decision is bringing unprecedented attention to the issue.
"I don't know how this inversion doesn't happen," says Christopher Geier, of the Chicago-based investment banking firm Sikich. "They'll get some bad press, but I don't see a big enough reaction from consumers on this to change where this appears to be heading."
Here in Dixon, the talk of Walgreens moving to Switzerland resonates in a personal way.
Charles Walgreen moved to Dixon as a teenager and got his start in the business working at a pharmacy, a job he took after injuring himself working at a shoe factory in town. Residents here recall Walgreen taking Boy Scouts up on his Sikorsky S-38 amphibian aircraft, which he would fly back and forth from the Chicago area and land on the Rock River, near the family's estate here.
As a young man, he moved to Chicago to seek his fortunes and eventually started his drugstore chain. But he opened his second pharmacy here in his adopted hometown — where he became revered as the city's second-favorite son. (President Ronald Reagan, who grew up here and caddied for Walgreen at the Timber Creek Country Club, is Dixon's most celebrated hometown boy.)
Walgreen, who died in 1939, saved the Dixon National Bank from going out of business during the Great Depression. The family also led fundraising for a statute erected in 1930 along the Rock River depicting a young volunteer named Abraham Lincoln, who spent time here during the Black Hawk War.
Charles Walgreen Jr., the founder's son, won the bid during World War II to open a store at the newly built Pentagon by giving all store profits to the Pentagon Post Restaurant Council, which supervised food service in the complex.
"Walgreens' attitude was so patriotically generous that no competitor could possibly better it," declared a weekly publication from the War Department.
Myrtle Walgreen, the wife of the company's founder, also was a good friend of the people of Dixon. James Burke, Dixon's mayor, says legend has it that at one of the regular coffee klatches at Dixon's Walgreens, she offered an extraordinary stock tip to some of the city's most prominent citizens.
"She told them we are getting ready to introduce a new line of product that you might consider investing in," says Burke, who has called on Walgreens to ditch the tax inversion plan. "That product was the tampon."
TRADING WALGREENS FOR CVS?
Larry Dunphy, who owns an independent bookstore in Dixon, says he takes pride in buying stocks in Illinois companies such as McDonald's, John Deere and Walgreens. But he says he's told his financial adviser to dump his stock in Walgreens and buy CVS if the company goes through with the inversion.
In the end, Dunphy says the public outcry may not have an impact on Walgreens' decision, but it could have a long-term effect on how companies approach inversion in the future and spur Congress to change laws to give companies an incentive to stay put.
"Will there be enough people who go to CVS or the local pharmacy that will offset the $4 billion that Walgreens will make by moving?" Dunphy says. "Maybe not. But I hope the damage this is doing to Walgreens' image is something that companies in the future will consider before moving to cut their share of taxes."
Walgreens CEO Gregory Wasson, who, along with his board, has come under intense pressure from shareholders to move the headquarters to Switzerland, says the company will decide soon whether to move its headquarters.
Early in 2014, Wasson said publicly that an inversion wasn't under consideration. The Deerfield, Ill., company bought 45% of Switzerland-based Alliance Boots in 2012 and has an option to buy the rest of the company next year, which would create the opportunity to make the move.
But after a private meeting in France with a shareholder group — including Goldman Sachs Investment Partners and hedge funds Jana Partners, Corvex and Och-Ziff — Wasson began to change his tune.
He made clear in a call with Wall Street analysts last month that an inversion was very much a possibility as Walgreens restructures the company ahead of completing the Alliance Boots deal.
Michael Polzin, a company spokesman, says Walgreens will do "what is in the best long-term interests of our customers, employees and shareholders."
Polzin won't comment about the impact a tax inversion would have on the company's image. The company also declined to make Kevin Walgreen, the great-grandson of the company's founder and the only member Walgreen family currently involved in day-to-day operations, available for an interview.
"Whether we do an inversion or not, we're still going to pay over $2 billion a year in federal, state, employer and property taxes," Polzin says. "We will still be one of the top job providers in America, with roughly 250,000 employees. We're going to continue to make capital investments in the U.S. and expand our business here for decades to come."
That argument hasn't assuaged some Illinois lawmakers. A Tax Lawyer Tulsa representative is actively watching the case unfold.
In a letter to Walgreens' board of directors this week, Rep. Jan Schakowsky, D-Ill., warned that the company was in danger of sullying its reputation as a community-minded corporation. She also sought to remind the Walgreens board that roughly a quarter of its $2.5 billion in profits last year were directly connected to federal programs — such as Medicare, Medicaid and the Affordable Care Act.
"Everywhere you look, the success of Walgreens is tied to the opportunities it has been afforded by this country," she wrote. "To benefit from those resources and then to refuse to pay your fair share of taxes needed to fund them is inexcusable."
In a separate letter, Sen. Dick Durbin, D-Ill., took a shot at Walgreens' folksy motto. "Is 'the corner of happy and healthy' somewhere in the Swiss Alps?" Durbin wrote. He added, "I believe you will find that your customers are deeply patriotic and will not support Walgreens' decision to turn its back on the United States."
Burke, the Dixon mayor, says he hopes Walgreens will stay put. But if it pushes ahead with the inversion, Burke notes there are three other drugstores in his town.
"I think Walgreens will see that a lot of Americans will take their business elsewhere," Burke says. "At some point, how much profit is enough?"
DIXON, Ill. — The Walgreens drugstore chain proudly touts itself as "the pharmacy America trusts."
But many here in this small river town where the founder of the company got his start complain that the drugstore chain is on the precipice of turning its back on the USA.
Walgreens, the USA's largest drugstore chain, with more than 8,500 stores, soon will decide whether to take advantage of a loophole in U.S. tax law that would allow it to save billions of dollars by moving its headquarters to Europe, where it is on the verge of acquiring controlling interest in Alliance Boots, a Swiss-based company that operates drugstores in Britain. A Tulsa Business Tax Lawyer said that giant corporations often look to move overseas for the purpose of cutting there taxes.
From the shareholders' perspective, making the move is a no-brainer: It could save the company roughly $4 billion over the next five years.
But here in this town of 16,000 where just about everybody can tell you about company founder Charles Walgreen's impact on the community, such a move seems out of step with how the Walgreen family conducted business.
"I think he'd be rolling in his grave if he knew what was going on today," says Bill Jones, who runs the Northwest Territory Historic Center in Dixon and worked closely with the Walgreen family on building an exhibit at the museum honoring the founder.
The loophole is known as tax inversion, a controversial tactic that allows a company that does most of its business in the USA to cut its federal tax bill by merging or buying an overseas company in a lower-tax country and then nominally relocating its headquarters there.
Despite years of on-and-off efforts by lawmakers in Washington and the IRS to close the loophole, dozens of American companies have used it — several in recent months.
The first corporate inversion to capture attention occurred in 1982, when oil-and-gas company McDermott moved its headquarters to Panama. It wasn't until 1994, after cosmetics company Helen of Troy moved to Bermuda, that the IRS raised concerns that such restructurings were motivated by the desire to dodge taxes.
This year alone, eight major U.S. companies — including AbbVie, Medtronic and Mylan — have announced plans to shift their headquarters overseas in an effort to trim their corporate tax rate, which hovers around 35% in the U.S. and is among the highest in the world.
Earlier this week, President Obama called inversion an "unpatriotic tax loophole" and pressed Congress to pass legislation to stem the flow of corporations that are effectively renouncing their U.S. citizenship. Inversion could cost the Treasury nearly $19.5 billion over the next decade, according to Congress' Joint Committee on Taxation.
Analysts say perhaps no company with a Main Street profile that matches Walgreens' — the country's largest pharmaceutical chain, with $72 billion in annual sales — has used the loophole, and Walgreens' pending decision is bringing unprecedented attention to the issue.
"I don't know how this inversion doesn't happen," says Christopher Geier, of the Chicago-based investment banking firm Sikich. "They'll get some bad press, but I don't see a big enough reaction from consumers on this to change where this appears to be heading."
Here in Dixon, the talk of Walgreens moving to Switzerland resonates in a personal way.
Charles Walgreen moved to Dixon as a teenager and got his start in the business working at a pharmacy, a job he took after injuring himself working at a shoe factory in town. Residents here recall Walgreen taking Boy Scouts up on his Sikorsky S-38 amphibian aircraft, which he would fly back and forth from the Chicago area and land on the Rock River, near the family's estate here.
As a young man, he moved to Chicago to seek his fortunes and eventually started his drugstore chain. But he opened his second pharmacy here in his adopted hometown — where he became revered as the city's second-favorite son. (President Ronald Reagan, who grew up here and caddied for Walgreen at the Timber Creek Country Club, is Dixon's most celebrated hometown boy.)
Walgreen, who died in 1939, saved the Dixon National Bank from going out of business during the Great Depression. The family also led fundraising for a statute erected in 1930 along the Rock River depicting a young volunteer named Abraham Lincoln, who spent time here during the Black Hawk War.
Charles Walgreen Jr., the founder's son, won the bid during World War II to open a store at the newly built Pentagon by giving all store profits to the Pentagon Post Restaurant Council, which supervised food service in the complex.
"Walgreens' attitude was so patriotically generous that no competitor could possibly better it," declared a weekly publication from the War Department.
Myrtle Walgreen, the wife of the company's founder, also was a good friend of the people of Dixon. James Burke, Dixon's mayor, says legend has it that at one of the regular coffee klatches at Dixon's Walgreens, she offered an extraordinary stock tip to some of the city's most prominent citizens.
"She told them we are getting ready to introduce a new line of product that you might consider investing in," says Burke, who has called on Walgreens to ditch the tax inversion plan. "That product was the tampon."
TRADING WALGREENS FOR CVS?
Larry Dunphy, who owns an independent bookstore in Dixon, says he takes pride in buying stocks in Illinois companies such as McDonald's, John Deere and Walgreens. But he says he's told his financial adviser to dump his stock in Walgreens and buy CVS if the company goes through with the inversion.
In the end, Dunphy says the public outcry may not have an impact on Walgreens' decision, but it could have a long-term effect on how companies approach inversion in the future and spur Congress to change laws to give companies an incentive to stay put.
"Will there be enough people who go to CVS or the local pharmacy that will offset the $4 billion that Walgreens will make by moving?" Dunphy says. "Maybe not. But I hope the damage this is doing to Walgreens' image is something that companies in the future will consider before moving to cut their share of taxes."
Walgreens CEO Gregory Wasson, who, along with his board, has come under intense pressure from shareholders to move the headquarters to Switzerland, says the company will decide soon whether to move its headquarters.
Early in 2014, Wasson said publicly that an inversion wasn't under consideration. The Deerfield, Ill., company bought 45% of Switzerland-based Alliance Boots in 2012 and has an option to buy the rest of the company next year, which would create the opportunity to make the move.
But after a private meeting in France with a shareholder group — including Goldman Sachs Investment Partners and hedge funds Jana Partners, Corvex and Och-Ziff — Wasson began to change his tune.
He made clear in a call with Wall Street analysts last month that an inversion was very much a possibility as Walgreens restructures the company ahead of completing the Alliance Boots deal.
Michael Polzin, a company spokesman, says Walgreens will do "what is in the best long-term interests of our customers, employees and shareholders."
Polzin won't comment about the impact a tax inversion would have on the company's image. The company also declined to make Kevin Walgreen, the great-grandson of the company's founder and the only member Walgreen family currently involved in day-to-day operations, available for an interview.
"Whether we do an inversion or not, we're still going to pay over $2 billion a year in federal, state, employer and property taxes," Polzin says. "We will still be one of the top job providers in America, with roughly 250,000 employees. We're going to continue to make capital investments in the U.S. and expand our business here for decades to come."
That argument hasn't assuaged some Illinois lawmakers. A Tax Lawyer Tulsa representative is actively watching the case unfold.
In a letter to Walgreens' board of directors this week, Rep. Jan Schakowsky, D-Ill., warned that the company was in danger of sullying its reputation as a community-minded corporation. She also sought to remind the Walgreens board that roughly a quarter of its $2.5 billion in profits last year were directly connected to federal programs — such as Medicare, Medicaid and the Affordable Care Act.
"Everywhere you look, the success of Walgreens is tied to the opportunities it has been afforded by this country," she wrote. "To benefit from those resources and then to refuse to pay your fair share of taxes needed to fund them is inexcusable."
In a separate letter, Sen. Dick Durbin, D-Ill., took a shot at Walgreens' folksy motto. "Is 'the corner of happy and healthy' somewhere in the Swiss Alps?" Durbin wrote. He added, "I believe you will find that your customers are deeply patriotic and will not support Walgreens' decision to turn its back on the United States."
Burke, the Dixon mayor, says he hopes Walgreens will stay put. But if it pushes ahead with the inversion, Burke notes there are three other drugstores in his town.
"I think Walgreens will see that a lot of Americans will take their business elsewhere," Burke says. "At some point, how much profit is enough?"
Monday, July 21, 2014
STATES WITH HIGHER MINIMUM WAGE GAIN MORE JOBS
Original Story: Freep.com
WASHINGTON — Maybe a higher minimum wage isn't so bad for job growth after all.
The 13 states that raised their minimum wages at the beginning of this year are adding jobs at a faster pace than those that did not, providing some counter-intuitive fuel to the debate over what impact a higher minimum has on hiring trends.
Many business groups argue that raising the minimum wage discourages job growth by increasing the cost of hiring. A Congressional Budget Office report earlier this year lent some support for that view. It found that a minimum wage of $10.10 an hour, as President Obama supports, could cost 500,000 jobs nationwide.
But the state-by-state hiring data, released Friday by the Labor Department, provides ammunition to those who disagree. Economists who support a higher minimum say the figures are encouraging, though they acknowledge they don't establish a cause and effect. There are many possible reasons hiring might accelerate in a particular state.
"It raises serious questions about the claims that a raise in the minimum wage is a jobs disaster," said John Schmitt, a senior economist at the liberal Center for Economic and Policy Research. The job data "isn't definitive," he added, but is "probably a reasonable first cut at what's going on."
Just last week, Obama cited the better performance by the 13 states in support of his proposal for boosting the minimum wage nationwide.
"When ... you raise the minimum wage, you give a bigger chance to folks who are climbing the ladder, working hard.... And the whole economy does better, including businesses," Obama said in Denver.
In the 13 states that boosted their minimums at the beginning of the year, the number of jobs grew an average of 0.85% from January through June. The average for the other 37 states was 0.61%.
Nine of the 13 states increased their minimum wages automatically in line with inflation: Arizona, Colorado, Florida, Missouri, Montana, Ohio, Oregon, Vermont and Washington. Four more states -- Connecticut, New Jersey, New York and Rhode Island -- approved legislation mandating the increases.
Twelve of those states have seen job growth this year, while employment in Vermont has been flat. The number of jobs in Florida has risen 1.6% this year, the most of the 13 states with higher minimums. Its minimum rose to $7.93 an hour from $7.79 last year.
Some economists argue that six months of data isn't enough to draw conclusions.
"It's too early to tell," said Stan Veuger, a scholar at the American Enterprise Institute. "These states are very different along all kinds of dimensions."
For example, the number of jobs in North Dakota -- which didn't raise the minimum wage and has prospered because of a boom in oil and gas drilling -- rose 2.8% since the start of this year, the most of any state.
But job growth in the aging industrial state of Ohio was just 0.7% after its minimum rose to $7.95 from $7.85. The federal minimum wage is $7.25.
Veuger, one of the 500 economists who signed a letter in March opposed to an increase in the federal minimum, said the higher wages should over time cause employers to hire fewer workers. They may also replace them with new technologies.
The Congressional Budget Office cited those factors in its February report. But in addition to job losses, the CBO also said a higher minimum could boost paychecks for another 16.5 million workers.
Sylvia Allegretto, an economist at the University of California, Berkeley, said that research comparing counties in states that raised their minimums with neighboring counties in states that did not has found no negative impact on employment.
Restaurants and other low-wage employers may have other ways of offsetting the cost of higher wages, aside from cutting back on hiring, she said. Higher pay can reduce staff turnover and save on hiring and training costs.
State and local governments have become increasingly active on the issue as the federal minimum wage has remained unchanged for five years. Twenty-two states currently have higher minimums than the federal requirement.
And 38 states have considered minimum wage legislation this year, the most on record, according to the National Conference of State Legislatures. At least 16 will boost their minimums starting next year, the NCSL says.
WASHINGTON — Maybe a higher minimum wage isn't so bad for job growth after all.
The 13 states that raised their minimum wages at the beginning of this year are adding jobs at a faster pace than those that did not, providing some counter-intuitive fuel to the debate over what impact a higher minimum has on hiring trends.
Many business groups argue that raising the minimum wage discourages job growth by increasing the cost of hiring. A Congressional Budget Office report earlier this year lent some support for that view. It found that a minimum wage of $10.10 an hour, as President Obama supports, could cost 500,000 jobs nationwide.
But the state-by-state hiring data, released Friday by the Labor Department, provides ammunition to those who disagree. Economists who support a higher minimum say the figures are encouraging, though they acknowledge they don't establish a cause and effect. There are many possible reasons hiring might accelerate in a particular state.
"It raises serious questions about the claims that a raise in the minimum wage is a jobs disaster," said John Schmitt, a senior economist at the liberal Center for Economic and Policy Research. The job data "isn't definitive," he added, but is "probably a reasonable first cut at what's going on."
Just last week, Obama cited the better performance by the 13 states in support of his proposal for boosting the minimum wage nationwide.
"When ... you raise the minimum wage, you give a bigger chance to folks who are climbing the ladder, working hard.... And the whole economy does better, including businesses," Obama said in Denver.
In the 13 states that boosted their minimums at the beginning of the year, the number of jobs grew an average of 0.85% from January through June. The average for the other 37 states was 0.61%.
Nine of the 13 states increased their minimum wages automatically in line with inflation: Arizona, Colorado, Florida, Missouri, Montana, Ohio, Oregon, Vermont and Washington. Four more states -- Connecticut, New Jersey, New York and Rhode Island -- approved legislation mandating the increases.
Twelve of those states have seen job growth this year, while employment in Vermont has been flat. The number of jobs in Florida has risen 1.6% this year, the most of the 13 states with higher minimums. Its minimum rose to $7.93 an hour from $7.79 last year.
Some economists argue that six months of data isn't enough to draw conclusions.
"It's too early to tell," said Stan Veuger, a scholar at the American Enterprise Institute. "These states are very different along all kinds of dimensions."
For example, the number of jobs in North Dakota -- which didn't raise the minimum wage and has prospered because of a boom in oil and gas drilling -- rose 2.8% since the start of this year, the most of any state.
But job growth in the aging industrial state of Ohio was just 0.7% after its minimum rose to $7.95 from $7.85. The federal minimum wage is $7.25.
Veuger, one of the 500 economists who signed a letter in March opposed to an increase in the federal minimum, said the higher wages should over time cause employers to hire fewer workers. They may also replace them with new technologies.
The Congressional Budget Office cited those factors in its February report. But in addition to job losses, the CBO also said a higher minimum could boost paychecks for another 16.5 million workers.
Sylvia Allegretto, an economist at the University of California, Berkeley, said that research comparing counties in states that raised their minimums with neighboring counties in states that did not has found no negative impact on employment.
Restaurants and other low-wage employers may have other ways of offsetting the cost of higher wages, aside from cutting back on hiring, she said. Higher pay can reduce staff turnover and save on hiring and training costs.
State and local governments have become increasingly active on the issue as the federal minimum wage has remained unchanged for five years. Twenty-two states currently have higher minimums than the federal requirement.
And 38 states have considered minimum wage legislation this year, the most on record, according to the National Conference of State Legislatures. At least 16 will boost their minimums starting next year, the NCSL says.
Tuesday, June 24, 2014
THE 10 OLDEST COMPANY LOGOS IN THE WORLD
Original Story 247WallSt.com
Even before global marketing campaigns, television commercials, and social media, a company's logo has been important. Over time, as businesses and consumers have changed, most major companies have also changed their logos dramatically. Still, some logos have had incredible staying power and have lasted for decades or even hundreds of years.
The world's oldest logos have all retained some core visual element, although several have been noticeably altered. Stella Artois, for example, is recognized by several details of its icon. The horn and the star resting above the label are the features continually represented in the brand's history.
Not surprisingly, the original intent behind a company's icon may be mysterious to many consumers. In some cases, this is due to the logo predating the company's current operations. Global energy conglomerate Royal Dutch Shell plc was originally a shipping company, transporting kerosene to India and returning with seashells to sell in Euro. The company selected a shell image as a result.
Paint company Sherwin-Williams, on the other hand, chose to symbolize its business with an image of a bucket of paint poured over a drawing of the Earth, a somewhat more explicit representation.
Many companies use their longevity as a selling point to consumers in advertising and on corporate websites. Companies also emphasize that they remain connected to their founding principles, with key management often related to the brand's inventor or the company's founder. Twinings Tea and Peugeot, for example, still employ descendants of their original founders.
While many of these companies operate internationally, all are recognizable to American consumers. Some are industry leaders — Sherwin-Williams, Levi's, and Heinz, for example, dominate U.S. markets. Peugeot, on the other hand, failed in the U.S. Many Americans, however, recognize the brand as virtually ubiquitous in Europe.
Based on a review of the world's oldest companies, 24/7 Wall St. identified the 10 oldest corporate logos still in use today. In order to be considered, the logo had to currently have an international presence. The logo also could not have been meaningfully changed.
1. Stella Artois
> Logo first used: 1366
> Company founded: 1366
> Parent company revenue: $43.2 billion
> Industry: Beverage
The origins of Stella Artois can be traced to 1366 when the Den Hoorn brewery was established in Leuven, Belgium. Local brewer Sebastian Artois bought the brewery in 1708 and renamed it after himself. The word Stella, meaning "star" in Latin, was not added to the name until the company released its first seasonal beer, the Christmas Star, in 1926. However, despite numerous shifts in management over hundreds of years, the original horn logo has not changed. The same horn that once beckoned travellers in Belgium is still prominently featured in the current Stella Artois brand. Today, Anheuser-Busch-Inbev distributes Stella Artois in more than 80 countries. According to Plato Logic Limited, a beer market data company, Stella Artois is the best-selling Belgian beer in the world.
2. Twinings Tea
> Logo first used: 1887
> Company founded: 1706
> Parent company revenue: $22.6 billion
> Industry: Beverage
Twinings Tea has used the same logo — capitalized font beneath a lion crest — continuously for 227 years, making it the world's oldest unaltered logo in continuous use, according to the company website. Perhaps even more remarkable, the company has occupied the same location on London's Strand since its founding by Thomas Twining in 1706. Tea consumption was not always essential to everyday British life. Coffee, gin, and beer dominated English breakfast drink preferences in the early 18th century. By the turn of the century, however, tea had become extremely popular. After 10 generations, family-owned Twinings is now a globally recognized company, distributing its tea to more than 100 countries worldwide.
3. Bass Ale
> Logo first used: 1876
> Company founded: 1777
> Parent company revenue: $43.2 billion
> Industry: Beverage
Bass Ale has used the red triangle logo since 1876, when the logo became the first registered trademark ever issued by the British government. Its simple design may have helped Bass become one of England's leading beer producers by 1890. The logo became so popular that Edouard Manet featured it in his 1882 work "A Bar at the Folies Bergere" and James Joyce explicitly mentioned it in his novel "Ulysses."Bass Ale is even mentioned in connection with the sinking of the Titanic, as it was carrying 12,000 bottles of Bass in its hold when it sank. According Anheuser-Busch-InBev, Bass ale was even fought over by Napoleon.
4. Shell Oil
> Logo first used: 1904
> Company founded: 1833
> Parent company revenue: $451.2 billion
> Industry: Energy
In 1891, Marcus Samuel and Company began shipping kerosene from London to India and bringing back seashells for sale in the European markets. Initially, the seashell business was so popular that it accounted for most of the company's profits. Samuel incorporated the name "Shell" in 1897 and designated a mussel shell as its logo. In 1904, a scallop shell became the official logo. In 1907, Shell merged with the Royal Dutch Petroleum Company, retaining the logo that remains synonymous with the oil conglomerate. In 1915, Shell opened its first service station in California, introducing the red and yellow color scheme still in use. Today, Shell is one of the world's largest energy companies, with a market value of nearly $260 billion.
5. Levi Strauss & Co.
> Logo first used: 1886
> Company founded: 1837
> Parent company revenue: $4.7 billion
> Industry: Clothing
Levi's logo featuring two horses is perhaps just as durable as the denim it is printed on. Levi's first used the logo in 1886 as a way to grow its market share before its patent on the jean-making process expired. In fact, the logo became so widespread that, according to Levi Strauss & Co., early customers would often ask for "those pants with two horses." In fact, the brand used the name "The Two Horse Brand' until 1928, when Levi Strauss officially trademarked the Levi's name. Levi's employed roughly 16,000 employees worldwide as of last year. Its product line now includes jeans, casual and dress pants, and jackets.
6. Sherwin-Williams
> Logo first used: 1905
> Company founded: 1866
> Parent company revenue: $10.2 billion
> Industry: Specialty chemicals
Sherwin-Williams’s logo was originally created in the 1890s by George Ford, the company’s head advertiser. Despite initial reservations about the design, general manager Walter Cottingham considered it an accurate illustration of the company’s rapid growth. In 1905, the “cover the earth” logo replaced an image of a chameleon as the company’s official logo. Sherwin-Williams, based in Cleveland, Ohio, is one of the world’s largest manufacturers, distributors, and retailers of paint. It had nearly 4,000 stores and employed nearly 38,000 people worldwide as of 2013.
7. Heinz
> Logo first used: 1869
> Company founded: 1869
> Parent company revenue: $11.5 billion
> Industry: Food
Heinz first hit the market in 1869 when Henry Heinz and L. Clarence Noble used vegetables from the garden of Heinz’s mother to bottle horseradish and sell it in U.S. markets. While Heinz & Noble Co. did not survive the financial panic of 1873, Heinz returned to selling condiments in a big way in 1876 when he introduced ketchup to the American consumer. Since 1876, Heinz has grown to supply more than 5,700 products worldwide. The Heinz logo itself has its roots in the original Heinz & Noble Co. of 1869. In terms of font, size, and shape, very little of the logo has changed since its inception. Last year, Heinz was acquired by Warren Buffett’s Berkshire Hathaway and private equity firm 3G Capital for $28 billion.
8. Prudential
> Logo first used: 1896
> Company founded: 1875
> Parent company revenue: $41.5 billion
> Industry: Life insurance
Prudential introduced its “Rock of Gibraltar” logo in 1896, shortly after the company was founded. The symbol appeared in a weekly newspaper above the words, “The Prudential has the strength of Gibraltar.” According to the company’s website, the rock is an icon of “strength, stability, expertise, and innovation.” Prudential has always been an insurance company, founded by John Fairfield Dryden as the Prudential Friendly Society in 1875. The prominence of the logo has paid off particularly well in international markets, where Prudential shares a name with local unrelated companies. In these cases, Prudential uses the rock logo with the alternative wording to promote its brand. Prudential Financial, Inc. (NYSE: PRU) is now among the world’s largest financial institutions, operating in more than 40 countries around the world. The company reported total revenue of $41.5 billion at the end of last year.
9. Peugeot
> Logo first used: 1850
> Company founded: 1810
> Parent company revenue: $54.1 billion
> Industry: Automotive
Justin Blazer, an engraver by trade, designed the original Peugeot trademark in 1847. The logo, originally depicting a lion standing on an arrow, has undergone some modifications — the arrow, for example has been removed, and the lion has changed its pose. The company itself has undergone more considerable changes. Peugeot was initially founded in 1810 as a steel manufacturer. Before becoming one of the world’s most well-known automakers, Peugeot was in the bicycle business. Peugeot is now known as PSA Peugeot Citroen.
10. Johnson & Johnson
> Logo first used: 1887
> Company founded: 1886
> Parent company revenue: $71.3 billion
> Industry: Drug manufacturers
Johnson & Johnson (NYSE: JNJ) — the first company in the U.S. to mass-produce and distribute sterile surgical dressings — was founded in New Brunswick, New Jersey in 1886. The distinctive cursive of the “Johnson & Johnson” logo was modelled after founding brother James Wood Johnson’s written signature the next year. The logo continues to be among the world’s most recognizable images. Johnson & Johnson is now a publicly traded company manufacturing a wide range of medical and consumer products. The company’s products are sold in nearly every country in the world. Last year, the company invested between $20 million and $30 million in a global corporate branding campaign, prominently featuring the company’s long-standing script logo.
Even before global marketing campaigns, television commercials, and social media, a company's logo has been important. Over time, as businesses and consumers have changed, most major companies have also changed their logos dramatically. Still, some logos have had incredible staying power and have lasted for decades or even hundreds of years.
The world's oldest logos have all retained some core visual element, although several have been noticeably altered. Stella Artois, for example, is recognized by several details of its icon. The horn and the star resting above the label are the features continually represented in the brand's history.
Not surprisingly, the original intent behind a company's icon may be mysterious to many consumers. In some cases, this is due to the logo predating the company's current operations. Global energy conglomerate Royal Dutch Shell plc was originally a shipping company, transporting kerosene to India and returning with seashells to sell in Euro. The company selected a shell image as a result.
Paint company Sherwin-Williams, on the other hand, chose to symbolize its business with an image of a bucket of paint poured over a drawing of the Earth, a somewhat more explicit representation.
Many companies use their longevity as a selling point to consumers in advertising and on corporate websites. Companies also emphasize that they remain connected to their founding principles, with key management often related to the brand's inventor or the company's founder. Twinings Tea and Peugeot, for example, still employ descendants of their original founders.
While many of these companies operate internationally, all are recognizable to American consumers. Some are industry leaders — Sherwin-Williams, Levi's, and Heinz, for example, dominate U.S. markets. Peugeot, on the other hand, failed in the U.S. Many Americans, however, recognize the brand as virtually ubiquitous in Europe.
Based on a review of the world's oldest companies, 24/7 Wall St. identified the 10 oldest corporate logos still in use today. In order to be considered, the logo had to currently have an international presence. The logo also could not have been meaningfully changed.
1. Stella Artois
> Logo first used: 1366
> Company founded: 1366
> Parent company revenue: $43.2 billion
> Industry: Beverage
The origins of Stella Artois can be traced to 1366 when the Den Hoorn brewery was established in Leuven, Belgium. Local brewer Sebastian Artois bought the brewery in 1708 and renamed it after himself. The word Stella, meaning "star" in Latin, was not added to the name until the company released its first seasonal beer, the Christmas Star, in 1926. However, despite numerous shifts in management over hundreds of years, the original horn logo has not changed. The same horn that once beckoned travellers in Belgium is still prominently featured in the current Stella Artois brand. Today, Anheuser-Busch-Inbev distributes Stella Artois in more than 80 countries. According to Plato Logic Limited, a beer market data company, Stella Artois is the best-selling Belgian beer in the world.
2. Twinings Tea
> Logo first used: 1887
> Company founded: 1706
> Parent company revenue: $22.6 billion
> Industry: Beverage
Twinings Tea has used the same logo — capitalized font beneath a lion crest — continuously for 227 years, making it the world's oldest unaltered logo in continuous use, according to the company website. Perhaps even more remarkable, the company has occupied the same location on London's Strand since its founding by Thomas Twining in 1706. Tea consumption was not always essential to everyday British life. Coffee, gin, and beer dominated English breakfast drink preferences in the early 18th century. By the turn of the century, however, tea had become extremely popular. After 10 generations, family-owned Twinings is now a globally recognized company, distributing its tea to more than 100 countries worldwide.
3. Bass Ale
> Logo first used: 1876
> Company founded: 1777
> Parent company revenue: $43.2 billion
> Industry: Beverage
Bass Ale has used the red triangle logo since 1876, when the logo became the first registered trademark ever issued by the British government. Its simple design may have helped Bass become one of England's leading beer producers by 1890. The logo became so popular that Edouard Manet featured it in his 1882 work "A Bar at the Folies Bergere" and James Joyce explicitly mentioned it in his novel "Ulysses."Bass Ale is even mentioned in connection with the sinking of the Titanic, as it was carrying 12,000 bottles of Bass in its hold when it sank. According Anheuser-Busch-InBev, Bass ale was even fought over by Napoleon.
4. Shell Oil
> Logo first used: 1904
> Company founded: 1833
> Parent company revenue: $451.2 billion
> Industry: Energy
In 1891, Marcus Samuel and Company began shipping kerosene from London to India and bringing back seashells for sale in the European markets. Initially, the seashell business was so popular that it accounted for most of the company's profits. Samuel incorporated the name "Shell" in 1897 and designated a mussel shell as its logo. In 1904, a scallop shell became the official logo. In 1907, Shell merged with the Royal Dutch Petroleum Company, retaining the logo that remains synonymous with the oil conglomerate. In 1915, Shell opened its first service station in California, introducing the red and yellow color scheme still in use. Today, Shell is one of the world's largest energy companies, with a market value of nearly $260 billion.
5. Levi Strauss & Co.
> Logo first used: 1886
> Company founded: 1837
> Parent company revenue: $4.7 billion
> Industry: Clothing
Levi's logo featuring two horses is perhaps just as durable as the denim it is printed on. Levi's first used the logo in 1886 as a way to grow its market share before its patent on the jean-making process expired. In fact, the logo became so widespread that, according to Levi Strauss & Co., early customers would often ask for "those pants with two horses." In fact, the brand used the name "The Two Horse Brand' until 1928, when Levi Strauss officially trademarked the Levi's name. Levi's employed roughly 16,000 employees worldwide as of last year. Its product line now includes jeans, casual and dress pants, and jackets.
6. Sherwin-Williams
> Logo first used: 1905
> Company founded: 1866
> Parent company revenue: $10.2 billion
> Industry: Specialty chemicals
Sherwin-Williams’s logo was originally created in the 1890s by George Ford, the company’s head advertiser. Despite initial reservations about the design, general manager Walter Cottingham considered it an accurate illustration of the company’s rapid growth. In 1905, the “cover the earth” logo replaced an image of a chameleon as the company’s official logo. Sherwin-Williams, based in Cleveland, Ohio, is one of the world’s largest manufacturers, distributors, and retailers of paint. It had nearly 4,000 stores and employed nearly 38,000 people worldwide as of 2013.
7. Heinz
> Logo first used: 1869
> Company founded: 1869
> Parent company revenue: $11.5 billion
> Industry: Food
Heinz first hit the market in 1869 when Henry Heinz and L. Clarence Noble used vegetables from the garden of Heinz’s mother to bottle horseradish and sell it in U.S. markets. While Heinz & Noble Co. did not survive the financial panic of 1873, Heinz returned to selling condiments in a big way in 1876 when he introduced ketchup to the American consumer. Since 1876, Heinz has grown to supply more than 5,700 products worldwide. The Heinz logo itself has its roots in the original Heinz & Noble Co. of 1869. In terms of font, size, and shape, very little of the logo has changed since its inception. Last year, Heinz was acquired by Warren Buffett’s Berkshire Hathaway and private equity firm 3G Capital for $28 billion.
8. Prudential
> Logo first used: 1896
> Company founded: 1875
> Parent company revenue: $41.5 billion
> Industry: Life insurance
Prudential introduced its “Rock of Gibraltar” logo in 1896, shortly after the company was founded. The symbol appeared in a weekly newspaper above the words, “The Prudential has the strength of Gibraltar.” According to the company’s website, the rock is an icon of “strength, stability, expertise, and innovation.” Prudential has always been an insurance company, founded by John Fairfield Dryden as the Prudential Friendly Society in 1875. The prominence of the logo has paid off particularly well in international markets, where Prudential shares a name with local unrelated companies. In these cases, Prudential uses the rock logo with the alternative wording to promote its brand. Prudential Financial, Inc. (NYSE: PRU) is now among the world’s largest financial institutions, operating in more than 40 countries around the world. The company reported total revenue of $41.5 billion at the end of last year.
9. Peugeot
> Logo first used: 1850
> Company founded: 1810
> Parent company revenue: $54.1 billion
> Industry: Automotive
Justin Blazer, an engraver by trade, designed the original Peugeot trademark in 1847. The logo, originally depicting a lion standing on an arrow, has undergone some modifications — the arrow, for example has been removed, and the lion has changed its pose. The company itself has undergone more considerable changes. Peugeot was initially founded in 1810 as a steel manufacturer. Before becoming one of the world’s most well-known automakers, Peugeot was in the bicycle business. Peugeot is now known as PSA Peugeot Citroen.
10. Johnson & Johnson
> Logo first used: 1887
> Company founded: 1886
> Parent company revenue: $71.3 billion
> Industry: Drug manufacturers
Johnson & Johnson (NYSE: JNJ) — the first company in the U.S. to mass-produce and distribute sterile surgical dressings — was founded in New Brunswick, New Jersey in 1886. The distinctive cursive of the “Johnson & Johnson” logo was modelled after founding brother James Wood Johnson’s written signature the next year. The logo continues to be among the world’s most recognizable images. Johnson & Johnson is now a publicly traded company manufacturing a wide range of medical and consumer products. The company’s products are sold in nearly every country in the world. Last year, the company invested between $20 million and $30 million in a global corporate branding campaign, prominently featuring the company’s long-standing script logo.
Thursday, June 19, 2014
THOSE SEX HARASSMENT LAWSUITS AGAINST AMERICAN APPAREL CEO DOV CHARNEY WERE MOSTLY BOGUS, IT TURNS OUT
Original Story: Business Insider
Some people owe American Apparel CEO Dov Charney an apology: The vast majority of the sexual harassment claims made against him have come to nothing.
A couple of years ago, Charney's name was synonymous with sexual harassment — he was accused at one time in seven different cases of unwanted sexual contact with female staffers or the models he shoots for the chain's advertising.
Most notoriously, one woman, Irene Morales, claimed she was briefly kept as Charney's sex slave inside his Los Angeles apartment.
Fast forward to today and it turns out most of the claims against Charney were bogus.
In American Apparel's annual report — which contains an update of the litigation against Charney and the company — only one very old case remains outstanding in court. That case, filed in 2006 by Sylvia Hsu, doesn't even have any specific allegations against Charney — it's a class action on behalf of all female employees and it cites an unidentified co-worker as a defendant.
The annual report describes three harassment cases in arbitration. One was settled "with no monetary liability to the Company." And, "The Company recently prevailed on the sexual harassment claims in another of these cases." (Normally, when companies settle cases they pay to make them go away, to avoid embarrassing facts from coming out. The fact that AA hasn't made any payout so far on the harassment claims suggests Charney's defense was a strong one.)
That leaves the Hsu case and one other case in arbitration. Here's the company's update:
The Company has previously disclosed an arbitration filed by the Company on February 17, 2011, related to cases filed in the Supreme Court of New York, County of Kings (Case No. 5018-1) and Superior Court of the State of California for the County of Los Angeles (Case Nos. BC457920 and BC460331) against American Apparel, Dov Charney and certain members of the Board of Directors asserting claims of sexual harassment, assault and battery, impersonation through the internet, defamation and other related claims. The Company recently settled one of these cases with no monetary liability to the Company. The Company recently prevailed on the sexual harassment claims in another of these cases. While the ultimate resolution of the remaining claims cannot be determined, in light of the favorable ruling in one of these cases, the amount of settlement in the other of these cases, and based on information available at this time regarding the remaining cases, we believe, but we cannot provide assurances that, the amount and ultimate liability, if any, with respect to these remaining actions will not materially affect our business, financial position, results of operations, or cash flows.
Some people owe American Apparel CEO Dov Charney an apology: The vast majority of the sexual harassment claims made against him have come to nothing.
A couple of years ago, Charney's name was synonymous with sexual harassment — he was accused at one time in seven different cases of unwanted sexual contact with female staffers or the models he shoots for the chain's advertising.
Most notoriously, one woman, Irene Morales, claimed she was briefly kept as Charney's sex slave inside his Los Angeles apartment.
Fast forward to today and it turns out most of the claims against Charney were bogus.
In American Apparel's annual report — which contains an update of the litigation against Charney and the company — only one very old case remains outstanding in court. That case, filed in 2006 by Sylvia Hsu, doesn't even have any specific allegations against Charney — it's a class action on behalf of all female employees and it cites an unidentified co-worker as a defendant.
The annual report describes three harassment cases in arbitration. One was settled "with no monetary liability to the Company." And, "The Company recently prevailed on the sexual harassment claims in another of these cases." (Normally, when companies settle cases they pay to make them go away, to avoid embarrassing facts from coming out. The fact that AA hasn't made any payout so far on the harassment claims suggests Charney's defense was a strong one.)
That leaves the Hsu case and one other case in arbitration. Here's the company's update:
The Company has previously disclosed an arbitration filed by the Company on February 17, 2011, related to cases filed in the Supreme Court of New York, County of Kings (Case No. 5018-1) and Superior Court of the State of California for the County of Los Angeles (Case Nos. BC457920 and BC460331) against American Apparel, Dov Charney and certain members of the Board of Directors asserting claims of sexual harassment, assault and battery, impersonation through the internet, defamation and other related claims. The Company recently settled one of these cases with no monetary liability to the Company. The Company recently prevailed on the sexual harassment claims in another of these cases. While the ultimate resolution of the remaining claims cannot be determined, in light of the favorable ruling in one of these cases, the amount of settlement in the other of these cases, and based on information available at this time regarding the remaining cases, we believe, but we cannot provide assurances that, the amount and ultimate liability, if any, with respect to these remaining actions will not materially affect our business, financial position, results of operations, or cash flows.
Wednesday, June 18, 2014
WENDY'S PRETZEL BURGER MAKES A COMEBACK
Original story: USAToday.com
The pretzel burger is finally, mercifully back.
And Wendy's is hinting — though not promising — that it may be back for good.
After a six-month absence, Wendy's will bring back over the July 4th weekend both its wildly popular Pretzel Bacon Cheeseburger and its Pretzel Pub Chicken Sandwich. The success of Wendy's pretzel burger arguably set off 2013's pretzelmania trend in fast-food, from Sonic's pretzel dog to Dunkin's pretzel roast beef sandwich to DQ's pretzel Blizzard.
Above all else, pretzels — especially soft pretzels — sell. Proof: consumers inhaled more than 50 million pretzel sandwiches from Wendy's in 2013, driving 3% sales jumps in both the third and fourth quarters, says CEO Emil Brolick.
"The relaunch is a seminal event in our innovation history," says Brolick in a phone interview. But this go-around, he says coyly, Wendy's won't specifically say if the re-launch is a limited-time offering or a permanent menu addition. "Time will tell," he says.
Of course, customers will have serious influence, too. After Wendy's removed the pretzel sandwiches from its menu late last year, it was pounded on social media by pretzel-loving customers."We learned the passion and emotional connection that people have with Pretzel Bacon Cheeseburger," says Brolick.
The burger, with a soft pretzel bun, is made with cheddar cheese, smoked bacon and honey mustard sauce, will be $4.99, about 30 cents more than last year. Also, notes Chief Marketing Officer Craig Bahner, consumers now will be able to request a pretzel bun with any other Wendy's sandwich for an additional 30 cents. "If you want a Dave's Hot 'N Juicy Double on a pretzel bun, we'll accommodate that," he says.
Beyond pretzel buns, the relaunch shows how quickly young, demanding consumers are changing fast food menus — particularly, sandwich buns and breads. "How long has it been since fast-food changed the white bun?" asks Elizabeth Sloan, a restaurant industry trends consultant. "There is a revolution going on in terms of sandwich carriers."
And beyond. Sloan points out that last year, 225 million Americans say they bought some kind of gourmet food or specialty food, and that number is growing.
For Wendy's, the intro also is a bid to boost sales during its already-busiest time of year and to regain its footing as an industry innovator.
Under its late founder Dave Thomas, Wendy's was regarded as a fast-food innovator with then-trend-setting offerings ranging from chili to baked potatoes to prepackaged salads.
The pretzel sandwiches may help change that. Within the industry's social-media buzz meter over the past several years, pretzel sandwiches arguably rank right up there with Taco Bell's game-changing Doritos Locos Tacos.
With the pretzel burger, Wendy's is chasing Millennials by aiming up, says Brolick. He says the chain is competing less with McDonald's and Burger King and increasingly with Chipotle and Panera Bread — which are preferred by Millennials.
That's also why Wendy's will launch a new version of its pretzel burger "Love Songs" ad campaign, which went viral last time around. This time, Morgan Smith, better known as "Red," the woman with the red hair who appears as a Wendy's booster in so many of its ads, will belt out a song professing her love for Wendy's pretzel burger.
Funniest, pretzel burger-worshiping line from her reinvented version of the song All By Myself: "When I was young, I never needed any bun."
The pretzel burger is finally, mercifully back.
And Wendy's is hinting — though not promising — that it may be back for good.
After a six-month absence, Wendy's will bring back over the July 4th weekend both its wildly popular Pretzel Bacon Cheeseburger and its Pretzel Pub Chicken Sandwich. The success of Wendy's pretzel burger arguably set off 2013's pretzelmania trend in fast-food, from Sonic's pretzel dog to Dunkin's pretzel roast beef sandwich to DQ's pretzel Blizzard.
Above all else, pretzels — especially soft pretzels — sell. Proof: consumers inhaled more than 50 million pretzel sandwiches from Wendy's in 2013, driving 3% sales jumps in both the third and fourth quarters, says CEO Emil Brolick.
"The relaunch is a seminal event in our innovation history," says Brolick in a phone interview. But this go-around, he says coyly, Wendy's won't specifically say if the re-launch is a limited-time offering or a permanent menu addition. "Time will tell," he says.
Of course, customers will have serious influence, too. After Wendy's removed the pretzel sandwiches from its menu late last year, it was pounded on social media by pretzel-loving customers."We learned the passion and emotional connection that people have with Pretzel Bacon Cheeseburger," says Brolick.
The burger, with a soft pretzel bun, is made with cheddar cheese, smoked bacon and honey mustard sauce, will be $4.99, about 30 cents more than last year. Also, notes Chief Marketing Officer Craig Bahner, consumers now will be able to request a pretzel bun with any other Wendy's sandwich for an additional 30 cents. "If you want a Dave's Hot 'N Juicy Double on a pretzel bun, we'll accommodate that," he says.
Beyond pretzel buns, the relaunch shows how quickly young, demanding consumers are changing fast food menus — particularly, sandwich buns and breads. "How long has it been since fast-food changed the white bun?" asks Elizabeth Sloan, a restaurant industry trends consultant. "There is a revolution going on in terms of sandwich carriers."
And beyond. Sloan points out that last year, 225 million Americans say they bought some kind of gourmet food or specialty food, and that number is growing.
For Wendy's, the intro also is a bid to boost sales during its already-busiest time of year and to regain its footing as an industry innovator.
Under its late founder Dave Thomas, Wendy's was regarded as a fast-food innovator with then-trend-setting offerings ranging from chili to baked potatoes to prepackaged salads.
The pretzel sandwiches may help change that. Within the industry's social-media buzz meter over the past several years, pretzel sandwiches arguably rank right up there with Taco Bell's game-changing Doritos Locos Tacos.
With the pretzel burger, Wendy's is chasing Millennials by aiming up, says Brolick. He says the chain is competing less with McDonald's and Burger King and increasingly with Chipotle and Panera Bread — which are preferred by Millennials.
That's also why Wendy's will launch a new version of its pretzel burger "Love Songs" ad campaign, which went viral last time around. This time, Morgan Smith, better known as "Red," the woman with the red hair who appears as a Wendy's booster in so many of its ads, will belt out a song professing her love for Wendy's pretzel burger.
Funniest, pretzel burger-worshiping line from her reinvented version of the song All By Myself: "When I was young, I never needed any bun."
Friday, June 13, 2014
FOR DEAL MAKERS, WHAT NOT TO WEAR TO WOO MEN'S WEARHOUSE
Original Story: WSJ.com
Mergers and acquisitions pros like their pricey duds: $5,000 suits, $200 Hermès silk ties and $1,300 John Lobb shoes.
But a deal's a deal, and sometimes that means shopping at Men's Wearhouse.
The attorneys at Willkie Farr & Gallagher LLP, which advised Men's Wearhouse on its recent deal to purchase rival Jos. A. Bank, shrugged off Armani and Zegna in favor of $600 suits by Joseph Abboud —a once-prestigious brand now owned by Men's Wearhouse. Some of these lawyers are considering investing in Philadelphia Apartments to have some real estate property.
They were "custom-made," points out partner Steven Seidman, who says he donned a light blue number with a subtle plaid pattern to several meetings during the six-month negotiation period.
"If you're coming in to make a pitch to a client that you're going to be charging a lot of money to, you should understand their product," says David Edwab, vice chairman of the board of directors for Men's Wearhouse.
In the hypercompetitive world of mergers, acquisitions and initial public offerings, you really do need to dress to impress. And it helps to have a flexible definition of what that means.
Consider the IPO of yogawear maker Lululemon Athletica Inc. LULU -0.64% seven years ago. Anxious bankers were prepared to strike a brand-appropriate pose to win the company's business.
Ditching their pressed shirts, suits and dress shoes, deal teams at several banks showed up at meetings wearing form-fitting yoga pants, track suit tops and sneakers to convince Lululemon's management that they would be committed to the underwriting assignment—and to the spirit of the brand.
But yoga isn't for everyone. The stretchy bottoms were tight, remembers one banker who pitched the company. "It was pretty embarrassing, actually," says the banker, who remembers leaving his hotel the morning of the pitch and feeling goofy as people in business suits walked by. Even though they were determined to wear the pants, the bank didn't get a piece of the deal.
In uptown Manhattan, UBS AG's bankers were planning an elaborate stunt of their own for the Lululemon pitch. The bank outfitted around 75 of its employees in Lululemon gear and had them descend upon Central Park for a "flash mob" yoga session. They photographed the event and presented it to Lululemon's management during their pitch. UBS was named as one of the deal's underwriters.
"Our sales went down when we stopped interviewing investment banks," jokes Robert Meers, Lululemon's CEO at the time, who was stunned by the number of bankers who loped into meetings sporting his product.
While bankers may resort to gimmickry for all manner of pitches, deal makers agree that retail clients require particularly special handling.
To woo a food company, for instance, bankers might arrange to have nibbles from the brand's pantry at the pitch. Tech bankers often dress down to be in sync with the relaxed vibe of Silicon Valley.
But fashion CEOs tend to have a discerning eye for detail and an obsession with who wears what.
True Religion founder and former CEO Jeffrey Lubell remembers one banker's entire outfit from when the two met in 2005.
"At the time, Peter Comisar appeared in my newest Big T Cords, a great shirt and blazer," recalls Mr. Lubell. "His fashion was a stand out in a sea of dark suits and ties."
Even the banker can recite his outfit for that crucial day: The corduroy pants were olive green with white stitching around the pockets.
The deal didn't materialize. But Mr. Comisar made such an impression that, years later, Mr. Lubell hired him to represent the brand in its sale to a private-equity firm.
The tradition of playing dress-up for a pitch extends back decades. Gilbert Harrison, founder of retail investment bank Financo LLC, remembers learning the lesson the hard way. In the 1970s, Mr. Harrison showed up to a meeting in St. Louis with the chairman of Interco Inc. wearing his go-to shoe: black Gucci loafers. Interco owned a number of shoe brands at the time, including Florsheim.
"Young man if you're coming here to sell a Camel, don't smoke a Lucky Strike," Mr. Harrison recalls being told by Maurice Chambers, an Interco executive who is now deceased. Later on, Mr. Chambers gave him a catalog and told him to order a few pairs. Mr. Harrison chose dress shoes in black and brown, and never got off on the wrong foot with Interco again, he says.
Fashion faux pas can be costly. Karen Goodman, a managing director at Financo, recalls driving to a pitch to sell a business for a different shoe retailer. Ms. Goodman says she usually wears the products of the client she is pitching. But on her drive over to the meeting, she realized she had on a competitor's kicks.
"It was 8 a.m. and stores weren't open," she laments. Financo lost the deal to a competitor and later learned, from a board member, that the snub had to do with the not-so-fancy footwork.
All the wardrobe changes can add up. Bankers are typically expected to pay for outfits and accessories out of pocket, which can get pricey when it comes to pitching luxury clients.
Jane DeFlorio, a former retail investment banker at Deutsche Bank, still grits her teeth when she opens her jewelry box and finds two cheap-looking necklaces she bought for a meeting with the founder of an accessories brand. The opera-length cream and gold plastic disk necklaces set her back $500 each, plus expedited shipping, she recalls.
"It just killed me to buy them," she says. To make matters worse, spending big bucks didn't work. The company chose a different bank.
Sometimes, the sartorial solicitation makes for delicate business. When Ms. DeFlorio worked on bra and panty maker Maidenform's initial public offering, she was often the only woman in the room, she says. Whenever the management team or other bankers would talk about the fit or comfort of the bras, they'd motion to her and ask her opinion, she remembers. Intimately familiar with the product, she obliged.
During a roadshow presentation in New York, Ms. DeFlorio remembers addressing a room full of men. To add a bit of levity to the session, she introduced Maidenform's management team with a tacit product endorsement that elicited laughs.
"I can speak to the quality of this company, the quality of its management team," she said, jutting out her hips for the punch line. "And most of all, I can speak to the quality of the product."
Mergers and acquisitions pros like their pricey duds: $5,000 suits, $200 Hermès silk ties and $1,300 John Lobb shoes.
But a deal's a deal, and sometimes that means shopping at Men's Wearhouse.
The attorneys at Willkie Farr & Gallagher LLP, which advised Men's Wearhouse on its recent deal to purchase rival Jos. A. Bank, shrugged off Armani and Zegna in favor of $600 suits by Joseph Abboud —a once-prestigious brand now owned by Men's Wearhouse. Some of these lawyers are considering investing in Philadelphia Apartments to have some real estate property.
They were "custom-made," points out partner Steven Seidman, who says he donned a light blue number with a subtle plaid pattern to several meetings during the six-month negotiation period.
"If you're coming in to make a pitch to a client that you're going to be charging a lot of money to, you should understand their product," says David Edwab, vice chairman of the board of directors for Men's Wearhouse.
In the hypercompetitive world of mergers, acquisitions and initial public offerings, you really do need to dress to impress. And it helps to have a flexible definition of what that means.
Consider the IPO of yogawear maker Lululemon Athletica Inc. LULU -0.64% seven years ago. Anxious bankers were prepared to strike a brand-appropriate pose to win the company's business.
Ditching their pressed shirts, suits and dress shoes, deal teams at several banks showed up at meetings wearing form-fitting yoga pants, track suit tops and sneakers to convince Lululemon's management that they would be committed to the underwriting assignment—and to the spirit of the brand.
But yoga isn't for everyone. The stretchy bottoms were tight, remembers one banker who pitched the company. "It was pretty embarrassing, actually," says the banker, who remembers leaving his hotel the morning of the pitch and feeling goofy as people in business suits walked by. Even though they were determined to wear the pants, the bank didn't get a piece of the deal.
In uptown Manhattan, UBS AG's bankers were planning an elaborate stunt of their own for the Lululemon pitch. The bank outfitted around 75 of its employees in Lululemon gear and had them descend upon Central Park for a "flash mob" yoga session. They photographed the event and presented it to Lululemon's management during their pitch. UBS was named as one of the deal's underwriters.
"Our sales went down when we stopped interviewing investment banks," jokes Robert Meers, Lululemon's CEO at the time, who was stunned by the number of bankers who loped into meetings sporting his product.
While bankers may resort to gimmickry for all manner of pitches, deal makers agree that retail clients require particularly special handling.
To woo a food company, for instance, bankers might arrange to have nibbles from the brand's pantry at the pitch. Tech bankers often dress down to be in sync with the relaxed vibe of Silicon Valley.
But fashion CEOs tend to have a discerning eye for detail and an obsession with who wears what.
True Religion founder and former CEO Jeffrey Lubell remembers one banker's entire outfit from when the two met in 2005.
"At the time, Peter Comisar appeared in my newest Big T Cords, a great shirt and blazer," recalls Mr. Lubell. "His fashion was a stand out in a sea of dark suits and ties."
Even the banker can recite his outfit for that crucial day: The corduroy pants were olive green with white stitching around the pockets.
The deal didn't materialize. But Mr. Comisar made such an impression that, years later, Mr. Lubell hired him to represent the brand in its sale to a private-equity firm.
The tradition of playing dress-up for a pitch extends back decades. Gilbert Harrison, founder of retail investment bank Financo LLC, remembers learning the lesson the hard way. In the 1970s, Mr. Harrison showed up to a meeting in St. Louis with the chairman of Interco Inc. wearing his go-to shoe: black Gucci loafers. Interco owned a number of shoe brands at the time, including Florsheim.
"Young man if you're coming here to sell a Camel, don't smoke a Lucky Strike," Mr. Harrison recalls being told by Maurice Chambers, an Interco executive who is now deceased. Later on, Mr. Chambers gave him a catalog and told him to order a few pairs. Mr. Harrison chose dress shoes in black and brown, and never got off on the wrong foot with Interco again, he says.
Fashion faux pas can be costly. Karen Goodman, a managing director at Financo, recalls driving to a pitch to sell a business for a different shoe retailer. Ms. Goodman says she usually wears the products of the client she is pitching. But on her drive over to the meeting, she realized she had on a competitor's kicks.
"It was 8 a.m. and stores weren't open," she laments. Financo lost the deal to a competitor and later learned, from a board member, that the snub had to do with the not-so-fancy footwork.
All the wardrobe changes can add up. Bankers are typically expected to pay for outfits and accessories out of pocket, which can get pricey when it comes to pitching luxury clients.
Jane DeFlorio, a former retail investment banker at Deutsche Bank, still grits her teeth when she opens her jewelry box and finds two cheap-looking necklaces she bought for a meeting with the founder of an accessories brand. The opera-length cream and gold plastic disk necklaces set her back $500 each, plus expedited shipping, she recalls.
"It just killed me to buy them," she says. To make matters worse, spending big bucks didn't work. The company chose a different bank.
Sometimes, the sartorial solicitation makes for delicate business. When Ms. DeFlorio worked on bra and panty maker Maidenform's initial public offering, she was often the only woman in the room, she says. Whenever the management team or other bankers would talk about the fit or comfort of the bras, they'd motion to her and ask her opinion, she remembers. Intimately familiar with the product, she obliged.
During a roadshow presentation in New York, Ms. DeFlorio remembers addressing a room full of men. To add a bit of levity to the session, she introduced Maidenform's management team with a tacit product endorsement that elicited laughs.
"I can speak to the quality of this company, the quality of its management team," she said, jutting out her hips for the punch line. "And most of all, I can speak to the quality of the product."
Wednesday, June 11, 2014
CHICAGO MONEY MANAGER STEPHEN COLEMAN CHARGED WITH FRAUD
Original Story: Chicago Tribune
Illinois regulators have charged Daedalus Capital LLC founder and chief investment officer Stephen Messiah Coleman with fraud, claiming in a civil action that the money manager sold improper investments and acted as an unlicensed adviser. Will he need a Novi Divorce Lawyer when his wife finds out?
Coleman had earlier been the subject of an investigation by Missouri securities regulators. He moved to Chicago two years ago from St. Louis and has been running advertisements in theater programs, promising to double investors’ money in five years or less regardless of market conditions.
In a “temporary order of prohibition” dated May 16, the Illinois Securities Department prohibited Daedalus for selling securities, namely the Deuce and Alpha, for 90 days effective May 16 subject to further order from the state. Coleman has 30 days to request a hearing after having been served the order. If he doesn’t, the order can become final.
“On the Illinois matter, I have no comment today,” Coleman said Friday morning. The Illinois securities division, which brought the charges, also declined to comment on Friday.
Missouri, where Coleman had lived for most of his life, had prohibited him from selling securities. That state’s securities commissioner had found that Coleman had committed fraud, a ruling that a division spokesman said was upheld by circuit and appeals courts in the state. But an administrative hearing commissioner looking into whether Coleman had violated professional conduct standards rejected charges in 2010 that Coleman had misled people who invested in a related company, saying financial arrangements were disclosed in documents. In another legal proceeding in 2012, a Missouri county court ruled that no evidence was presented that Coleman’s investors lost money, but it fined him and Daedalus $50,000 and found he committed fraud after selling unregistered securities and acting as an unregistered investment adviser, in violation of securities laws.
Illinois is charging him with fraud in the offer and sale of securities; the offer and sale of unregistered securities; fraud in offering investment advice; and acting as an unregistered investment adviser.
Deuce is a "debt security" that seeks to double its money in five years. A copy of the Deuce agreement on Daedalus' website prominently states that the security isn't registered with the SEC or any state securities laws.
Coleman has accepted $346,000 from four Deuce investors, but the vehicle has an undisclosed $248,404 unfunded liability, Illinois said in its eight-page order.
Coleman and Daedalus “omitted to inform investors that they had insufficient assets to cover projected liabilities to current investors,” Illinois said.
Daedalus had assured at least one Deuce investor in January that it was “highly confident” that it would be able to fulfill its obligations, the state of Illinois said.
Although the Deuce agreement, as well as that for Alpha, discloses that the state of Missouri had fined Daedalus $50,000 for selling unregistered securities, the agreement failed to say that the penalties were unpaid, the state of Illinois pointed out. The Deuce and Alpha agreements also didn’t mention federal tax liens filed against Coleman, the state said.
Securities sold in Illinois must be registered unless they receive exemptions.
“Daedalus is not using an exemption from registration,” Illinois securities regulators quote Coleman as saying under oath in February 2014. “We did not seek registration of the Deuce because it is borrowed money, like a bank loan.”
Another Daedalus investment is Alpha, which invests in up to five stocks. Coleman told the Tribune on May 7 for a story that ran May 18 that clients give him their usernames and passwords to allow him to manage money in their accounts, a practice known as proxy trading. Coleman said that was one reason he didn’t need to be registered.
In its May 16 complaint, the state of Illinois says it’s typical industry practice to file a limited power of attorney with a broker dealer granting the money manager the power to execute trades in the customers’ accounts.
The state of Illinois said Coleman essentially misrepresented himself as the account’s owner. The state said it suspects that Coleman did so because he was afraid that the broker dealer might not do business with him given his past history with regulators.
Also, by acting in such a manner, Coleman was acting as an investment adviser despite not being registered, the state of Illinois said.
Coleman, who declined to comment on Illinois’ actions, on Friday called the Missouri actions “a rigged game.”
“This was nothing simple or benign,” he said. “It was evil in my eyes.
“Do not get lost in the muck,” Coleman told the Tribune on Friday. “The truth that brought Daedalus to your attention endures: Daedalus Capital LLC promises a return of 100 percent or more to our clients, in five years or less, regardless of general market conditions."
Illinois regulators have charged Daedalus Capital LLC founder and chief investment officer Stephen Messiah Coleman with fraud, claiming in a civil action that the money manager sold improper investments and acted as an unlicensed adviser. Will he need a Novi Divorce Lawyer when his wife finds out?
Coleman had earlier been the subject of an investigation by Missouri securities regulators. He moved to Chicago two years ago from St. Louis and has been running advertisements in theater programs, promising to double investors’ money in five years or less regardless of market conditions.
In a “temporary order of prohibition” dated May 16, the Illinois Securities Department prohibited Daedalus for selling securities, namely the Deuce and Alpha, for 90 days effective May 16 subject to further order from the state. Coleman has 30 days to request a hearing after having been served the order. If he doesn’t, the order can become final.
“On the Illinois matter, I have no comment today,” Coleman said Friday morning. The Illinois securities division, which brought the charges, also declined to comment on Friday.
Missouri, where Coleman had lived for most of his life, had prohibited him from selling securities. That state’s securities commissioner had found that Coleman had committed fraud, a ruling that a division spokesman said was upheld by circuit and appeals courts in the state. But an administrative hearing commissioner looking into whether Coleman had violated professional conduct standards rejected charges in 2010 that Coleman had misled people who invested in a related company, saying financial arrangements were disclosed in documents. In another legal proceeding in 2012, a Missouri county court ruled that no evidence was presented that Coleman’s investors lost money, but it fined him and Daedalus $50,000 and found he committed fraud after selling unregistered securities and acting as an unregistered investment adviser, in violation of securities laws.
Illinois is charging him with fraud in the offer and sale of securities; the offer and sale of unregistered securities; fraud in offering investment advice; and acting as an unregistered investment adviser.
Deuce is a "debt security" that seeks to double its money in five years. A copy of the Deuce agreement on Daedalus' website prominently states that the security isn't registered with the SEC or any state securities laws.
Coleman has accepted $346,000 from four Deuce investors, but the vehicle has an undisclosed $248,404 unfunded liability, Illinois said in its eight-page order.
Coleman and Daedalus “omitted to inform investors that they had insufficient assets to cover projected liabilities to current investors,” Illinois said.
Daedalus had assured at least one Deuce investor in January that it was “highly confident” that it would be able to fulfill its obligations, the state of Illinois said.
Although the Deuce agreement, as well as that for Alpha, discloses that the state of Missouri had fined Daedalus $50,000 for selling unregistered securities, the agreement failed to say that the penalties were unpaid, the state of Illinois pointed out. The Deuce and Alpha agreements also didn’t mention federal tax liens filed against Coleman, the state said.
Securities sold in Illinois must be registered unless they receive exemptions.
“Daedalus is not using an exemption from registration,” Illinois securities regulators quote Coleman as saying under oath in February 2014. “We did not seek registration of the Deuce because it is borrowed money, like a bank loan.”
Another Daedalus investment is Alpha, which invests in up to five stocks. Coleman told the Tribune on May 7 for a story that ran May 18 that clients give him their usernames and passwords to allow him to manage money in their accounts, a practice known as proxy trading. Coleman said that was one reason he didn’t need to be registered.
In its May 16 complaint, the state of Illinois says it’s typical industry practice to file a limited power of attorney with a broker dealer granting the money manager the power to execute trades in the customers’ accounts.
The state of Illinois said Coleman essentially misrepresented himself as the account’s owner. The state said it suspects that Coleman did so because he was afraid that the broker dealer might not do business with him given his past history with regulators.
Also, by acting in such a manner, Coleman was acting as an investment adviser despite not being registered, the state of Illinois said.
Coleman, who declined to comment on Illinois’ actions, on Friday called the Missouri actions “a rigged game.”
“This was nothing simple or benign,” he said. “It was evil in my eyes.
“Do not get lost in the muck,” Coleman told the Tribune on Friday. “The truth that brought Daedalus to your attention endures: Daedalus Capital LLC promises a return of 100 percent or more to our clients, in five years or less, regardless of general market conditions."
Monday, May 12, 2014
M&A frenzy as Pfizer amasses AstraZeneca critics
Original Story: USAToday.com
LONDON — Fears that a proposed $106 billion takeover of British pharmaceuticals firm AstraZeneca by Pfizer, its New York-based rival that makes the erectile dysfunction drug Viagra, would lead to job losses and tax sidestepping is ruffling political feathers on both sides of the Atlantic even as merger activity in the pharma sector hits record levels. A San Francisco M&A Lawyer says this will affect the U.S.
Since the start of the year, the value of deal-making maneuvers in the global pharmaceutical sector has hit nearly $240 billion, making 2014 the busiest year ever, according to Thomson Reuters data.
"What the Pfizer bid for AstraZeneca has done is to highlight that the next cycle in the bio-pharmaceutical business is M&A," says Basil Petrides, an analyst at Beaufort Securities, a London-based wealth management company.
"There are always synergies to be had in terms of minimizing overlap, but the deals we have seen recently are not necessarily all about cost-cutting either," he says. "Intellectual property rights on drugs only last for a certain amount of years and after that they are opened up to other manufacturers. Pfizer has been circling this deal for a long time. Its pipeline of drugs is slowly eroding and the easiest way to get value for shareholders is to take over companies that have 'pipe' and proven technology."
In addition to Pfizer's spurned cash and stock bid for AstraZeneca on May 2 — worth a bit less after shares in Britain's second-largest drugs firm closed down 2.4% Friday — Germany's Bayer agreed to purchase New Jersey-headquartered Merck's consumer care business on May 6 for $14.2 billion.
On April 22, activist investor Bill Ackman teamed up with Canada's Valeant Pharmaceuticals for a $47 billion bid for Allergen, the maker of Botox. That same day, Novartis of Switzerland and Britain's GlaxoSmithKline said they would swap assets and combine units in a deal valued at around $16 billion. A New York M&A Lawyer is not surprised by the numbers.
Pfizer's so-far rebuffed interest in AstraZeneca is confronting particularly intensive scrutiny in Britain though. The pharmaceutical industry is thought of, by Prime Minister David Cameron's coalition government and key by opposition parties, as a "jewel in Britain's scientific and industrial crown," as the Association of the British Pharmaceutical Industry (ABPI) has put it.
The ABPI, whose current president is Pfizer's managing director in Britain, declined to comment on the proposed deal, but did provide data showing that the pharmaceutical industry directly employs 73,000 people in Britain and as a sector "represents 25% of all expenditure on R&D in U.K. businesses" — a figure that fell to about $29 billion in 2012, according to the Office for National Statistics.
Critics of the deal say losing AstraZeneca, which employs around 6,700 workers in Britain and makes a sizable contribution to its R&D efforts, would weaken Britain's claim to being a major global player in science and technology. Foes of the proposal, including the opposition Labour Party leader Ed Miliband, accuse Cameron of being a "cheerleader" for the takeover, arguing that Pfizer has failed to provide sufficient assurances that it won't shed jobs or gut a planned research center AstraZeneca is building in the technology hub of Cambridge.
''Let me be absolutely clear — I'm not satisfied. I want more. But the way to get more is to engage," Cameron has said, responding to allegations he has been too supportive of the proposal.
Others, including some from the prime minister's Conservative Party, have voiced suspicions that Pfizer is concerned chiefly with lowering its tax liabilities by shifting its domicile to the United Kingdom, where the corporate tax rate is lower, and have called for a public interest test.
"If such a test were applied in this case, then I believe Pfizer's bid would fail. It doesn't have a great track record in honoring its undertakings and the suspicion remains it is primarily interested in reducing its tax bill," David Davis, a senior Conservative politician, told the Times of London.
On Tuesday and Wednesday, Ian Read, Pfizer's Scottish-born CEO, and Pascal Soriot, AstraZeneca's French boss, will appear before two separate panels of British lawmakers to face questioning about the deal's potential impact.
One relatively recent test case that may arise is U.S. foods company Kraft's 2010 takeover of British chocolate maker Cadbury. "Kraft implied it was going to keep staff on at Cadbury, but as soon as the deal was done it didn't," says Petrides, the Beaufort analyst. A factory that was slated to remain open was also closed.
Anders Borg, Sweden's foreign minister, already warned this week that Pfizer failed to live up to pledges it made over keeping jobs in that country following its acquisition of drug maker Pharmacia in 2002.
"Our experience shows that their track record is not very convincing and I think one should take these kind of promises not only with a pinch of salt but a sack full of salt," Borg said, speaking on British radio.
Capitol Hill is paying attention, too. Sen. Carl Levin, D-Mich, said Thursday he would push for legislation aimed at closing a loophole that permits companies to re-incorporate in overseas territories with lower tax bases.
"Companies that exploit this loophole benefit from the protections and services the federal government provides, including patent protection, research and development tax credits, national security and more," said Levin. Senate Finance Committee chairman Ron Wyden, D-Ore., supports Levin's initiative.
Also Thursday, Delaware Gov. Jack Markell and Maryland Gov. Martin O'Malley sent a letter to Pfizer's Read, expressing concern over how a deal with the British drug maker may affect the 5,700 workers in their states.
"Our states have invested substantially to make AstraZeneca a success in our communities. Elected officials and the public have a right to know Pfizer's intentions with respect to the key U.S. operations of AstraZeneca and the thousands of employees in our states whose jobs may be jeopardized by Pfizer's desire to reduce its tax liabilities," they wrote.
In a video posted on Pfizer's website over the weekend, Read shot back at critics who have called into doubt his firm's motives, saying the deal would be a "win-win" for society and investors. He has previously written to Cameron, confirming a commitment to Britain's science sector.
Read said Saturday that gaining access to AstraZeneca's R&D was a key motivation for the bid. "When we looked at AstraZeneca, we liked their science. We liked where their science is being done, which is in the U.K., and we know we have good science in the U.K. in Cambridge, Oxford, London and other universities," he said. No new pledges were made.
Since rejecting Pfizer's bid as "inadequate" and subsequent comments from Soriot that shareholders have been "supportive" of that move, AstraZeneca has made few public comments.
LONDON — Fears that a proposed $106 billion takeover of British pharmaceuticals firm AstraZeneca by Pfizer, its New York-based rival that makes the erectile dysfunction drug Viagra, would lead to job losses and tax sidestepping is ruffling political feathers on both sides of the Atlantic even as merger activity in the pharma sector hits record levels. A San Francisco M&A Lawyer says this will affect the U.S.
Since the start of the year, the value of deal-making maneuvers in the global pharmaceutical sector has hit nearly $240 billion, making 2014 the busiest year ever, according to Thomson Reuters data.
"What the Pfizer bid for AstraZeneca has done is to highlight that the next cycle in the bio-pharmaceutical business is M&A," says Basil Petrides, an analyst at Beaufort Securities, a London-based wealth management company.
"There are always synergies to be had in terms of minimizing overlap, but the deals we have seen recently are not necessarily all about cost-cutting either," he says. "Intellectual property rights on drugs only last for a certain amount of years and after that they are opened up to other manufacturers. Pfizer has been circling this deal for a long time. Its pipeline of drugs is slowly eroding and the easiest way to get value for shareholders is to take over companies that have 'pipe' and proven technology."
In addition to Pfizer's spurned cash and stock bid for AstraZeneca on May 2 — worth a bit less after shares in Britain's second-largest drugs firm closed down 2.4% Friday — Germany's Bayer agreed to purchase New Jersey-headquartered Merck's consumer care business on May 6 for $14.2 billion.
On April 22, activist investor Bill Ackman teamed up with Canada's Valeant Pharmaceuticals for a $47 billion bid for Allergen, the maker of Botox. That same day, Novartis of Switzerland and Britain's GlaxoSmithKline said they would swap assets and combine units in a deal valued at around $16 billion. A New York M&A Lawyer is not surprised by the numbers.
Pfizer's so-far rebuffed interest in AstraZeneca is confronting particularly intensive scrutiny in Britain though. The pharmaceutical industry is thought of, by Prime Minister David Cameron's coalition government and key by opposition parties, as a "jewel in Britain's scientific and industrial crown," as the Association of the British Pharmaceutical Industry (ABPI) has put it.
The ABPI, whose current president is Pfizer's managing director in Britain, declined to comment on the proposed deal, but did provide data showing that the pharmaceutical industry directly employs 73,000 people in Britain and as a sector "represents 25% of all expenditure on R&D in U.K. businesses" — a figure that fell to about $29 billion in 2012, according to the Office for National Statistics.
Critics of the deal say losing AstraZeneca, which employs around 6,700 workers in Britain and makes a sizable contribution to its R&D efforts, would weaken Britain's claim to being a major global player in science and technology. Foes of the proposal, including the opposition Labour Party leader Ed Miliband, accuse Cameron of being a "cheerleader" for the takeover, arguing that Pfizer has failed to provide sufficient assurances that it won't shed jobs or gut a planned research center AstraZeneca is building in the technology hub of Cambridge.
''Let me be absolutely clear — I'm not satisfied. I want more. But the way to get more is to engage," Cameron has said, responding to allegations he has been too supportive of the proposal.
Others, including some from the prime minister's Conservative Party, have voiced suspicions that Pfizer is concerned chiefly with lowering its tax liabilities by shifting its domicile to the United Kingdom, where the corporate tax rate is lower, and have called for a public interest test.
"If such a test were applied in this case, then I believe Pfizer's bid would fail. It doesn't have a great track record in honoring its undertakings and the suspicion remains it is primarily interested in reducing its tax bill," David Davis, a senior Conservative politician, told the Times of London.
On Tuesday and Wednesday, Ian Read, Pfizer's Scottish-born CEO, and Pascal Soriot, AstraZeneca's French boss, will appear before two separate panels of British lawmakers to face questioning about the deal's potential impact.
One relatively recent test case that may arise is U.S. foods company Kraft's 2010 takeover of British chocolate maker Cadbury. "Kraft implied it was going to keep staff on at Cadbury, but as soon as the deal was done it didn't," says Petrides, the Beaufort analyst. A factory that was slated to remain open was also closed.
Anders Borg, Sweden's foreign minister, already warned this week that Pfizer failed to live up to pledges it made over keeping jobs in that country following its acquisition of drug maker Pharmacia in 2002.
"Our experience shows that their track record is not very convincing and I think one should take these kind of promises not only with a pinch of salt but a sack full of salt," Borg said, speaking on British radio.
Capitol Hill is paying attention, too. Sen. Carl Levin, D-Mich, said Thursday he would push for legislation aimed at closing a loophole that permits companies to re-incorporate in overseas territories with lower tax bases.
"Companies that exploit this loophole benefit from the protections and services the federal government provides, including patent protection, research and development tax credits, national security and more," said Levin. Senate Finance Committee chairman Ron Wyden, D-Ore., supports Levin's initiative.
Also Thursday, Delaware Gov. Jack Markell and Maryland Gov. Martin O'Malley sent a letter to Pfizer's Read, expressing concern over how a deal with the British drug maker may affect the 5,700 workers in their states.
"Our states have invested substantially to make AstraZeneca a success in our communities. Elected officials and the public have a right to know Pfizer's intentions with respect to the key U.S. operations of AstraZeneca and the thousands of employees in our states whose jobs may be jeopardized by Pfizer's desire to reduce its tax liabilities," they wrote.
In a video posted on Pfizer's website over the weekend, Read shot back at critics who have called into doubt his firm's motives, saying the deal would be a "win-win" for society and investors. He has previously written to Cameron, confirming a commitment to Britain's science sector.
Read said Saturday that gaining access to AstraZeneca's R&D was a key motivation for the bid. "When we looked at AstraZeneca, we liked their science. We liked where their science is being done, which is in the U.K., and we know we have good science in the U.K. in Cambridge, Oxford, London and other universities," he said. No new pledges were made.
Since rejecting Pfizer's bid as "inadequate" and subsequent comments from Soriot that shareholders have been "supportive" of that move, AstraZeneca has made few public comments.
Tuesday, May 6, 2014
CLASS OF 2014 FACES TOUGH JOB MARKET
Original Story Money.CNN.com
Class of 2014: Get ready for a rocky job market.
It's been about five years since the recession officially ended, but there is still a sizable group of young high school and college grads who are idle. Known as "disconnected youth," these under 25-year-olds are neither working, nor enrolled in college.
Roughly 1 in 5 young high school graduates and 1 in 10 recent college graduates fell into these ranks last year, according to a new report by the Economic Policy Institute, a liberal think tank.
The researchers used government census data to come to some rather depressing conclusions for the class of 2014. Young people graduating from high school or college in the next few months will "join a sizable backlog of unemployed college graduates from the last five graduating classes in an extremely difficult job market," they say.
Share: Not working, not in school? What are you doing instead?
The growing ranks of "disconnected youth" make for a worrisome trend, confirmed by earlier studies conducted by the Brookings Institution and the Social Science Research Council.
While the three research groups crunched the data separately, the conclusions all remain the same: Being "disconnected" is a setback that could have a lasting impact on millennials' career tracks and lifetime earnings.
So if they're not working or studying, what are these young people doing instead?
Unfortunately, the data doesn't get very specific. Many are actively looking for jobs, while others may be taking care of family, volunteering, living with a disability that makes it difficult to work, or yes... vegging out playing video games.
As for those who do get jobs, they are not immune from the ongoing impact of the jobs crisis, either.
For starters, even the lucky graduates who find jobs are starting out with wages lower than the generation that came before them. Wages for young graduates have been falling for over a decade, according to EPI.
Recent high school grads (ages 17 to 20) earn hourly wages around $9.82. After adjusting for inflation, that's 11% lower than they earned in 2000.
For recent college grads between the ages of 21 and 24, average earnings are around $16.99, or 8% lower than they were in 2007.
These declines represent a substantial amount of money. If wages had merely remained about the same, for example, today's young graduates would be earning about $2,500 to $3,000 more per year.
Meanwhile, job benefits are also on the decline. In 2000, about 53% of newly employed college grads received health insurance from their job. Now only 31% do.
It's possible to overcome these setbacks as young workers move up the career ladder, but the process often takes 10 to 15 years, the report warns.
"The evidence suggests that because of their unlucky timing -- in other words, through absolutely no fault of their own -- this cohort is very likely to fare poorly for at least the next decade," it says.
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