1. Mutterings after Stern Hu Gets Hard Time
Australia's foreign minister, Stephen Smith, says that Stern Hu's sentence is harsh, and that part of the trial took place behind closed doors, in defiance it appears of the Sino-Australian consular agreement.
"Because we have had no access to that part of the trial, there are I think serious, unanswered questions which international business community will want to continue to pursue with China." For more on the diplomatic fall-out from the Rio Tinto case, go here.
2. Supreme Court on Foreign-Cubed Securities Fraud Actions.
What are called "foreign cubed" actions are those brought in the courts of the US by a foreign party, against another foreign party, and based upon securities issued in a foreign country. So what is the connection with the US?
In the case of Morrison v. National Australian Bank, the foreign country is -- as you've probably just guessed -- Australia. Investors in that country bought securities issued by a bank in that country and traded on an exchange there. But in 1998 that bank purchased a US based mortgage company, HoimeSide Lending, and the investors complain of shenanigans Australian investors in NAB complain that NAB's treatmnent of that mortgage unit thereafter.
On March 29, 2010, the Supreme Court of the United States heard oral arguments in this case, considering whether the federal courts of the US ought to be considering the question of whteher NAB violated section 10(b) of the Securities and Exchange Act of 1934.
3. Richard Grubman back in the news.
I have to note this mug shot. That's Richard Grubman, who was arrested and released on his own recognizance after an altercation with the valet at the parking garage of a fancy-schmansy hotal. Grubman is due back in Boston Municipal Court on April 30 for a pretrial conference.
Grubman is one of the principals of a prominent hedge fund. His previous "15 minutes of fame" arrived back in 2001. In a now-infamous conference call, Grubman pressed Enron's Jeffrey Skiling about why Enron had not submitted a balance sheet with its 10k. Skilling responded, "Thank you very much ... asshole." The moment became emblematic of Enron's troubles -- executives of large cap companies are generally expected to put their best foot forward on such conference calls, and not to "lose it" even under provocation!
Anyway, there is now likely one valet who thinks Skilling was right.
Showing posts with label federal courts. Show all posts
Showing posts with label federal courts. Show all posts
Sunday, April 4, 2010
Wednesday, February 10, 2010
Last Friday morning
Last Friday I attended a hearing, in Manhattan, and listened to witnesses testify before the Committee on Rules of Practice and Procedure of the Judicial Conference of the United States, on a proposed re-write of Rule 2019.
As is my usual practice in these matters, I drove down to Stamford the previous evening, stayed at a hotel (by preference La Quinta, which is convenient to both the highway and the train station), then took MetroNorth into Grand Central early Friday morning. When I arrived at the hotel, around 9 PM Thursday, there were three police cars in front of the main entrance. Two more were to come by a couple of minutes later. Bravely pushing on despite my own desperado past, I went to the front desk to check in anyway.
Curiousity in its cat-killing way got the better of me, and I made discrete inquiries. It appears that a homeless man had been camping out in of the the supposedly unocuupied rooms of the hotel. I'm unsure how he had originally gotten there, but apparently housekeepiung discovered him. All the police were doing was trying to find out who he was -- deliver him to some relation if they could find one -- deliver him to one of the city's shelters otherwise. For this they needed five squad cars? I'm guessing conversational lulls were ruling the day at the coffee shops on Stamford where that city's Finest hang out, and they relished the diversion.
Anyway, my train ride went smoothly the next morning and I was soon in Grand Central. I elected to take a cab from there to the federal courthouse near Foley Square where the hearing was to be, and the cabbie elected the FDR.
There are no trash bins within about two blocks of that courthouse. I know this because a woman in line with me at the security checkpoint was complaining about this as she held an empty styrofoam cofee cup in her hand. She had purchased the coffee who-knows-where and had found no place wherein the discard the cup.
My hearing took place on the 23d floor. The room's window faced north, and there was an impressive view of the towers of midtown.
The hearing was actually of interest as these things go, though its unlikely any of the fifty or so non-testifying observers was there for fun. I suppose you know a good deal more about that evening and morning in my life now than you ever thought you would. The point? -- well, how about this: this is my blog, and I can be self-indulgent if I want to.
As is my usual practice in these matters, I drove down to Stamford the previous evening, stayed at a hotel (by preference La Quinta, which is convenient to both the highway and the train station), then took MetroNorth into Grand Central early Friday morning. When I arrived at the hotel, around 9 PM Thursday, there were three police cars in front of the main entrance. Two more were to come by a couple of minutes later. Bravely pushing on despite my own desperado past, I went to the front desk to check in anyway.
Curiousity in its cat-killing way got the better of me, and I made discrete inquiries. It appears that a homeless man had been camping out in of the the supposedly unocuupied rooms of the hotel. I'm unsure how he had originally gotten there, but apparently housekeepiung discovered him. All the police were doing was trying to find out who he was -- deliver him to some relation if they could find one -- deliver him to one of the city's shelters otherwise. For this they needed five squad cars? I'm guessing conversational lulls were ruling the day at the coffee shops on Stamford where that city's Finest hang out, and they relished the diversion.
Anyway, my train ride went smoothly the next morning and I was soon in Grand Central. I elected to take a cab from there to the federal courthouse near Foley Square where the hearing was to be, and the cabbie elected the FDR.
There are no trash bins within about two blocks of that courthouse. I know this because a woman in line with me at the security checkpoint was complaining about this as she held an empty styrofoam cofee cup in her hand. She had purchased the coffee who-knows-where and had found no place wherein the discard the cup.
My hearing took place on the 23d floor. The room's window faced north, and there was an impressive view of the towers of midtown.
The hearing was actually of interest as these things go, though its unlikely any of the fifty or so non-testifying observers was there for fun. I suppose you know a good deal more about that evening and morning in my life now than you ever thought you would. The point? -- well, how about this: this is my blog, and I can be self-indulgent if I want to.
Tuesday, November 18, 2008
More on Sirius XM
Sirius has scheduled its annual shareholders' meeting for December 18, and has filed an agenda with four items: the re-election of the board of directors; approval of an amendment in the certificate of incorporation to increase the number of authorized shares of stock; approval of a reverse stock split; and ratification of the appointment of KPMG as accountant.
This is the meeting that Hartleib and allies hope to have postponed.
I've done some quick research on the lawsuit mentioned in Mr. Hartleib's recent press release. It appears he actually filed it months ago, in July, when the precursor company defendant was still known as Sirius Satellite Radio Inc.
The original complaint charged, (and I emphasize, I'm only conveying an accusation, one made as a matter of public record, and I don't intend thereby to give it any cerdence): "Upon information and belief, Sirius and XM did develop an interoperable radio, but based on claims that it could not be marketed commercially, never made the radios available to the satellite radio using public."
The plan to merge the two companies developed, the complaint says, as a way of avoiding the competition that interoperability would have made necessary.
At the end of that month, the merger closed.
In September the defendant moved to dismiss the case, arguing as follows: "Basically, Plaintiff, a private citizen, seeks through this action to substitute his own judgment for that of the Federal Communications Commission and the Antitrust Division of the United States Department of Justice, both of which conducted comprehensive reviews of the proposed merger and its competitive effects over many months -- and approved it."
The court granted the motion to dismiss, but in doing so gave the plaintiff leave to amend -- i.e. until October 27 to file an amended complaint that might cure the defects of the first effort.
So the plaintiff filed his amended complaint on time. This one focuses on the merger as a breach of fiduciary obligation. "The Board and officers of Sirius ... grossly mismanaged its operations by engaging in reckless financing of the merger [ignoring] warning signs that the merger ... would severely damage Sirius Satellite Radio Inc." The complaint notes that shares of Sirius traded at about $2 a share before the merger, and have since (as of late October) fallen to 29 cents per share.
The defendant has again, as of yesterday, Nov. 17. moved to dismiss. In its motion, it says thst the sort of charge I just quoted is a conclusory allegation "without particularized facts about the individual directors' supposed conflicts. Likewise, hartleib carelessly accuses the Board of misconduct ... without identifying specific wrongdoing by any particular member."
That's where matters stand as to the lawsuit. My guess (which is only a guiess) is that Hartleib himself is concerned that things aren't going his way, that the defendants may win this one as well. If so, then it makes sense that Hartleib would go public with a press release just as the defense is making its second motion to dismiss -- appealing over the heads of the judge to the public and the shareholders, so to speak.
This is the meeting that Hartleib and allies hope to have postponed.
I've done some quick research on the lawsuit mentioned in Mr. Hartleib's recent press release. It appears he actually filed it months ago, in July, when the precursor company defendant was still known as Sirius Satellite Radio Inc.
The original complaint charged, (and I emphasize, I'm only conveying an accusation, one made as a matter of public record, and I don't intend thereby to give it any cerdence): "Upon information and belief, Sirius and XM did develop an interoperable radio, but based on claims that it could not be marketed commercially, never made the radios available to the satellite radio using public."
The plan to merge the two companies developed, the complaint says, as a way of avoiding the competition that interoperability would have made necessary.
At the end of that month, the merger closed.
In September the defendant moved to dismiss the case, arguing as follows: "Basically, Plaintiff, a private citizen, seeks through this action to substitute his own judgment for that of the Federal Communications Commission and the Antitrust Division of the United States Department of Justice, both of which conducted comprehensive reviews of the proposed merger and its competitive effects over many months -- and approved it."
The court granted the motion to dismiss, but in doing so gave the plaintiff leave to amend -- i.e. until October 27 to file an amended complaint that might cure the defects of the first effort.
So the plaintiff filed his amended complaint on time. This one focuses on the merger as a breach of fiduciary obligation. "The Board and officers of Sirius ... grossly mismanaged its operations by engaging in reckless financing of the merger [ignoring] warning signs that the merger ... would severely damage Sirius Satellite Radio Inc." The complaint notes that shares of Sirius traded at about $2 a share before the merger, and have since (as of late October) fallen to 29 cents per share.
The defendant has again, as of yesterday, Nov. 17. moved to dismiss. In its motion, it says thst the sort of charge I just quoted is a conclusory allegation "without particularized facts about the individual directors' supposed conflicts. Likewise, hartleib carelessly accuses the Board of misconduct ... without identifying specific wrongdoing by any particular member."
That's where matters stand as to the lawsuit. My guess (which is only a guiess) is that Hartleib himself is concerned that things aren't going his way, that the defendants may win this one as well. If so, then it makes sense that Hartleib would go public with a press release just as the defense is making its second motion to dismiss -- appealing over the heads of the judge to the public and the shareholders, so to speak.
Monday, October 6, 2008
Cleveland-Cliffs Inc.
Cleveland-Cliffs, the Ohio-based operator of iron ore mines, announced Friday that its shareholders have voted decisively against a proposal by hedge fund Harbinger Capital -- a proposal that might have allowed Harbinger to block Cleveland-Cliffs' planned acquisitionof Alpha Natural Resources.
Harbinger requested approval from the other shareholders to increase its stake in the company from 15.57% to 33%. Ohio law requires such approval when one party passes the 20% threshold.
In a statement Friday, Cliffs' chairman Joseph Carrabba said that he was pleased that the non-Harbinger shareholders "voted to retain their right to provide meaningful input on the future strategic decisions of the Company."
The management victory is a time to reflect on a point sometimes neglected in popularizing accounts of the US based M&A world. It isn't all Delaware. Delaware obviously is of great importance, but there are major corporations that have chosen to charter themselves in other states, due in large part to the differences in the pertinent laws.
Ohio's statute in particular -- aimed overtly at protecting Ohio-based companies from unfriendly takeover -- made news back in 2003, when Northrop Grumman managed to overcome such obstacles and acquire the local company TRW. Ohio's response? -- to raise to bar again, by adding an anti-arb provision.
I would imagine that Ohio's statutes have been challenged in federal court at some point on the theory that they burden interstate commerce, thereby violating the "dormant" exercise of Congress' constitutional power in that area.
Commerce in the sense of the "dormant commerce clause doctrine" has generally meant something more tangible -- the act of moving objects into one state from another for sale there. But what about the handicapping of out-of-state investors in the way Ohio seems to have in mind? My suspicion (unconfirmed by any actual research into the question) is that challenges have been launched on this point, and they have failed.
If any of my alert readers know of litigation on this constitutional point, I'd be happy to hear of it. Thanks.
Harbinger requested approval from the other shareholders to increase its stake in the company from 15.57% to 33%. Ohio law requires such approval when one party passes the 20% threshold.
In a statement Friday, Cliffs' chairman Joseph Carrabba said that he was pleased that the non-Harbinger shareholders "voted to retain their right to provide meaningful input on the future strategic decisions of the Company."
The management victory is a time to reflect on a point sometimes neglected in popularizing accounts of the US based M&A world. It isn't all Delaware. Delaware obviously is of great importance, but there are major corporations that have chosen to charter themselves in other states, due in large part to the differences in the pertinent laws.
Ohio's statute in particular -- aimed overtly at protecting Ohio-based companies from unfriendly takeover -- made news back in 2003, when Northrop Grumman managed to overcome such obstacles and acquire the local company TRW. Ohio's response? -- to raise to bar again, by adding an anti-arb provision.
I would imagine that Ohio's statutes have been challenged in federal court at some point on the theory that they burden interstate commerce, thereby violating the "dormant" exercise of Congress' constitutional power in that area.
Commerce in the sense of the "dormant commerce clause doctrine" has generally meant something more tangible -- the act of moving objects into one state from another for sale there. But what about the handicapping of out-of-state investors in the way Ohio seems to have in mind? My suspicion (unconfirmed by any actual research into the question) is that challenges have been launched on this point, and they have failed.
If any of my alert readers know of litigation on this constitutional point, I'd be happy to hear of it. Thanks.
Subscribe to:
Posts (Atom)
