Corporations and securities brief ~ Grand jury investigates alleged misspending at Wal-Mart
Amit Patel at 12:38 PM ET
[JURIST] Leading Friday's corporations and securities law news, a Wal-Mart Stores Inc. [corporate website] spokesman said a federal grand jury is reviewing allegations of misspending within company. The investigation into Wal-Mart began after it handed over internal documents to the Justice Department [official website] related to allegations that former vice chairman Tom Coughlin misspent up to $500,000, some of it allegedly for anti-union activity. Wal-Mart has denied any anti-union spending. Coughlin was the No. 2 figure in Wal-Mart's hierarchy before his resignation last year. AP has more.
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- US District Judge Barbara Jones has rejected claims by Nevada utilities Nevada Power Company [corporate website] and Sierra Pacific Power Company [corporate website] against a subsidiary of Enron Corporation. The ruling affirms a federal bankruptcy judge's ruling which threw out the utilities' claims that Enron manipulated markets during the 2000 and 2001 Western energy crisis. The utilities' claim the bankruptcy judge did not have authority to dismiss the claims. Nevada Power and Sierra Pacific Power still face a May 23 trial date to determine if they have to pay Enron more than $300 million to fulfill contracts signed before the energy crisis. AP has more.
- As previously reported on JURIST's Paper Chase, two ex-Merrill Lynch bankers convicted in the Enron [corporate website; JURIST Hot Topic news archive] Nigerian barge scam were sentenced to less than the government requested. Daniel Bayly, the former global head of the investment banking division at Merrill Lynch [corporate website], was sentenced to 30 months in prison and fined $840,000. James A. Brown, former head of the bank's asset lease and finance group, was sentenced to 46 months in prison and $840,000 in fines. Bayly and Brown were both convicted of conspiracy and fraud and Brown was also convicted of lying and obstructing justice. The pair's co-defendants will be sentenced in May. Read the indictment [PDF] against Brown and Bayly. The Houston Chronicle has more and continuing coverage of the Enron barge trials.
- Former Enron Chairman Ken Lay [Wikipedia profile] will face his four personal banking charges right after the jury goes to deliberation in his Enron fraud charges in 2006. The Enron Task Force had wanted Lay to face his personal fraud charges this year but US District Judge Sim Lake found a 2005 trial would skewer the jury pool for Lay's Enron fraud trial. The Houston Chronicle has more.
- The World Trade Organization (WTO) [official website] ruled in a report the European Union [official website] can pay subsidies to its shipbuilders to help them compete against South Korean yards. However, the ruling also said the EU violated trade rules by unilaterally pay subsidies to its shipbuilders without first filing a complaint at the WTO. The ruling did not give any specific penalties to the EU. Read the WTO report [PDF]. The EU has more on its efforts to even competition in the shipbuilding sector. AP has more.
- Medtronic Inc. [corporate website], the world's biggest maker of spinal implants, announced in s SEC filing [text] that they have paid $1.35 billion to end a lawsuit by Los Angeles surgeon Gary K. Michelson over claims the company made money off his patents without properly compensating him. Bloomberg has more.
- Qwest Communications [corporate website] has raised its offer for MCI Inc. [corporate website] to $9.7 billion in cash and stock. The new offer is more than $2 billin above Verizon Communication's [corporate website] winning offer. The MCI board, which has already rejected Qwest three times, will likely face pressure to reverse course. Read the Qwest press release and the MCI press release. AP has more.
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