New Life in an Old Method: A Concise Railroad Law Primer

by Christopher Minelli September 12 2006, 16:22
The reality of the modern world is that fuel prices are enormous compared with averages from as little as ten years ago, and it is improbable that they will decline anytime in the near future. [1] One consequence of current fuel prices is the higher cost of freight and passenger transportation around the country. Carriers must adjust their rates according to a confusing maelstrom of fluctuating fuel costs, federal security requirements pertaining to the war on terrorism, and the instability of steady customers in the lukewarm economy. [2] A solution may be as simple as looking to a transportation method that is over a century old and is conveniently located in nearly all major American markets – the railroad system. Railroad freight and passenger services, and the laws that accompany them, are probably unfamiliar to many practicing attorneys because of the multitude of other transportation options that sellers have preferred over the last half century. [More]

No One at the Helm: Trustee Appointed to Manage Death Row Records

by Jillian McClelland September 12 2006, 00:13
Suge Knight’s hopes of maintaining control of Death Row Records during its Chapter 11 reorganization were dashed on July 7, 2006, when United States Bankruptcy Judge Ellen Carroll placed the company under the management of a case trustee. Judge Carroll cited gross mismanagement of the record company’s finances, stating, "it seems apparent that there is no one at the helm." [1]


The Death Row case illustrates a pervasive tension in corporate reorganizations: at what point does the interest of the creditors trump the vested control of management, which may have driven the company insolvent in the first place? Under certain conditions, the bankruptcy court has the power to transfer control of the estate from the debtor-in-possession to a trustee under section 1104(a) of the Bankruptcy Code. [2] [More]

A Warning to Foreign Companies Entering "Sensitive" U.S. Markets

by David Lee September 7 2006, 02:47
I. Introduction



While the United States generally pushes for more open access for its investors to foreign markets, the sight of foreign companies trying to invest in "sensitive" areas of the U.S. economy has drawn a very different reaction. Two recent acquisition attempts illustrate this point: CNOOC's, a Chinese oil and gas company, attempted acqusition of Unocal and Dubai Ports World's attempted takeover of security for a number of eastern and southern ports. [More]

O'Brien v. Ohio State University: Implications for Future Employment Agreements

by Krikor Meshefejian April 26 2006, 16:27
In 2004, Ohio State University officials announced that they were firing then-coach Jim O'Brien because of NCAA violations that allegedly breached O'Brien's contract with Ohio State. [1] O'Brien was the head coach for the men's basketball team, and was fired for loaning out $6,000 to a foreign player who the University was trying to recruit. [2] He then sued the University for a breach of their employment agreement. On February 15, 2006, Judge Joseph T. Clark of the Ohio Court of Claims ruled that O'Brien was unlawfully fired, despite the fact that he had indeed broken NCAA rules. [3] O'Brien had violated the terms of his contract, but the violations were not serious enough to warrant his firing. [4] This article evaluates the court's decision, and its implications on future contractual relationships between coaches and universities. [More]

Tags:

Sports

McMansions: Super-Sized Homes Cause a Super-Sized Backlash

by Alicia Filter April 20 2006, 15:54
"McMansions", also known as "garage mahals", "starter castles", and "Hummer houses" are all synonymous for the latest phenomenon in home building that has communities across the country banging down the doors of local City Councils to enjoin builders from destroying the character of their neighborhoods. The debate concerns interests of property owners who want to be able to use their own land as they see fit versus the interests of community members who want to maintain a uniform neighborhood appearance and not have a huge eyesore on their block, literally casting a shadow onto their humble, and often historic, homes. There is a wide range of issues at play in these communities, including constitutional rights, zoning issues, and even energy and water concerns. Though McMansions are causing a stir throughout the U.S., the solution is left to the 40,000 local governments across the country who will ultimately determine whether to eliminate Super-Size from the menu of housing permits, or to allow the expansion to continue. [1] [More]

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Real Estate

Insider Trading Scandal at Goldman and Merrill

by Mark Cassidy April 19 2006, 23:47
Prosecutors recently charged three employees at Goldman Sachs and Merrill Lynch with participating in a $6.7 million insider trading scheme. [1]  Authorities claim that Stanislav Shpigelman, an analyst at Merrill, sold inside information on upcoming mergers and acquisitions to Eugene Plotkin, an associate at Goldman, and David Pajcin, a former Goldman analyst. [2]  Plotkin and Pajcin then used this information to buy stocks before the public announcement of the deals and then sell them after the announcements for a significant profit. [3] The trio also recruited two employees of a printing plant in Wisconsin that publishes Business Week. [4]  The plant employees stole advance copies of the magazine and informed Plotkin and Pajcin of companies mentioned favorably in the “Inside Wall Street” column. [5]  As a favorable mention in the column usually leads to an increase in the price of those stocks, the conspirators were able to purchase the stocks prior to publication and then sell them for a profit. [6] Authorities became aware of the conspiracy when Pacjin’s aunt, Sonja Anticevic, a retired seamstress in Croatia, made more than $2 million on a two day investment in Reebok after the company announced its acquisition by Adidas. [7]  The SEC’s market surveillance department’s suspicion was aroused by of the unusually large number of options Ms. Anticevic had purchased prior to the announcement of the Reebok deal. [8]  Subsequent investigations led to her nephew David Pajcin who is cooperating with authorities against Shpigelman and Plotkin. [9] Both Goldman and Merrill have cooperated with authorities and warned their staffs about unethical behavior. [10]  Even though prosecutors have not charged either firm with complicity in the scheme, the fall-out for Merrill could be costly. [11]  Companies who had their information leaked by Shpigelman may decline to do business with Merrill in the future and the conspiracy may have compromised deals currently in development.  Going forward, Merrill will have to take additional measures to ensure security if it does not want to lose clients. This case is indicative of the security problems faced by businesses that handle sensitive and confidential information.  No matter what measures a business takes to prevent unethical behavior, employees still may engage in fraud; the fall out from which can greatly damage the business’ reputation and cost significant amounts of money. [1] Stephanie Kirchgaessner, Goldman and Merrill Staff Charged With Insider Trading, FT.com, Apr. 12, 2006, http://news.ft.com/cms/s/eb584f68-c96d-11da-94ca-0000779e2340.html [2] Id. See also, Jenny Anderson, Wall Street Employees Charged With Insider Trading, nytimes.com, Apr. 12, 2006, http://www.nytimes.com/2006/04/12/business/12inside.html?_r=1&ei=5087%0A&en=d2b225ef2b0b1434&ex=1145073600&adxnnl=1&adxnnlx=1145074314-IHXk5RHvgJ8TDzfq5UQ8vw&oref=slogin [3] Kirchgaessner, Supra, Note 1. [4] Anderson, Supra, Note 3. [5] Id. [6] Id. [7] Id. [8] Id. [9] Id. [10] James Polti, Merrill Lynch Warns Staff on Ethical Behavior, FT.com, Apr. 12, 2006, http://news.ft.com/cms/s/c55f148c-ca43-11da-852f-0000779e2340.html [11] Anderson, Supra, Note 3.

NAACP Ready to Fight IRS Claim of Improper Political Campaign Intervention

by Lucy Kalnes April 15 2006, 02:21
I. Introduction



"The NAACP has always been nonpartisan, but that doesn't mean we're noncritical. For as long as we've existed, whether Democrats of Republicans have occupied the White House, we've spoken truth to power."[1] With these words, Chairman Julian Bond, head of the National Organization for the Advancement of Colored People (NAACP), began the keynote address of the organization's 95th annual convention in Philadelphia in July of 2004. He went on: "We must guarantee the irregularities, suppression, nullification and outright theft of black votes that happened on election day 2000 never, ever happen again . . . You cannot win this race by ignoring race . . . We know that if whiles and nonwhites vote in the same percentages as they did in 2000, Bush will be re-defeated by 3 million votes."[2]

Soon after this speech was made, and its contents made publicly available on the official website for the NAACP, the IRS began an investigation claiming that the speech made by Bond in his capacity as Chairman constituted intervention in a political campaign, an activity prohibited for organizations operating as charitable under section 501(c)(3) of the Internal Revenue Code.[3][4] Intervention in a political campaign can carry with it a penalty as high as complete revocation of tax-exempt status. At the very least, a charitable organization which has intervened in a political campaign must pay an excise tax on the amount of money spent by the organization on the activity.[5] [More]

Tags:

Tax

The Guest Worker: Will he or she stay?

by Sabeen Malik April 13 2006, 01:47
I. Introduction



As of April 10, 2006, the Senate of the United States was still at an impasse regarding immigration reform in the United States. One of the most contentious topics within the immigration reform debate has been the idea of a guest worker program. The House bill that was passed in December had no mention of a guest worker program. Several versions of the Senate bill have contained varied schemes for a guest worker program. This article will look at the different versions of the Senate guest worker programs and the influence of big business in developing these schemes. [More]

Tags:

Labor

Is the Internet Replacing Real Estate Agents?

by Alicia Filter April 11 2006, 15:56
Before the Internet became popular, homebuyers had to spend days touring dozens of homes pre-selected by their real estate agent, and were often forced to settle on a home that was merely satisfactory. Now individuals can shop online for homes, take virtual tours of homes, and even list their homes for sale online without ever stepping foot inside an agent's office. The Internet provides what previously could only be provided by an agent: a direct connection between buyers and sellers, thus eliminating the need for a middleman that charges a pricey commission. In this age of technology though, some argue that the middleman can never be entirely replaced by the Internet. [More]

Can Congress Save the PBGC? Implications of a Delphi Corp. Distress Termination of Pension and Benefits Plans in Bankruptcy

by Jillian McClelland April 11 2006, 00:14
The negotiation efforts of Delphi Corp.'s union employees took on new urgency on March 31 as Delphi filed a motion with the U.S. Bankruptcy Court seeking to reject its collective bargaining agreements and modify its retiree benefits plans under sections 1113 and 1114 of the Bankruptcy Code. [1] If Delphi's pension and benefits obligations are ultimately rejected and then terminated, it will have a profound effect on the Pension Benefit Guaranty Corp., the federal agency that insures pension obligations. Already operating at a deficit, PBGC can ill-afford to take on any of Delphi's estimated $10.7 billion in under-funded liability for hourly employees' retirement benefits. [2] In response to the recent distress terminations of pension plans in the steel and airline industries, Congress has introduced several measure to bolster the PBGC. As a consequence, Chapter 11 debtors may find it more difficult to avoid pension liability as part of a reorganization plan. [More]

Tags:

Bankruptcy

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