BUSINESS IN BRIEF
Tyco Bonus Questioned
Friday, June 11, 2004; Page E02
Tyco International's board never approved a $17 million bonus for former general counsel Mark A. Belnick, a former director told jurors in Belnick's criminal trial. Joshua M. Berman, a Tyco director for 25 years, said the board would not have approved the 2000 bonus because L. Dennis Kozlowski, then the chief executive, wanted to fire Belnick within months of his hiring in 1998.
Energy Leads Import Cost Jump
Import prices rose 1.6 percent last month, the most in 15 months, another sign of inflation that might prompt the Federal Reserve to raise interest rates. The Labor Department's import price index's increase was led by energy prices and followed a 0.2 percent rise in April. Excluding petroleum, the index, which gauges the cost of goods and raw materials from abroad, rose 0.4 percent.
Securities and Exchange Commission Chairman William H. Donaldson scheduled a June 23 vote on a plan to require mutual funds to have independent chairmen, a proposal opposed by much of $7.6 trillion fund industry. The SEC's five commissioners are divided on the issue.
A federal judge is leaning toward unsealing much of the evidence that companies want to keep secret in an antitrust trial examining Oracle's $7.7 billion bid for rival software maker PeopleSoft -- a factor that could sway the case's outcome. U.S. District Judge Vaughn Walker told attorneys for both Oracle and the Justice Department that, based on the evidence submitted during the first three days of the trial, he saw little reason the material should be kept confidential.
Tenet Healthcare is in talks that could result in it paying more than $1 billion to settle hundreds of claims of unnecessary heart surgeries and to end most of the federal investigations into the hospital chain's business practices, sources familiar with the talks said. If negotiations fail, the Santa Barbara, Calif.-based company faces the prospect of civil and criminal trials.
United Airlines' parent, UAL, reached a benefit agreement with 27,000 retirees that it says will save the company at least $300 million through 2010. UAL, operating under Chapter 11 bankruptcy protection, had earlier reached a similar deal with mechanics.
The SEC is stepping up a drive to stop accounting firms from charging contingency fees for handling tax work of companies they audit. SEC Chief Accountant Donald T. Nicolaisen said he ordered the seven biggest firms to fully disclose any such arrangements to company audit committees that oversee their work. He also warned the firms that they may face enforcement investigations over the fees, which are based on a percentage of tax savings and may create an incentive for questionable accounting.
DaimlerChrysler is facing an expanded investigation into potentially faulty air bags on almost 1.3 million minivans, the National Highway Traffic Safety Administration said. Affected models are the 1998 to 2000 Caravan, Grand Caravan, Voyager, Grand Voyager and Town and Country. Also, the NHTSA is probing reported failures of glass assemblies in the liftgates of 2002 Ford Explorer, Explorer Sport and Mountaineer sport-utility vehicles. More than 570,000 SUVs could be affected.
Ford Motor Credit has reached a settlement with 38 states over fees charged to customers who ended their vehicle leases before the scheduled date. Sometimes the fees exceeded the lease balance, and dealers kept the extra money. Affected customers in the 38 states, including Virginia, could get back $100.
Unemployment claims rose as the Labor Department reported that the four-week moving average of jobless claims rose to 346,000 from 341,250. Last week, the department reported that companies added 1.2 million jobs in the first five months of this year, a pace that would recoup the jobs lost since the start of the 2001 recession by November if it is sustained.
© 2004 The Washington Post Company