Berkshire Hathaway severed ties with a former chief executive of its General Re subsidiary after he invoked his Fifth Amendment rights against self-incrimination during questioning by officials from the Securities and Exchange Commission and the Justice Department. Ronald E. Ferguson had been a consultant for General Re and other Berkshire affiliates since stepping down as the reinsurance company's chief executive in 2001, Berkshire Hathaway said in a news release. The company said it terminated Ferguson's consulting services Friday after his questioning.
No Housing Bubble, Greenspan Says
Alan Greenspan said some local housing markets are showing signs of unsustainable speculation but that surging prices may "simmer down" as housing grows less affordable. Fed economists have determined that second-home purchases are partly responsible for driving up the ratio of sales to the existing housing stock, the Federal Reserve chairman said. There is not a national bubble because home purchases are too expensive and complicated, making it unlikely that continued housing speculation will trigger an economic collapse, he said.
MORE NEWS
A federal bankruptcy judge said he would not rule until May 31 on United Airlines' request to reduce machinists' pay and benefits. Lawyers for the International Association of Machinists and Aerospace Workers, which had said it would strike if Judge Eugene R. Wedoff imposed United's contract terms, said they were pleased that the two sides could continue negotiations, hoping to settle on a new long-term contract before the judge imposes terms. But the union said it would still seek a restraining order to prevent United from barring a strike.
The jury in the trial of former HealthSouth chief executive Richard M. Scrushy listened to tapes made by former finance chief William T. Owens of meetings with Scrushy in March 2003. Jurors also asked U.S. District Judge Karon O. Bowdre how to proceed if they can't reach a unanimous verdict on a conspiracy charge, one of 36 counts in the indictment against Scrushy.
Exxon Mobil acted in bad faith by delaying paying $1 billion owed to gas station owners and could be liable for almost 24 percent interest on that amount if it continues to "misuse the judicial process," a judge ruled. To stall payment in a class-action lawsuit, the oil company "knowingly and recklessly" filed "frivolous and bad-faith" defenses to about 9,000 claims, the judge ruled. A 2001 jury award of $500 million in damages to the station owners has doubled with interest.
Archipelago Holdings chief executive Jerry D. Putnam said he could envision his company's electronic-trading system becoming more tightly woven with the New York Stock Exchange's market. He also said the NYSE might consider expanding in Europe. Archipelago last month agreed to acquire the NYSE.
Adelphia Communications won the second of three required approvals of a $715 million settlement of a fraud lawsuit filed by the Securities and Exchange Commission. The cable television company faced $20 billion in fines in the SEC suit. U.S. Bankruptcy Judge Robert E. Gerber said that the settlement is in the best interest of Adelphia and its creditors. The company now needs the approval of U.S. District Judge P. Kevin Castel in New York, who oversees the SEC lawsuit.
Air France-KLM approved an order for five Boeing 777 cargo jets with options to buy three more. The orders would be worth about $1 billion at projected list prices, though airlines typically get steep discounts.
The judge in the Enron Broadband Services trial said she persuaded a Houston employer to provide financial relief to one of two jurors who asked to leave because serving was a hardship. U.S. District Judge Vanessa D. Gilmore said she is also working something out with the other juror's employer. The trial began five weeks ago.
INTERNATIONAL
Brazil is preparing domestic anti-dumping regulations against Chinese products, whose imports increased 58 percent in the first four months of the year. Government authorities said they would prepare one set of regulations to cover textile products and another set for other goods.
RECALL
Apple Computer is recalling rechargeable batteries in 128,000 of its laptop computers because they may overheat and ignite. The batteries were delivered in iBook G4 and PowerBook G4 computers. Customers should remove the batteries and contact Apple for a free replacement.
Compiled from reports by the Associated Press, Bloomberg News, Dow Jones News Service and Washington Post staff writers.
