LEGAL

Wednesday, January 17, 2007

LEGAL

High Court Refuses Pension Case

The Supreme Court refused to consider an appeal brought by a group of IBM employees who accused the firm of age discrimination after it altered its pension plan to a cash-balance plan. Such plans provide workers with individual accounts that can be cashed out when they leave the company and are intended to appeal to younger workers.

Separately, the court also declined to rule on a dispute between IBM and a former employee who accused IBM of retaliating against him after he complained about how managers handled overtime.

New Charges for Refco's Bennett

U.S. prosecutors in New York added new charges to a pending criminal indictment against former Refco chief executive Phillip R. Bennett, accusing him for the first time of bank fraud and money laundering. Bennett already faced a multi-count indictment that accused him of defrauding investors.

Exxon Appeals Valdez Award

Exxon Mobil asked a federal appeals court to reconsider its December ruling that the it must pay $2.5 billion for the 1989 Valdez oil spill. An Anchorage jury had ordered the company to pay $5 billion in punitive damages, and the U.S. Court of Appeals for the 9th Circuit cut the award in half. Exxon says it should pay no more than $25 million.

BANKING

Commerce Bancorp Under Probe

The parent of Commerce Bank said its officials were under federal investigation by the Office of the Comptroller of the Currency and the Federal Reserve's board of governors. The probe "will include but not be limited to transactions with its officers, directors and related parties, including transactions involving bank premises," according to a filing with the Securities and Exchange Commission.

Separately, the company said fourth-quarter profit climbed 68 percent on deposit and loan growth, to $78.7 million from $46.9 million in the comparable period a year earlier.

Bank Lobbies on Deposit Rules

Bank of America is lobbying state banking associations and legislators to eliminate a 1994 law that sets a 10 percent federal cap on the deposits a bank can hold. As of Sept. 30, Bank of America had 9 percent of the $6.47 trillion in deposits held in the 50 states and U.S. territories, the Federal Deposit Insurance Corp. said.

MERGERS & ACQUISITIONS

Cablevision Rejects Dolans' Offer

Cablevision Systems rejected an $8.9 billion buyout offer from the company's founding Dolan family. The action upends an 18-month effort to buy the company by Chairman Charles Dolan and his son, chief executive James Dolan.

Offer for Caremark Shares Begins

Express Scripts began its $25 billion offer for all outstanding shares of rival Caremark Rx, which has rejected the bid in favor its deal with CVS. The offer expires Feb. 13.

Separately, CVS added a $2-a-share one-time dividend to Caremark shareholders if their company completes a merger with CVS.

AGRICULTURE

Calif. Freeze Threatens Oranges

With California bracing for more freezing weather, juice makers may soon face rising costs and falling earnings as orange losses there add to an already dismal year for the crop. Growers expect losses of 50 percent to 75 percent.

WALL STREET

Specialist Firms Fined

The seven specialist firms that handle stock trading at the New York Stock Exchange were hit with a combined $2.8 million in fines for what officials said were multiple trading violations.

NYSE Regulation said the infractions included the failure to honor the "firm quote" rule, which deals with the prices at which specialist firms execute buy or sell orders.

EARNINGS

Intel said fourth-quarter profit fell 39 percent, to $1.5 billion from $2.45 billion in the comparable period a year earlier. Sales fell 5 percent, to $9.7 billion. New chips that replaced Intel's six-year-old Pentium design last year helped take back orders from Advanced Micro Devices.

For the year ended Dec. 30, profit fell 42 percent from the previous year, to $5.04 billion. Revenue fell 9 percent, to $35.38 billion.

TREASURY

T-bill rates rose. The discount rate on three-month Treasury bills auctioned yesterday rose to 4.975 percent from 4.94 percent last week. The rate on six-month bills was 4.95 percent, up from 4.92 percent last week. The annualized return to investors is 5.108 percent for three-month bills, with a $10,000 bill selling for $9,874.24, and 5.148 percent for a six-month bill selling for $9,749.75.

Separately, the Federal Reserve said the average yield for one-year Treasury bills, a popular index for making changes in adjustable-rate mortgages, rose to 5.03 percent last week, up from 4.98 percent the previous week.

Compiled from reports by Washington Post staff writers, the Associated Press and Bloomberg News.