July 16, 2004
Senate's Frist Wants $140
Billion Asbestos Fund
Senate Majority Leader Bill
Frist (R-Tenn.) proposes to resolve legal claims over asbestos exposure
with a $140 billion industry-financed fund to pay victims, aides close
to lawmakers' talks said on Thursday, Reuters reported. The proposal
from Frist narrowed the differences between himself and Senate
Democratic Leader Tom Daschle (D-S.D), who has suggested a $141 billion
fund. The leaders are trying to agree on the outlines of a
fund that could be written into legislation. The idea is to establish a
fund to pay victims' claims, to be financed by asbestos litigation
defendants and insurers, while ending victims' right to sue, the
newswire reported.
Consumer Inflation Moderates
in June
The pace of U.S. consumer price
increases moderated in June, the government said today, but the
energy-driven gain outstripped expectations and may keep inflation
concerns on the front burner, Reuters reported. The Labor Department's
Consumer Price Index, the most widely used gauge of inflation, rose 0.3
percent -- half the 0.6 percent jump posted in May when gasoline prices
were soaring but slightly ahead of Wall Street economists' forecasts for
a 0.2 percent rise.
Depressed Enron Stock Jumps
As Shares, Case Near Their End
The once-highflying stock of
Enron Corp. has taken a rocky ride ever since questions about its
finances arose more than two years ago, and on Thursday the bumps
continued as the company's bankruptcy reorganization plan was
confirmed.
Although firmly mired at the
bottom of over-the-counter Pink Sheet share prices, Enron's stock jumped
to trade around 8 cents on volume of 18.2 million shares Thursday after
news early in the day that the former energy giant had finally obtained
the green light to emerge from Chapter 11. The Houston-based company
filed for protection from creditors in December 2001. Enron shares
opened Thursday at 5 cents.
At their price pinnacle -
before investors learned of the company's hidden debts, inflated profits
and dubious accounting - Enron shares traded as high as $84.87, a
52-week high touched in December 2000. Enron at that time had just
announced the promotion of President and Chief Operating Officer Jeffery
Skilling to chief executive, replacing Kenneth Lay, who would remain as
chairman.
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Bank Group To Pursue
Owens Corning Trustee On Their Own
Lenders led by Credit Suisse
First Boston will continue the push to bring in a trustee to run
building products company Owens Corning on their own, court papers said.
The motion had been brought by the official committee of unsecured
creditors, but a recent deal between Owens Corning and certain of the
creditors that made up the committee has left it 'disabled,' according
to court papers filed Tuesday by Credit Suisse with the U.S. Bankruptcy
Court in Wilmington, Del.
The motion for a trustee was
originally filed by the creditors committee - which represents the banks
whose loans are unsecured - in late 2003 and amended in May. However, in
early June, Owens Corning reached an agreement on distributions with
many of its major creditor groups including bondholders, which were also
represented by the creditors committee. The bank group doesn't have an
agreement with the company.
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Sentencing the Aging
Inmate
John Rigas and his son Timothy,
who were convicted of the same corporate fraud charges, both face the
possibility of 30 years in prison under federal sentencing guidelines,
the New York Law Journal reported. But downward departures in other
courts suggest that the elder Rigas can hope for a significantly shorter
sentence. Read the
href='http://www.law.com/jsp/article.jsp?id=1089315045700'>article.
WCI Steel Reaches New Labor
Deal
WCI Steel Inc., which filed for
bankruptcy last year, today said it reached a new labor deal with the
United Steelworkers of America union, Reuters reported. The contract
will become effective upon WCI's exit from chapter 11 bankruptcy
protection and expires on Nov. 1, 2008, the Warren, Ohio steelmaker said
in a statement. The U.S. Bankruptcy Court in Akron has scheduled a
confirmation hearing to start July 21 on competing reorganization plans
for the company. The union 'strongly' supports the debtor's plan,
according to WCI, which filed for bankruptcy on Sept. 16,
2003.
Air Canada Unit Flight
Attendants Accept Pact
Flight attendants at Air
Canada's regional airline Jazz accepted a cost-cutting pact that is part
of the carrier's effort to restructure under bankruptcy protection, the
airline said on Thursday, Reuters reported. The Jazz flight attendants
were the last of nine bargaining groups across the seven unions
representing the bulk of Air Canada's 33,000 employees to ratify an
agreement on wage and job concessions aimed at trimming costs by C$200
million ($151.5 million).
Southwest Profit Falls as Fuel Costs Rise
Low-cost carrier Southwest Airlines on Thursday again flew higher
than competitors, posting another profit while rivals remain in the red,
but earnings missed analyst estimates as fuel costs soared, and its CEO
unexpectedly stepped down, Reuters reported. Southwest's second-quarter
net earnings fell to $113 million, or 14 cents per share, from $246
million, or 30 cents a share, a year earlier. The results missed Wall
Street estimates for a profit of 16 cents per share, according to
Reuters Estimates, and Southwest's shares fell 2 percent. The 2003
second quarter included a $271 million government payment to help
reimburse Southwest for security costs. Excluding that benefit, the
year-ago profit was $103 million, or 13 cents a share.