June 212004

Submitted by webadmin on Mon, 2004-06-21 00:00

June 21, 2004

Backers of Class Action to
Push Floor Vote This Week

Senate sponsors of a bipartisan bill to overhaul the rules for class
action lawsuits are still hoping the measure will move to the floor
before the July Fourth recess, Senate aides said on Friday,
CongressDaily reported. 'We expect it to come up as soon as
the defense authorization bill is done, whenever that may be,' said a
spokeswoman for Finance Chairman Charles Grassley (R-Iowa), the chief
sponsor of the bill. She added that Grassley 'would hope it would be
before the July recess.' Democratic co-sponsors of the bill have told
Majority Leader Bill Frist (R-Tenn.) the bill should not be left hanging
during the recess, according to a Frist spokeswoman. But Republican and
Democratic leaders had not come to an agreement as of Friday on the
number of amendments that could be offered.

Speaking to the National
Federation of Independent Business, Frist said the Senate remains
scheduled to take up the class action bill midway through this
week, although he acknowledged he could move to either the FY05 Homeland
Security or Defense appropriations bills, the newswire
reported. Leadership aides said Friday it appears more likely he
will go to the Defense appropriations bill instead.

House to Debate
Asbestos-related Issues on Tuesday

The House Judiciary Committee
may debate some class action-related issues Tuesday, during a hearing on
the impact of so-called frivolous lawsuits, CongressDaily
reported. The panel is likely to examine legislation introduced last
week by House Judiciary Courts, the Internet and Intellectual Property
Subcommittee Chairman Lamar Smith (R-Texas) to require federal judges to
sanction plaintiffs and attorneys who file lawsuits the judges deem
frivolous.

Asbestos-plagued Shares
Rise On Revived Fund Talk

Shares of two companies
battling asbestos lawsuits climbed on Friday on hopes that lawmakers are
reviving legislation to create a national trust fund for asbestos
liabilities, Reuters reported. Shares of McDermott International Inc.
were up 6 percent, at $9.71, in late Friday trade on the New York Stock
Exchange (NYSE). Shares of W.R. Grace and Co. climbed more than 6
percent, to $5.57, in late trade on NYSE.

'Although we would ascribe a 10 percent probability of
the asbestos legislation being enacted this year, a 'meeting of the
minds' seems to be emerging between the opposing parties,' said analyst
Prabhas Panigrahi, who follows McDermott for institutional research firm
EKN Inc. in New York, the newswire reported. Panigrahi saw a 50 percent
to 60 percent probability of a national asbestos fund by early
2005.

Decision Expected Soon
on Kenneth Lay Indictment

A decision on whether to indict Kenneth L. Lay,
face='Times New Roman'>Enron's former chairman and CEO, on
criminal charges is expected within the next few weeks, the
face='Times New Roman'>New York Times reported. After The
Houston Chronicle reported on Saturday on the timing of a decision,
lawyers for Lay sent a letter yesterday to the Justice Department's
Enron Task Force, asking for a meeting before the government takes a
final step. In recent months, a new team of
prosecutors has been aggressively pursuing Lay. The prosecutors are
trying to determine whether, in the days before the collapse, Lay made
positive statements about the company's prospects when he may have had
reason to know of the financial troubles that ultimately brought it
down.

UNITED AIRLINES

UAL to Offer New Concessions In Bid
for Loan-Board Reversal

United Airlines parent UAL Corp. as
early as today plans to reduce its request and offer the federal
government new concessions in a bid to reverse last week's denial of a
$1.6 billion loan guarantee it says it badly needs to emerge from
bankruptcy-court protection, the Wall
Street Journal reported. Some of the inducements United last week
discussed with federal officials are expected to be formally proposed,
according to people familiar with the matter. A plan will be proposed to
find about $500 million in new equity, thereby reducing the size of the
federal guarantee. United would seek funds from private-equity
investors, possibly augmented by the issuance of UAL subordinated
debt. UAL also intends to amend the
proposed government-backed loan to make the technical terms more
attractive to the Air Transportation Stabilization Board, the online
newspaper reported.

UAL Gets More Time to Exit
Bankruptcy

UAL Corp.'s United Airlines on Friday was granted
another month to reorganize itself without interference from creditors
as it pursues a federal loan guarantee to secure $2 billion in exit
financing, Reuters reported. United Airlines was given 'exclusivity'
until July 30 to organize its own emergence from bankruptcy,
face='Times New Roman'>U.S. Bankruptcy Judge Eugene Wedoff said
in court in Chicago. The ruling comes a day after a decision by the Air
Transportation Stabilization Board to reject United's bid for a federal
loan guarantee for a second time, though two members of the three-member
panel said they might reconsider the matter and the third reserved his
decision. Shares of UAL were down 13.5 cents at $1.34, after falling 29
percent earlier in the New York Stock Exchange session, the newswire
reported.

HealthSouth Says Debtholders Agree To
Changes

HealthSouth Corp. on Friday
said a majority of people holding its notes due in 2012 have agreed to
proposed amendments governing terms of the debt, Reuters reported. The
Birmingham, Ala.-based operator of rehabilitation and surgery centers,
which was caught up in an accounting scandal last year, said holders of
its 7.625 percent senior notes approved the proposed amendments. The
company is attempting to reach agreements with holders of other notes in
an effort to stay current on debts that had threatened to put it into
bankruptcy.

California AG Sues
Enron, Claiming Energy Market Manipulation

The state of California sued
Enron Corp. and several subsidiaries on Thursday for allegedly
manipulating market prices during the state's 2000-01 energy crisis and
costing Californians billions of dollars. According to an Associated
Press article, California State Attorney General Bill Lockyer said a
20-page complaint was filed in Alameda County Superior Court seeking
restitution and unspecified damages from the Houston-based energy giant
whose trading practices are under investigation by the Justice
Department.

Three former Enron Corp.
traders have been charged with wire fraud involving price manipulation
in California. Two of them have pleaded guilty and a third awaits trial
in October.

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Reserved

Maxim Crane Works Gets
Nod For $25.5 Million Interim DIP Loan

Maxim Crane Works LLC won
interim court approval to borrow up to $25.51 million from some of its
senior secured lenders led by Fleet National Bank and Goldman Sachs
Credit Partners L.P. Judge M. Bruce McCullough of the U.S. Bankruptcy
Court in Pittsburgh signed an interim order Wednesday, approving the
financing on an interim basis pending a July 1 final hearing on the full
$70 million debtor-in-possession loan offered by the senior lenders. The
interim order, obtained Thursday by Dow Jones Newswires, also enables
the crane rental company to use the cash collateral securing the
lender's prior loans.

June 212004

Decision Expected Soon on Kenneth Lay Indictment

Decision Expected Soon
on Kenneth Lay Indictment