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May 27, 2005
Market Climbs on GDP Report
Stocks climbed to their highest level in two months today, as traders
focused on news that the economy is healthier than previously estimated,
the Washington Post reported. The Commerce Department
yesterday reported that the economy grew at a 3.5 percent annual rate in
the first quarter of the year—substantially faster the preliminary
tally of 3.1 percent. That solid growth in the gross domestic product
came despite record energy prices, suggesting that the cost of crude
oil, gasoline and other fuels isn’t doing as much damage as
feared.
Supporters of Asbestos Bill Talk Up Chances of Passage
Backers of a proposed $140 billion asbestos bill said yesterday the
legislation has a better chance of passing than a previous version that
the Senate scuttled in 2003, CongressDaily reported. But
the bill that the Senate Judiciary Committee adopted yesterday likely
will undergo further changes in order to maintain support among
Republicans before a final floor vote, they said. Sen. Orrin Hatch
(R–Utah), the author of the previous bill and a co-sponsor along
with Judiciary Chairman Arlen Specter (R–Pa.) of the new version,
said the Judiciary Committee’s latest product is “a much
improved ersion.” While Democratic leaders are expected to oppose
the new asbestos bill, Sen. Patrick Leahy (D–Vt.) predicted it
would pick up support on both sides of the aisle as a floor vote draws
nearer. “It’s a far, far better bill with far, far better
chances,” Leahy said. The bill received approval from Senate
Majority Leader Bill Frist (R–Tenn.) and the White House, Specter
said. The bill also faces stiff opposition from many of the stakeholder
groups that have been involved in negotiations. The AFL-CIO, many
insurers and trial lawyers have objected to the bill, the newswire
reported.
A Class Action Trial in Bankruptcy Court?
All 389,000 Roman Catholic parishioners in Western Oregon soon may
find themselves defendants in their archdiocese’s legal fight to
keep parish property from being used to pay sexual-abuse settlements,
the Oregonian reported. U.S. Bankruptcy Judge Elizabeth
Perris said in a Wednesday hearing that she was leaning toward
converting the property litigation into a rare class action at the end
of July. “I’ve never had a class action before in my 21
years as a bankruptcy judge,” Perris said. Read the full article
at
href='http://www.oregonlive.com/search/index.ssf?/base/front_page/11171020258…'>www.oregonlive.com/search/index.ssf?/base/front_page/111710202583760.xm….
Sentencing of Ebbers Is Delayed Until July 13
The sentencing of former WorldCom Inc. CEO Bernard J. Ebbers has been
rescheduled to July 13 to allow for more time for arguments on his
request for a new trial, the online Wall Street Journal
reported. He was originally scheduled to be sentenced in June. Ebbers
will have until June 10 to respond to a motion by the U.S.
attorney’s office in Manhattan earlier this week opposing his
request last month for a new trial. Ebbers’s lawyers also must
submit any motions related to his sentencing by that date.
United Airlines
Judge Delays Action on UAL Union Strike Sanction
A federal judge yesterday delayed action until June 7 on a key United
Airlines labor union bid to get the court to sanction a threatened labor
strike, Reuters reported. The delay, however, would not stop the
International Association of Machinists and Aerospace Workers from
calling a strike next week if a bankruptcy judge allowed United, a unit
of UAL Corp., to void a labor contract with the ground workers
represented by the union, an IAM spokesman said.
UAL Asks Illinois to Help Ease Fuel Tax Burden
United Airlines is asking its home state of Illinois to cap the tax
airlines pay on jet fuel purchased there, a move that could inspire
similar requests by airlines in other states, Reuters reported. The
airline, a unit of UAL Corp., wants the state to cap its jet fuel tax at
$18 million, UAL’s tax liability in 2004. If the measure wins
state approval, United, the biggest fuel consumer at its Chicago hub,
says it stands to save about $8 million. Other carriers that refuel in
Illinois also would reap benefits.
Stelco Says Steel Market Weaker, Mulls Projections
Stelco Inc. said on Thursday that market conditions have weakened and
it will rethink financial projections it is scheduled to release later
this month, Reuters reported. “Spot market conditions in the steel
industry have softened considerably in recent weeks,” the
court-appointed monitor in Stelco’s restructuring said in a
report. “Because of these changing market conditions, Stelco is in
the process of updating its financial projections.” Stelco said in
early March that it expected operating earnings for 2005 to be in a
range of C$350 million ($275 million) to $400 million. The company has
since said it will reaffirm or amend its full-year estimates by the end
of May.
Creditors Seek U.S. Chapter 11 for Mexico’s Satmex
Creditors of troubled Mexican satellite firm Satmex have asked a U.S.
court to force the company into chapter 11 bankruptcy protection and
restructure its debt after two years of failed negotiations, Reuters
reported. Creditors “have determined that the commencement of a
chapter 11 case gives all parties in interest the best chance of a
reorganization for Satmex,” they said in a filing before the U.S.
Bankruptcy Court for the Southern District of New York on Wednesday.