September 6, 2004
Bankruptcy Wipes Out Debt from Sexual Harassment Suit
A man who sexually harassed an employee can escape liability through
bankruptcy because there is no proof that his conduct, although
“deplorable,” was intended to cause psychological or
economic harm, a Northern District judge in New York has found, the
New York Law Journal reported. Bankruptcy Judge Robert E.
Littlefield Jr. said that his finding of law in discharging a $430,232
debt results in a “grave injustice” that seemingly will
“add insult to injury.” He said the outcome was dictated by
the 1998 U.S. Supreme Court decision Kawaauhau v. Geiger,
523 US57. Read the
href='http://www.law.com/jsp/article.jsp?id=1094073220607'>full
article.
Continental Airlines Skips 2004 Pension Payments
Continental Airlines said on Friday it will not make any pension
contributions this year, taking advantage of changes in funding rules
enacted by Congress that permit carriers to skip certain payments,
Reuters reported. Relief provided by the government for the airline and
steel industries temporarily lifted some pension funding requirements
through next year. Continental, which does not have pension problems
like some competitors, said it was fully compliant with all federal
funding requirements.
Biggest Pilot Union in U.S. Weighs Pension Shift
The nation’s largest airline pilots’ union is considering
moving away from the traditional pension system that labor groups have
defended for years, but is now in crisis, the union’s president
says, Reuters reported. Willingness by the Air Line Pilots Association
(ALPA) to weigh other pension options at several airlines represents a
new strategy by the airline union. It is a recognition that old-style
pensions, which have been a cornerstone of contracts at the biggest
airlines for decades and guarantee a set payout, may no longer be
feasible for all workers, the newswire reported.
Williams to Take Charge for $793 Million Debt Buyback
Williams Cos. Inc. has bought back about $793 million of debt and
will take a quarterly charge as a result, the natural gas company said
on Friday, Reuters reported. Williams is trying to cut total long-term
debt to less than $8 billion by the end of 2005. At the end of the
second quarter, the company had a total of $9.8 billion in outstanding
debt. The Tulsa, Okla.–based company said it paid a premium of
about $135 million over the face value of $793 million of its 8 5/8
percent senior notes due 2010. The company bought back 99 percent of the
outstanding 8 5/8 percent notes due 2010.
Pfizer to Take $369 Million Asbestos-related Charge
Pfizer Inc. on Friday said it would take a third-quarter pretax
charge of $369 million for a settlement with plaintiffs who allege they
were harmed by products containing asbestos and other minerals once sold
by a Pfizer subsidiary, Reuters reported. Pfizer said the charge and its
insurance coverage should cover all asbestos-related liabilities of the
wholly owned subsidiary, Quigley. The proposed settlement was reached
with attorneys representing most claimants in a 25-year battle.
Puerto Rico Bankruptcies Have Leveled, but Experts Warn of Possible
Explosion Unless Economy Picks Up
The number of annual bankruptcies in Puerto Rico has remained steady
over the past four years, the Puerto Rico Herald reported.
However, the number is twice as high as it was in the early ‘90s.
The number of chapter 7 bankruptcies has tripled in the past four years.
Read the
href='http://www.puertorico-herald.org/issues/2004/vol8n35/CBCalmStorm.shtml'>full
article.
Credit Card Practices Bring Calls for Reform
A consumer finance expert says financial services companies
“have not played fair with American families” and applauds
Sen. John Kerry’s pledge to curb credit card lending abuses, the
Kansas City Star reported. Harvard law professor Elizabeth
Warren says the credit card industry is the only business she knows of
in which the seller can unilaterally change the price of a product after
the purchaser buys it. Read the
href='http://www.kansascity.com/mld/kansascity/business/9567190.htm'>full
article.
Parmalat Ready to Sue Italian Banks
Bankrupt dairy multinational Parmalat plans to file lawsuits against
Italian banks in the coming days in a bid to recover cash, Reuters
reported. Parmalat administrator Enrico Bondi has begun legal
proceedings against several foreign financial institutions that did
business with the group before it collapsed under 14 billion euros
($17.07 billion) of debt in December last year, triggering a fraud
scandal, the newswire reported.