LOS ANGELES – The life of “Charlie’s Angels” star Farrah Fawcett was celebrated Tuesday at a private funeral in the Cathedral of Our Lady of the Angels.
Her longtime companion, Ryan O’Neal, was among pallbearers who accompanied the casket, covered in yellow and orange flowers, into the Roman Catholic cathedral.
Fawcett’s friend Alana Stewart and “Charlie’s Angels” co-star Kate Jackson were among early arrivals before the hearse pulled up, accompanied by 10 motorcycle officers.
Fans and news media watched from across a street. The service was closed to the public.
Fawcett died Thursday at age 62 after a public battle with cancer. O’Neal and Stewart were at her side.
“After a long and brave battle with cancer, our beloved Farrah has passed away,” O’Neal said in a statement last week. “Although this is an extremely difficult time for her family and friends, we take comfort in the beautiful times that we shared with Farrah over the years and the knowledge that her life brought joy to so many people around the world.”
Diagnosed with a rare cancer in 2006, Fawcett’s battle with the disease was documented in “Farrah’s Story,” which aired last month on NBC.
Stewart, a producer of the documentary, said Fawcett was “much more than a friend; she was my sister.”
“Although I will miss her terribly, I know in my heart that she will always be there as that angel on the shoulder of everyone who loved her,” Stewart said in a statement.
Fawcett and O’Neal, 68, have a son, 24-year-old Redmond, who has been jailed since April 5 on drug charges.
Last week, a judge granted his request to attend Fawcett’s funeral. The order by Los Angeles Superior Court Judge Jane Godfrey allows Redmond O’Neal to be released for three hours and wear street clothes to attend the funeral.
Archive for June 2009
LOS ANGELES – The life of “Charlie’s Angels” star Farrah Fawcett was celebrated Tuesday at a private funeral in the Cathedral of Our Lady of the Angels.
NEW YORK – It’s one of the biggest mysteries in the Michael Jackson saga: How much was the lavish-spending, massively debt-ridden pop icon really worth? In the most detailed account yet of the singer’s tangled financial empire, documents obtained by The Associated Press show Jackson claimed to have a net worth of 236.6 million as of March 31, 2007.
But less than 700,000 of that amount was in cash — a relatively paltry sum given his opulent lifestyle, prodigious borrowing and seven-figure shopping sprees.
The dollar amounts, which previously consisted of estimates, are crucial because Jackson’s estate is expected to become the focus of a legal battle between the singer’s family and creditors.
The revelation came Tuesday as Jackson’s family reversed itself and said the singer did in fact have a will — complicating a bid by Jackson’s mother to take control of her son’s finances.
Jackson had 567.6 million in assets, including his Neverland Ranch and his share of the Sony/ATV Music Publishing catalog, which includes the rights to songs by the Beatles, according to a statement of financial condition prepared by Washington, D.C.-based accounting firm Thompson, Cobb, Bazilio & Associates.
The report was prepared at a time when Jackson had large sums of debt coming due that had to be refinanced. The financial statement, which is not as thorough as an audit, was based in large part on estimates provided by Jackson’s advisers that the accounting firm said it could not verify.
In the documents, the firm also said it omitted the amount Jackson owed in income taxes.
The documents do not show how much money he had coming in that year or how much he was spending, which makes it hard to estimate just how cash-poor he was. Still, the statement paints a picture of Jackson’s tangled finances and the mountain of debt he left behind.
The five-page report says Jackson had debts of 331 million. The singer had just 668,215 in cash, according to the report.
The accounting firm did not return calls seeking comment.
The report puts a net value on Jackson’s 50 percent stake in the Sony/ATV Music Publishing catalog — his most prized asset — at 390.6 million. The 750,000-song catalog includes music by the Beatles, Bob Dylan, Neil Diamond, Lady Gaga and the Jonas Brothers.
A separate document obtained by the AP details Jackson’s dealings with Sony Music Entertainment Inc., which owns the other half of Sony/ATV. Jackson was guaranteed a cash distribution of 11 million a year from the venture through September 2011, according to the May 25, 2007, document that was signed by the pop star.
The document also detailed Sony’s ability to buy an unspecified percentage of Jackson’s remaining share in Sony/ATV.
It said Sony agreed to guarantee loans made to Jackson through September 2011 and to help him refinance his debts. Sony also agreed to advance Jackson money to help pay the interest to his main creditor at the time, Fortress Investment Group LLC, to avoid defaulting. Barclays Bank PLC took over the Fortress loan, which is now around 315 million, in December 2007.
The documents also show that Jackson gave his approval for Sony/ATV to use up to 400 million to purchase the 125,000-song Famous Music LLC catalog from Viacom Inc., which holds such songs as “Footloose” and “The Real Slim Shady” by Eminem. The deal was announced a week later.
A Sony/ATV spokesman declined to comment.
Another of Jackson’s prized possessions, his Neverland Ranch, is valued at 33 million, according to the accounting firm’s report. He also had 20 million worth of cars, antiques, collectibles and other property.
It’s likely that Neverland, a 2,500-acre property in the rolling hills of Santa Barbara County, has dropped in value since 2007 along with the rest of the battered California housing market, experts said.
“The luxury market in the past year has really taken a hit in markets across the country,” said Rick Goodwin, publisher of Ultimate Homes and its parent publication, Unique Homes.
The ranch in central California’s wine country was set to be sold in March 2008 because of missed payments on a 24.5 million loan, but Jackson managed to cut an 11th-hour deal to keep it off the auction block.
The fact that few, if any, similar properties in the area are selling makes it even harder to determine Neverland’s current market value. A couple of properties in the 500-acre range are on the market in the area for around 10 million, said Steve Schott, a real estate appraiser based in Santa Barbara.
Jackson died Thursday at age 50 of what his family has said was cardiac arrest. Medical examiners in Los Angeles are perhaps weeks away from determining the official cause of death.
The divvying up of Jackson’s assets — and the settling of his debts — are likely to be hotly contested in court. On Monday, lawyers for Katherine and Joe Jackson won temporary custody of Michael Jackson’s three children and moved to become administrators of his estate.
A judge granted 79-year-old Katherine Jackson temporary guardianship of the children, who range in age from 7 to 12. He also gave her control over some of her son’s personal property that is now in the hands of an unnamed third party. But the judge did not immediately rule on her requests to take charge of the children’s and Jackson’s estates.
Associated Press writers Alex Veiga, Ryan Nakashima and Anthony McCartney in Los Angeles contributed to this report.
WASHINGTON – U.S. troops are out of Iraq’s cities but not its future. Even a best-case scenario is likely to feature an American role there for years — militarily as well as diplomatically.
That does not mean a permanent large U.S. troop presence in Iraq. Under a security deal struck with the Bush administration, American forces are to be out by the end of 2011.
But it’s no secret that Iraq’s security forces are not fully ready to handle even a diminished insurgency on their own.
Some senior U.S. military officers say privately they anticipate Iraqi setbacks in coming months, particularly if the insurgents regroup. But by partnering with American forces, the Iraqis stand a good chance of succeeding. That is why a number of U.S. troops will remain in the cities to assist and advise.
But most were gone Tuesday as Iraqis marked National Sovereignty Day with military parades and marching bands in Baghdad. In a sobering reminder the violence was not over, a car bombing in a crowded food market in the northern city of Kirkuk killed at least 27 people.
It’s not possible to know how long Iraq will need American help, but it could be well beyond President Barack Obama’s current term. Much will depend on the pace of progress toward Iraqi political reconciliation. That is because the success of the Iraqi security forces depends as much, if not more, on their willingness to operate in a nonsectarian, evenhanded way as on their technical competence.
Diplomatically, the U.S. role will be less visible but still crucial. Even with declining levels of violence since 2007, progress toward political reconciliation among Sunnis, Shiites and Kurds has been minimal.
Obama made clear Tuesday that while he expects violence to persist, the final outcome is an Iraqi responsibility.
“Iraq’s future is in the hands of its own people,” he said at the White House. “And Iraq’s leaders must now make some hard choices necessary to resolve key political questions” and to provide security.
There are still about 131,000 U.S. troops in Iraq. They won’t be fighting in urban areas any more, unless the Iraqi government asks for their help. Instead they will focus on securing Iraq’s borders, keeping insurgents on the run in rural areas and conducting training with Iraqi security forces.
Gen. Ray Odierno, the top U.S. commander in Iraq, said Tuesday he was hopeful, in part because Iraqis have embraced the U.S. urban withdrawal as a confidence booster.
“They’re not ready for us to go yet, but they are ready for us to allow them to attempt to exercise their security responsibilities, and to me that’s very encouraging,” Odierno said.
Even in the most optimistic of circumstances in which Iraq muddles through its political and ethnic problems — and keeps chipping away at the insurgency — it will still need U.S. support. And the Obama administration has said it wants to build a long-term relationship with a key Arab state in a volatile region.
But if today’s relative peace in Iraq unravels within the coming year, Obama will face tough choices, including whether to push back his announced timeline for ending the U.S. combat role in the country by September 2010.
Obama could not reinsert U.S. combat forces in Iraqi cities without Iraqi government permission, under terms of the security deal negotiated by the Bush administration last year. And he could not change the 2011 deadline for removing all U.S. troops from Iraq without renegotiating that deal.
Nor might he want to, even with the prospect of Iraq spinning into a new cycle of sectarian warfare. Obama came into office promising to end U.S. involvement in the war, arguing that Iraq’s remaining problems are primarily of a political nature and cannot be solved by continued U.S. military force.
And more recently, Obama announced that his administration was refocusing on what he considers a bigger problem — increasing instability in Afghanistan and a growing insurgency in neighboring Pakistan. In that context, U.S. troop reductions in Iraq are a one-way ticket; once out, they are unlikely to return.
Qubad Talabani, son of Iraqi President Jalal Talabani and the Washington representative of the semiautonomous Kurdish regional government in northern Iraq, believes that if security deteriorates in coming months and hot-button political issues are not settled, the 2011 deadline should be renegotiated.
“Regardless of whether things go well or things deteriorate, there is going to be a strong connection between the United States and Iraq,” Talabani said in an interview Tuesday. “The nature of that relationship will depend on whether things improve or deteriorate. The U.S. has invested too much in this effort just to walk away.”
What would Obama do if Iraq reverted to major violence?
Stephen Biddle, an Iraq watcher at the Council on Foreign Relations, wrote in a recent analysis that a full-scale civil war could mean a civilian death toll in the range of 600,000 to more than two million.
“Given its role in precipitating the war in Iraq, the United States would bear special responsibility for such a catastrophe,” Biddle wrote. He added that if the conflict spread beyond Iraq’s borders it would risk a disruption of world oil markets and might derail prospects for successful Israel-Palestinian peace talks.
EDITOR’S NOTE — Robert Burns has covered national security and military affairs for the AP since 1990.
LONDON, EnglandWhen people think of coffee, words such as caffeine, aroma and energy may spring to mind. ‘Good breath,’ however, certainly isn’t one of them.
Mel Rosenberg at work in his ‘smell laboratory’ found that coffee can lead to good breath.
So researchers at the University of Tel Aviv in Israel, were in for a surprise when their study into the relation between coffee and bad breath, showed that coffee can actually lead to good breath. Breath specialist Mel Rosenberg of the university’s Faculty of Medicine found that there are certain components in coffee that inhibit the bacteria that lead to bad breathpreventing these bacteria from making their presence felt, or smelt. “Everybody thinks that coffee causes bad breath,” Rosenberg told CNN “and as a latte drinker, I believe that too.” But the malodor doesn’t necessarily come from the coffee itself, said Rosenberg: “We think that coffee, which has a dehydrating effect on the mouth, can ferment into bad breath when mixed with substances such as milk.”
Each month CNN’s Dr. Sanjay Gupta brings viewers health stories from around the world.
See more from the show »
This meant that until recently, coffee was up there with eating an unhealthy breakfast, not drinking enough water and consuming alcohol as causes for unpleasant mouth odors. But until Rosenberg’s study, no one had ever scientifically shown the link between the consumption of coffee and bad breath. Rosenberg’s team wanted to prove just that. They did the research by taking saliva and incubating it with different brands of coffee including the Israeli brand Elite coffee, Landwer Turkish coffee, and Taster’s Choice. “We thought this coffee and saliva mixture would have a terrible odor, but incredibly it had the opposite effect.” Rosenbergwho also created popular mouthwash Dental PHis now thinking about creating a mouthwash, toothpaste, or chewing gum based on coffee. The effects could be similar to plant extracts such as clove oil, which have also been shown to have anti-bacterial properties that prevent bad breath. But first Rosenberg would have to find which of the hundreds of components in coffee are the ones that have these beneficial properties. “That will take a long time” said Rosenberg. “But this research has already been a lesson in humility, showing that assumptions are not always correct.” Rosenbergwho also writes children’s books such as ‘Mel the Smell Dragon’told CNN. “And sometimes, getting it wrong can create even more interesting outcomes.”
JERUSALEMThe Israeli navy took control of a boat reported to be carrying humanitarian aid, a former U.S. congresswoman and a Nobel laureate Tuesday after the boat violated an Israeli blockade and crossed into Gazan waters, the Israel Defense Forces said.
Cynthia McKinney reportedly is asking the international community to demand the crew’s release.
The boat’s crew included former U.S. Rep. Cynthia McKinney, according to the Free Gaza Movement, a human rights group that sent the boat it calls “Spirit of Humanity” from Cyprus. Along with McKinney, who served six terms in the House of Representatives from Georgia and was the Green Party’s presidential nominee in 2008, Israeli authorities took 20 people into custody, the group said. Also aboard, the group said, was Mairead Maguire, who co-founded a group that worked for peace in Northern Ireland. Maguire and co-founder Betty Williams received the Nobel Peace Prize in 1977 for their work. IDF said the Israeli navy contacted the boat, which it called the Arion, while it was still at sea and warned the crew they would not be allowed to enter Gazan waters “because of security risks in the area and the existing naval blockade.” Disregarding all warnings, the boat entered Gazan coastal waters, IDF said. An Israeli navy force intercepted, boarded and took control of the boat, directing it toward Ashdod, Israel, IDF said. The boat’s crew, the military said, would “be handed over to the proper authorities.”
Israel moves forward with settlement construction
Without naming individuals on the boat, IDF confirmed the incident it described was the same one detailed by the Free Gaza Movement. According to the Free Gaza group, McKinney said, “This is an outrageous violation of international law against us. Our boat was not in Israeli waters, and we were on a human rights mission to the Gaza Strip,” before authorities confiscated cell phones. “President Obama just told Israel to let in humanitarian and reconstruction supplies, and that’s exactly what we tried to do. We’re asking the international community to demand our release so we can resume our journey,” McKinney said, according to the group IDF said the aid aboard the boat would be delivered to Gaza “subject to authorization.” “Any organization or country that wishes to transfer humanitarian aid to the Gaza Strip can legally do so via the established crossings between Israel and the Gaza Strip with prior coordination,” IDF said. Free Gaza said the Spirit of Humanity voyage is the eighth such trip the group has launched. Five succeeded, the group said, but the Israeli military stopped attempts in January and December 2008.
It took the story of one firefighter to expose the tension between fairness and affirmative action.
The nation's four most prominent liberal justices ignored that tension Monday. By consequence, the liberal justices decided that equal outcome should trump equal opportunity, when the two values compete. And in that decision, supported by a chorus of liberal analysts, American liberalism continued decades of thinking that places diversity, not fairness, as its first principle.
In Depth: 7 Firsts in Supreme Court History
In Depth: America's 10 Freest and Least Free States
The Supreme Court ruled Monday that white and Hispanic firefighters were unfairly discriminated against when the city of New Haven discarded a promotional exam because no blacks, or not enough minorities in the city’s view, earned a sufficient score to be promoted.
The ruling concludes one of the most widely debated discrimination cases of the past decade. Much of that attention is based on Supreme Court nominee Sonia Sotomayor's involvement in the case. Sotomayor, as an appellate judge, upheld the initial decision siding with New Haven.
In the end, the Court's conservative majority prevailed in yet another 5 to 4 vote. But it's the minority's dissent–a view supported by the Obama administration in its brief submitted to the Court–which stirs up liberalism's ongoing avoidance of affirmative action's “real-world” negative consequences.
The Court's united liberal view on affirmative action carries heightened resonance today. Democrats hope President Obama marks the beginning of an enduring political majority. A primary aim of either party, when seeking sustained dominance, is to shift the Court to their side. Had today's Court been left leaning, liberals should be troubled to know, it would have almost certainly upheld a policy that denied a promotion based on the color of those promoted.
The Ricci case gets to the core of the American ideal of “the pursuit of happiness” as an “inalienable right.” This right was most egregiously denied to blacks through slavery. It was not until the 1960s that the nation finally confronted and outlawed discriminatory practices. Affirmative action was instituted to correct past inequality.
Nearly a half-century later, liberalism faces new questions. In the time of the first black president, when white men's unemployment rate increases at twice the rate of black women in this recession, liberal thought has remained hinged to an earlier era.
Title VII of the 1964 Civil Rights Act prohibited discrimination based on disparate treatment or disparate impact. In 1960s and 1970s America the tension between the two principles was mitigated by the need to right history.
The liberal opinion, written by Justice Ruth Bader Ginsburg on behalf of all four left-leaning justices, argued Monday that the “purpose” of Title VII's disparate-impact provision “is to ensure that individuals are hired and promoted based on qualifications manifestly necessary” and “do not screen out members of any race.”
The liberal justices refused to reckon with instances when the desire for “manifestly necessary” skills creates an unequal racial outcome, as was the case in New Haven.
The conservative majority addressed this tension Monday. It decided New Haven's actions amounted to disparate treatment, what the rest of us call overt discrimination.
An Illiberal Argument
Liberals now find themselves bunkered down beneath illiberal logic. Conventional affirmative action supporters effectively back discrimination for the sake of diversity. The driving role that class and culture play in endemic inequality is ignored. Affirmative action has become an entitlement supported despite consequence or context.
Whites overwhelmingly support a move toward class-based affirmative action that would still disproportionately aid minorities. But liberals remain seemingly vested in defending affirmative action as it was conceived, in a time far different than today.
The liberal opinion on the Ricci case upheld the city's effort to find any means to hold fast to conventional affirmative action. The city, after extended deliberation, decided that it was legal to discard the test results if no one was promoted.
Ginsburg echoed earlier decisions when she wrote that the city policy was “race-neutral in this sense” because “‘[A]ll the test results were discarded, no one was promoted, and firefighters of every race will have [the opportunity] to participate in another selection process to be considered for promotion.'”
The liberal argument feels like the cold legal judgment opposed by Barack Obama, in his criteria for nominating new liberal justices.
“She understands that upholding the rule of law means going beyond legal theory to ensure consistent, fair, common-sense application of the law to real-world facts,” the White House wrote when Sotomayor was nominated.
Consider the well known details of the case's lead plaintiff, Frank Ricci. He gave up a second job and spent a third to half of his days studying over a period of months. He paid an acquaintance more than 1,000 to read textbooks onto audiotapes to overcome his dyslexia. He passed the test. Earned the promotion. But he was denied that promotion because diversity took precedent over qualification.
As I wrote in an earlier article on Ricci and concepts of “white male privilege,” Ricci personifies the negative impact of so-called “positive discrimination.” It's precisely this impact that liberalism must confront. The liberal argument ignored issues of harm, the loss of time or additional income suffered by Ricci and his fellow plaintiffs.
Ginsburg wrote that the majority opinion ignores firefighters' “long history of rank discrimination against African-Americans.” It's an important consideration. But Ginsburg ignored the decades of distance from that history.
The liberal opinion goes on to write of the city's “unlikely” desire to exclude white firefighters from promotion because “a fair test”–fair, in this sense, meaning equal outcome–”would undoubtedly result in the addition of white firefighters to the officer ranks.”
This line of argument would have us believe that a “fair” system would promote some white applicants who passed the test while denying other white applicants who also passed. Ginsburg argues that the deliberate denial of some white men’s hard-won promotion because of their race is preferable to an inadvertent result in which no members of a minority group passed. This logic may be based on precedent. But it does a disservice to the brave fight for equality that liberals championed for decades.
The Ginsburg argument places disparate impact above disparate treatment. It argues, at best, that subtle discrimination is preferable over its more overt form. This is the inverse of our common hierarchy of justice. Common sense dictates that intentional harm is worse than accidental.
The test was created by a company specializing in employment exams and met legal requirements, such as a review by independent experts. But the liberal argument ignored the quality of the test and focused on the result. This logic is again based on civil rights era precedent and again faulty. It defines quality by demographic outcome. It consequently attempts to uphold the outdated use of quotas in that earlier era.
The city claimed that it trashed the test only because it was afraid of being sued for discrimination by the minority applicants. But practical consequences also matter in law, as Obama has said.
Liberals continue to argue today that affirmative action is the result of employers impeding the progress of minorities. But the Ricci case captures how affirmative action improves the position of minorities often by impeding the progress of whites. And it's the most vulnerable whites who often pay the price of affirmative action, those men who lost blue-collar jobs and know nothing of privilege.
Mistaking Cure for Disease
Sotomayor has commendably acknowledged that affirmative action played a critical role in her admittance to Ivy League universities. And to be sure, diversity has its practical benefits. One needs Spanish speaking social workers or black police officers patrolling black neighborhoods. Whites can be ill served by a homogenous education. But when diversity is emphasized solely for its own sake, the cure becomes the cause rather than the true cause–curing the disease of discrimination.
It has been suggested that New Haven could have certified the test results and found “alternative ways to deal with these issues in the future.” Does this mean that every test that does not achieve the desired demographic result should be tossed out?
At some point, in some cases, the liberal argument places diversity above the skill level of a workforce. It is exactly this thinking that contributes to the decades of distance between Democrats and working and middle class whites.
For Sotomayor in particular, her role in the Ricci case is hardly radical. She upheld precedent. So-called “judicial activism” is not a tool exclusive to the right or left. Sotomayor's view on affirmative action was in the mainstream of liberal thought. But on this policy, liberal thought is not in the mainstream.
A Quinnipiac University poll recently detailed the Ricci case and found that seven in ten Americans, including 53 percent of blacks, believed the Court should compel “the city to promote” the firefighters even if no blacks “scored high enough to qualify.”
Blacks overwhelmingly support affirmative action. But when given a specific example of the negative side of the policy, even a majority of blacks changed their mind.
Yet the liberal justices hid from these moral issues. The minority opinion sought to stay within the safe confines of precedent. It focused on defending the city's effort to avoid a civil rights lawsuit. The deeper issues that liberal justices ache to confront on other occasions, questions of fairness and equality, went ignored.
Imagine the opposite of the Ricci case. A test is tossed out because not enough whites earned a promotion and too many blacks did. Would liberals support the city's action then?
“We are not unsympathetic to the plaintiffs' expression of frustration,” Sotomayor and her fellow appellate justices wrote last year. The Supreme Court liberal justices wrote in their opinion that the firefighters denied a promotion “understandably attract this Court's sympathy.”
Sympathy is exhibited not in words but actions. The liberal justices sought sanctuary in the legalese of the case. They argued for the continued use of unequal actions to attain an equal outcome and thereby undercut the roots of liberalism, the right to equal opportunity. Those who once fought for equality, and stood on the shoulders of that fight, are reduced to justifying inequality to combat inequality. In this era of Obama, it's the measure of what remains unchanged that is sometimes most striking.
In Depth: 7 Firsts in Supreme Court History
In Depth: America's 10 Freest and Least Free States
In Depth: 8 Things Americans Believe in 2009
MIAMI (Reuters) –
The U.S. Justice Department said on Tuesday it was pressing ahead with its five-month-old lawsuit against UBS AG to force the Swiss bank to identify thousands of U.S. clients with secret UBS accounts.
Despite recent media speculation about a possible settlement of the case, the Justice Department said in a brief filed with a Florida court that it was seeking to enforce tax compliance with the full weight of U.S. law.
“The United States has a strong national interest in making sure that all U.S. taxpayers comply with the tax laws, including disclosing their offshore accounts, and paying all the taxes they owe,” the department said in the brief.
The U.S. government sued UBS in February in the U.S. Southern District Court of Florida, seeking the names of 52,000 Americans suspected of using the bank to hide nearly $15 billion in assets and evade U.S. taxes.
“The United States has proven its case for enforcement. The Court should order UBS to comply in full,” the Justice Department said in its filing.
In response, a spokesman for UBS said enforcement of the U.S. summons would require the bank to violate Swiss law and was inconsistent with U.S.-Swiss treaty frameworks.
A court hearing on the U.S. government case against UBS has been scheduled for July 13.
Attorneys and analysts have been skeptical about media reports that the United States would drop the case against UBS without major Swiss concessions, given the international momentum against tax havens and the coming deadlines for errant U.S. taxpayers to come forward voluntarily.
“Based on our representation of many UBS cases, it is clear in our minds that the government is going to pursue vigorously its objectives of transparency and limiting tax haven abuse,” attorney William Sharp, who represents U.S. clients of UBS, told Reuters by phone.
UBS and the Swiss government have argued that any exchange of confidential banking information should be handled through existing legal treaties rather than in the courts.
But in its court filing on Tuesday, the U.S. Justice Department appeared unrelenting in its bid to use legal tools to pry open Switzerland's jealously guarded tradition of bank secrecy.
“VITAL NATIONAL INTEREST”
“Although Swiss interests in bank secrecy may also be important, the Court must consider those interests in the context of UBS's conduct, where for at least seven years the bank actively helped tens of thousands of Americans break U.S. laws, and evade hundreds of millions of dollars in U.S. taxes,” the Justice Department said.
“The vital national interest of the United States in fighting attempts by U.S. taxpayers to avoid and evade their tax obligations outweighs the general Swiss interest in maintaining the secrecy of its banking relationships — especially for those foreign lawbreakers,” it added.
A source familiar with the matter told Reuters earlier on Tuesday that American clients of UBS will not be able to access secret accounts starting on Wednesday unless they transfer the money onshore or close the account.
“Starting from the beginning of July, U.S. clients will not be able to access information about their accounts unless they tell UBS they either want to transfer the money to a U.S.-regulated entity or to another bank,” the source said, confirming an earlier report by Swiss news agency AWP.
In its brief, the Justice Department said that UBS had already acknowledged that its bankers committed “very serious crimes on U.S. soil” and had therefore subjected the bank to the full jurisdiction of U.S. law.
“Swiss banking secrecy is not an impenetrable wall,” the document said.
“The filing of this brief suggests that if in fact there have been settlement talks, as has been rumored, they obviously have either broken down or are still in progress,” said Scott Michel, an attorney with Caplin & Drysale who represents individuals and companies in criminal and civil tax matters.
Michel has been following the case closely since he represents individuals coming forward under a voluntary disclosure program established by U.S. tax authorities.
He said he believed the United States had a stronger case than UBS in the tax evasion dispute.
(Reporting by Tom Brown; Additional reporting by Jim Loney and Pascal Fletcher in Miami, Lisa Jucca in Zurich, Kim Dixon in Washington and Juan Lagorio in New York; Editing by Gary Hill, Toni Reinhold)
If any designer in Paris can walk away feeling justifiably good about himself after the just finished menswear season it is Kris Van Assche, whose subtle collection for Dior Homme in Paris on Sunday, June 28, and edgy fare with his own label both bore one indelible trademark – his own.
In previous seasons at Dior, Van Assche has tended to hedge his bets by not fully embracing his own aesthetic, partly due to the reputation of his predecessor, Hedi Slimane, and partly due to the weight of assuming the responsibility at such a famous house as Christian Dior.
But on Sunday afternoon, his lightly layered, faintly billowing and inside-outside Dior Homme collection was Van Assche following his own voice.
“This collection is really me being really, fully myself at Dior,” said Van Assche with a slight intake of air and a palpable sense of release.
Where before Van Assche tended to be out in left field in terms of design trends, this season his main themes were entirely in sync with the current mood in menswear.
Take the trousers from Dior, cut amply at the thigh and tight at the ankle and slotting in with current trend, or the light layering, where the just-so transparency picked up on a look seen a lot in Milan this season. But Van Assche's ideas were all the better for his riskier approach, like using horse hair, normally employed on the inside to define the shoulder, used here on the outside to embellish a jacket.
The Dior designer also injected a note of street hipness with sleeveless jackets, vests with floppy lapels and high-tops with laces wrapped all around the ankle.
On Friday, June 26, Van Assche sent out his signature collection underneath the arches of the University Pierre and Marie Curie. A layered look at menswear, it featured baggy shorts, transparent chiffon tops, jackets with exposed seams and some great djellabas, a key item for next summer.
But his best moment were some remarkable, multilace street warrior sandals in electric blues and yellows, ideal for the a colonial-inspired clubber next spring.
WASHINGTON – The Senate plans to hold a hearing next week looking into antitrust issues surrounding the Bowl Championship Series. It’s the second time this year that Congress is shining a light on the polarizing system college football uses to crown its national champion.
The hearing will be held next Tuesday in the Judiciary Committee’s subcommittee on antitrust, competition policy and consumer rights, according to a posting on the committee’s Web site.
Sen. Orrin Hatch of Utah, the subcommittee’s top Republican and the lawmaker who sought the hearing, did not return telephone and e-mail messages left at his office Tuesday.
In an essay for Sports Illustrated being released Wednesday, Hatch wrote that the Sherman Antitrust Act prohibits contracts, combinations or conspiracies designed to reduce competition.
“I don’t think a more accurate description of what the BCS does exists,” Hatch wrote. He noted that six conferences get automatic bids to participate in series, while others do not. The system, he argued, “intentionally and explicitly favors certain participants.”
Citing the money generated by the BCS, Hatch wrote, “If the government were to ignore a similar business arrangement of this magnitude in any other industry, it would be condemned for shirking its responsibility.”
When asked about Hatch’s comments, BCS coordinator John Swofford said the BCS’ lawyers have “worked diligently to ensure that the BCS is in compliance with the law.”
Football fans in Hatch’s state were furious that Utah was bypassed for the national championship despite going undefeated in the regular season. Hatch noted that President Barack Obama and others have called for the BCS to be replaced with a playoff system.
“One thing is clear: No changes will take place if Congress does nothing,” Hatch wrote.
Rep. Joe Barton of Texas, the top Republican on the House Energy and Commerce Committee, has introduced legislation that would prevent the NCAA from calling a game a national championship unless it’s the outcome of a playoff. At a May hearing, Barton warned that the legislation would move forward “if we don’t see some action in the next two months” from BCS on switching to a playoff system.
David Frohnmayer, president of the University of Oregon and chairman of the BCS Presidential Oversight Committee, expressed a preference Tuesday for the current system, saying the proposals for a playoff system “disrespect our academic calendars, and they utterly lack a business plan.”
MINNEAPOLIS (Reuters) –
Democrat Al Franken, a satirist turned politician, was declared the winner of a Senate seat in Minnesota on Tuesday, clearing the way for President Barack Obama's party to secure a critical 60-seat majority in the Senate.
Ending one of the longest Senate races ever, the Minnesota Supreme Court unanimously rejected each of Republican Norm Coleman's five legal arguments that an earlier recount of the November 4 vote had been unfair. Coleman quickly conceded.
Franken will become the 58th Senate Democrat, the most the party has had since 1981. Two independents routinely vote with the Democrats, giving the party the 60 votes needed to clear Republican procedural hurdles known as filibusters.
However, the party has traditionally had trouble ensuring all its members vote the same way. They will also need to rely on Arlen Specter, a former Republican from Pennsylvania who switched parties in April who has said he will vote his own way and not necessarily along party lines.
“A lot is being made of me being the 60th member of the Democratic caucus. That's not how I see it,” Franken said. “I'm going to Washington to be the second senator from Minnesota.”
The Minnesota court, in its 32-page ruling, said Coleman had failed to show there was anything wrong with the standards used to reject absentee ballots that he wanted counted.
“I thought we had a better case, but the court has spoken,” Coleman said outside his St. Paul, Minnesota, home. “I'll abide by the results. There will be no further litigation.”
Republican Governor Tim Pawlenty said in a statement he would sign the election certificate immediately, allowing Franken, a former writer and actor for the popular Saturday Night Live television show, to join the Senate, likely next week.
After creating such characters as sad-sack self-help guru Stuart Smalley on Saturday Night Live, Franken agitated against conservatives on his nationally syndicated radio show and in a series of books that included “Lies and the Lying Liars Who Tell Them: A Fair and Balanced Look at the Right.”
As a campaigner, however, he maintained serious demeanor, and said he will focus on issues such as health care reform, education and energy policy.
“I really will be catching up,” he acknowledged. “I'll hit the ground, if not running, trotting.”
“I'm just glad it's over. Enough taxpayer money has been spent,” said Joseph Grevious, 30, a neighbor of Franken's who joined the crowd outside the senator-elect's condominium.
Both Obama and Senate Majority Leader Harry Reid extended a hand to the 58-year-old Franken, who had never run for public office and grew up in Minnesota.
“The Senate looks forward to welcoming Senator-elect Franken as soon as possible,” Reid said.
Minnesota's vote count was the subject of recounts and legal battles.
Coleman, seeking a second term, held a razor-thin 206-vote lead in initial results after the November 4 election.
But the close vote triggered an automatic recount of the 2.4 million ballots cast for the two men, and Franken edged to a 225-vote lead. That was challenged by Coleman and a judicial panel agreed to add only a few hundred previously rejected absentee ballots. That tally expanded Franken's lead to 312.
Pawlenty, considered a possible presidential contender in 2012, previously announced he would not run for governor again next year, which clears an avenue for Coleman to run for the post.
“That's a decision for another day,” Coleman said.
The last time either party had a filibuster-proof 60 senators was 1979 when Democrats held 61 and Democratic Jimmy Carter was president. Democrats also control the House of Representatives, 256 to 178 with one vacancy.
There is no guarantee Senate Democrats would all fall in line to pass Obama's top initiatives, and the Democratic president knows it.
“I am under no illusions that suddenly I'm going to have a rubber-stamp Senate,” Obama said in April after Specter switched parties.
The Franken-Coleman duel was the longest contested Senate election since a 1974 New Hampshire race, which was voided 10 months later due to voting irregularities, according to the Senate historian's office.
(Additional reporting by Tom Ferraro in Washington; Writing by Andrew Stern; Editing by Jackie Frank)
Dinosaur mummy yields its secrets
By Jason Palmer
Science and technology reporter, BBC News
A remarkably well-preserved fossil of a dinosaur has been analysed by scientists writing in the journal Proceedings of the Royal Society B.They describe how the fossil’s soft tissues were spared from decay by fine sediments that formed a mineral cast. Tests have shown that the fossil still holds cell-like structures – but their constituent proteins have decayed. The team says the cellular structure of the dinosaur’s skin was similar to that of dinosaurs’ modern-day descendants. A member of the duck-billed hadrosaur family, the fossil was found in North Dakota in the US and has been nicknamed “Dakota”. Phil Manning of the University of Manchester and his collaborators have been employing a number of techniques to tease out as much information as they can from the fossil. ‘Clean science’They believe that the dinosaur fell into a watery grave, with little oxygen present to speed along the decay process. Meanwhile, very fine sediments reacted with the soft tissues of the animal, forming a kind of cement.
As a result, the 66 million-year-old fossil still retains some of the organic matter of the original dinosaur, mixed in with the minerals. The team found that although the proteins that made up the hadrosaur’s skin had degraded, the amino acid building blocks that once made up the proteins were still present. “We’re looking at the altered products of proteins from the skin of this animal, locked within the three dimensional mineralised skin,” Dr Manning told BBC News. “You’re looking at cell-like structures; you slice through this and you’re looking at the cell structure of dinosaur skin. That is absolutely gobsmacking.” A study of the cell structures show that, like modern-day crocodiles and birds, the skin was made up of two layers: a surface epidermis against a deeper dermis layer made up of dense connective tissue. Although that finding is what might have been expected based on the presumed lineage of the modern animals, Dr Manning said it is “clean science”. “If you’ve got a hypothesis and you can’t test it, it remains a hypothesis. Now we’ve had an exceptionally preserved dinosaur which has allowed us to ask that question and answer it for the first time,” he said.
Studies of the skin from across the fossil show that the skin was thinner toward the flanks, between the tail and the hips, where other hadrosaur fossils have shown bite marks. Dr Manning said that region may have been the dinosaur’s “Achilles heel”. “If you understand the distribution of these structures in the skin of a prey animal, you can understand something about predator-prey interactions, and it might explain some of the hadrosaur fossils we see with these bite marks,” he said. Derek Briggs, a palaeontologist at Yale University and an expert in exceptionally preserved fossils, praised the work, saying that the important step was elucidating the mechanism by which such fossils could be preserved. “One can’t be certain, but I suspect that in many cases these kinds of skin impressions have gone unnoticed and people have gone after the skeleton, which is of course what you’d expect to be preserved,” he told BBC News. “This kind of discovery just demonstrates very clearly that soft tissue does survive, that the processes involved are unusual but not absolutely extraordinary – so there’s no reason why this kind of material won’t be discovered again.” Dr Manning said that studies on Dakota were continuing apace on a fossil he described as a pleasure to work with. “Whereas most of us have to deal with disjointed sentences and occasional fractured words to reconstruct the volumes of the fossil record, you’ve got a whole chapter lying there and you can flick through the pages at your leisure,” he said.
Where small is beautiful and bountiful
Business reporter, BBC News, Bangalore
Rows of large glass jars holding myriad different Indian spices and dry fruits are being cleaned and polished to prepare for the first customers of the day.This has been the ritual everyday for over 50 years in Shivaji stores – a brightly lit corner shop located in the central Delhi. Over 95% of the Indian retail market is made up of small, family run businesses like this one, that has been run by Gulshan Rai’s family for generations. Here the shopkeeper is the friendly confidante, counsellor and even family, for some. He understands the local tastes and customises the products on offer. “Despite the new malls, our customers keep coming back to us,” he beams. “We provide them with good quality products and people put their trust in us. “We have been here for over 50 years and are always going to be right here, so they can hold us responsible for anything they are not satisfied with,” Gulshan Rai says. His store is not an exception. Most local shopping markets are bustling with people. Chaos and creditAt another market nearby, shopkeepers are putting their wares on display on rows of clothes lines.
There are long strips of hair clips, colourful bands and other hair accessories. Most of the shoppers cry out to attract the shoppers who in turn start haggling loudly over the prices. The sounds, the colours and the smells, along with the chaos, are an integral part of the shopping trip. Though they seem disorganised, they are generating good business. These tiny shops stock just what the consumers want and constantly change the products to match the demand. Shopkeepers here know most of their customers by name, offer credit and will deliver to their doorsteps. This is an experience that can’t be matched by modern retail giants. Revolution revvingBut just over a year ago, the country was all set for a retail revolution. A number of Indian companies set up western-style supermarkets.
They rented or bought thousands of square feet of retail space to sell everything from vegetables, electronic goods, jewellery and books under one roof. People thronged these stores for the new experience of shopping in large air-conditioned stores and to get away from the heat outside. There were even protests by millions of people in the unorganised trade who felt threatened by this growth and feared job losses. However, two years down the line, some of these big chain stores have had to scale down operations. Trying to provide the frills of modern retailing, these shops had to bear the burden of sky-high rents in shopping malls, electricity bills and paying the salaries of a large workforce. Some simply couldn’t cope. Many have started to pull down their shutters. Empty stores lootedThe worst-hit among them is Subhiksha – the south Indian retail chain that opened over 1,600 stores in less than two years. They couldn’t sustain the pace at which they expanded and the stores have now been mothballed.
From over 5,000 employees they have been reduced to less than 50. Unable to pay for security agencies and staff, their stores and warehouses were looted across the country. Now a group of banks are working on a corporate debt restructuring plan to try and revive the company. Experts say it’s not easy to change Indian shopping habits. “In the next 20 years, I can’t foresee modern retail being any threat to traditional shops in India,” says Pinakiranjan Mishra, heads of Ernst & Young’s retail and consumer practice. “If you look at the places where [modern retailing] has a large share of the market, they have good infrastructure, everyone has a vehicle. “They have the propensity to buy rations for the month and store them – how many people in India have cars to cart such huge rations or refrigerators to store them?” Indian consumption patterns are not like western patterns, he argues. Here, people shop daily or at the most weekly, not for longer periods. Rural focusThis is something that Dabur India knows all too well. In a large research lab outside Delhi, their scientists are working on new and improved shampoos, herbal tonics and health drinks. Despite the downturn, the company found an increase in sales of products in neighbourhood stores. So they have turned their focus back onto the smaller outlets for their growth. As a result, this year, the company has delivered its best growth in nearly a decade. “Initially when the modern formats were launched, we made an effort to put our products there and they did sell,” says Rajan Verma, Dabur’s chief financial officer. “But in the long-run our focus remains neighbourhood shopkeepers… In fact this year ,we are also increasing our focus toward the semi-rural and rural end of our portfolio by investing significantly in personal care and health care products, which cater to rural markets.” Dabur is now looking for acquisitions and recently bought a controlling stake in Fem Care Pharma to enter the skincare market. The potential is huge. US-based management consultancy AT Kearney has named India as the most attractive retail destination for investors among 30 emerging markets. Back at the Shivaji store, women in bright sarees are sitting outside in the sun cleaning and packing the lentils and grain. Whether it’s in service or in products, many consumers think these shops give added value. Both small and large shopkeepers agree that the retail business in India is booming. But in the fight between traditional practises and modern business, it seems the first round has gone to the small Indian shopkeeper.
Costs hit low income households
By Steve Schifferes
Economics reporter, BBC News
The cost of living for those living on minimum household budgets is rising faster than inflation, the Joseph Rowntree Foundation has calculated.It says that the costs for a single household on its low-income budget were up 5.3% this year, with rises of 5% for pensioners and couples with children. The reason is that the poor spend more on fuel, food, and public transport, which have risen by 7% to 12%. Benefits for working age people are well below minimum income standards.
However, the report says that pensioners who get the full amount of pensioner credit do receive enough to meet the minimum income standard. The think tank had created the benchmark measure last year in order to determine the income people need “to reach a minimum socially acceptable standard of living” which includes “having what you need to in order to have the opportunities and choice necessary to participate in society”.
It is based on detailed survey evidence from the public about which items of expenditure are essentials. Rowntree says that its preliminary findings suggest that despite the recession, the public “continue to believe that a minimum standard of living should allow people in Britain not just to survive, but to play a full part in society”. However, it points out that in tough economic times a growing number of people are concerned about whether they have enough income to meet the minimum acceptable standard of living. And it warns that some people losing their jobs will have to survive on less than half of that minimum standard of living. According to the report, a single person of working age would only receive benefits worth 42% of the minimum income needed, while a lone parent with one child would only receive 67% of the minimum. And it says that the national minimum wage would have to rise by 1 in order for it to provide enough money for to raise a single-earner household out of relative poverty. Poverty lineThe report is an attempt to raise the debate about the level of relative poverty in Britain beyond the government’s official poverty line of 60% of average earnings – and as the government prepares to legislate to make legally binding its target of cutting child poverty in half by 2020. It points out that on this relative measure, poverty is likely to have decreased or stabilised this year, simply because during the recession average earnings have stopped growing while benefits went up by 5% in April 2009 in line with the September 2008 inflation figure. It says that “this apparently beneficial effect on the poverty figures does not represent a real improvement in the living standards of people on low incomes” because their cost of living is going up faster than for the average family. And it warns their standard of living could fall if the inflation rate for those on minimum incomes continues to outstrip the general inflation rate. Rowntree found that people in its focus groups continued to believe that everyone should have access to items that met key social needs, but there was a scaling down of how much should be spent to achieve these needs. People thought some needs could be met through a more modest level of consumption, for example by shopping at discount supermarkets, or going out less frequently for meals or entertainment. “The mood was not so much one of austerity, but of prudence,” it said.
Top employers cut graduate jobs
There is further evidence of a tough graduate jobs market with a survey showing vacancies down 13.5% on 2008.The research among the top 100 employers identified by graduates shows that the only area with significant growth was the armed forces – up 11%. As numbers of jobs have shrunk, firms have been getting more applicants for each – a third more than last year. High Fliers Research, which carried out the survey, said employers had cut recruitment targets by 28%. Employers have recruited 14,370 graduates to join their payrolls – against an original target of 19,951. Last year, there were 16,614 graduates recruited. Unemployment prospectsThe market research company’s report, The Graduate Market in 2009, said the greatest recruitment of graduates this year was in accountancy and the public sector. Accountancy and the armed forces are also the least competitive fields to enter in terms of the number of people applying for each vacancy: 15 per training place in accountancy and just two for each place in the military. The biggest competition is in investment banking, with 100 applicants chasing every position. Half of the leading employers feel they are likely to be recruiting at similar levels in 2010. High Fliers managing director Martin Birchall said: “With a record number of students graduating from UK universities this summer, these substantial cuts in graduate recruitment at Britain’s best-known and most sought-after employers couldn’t have come at a worse time. “The ‘Class of 2009′ are facing one of the toughest job markets of the last two decades and there is now the very real prospect that tens of thousands of new graduates will be left unemployed after leaving university this year.”
Machete sold to 15-year-old boy
Trading standards officers have called for a ban on online knife sales after a machete was sold to a 15-year-old for 1.50 over the internet.The potential weapon was delivered in the mail in bubble wrap and cardboard to the teenager who was testing underage sales for trading standards. The tests found that 214 out of 835 stores in England and Wales sold knives illegally to under 18s. The problems were more acute online, where 80% sold knives to young people. “As knife crime remains a problem in many of our towns and cities, it beggars belief that so many traders are still prepared to sell potentially lethal weapons to children,” said Ron Gainsford, chief executive of the Trading Standards Institute (TSI). RulesThe law states that it is illegal to sell a knife or bladed article to anyone aged under 18, with businesses and staff facing a fine of up to 5,000 or six months in prison for doing so.
Home Office figures show that knives were involved in 22,151 violent offences in 2007-8. Knives have become a status symbol among some young people and the increase in searching by police officers means some young people dash into shops to buy knives for “instant arming”. The situation appeared more problematic with sales made online, according to tests by trading standards departments in the London boroughs of Southwark, Lambeth and Greenwich, as well as Staffordshire, Salford and Cardiff. They found that 58 out of 72 websites selling knives were prepared to sell to children aged under 18, often because they failed to ask the buyers’ age. Sales to teensBrandon Cook, TSI lead officer for tackling underage sales, asked his 15-year-old son Alex to test how easy it was to buy knives on the internet using the teenager’s debit card. He bought four, including the machete, in one hour. They started to be delivered within days. “It was too easy. Anyone can do it, because a lot of people are used to buying things online,” said Alex. His father said that websites offering online gambling were able to put blocks on people aged under 18 using their sites and the same should be true of websites selling knives. Issues around underage web-based sales of knives were raised with some major department stores which immediately withdrew them from sale online. The British Retail Consortium also started a scheme in February that ensures retailers do not sell knives to youngsters. Some 21 major retailers have signed up. However, the TSI wants the government to ban the sale of knives online. The Institute is supported by Ann Oakes-Odger, founder of KnifeCrimes.org, whose son Westley, 27, died in 2005 when he was stabbed in the neck in an unprovoked attack at a cash machine. “As a mother who knows the pain of losing a child, if one life was saved by a ban on the internet sale of knives, it would be worthwhile,” she said. The industry says that work is continuing for a strategy that would allow legitimate consumers to buy age-restricted products. “We are working towards creating an industry standard so that both online retailers and customers can be assured that we are doing everything possible to ensure that age-restricted products are sold responsibly,” said James Roper, chief executive of the Interactive Media in Retailing Group – the online retailing industry body.
US warns Iraq of ‘difficult days’
US President Barack Obama says US troops have withdrawn from Iraq’s towns and cities on schedule, but he warned of “difficult days” ahead.Mr Obama described Tuesday’s handover to Iraqis as a milestone, but said the country’s leaders would face “hard choices” on politics and security. As Iraqis celebrated the US withdrawal, a car bomb in the northern city of Kirkuk killed at least 27 people. In the past two weeks about 250 people have been killed in a wave of attacks. Iraqi and US troops have been on alert for attacks during the pullback. As Iraq marked the handover with a public holiday called National Sovereignty Day, President Obama said: “Iraq’s future is in the hands of its own people.” “The Iraqi people are rightly treating this as a cause for celebration.
“The future belongs to those who build, not to those who destroy.” Mr Obama predicted there would be more violence, like the “senseless bombing” in Kirkuk. That came 10 days after a truck bomb killed more than 70 in the city’s deadliest attack in over a year. “Make no mistake, there will be difficult days ahead,” he said. He added: “There are those who will test Iraq’s security forces and the resolve of the Iraqi people through more sectarian bombings and the murder of innocent civilians. “I am confident that those forces will fail. Today’s transition is further proof that those who have tried to pull Iraq into the abyss of disunion and civil war are on the wrong side of history.” Violent monthKirkuk, about 250km (155 miles) from Baghdad, was also the scene of two suicide bombings last month, in which 14 people were killed.
The city is the centre of northern Iraq’s oil industry, and home to a volatile mix of Kurds, Arabs, Christians and members of the Turkmen community. Most of the other bombs that have killed around 250 people in the past fortnight have been aimed at Shia areas. Despite their pullback from cities and towns, US troops will still be embedded with Iraqi forces. On Monday, four US soldiers were killed in combat in Baghdad. The pullback comes two years after the US “surge” of extra troops between February and June 2007, which saw US troop levels in Iraq reach about 170,000. US-led combat operations are due to end by September 2010, with all troops gone from Iraq by the end of 2011. Some 131,000 US troops remain in Iraq, including 12 combat brigades, and the total is not expected to drop below 128,000 until after the Iraqi national election in January.
NEW YORK – General Motors’ Chief Executive was grilled by a string of lawyers on Tuesday about his company’s bid to sell its “good” parts into a new company and emerge from bankruptcy protection.
GM, whose June 1 filing for bankruptcy protection was the fourth-largest in U.S. history, is hoping to avoid a lengthy sale hearing that could drag out the process and postpone its emergence from Chapter 11. Last month, objections from a group of bondholders and others dragged out rival Chrysler LLC’s sale hearing for three days.
At a packed Manhattan courthouse Tuesday, GM CEO Fritz Henderson was questioned for around five hours by attorneys for the various parties challenging the sale, including bondholders, consumer groups and unions.
Despite U.S. Judge Robert Gerber’s urging for the attorneys to keep their arguments concise and to avoid redundancies among their questioning, the hearing dragged on as a parade of lawyers made their way up to the podium to question Henderson.
“I think people have forgot why we’re here and what we have to accomplish,” Gerber said sharply. “I’m not going to deny anybody due process, but I expect the questioning to be more focused.”
Gerber looked particularly annoyed when Henderson was questioned by an attorney from Florida who himself owned 5 million in GM bonds. The attorney spent much of his time searching for documents, at times asking opposing council to provide them, prompting Gerber to bury his head in his hands.
At the same time, Henderson wasn’t phased by his lengthy stay on the stand, answering questions quickly and directly for the most part, making eye contact with the attorneys.
When asked about the current condition of GM, Henderson testified that the automaker’s June sales were “slightly better than expected” excluding fleet sales, which he partly attributed to the company’s progress toward an exit from Chapter 11.
Under a government-backed deal, General Motors Corp. will sell most of its assets to a newly created company, 60 percent owned by the U.S. government. The Canadian government will get a 12.5 percent stake while the United Auto Workers union will take a 17.5 percent share to fund its health care obligations. Unsecured bondholders receive the remaining 10 percent.
Existing GM shareholders are expected to be wiped out.
The remaining pieces of the company, including some closed plants, will become the “Old GM” and be liquidated.
GM hopes to emerge as a leaner company, less burdened by debt and labor costs as it faces a severe recession that has sapped car and truck sales. Automakers, which are due to report June U.S. sales on Wednesday, have seen sales fall 37 percent over the first five months of the year.
Lawyers, media and other spectators, along with a handful of people who claim they were injured as a result of allegedly defective GM vehicles, gathered outside the U.S. Bankruptcy Court for the Southern District of New York hours before the hearing’s scheduled start Tuesday in a line that wrapped around the building.
Consumer groups and several individuals with product-related liability claims against the company are objecting to the sale because people with pending product-related liability claims against GM will be forced to seek compensation from “Old GM,” the collection of mostly unprofitable assets leftover from the sale where there will likely be nothing left to pay their claims.
Early on in the hearing, Mark Salzberg, an attorney for a group of bondholders, questioned why GM would opt for a sale plan instead of a restructuring plan, charging that the automaker took that route to make it harder for its creditors to negotiate with the company.
But Harvey Miller, an attorney from GM, questioned the validity of the bondholder group’s challenge, noting that it only has three members, one of which bought his bonds for just 2 cents on the dollar, while the other two spent no more than 20 cents on the dollar for theirs.
Besides the bondholders, a trio of labor unions who claim that their retirees stand to lose health care benefits are also trying to block the sale. Unlike the UAW, which brokered a deal for a stake in the company, those unions say they won’t have anything to pay for retiree health care.
Henderson testified that retiree benefits for the three unions cost GM about 26 million a month.
PITTSBURGH – The Pittsburgh Pirates, swapping outfielders at a rapid rate for the second successive season, sent starting left fielder Nyjer Morgan to the Washington Nationals in a four-player deal involving outfielder Lastings Milledge and also shipped backup Eric Hinske to the Yankees on Tuesday.
The Pirates, who have pushed to restock a thin farm system by making numerous trades over the last year, get Milledge and reliever Joel Hanrahan from the Nationals for the fleet Morgan and left-hander Sean Burnett, a former first-round draft pick.
Earlier, they sent 2002 AL Rookie of the Year Hinske to the Yankees for minor-league right-hander Casey Erickson and outfielder Eric Fryer.
Just as they did last season by dealing Jason Bay and Xavier Nady, the Pirates have traded two of their three starting outfielders before Aug. 1. They sent former NL All-Star center fielder Nate McLouth to the Braves on June 4 for pitcher Charlie Morton and two other prospects.
Though rumored for several days, the Nationals trade is somewhat surprising because the Pirates dealt Morgan — who turns 28 on Thursday — less than halfway through a promising first season as a starter. He is hitting .277 with 2 homers and 27 RBIs, only four fewer than No. 3 hitter Freddy Sanchez, and has 18 steals, although he has been thrown out 10 times.
Milledge, a former top Mets prospect, has played in only seven games with Washington while part of the season rehabilitating a broken right ring finger that required surgery in May. He is expected to join Triple-A Indianapolis before being called up by Pittsburgh later this month.
Milledge, 23, has more power than Morgan — he has 25 homers in 897 career at-bats — but has bothered frequently by injury problems that include a broken right hand, sore foot and groin strain. He hit .268 with 14 homers, 61 RBIs and 24 doubles in 138 games last season, earning him a spot on the cover of the Nationals’ media guide this season.
Still, Milledge was a major disappointment to the Nationals, who dealt two starters — catcher Brian Schneider and outfielder Ryan Church — to acquire Milledge from the Mets in November 2007.
The right-handed Hanrahan, 27, is 0-3 with a 7.71 ERA in 34 games — he was demoted from the closer’s job — and has a 5.30 ERA in 115 career games. Burnett, the Pirates’ top pick in 2000, is 1-2 with a 3.06 ERA in 38 games and has pitched in 96 games the last two seasons.
The 31-year-old Hinske hit .255 in 106 at-bats this season with nine doubles, one homer and 11 RBIs, playing right field, first base and third base. He was 8 for 24 as a pinch hitter and has been disappointed by a lack of playing time.
Through June 29 last year, he had 13 home runs en route to a 20-home run season with the AL champion Tampa Bay Rays. He won the rookie award with Toronto in 2002, when he hit .279 with 24 homers and 84 RBIs, and was a member of Boston’s World Series championship team in 2007.
“He’s a pro. He’s been through the trenches in the AL East,” Yankees general manager Brian Cashman said. “There’s a lot of benefits to him. He knows his role.”
The 23-year-old Erickson was 3-3 with a 2.25 ERA in three starts and 18 relief appearances at Class A Charleston this season. Fryer, also 23, hit .250 with 11 doubles, two homers, 24 RBIs and 11 steals for Class A Tampa after leading the South Atlantic League with a .335 average last year for West Virginia. He was obtained by the Yankees in February for left-hander Chase Wright.
To fill Hinske’s roster spot, Pittsburgh purchased the contract of 28-year-old outfielder Garrett Jones from Triple-A Indianapolis, where he hit .307 with 18 doubles, 12 homers, 48 RBIs and 14 steals.
LOS ANGELES (Reuters) –
Bizarre in life, Michael Jackson's complex personal affairs are taking even stranger twists in death, with reports on Tuesday questioning the parentage of his children and what caused his untimely demise.
After five days of television replays of Jackson's most famous hits and glowing emotional tributes to his musical genius, attention has turned to the murkier side of the “Thriller” singer.
Celebrity website TMZ.com, which broke the news of Jackson's death, reported the entertainer was not the biological father of his three children and that his ex-wife, Debbie Rowe, was not their genetic mother.
Citing multiple but unnamed sources, TMZ said all three children were conceived “in vitro” but that neither Jackson's sperm nor Rowe's eggs were used.
Rowe was quoted as saying in 2004 that Jackson was not the biological father of Michael Jr, 12, and Paris, 11, but she had been assumed to be their mother. The third child, Prince Michael II, was born in 2002 and the identity of his surrogate mother has never been known.
Rowe's lawyers did not return calls for comment.
Celebrity magazine Us said the biological father of Michael Jr and Paris was Jackson's dermatologist, for whom Rowe once worked.
None of the claims could be verified by the parade of managers, lawyers and spokespeople who said they spoke on behalf of Jackson or his family during his career and who have resurfaced since his death on June 25 at the age of 50.
The question of parentage is important because the children stand to inherit a share of what is believed to be the pop star's multimillion-dollar estate. Whoever has guardianship over the three children will control the money.
Jackson's mother Katherine won temporary guardianship of the children and control of his estate on Monday until a July 6 hearing.
Despite his long career, Jackson was largely reclusive off stage. He relied on an ever-changing series of aides to fend off curiosity about his two brief marriages, controversial relationships with young boys and changing physical appearance — all of which led the British media to dub him “Wacko Jacko” some 15 years ago.
“This is a story that's going to last and develop and get bigger in the next year,” TMZ managing editor Harvey Levin said on Tuesday. “You're going to see quite the show here.”
Lacking a focal spokesperson, reports on Tuesday of Jackson's funeral arrangements trickled out piecemeal, with conflicting sources speaking of a public viewing at Jackson's Neverland Valley Ranch in central California on Friday or Saturday, or possibly both.
A cause of death has not yet been determined. Results of toxicology tests are not expected for about 4-6 weeks but speculation is rife that Jackson's death will be attributed to his prescription drug use.
Media reports have focused on his alleged addiction to painkillers, anti-depressants and anxiety drugs. Police have reportedly removed medical evidence and quantities of medicines from the singer's rented home in Los Angeles.
In one of the more extraordinary claims on Tuesday, Jackson family lawyer Brian Oxman told Life & Style Weekly that the singer “feared somebody wanted to kill him.”
“He was even concerned people would kill him to somehow try to take control of the Beatles back catalog,” Oxman told the magazine, referring to Jackson's lucrative joint venture.
The existence — or not — of a Jackson will was also steeped in mystery.
His family suggested in court papers on Monday that he had died intestate. But other reports said a will written in 2002 had been found that left the bulk of his estate to his children and his mother Katherine.
His father Joe, who Michael accused of beating him and his siblings when they were young, was apparently cut out of that will. Joe Jackson has been the public face of the family this week but enraged many fans by twice using the media spotlight to promote his own music industry projects.
(Editing by John O'Callaghan)
Los Angeles (E! Online) –
Is it true that Michael Jackson wasn't the dad of some of his kids? If they aren't related to him at all, how can Michael's mom get custody of them?
It's been assumed for years that Prince Michael and Paris are not biologically related to the late star—reports have been floating around since at least 2004, when newspapers worldwide picked up on a tabloid report citing court papers filed by Jackson's ex-wife Debbie Rowe.
The new rumor surfacing, of course, is that the mystery dad now allegedly has a name, face and profession. Us Weekly magazine is claiming he is Arnold Klein, the dermatologist who treated Jackson's reported skin disorder.
If these reports are true, what might that eventually mean when it comes to custody of Prince and Paris? Well…
…probably not much.
The kids are 11 and 12 now, Jackson's mother Katherine has filed for custodianship, and Klein—assuming he is the dad—hasn't said a word publicly.
(Access Hollywood spoke with Klein's publicist, who would only say that the doctor has been a friend of Jackson's for two decades. More interestingly, the flack says Klein's attorney will not let him speak until the coroner's report on M.J.'s death comes out.)
Reports are now claiming that Klein and Rowe were “surrogates” in producing the kids—an arrangement that usually includes ceding of custody as standard operating procedure.
Also, courts are generally not keen on separating children from siblings. Let's not forget that there's also Prince Michael II aka Blanket, a third child, age 7, and that all three kids have been together since he was born. (Mystery surrounds Blanket, too, and the mother has never been revealed, even on the birth certificate.)
If anyone other than Katherine has a shot at custody of Prince and Paris, it's Rowe. Some reports are indicating that she might not even be the biological mother of Prince or Paris, but she does have some parental rights. (Rowe's lawyer told Radar today that this rumor is “entirely false.”) For more on that, see my previous story on the possible fate of the Jackson children.
Follow me on Twitter @answerbitch
··· THEY SAID WHAT? Get today's most commented stories now at www.eonline.com
Job fears spark ‘Plan B’ career hunts
By Claire Prentice
It never hurts to have something up your sleeve: that’s the theory behind a growing trend in the world of work.In the face of a contracting economy, more and more professionals are devising Plan B careers. Fearing that they may be made redundant, or despairing at the widespread demise of their industry, they continue to turn up at the office each day. But at the same time, they are secretly enrolling in night classes, signing up for online courses, engaging in research, writing up business plans and approaching potential backers to prepare themselves for an alternative career. Unlike downsizing, where workers seek a better work-life balance, Plan B-ers often enjoy the job they are leaving, but fear that today’s economic climate and industry changes mean it no longer offers them a viable long-term career. “This is what we expect to see in times of recession,” says John Gnuschke, director of the Sparks Bureau of Business and Economic Research at the University of Memphis. “People retool and find opportunities in other areas of the economy. “Insecurity always causes people to rethink their view of their future. People can’t count on a single employer or even a single industry anymore. “If you’re lucky enough to still have a job it’s still wise to begin to retrain and to broaden your skill base.” Finding a sweet spotCaitlin Kelly, 52, a Canadian-born newspaper journalist and author of “Blown Away: American Women and Guns”, is a typical example.
Ms Kelly continues to work as a freelance journalist for newspapers including the Wall Street Journal, but has branched out into retail and plans to start a wedding photography business. As she points out, people will always want to get married and to shop. “I have been a professional journalist since the age of 18 and have so loved it that I have never seriously considered tackling anything else,” she says. “But I’ve reached the stage where I need to work in a more stable industry with long term prospects. “The challenge of Plan B is finding a sweet spot, something that combines a good income, is enjoyable and is something I already know how to do or can learn quickly and affordably.” Lucrative creativityDavid Gray’s Plan B came about not an alternative career but as another outlet for his creativity.
By day, the Scot works in New York as a creative director in magazines but in his spare time he runs Oddhero, a graphic t-shirts and print business. Mr Gray recalls the long hours he spent in the studio checking the ink on prints or wrapping t-shirts when his friends were in the pub. “It pays to have a Plan B, as there’s no such thing as a job for life now,” he says. “I’m lucky, I wake up and look forward to going to work, but I also love my Plan B, and things change. “It wasn’t dreamed up as an insurance policy, but this is a changing world and a volatile industry and if it all went wrong, I could easily see myself living by a beach, running my own business, if there was ever enough money in it. “An ideal world is both, where one complements the other.” Starting from scratchA spate of recent high-profile closures in newspaper and magazine publishing, manufacturing, real estate and printing have left workers feeling vulnerable. According to experts, workers in other fields such as finance, IT and the charity sector are also jumping ship. Irina Melloy has worked at a London art gallery for 15 years, but plans to use her summer holidays to take a course teaching English to foreign students. “It is a great fallback, which should guarantee me work anywhere in the world,” she says. Neil Callaghan, 53, was a broker on Wall Street, earning 100,000 60,000 a year, before he became an operations specialist in a bid to broaden his skill base. He is now taking a book-keeping class in the hope of further improving his long term employability. “I’ve started networking and I’m studying in all my spare time so that I can get some new skills on my resume fast,” he says. “It’s not easy to start from scratch again, but what’s the alternative?” Changed focusVocational colleges and universities across the US are a surge in applicants as people of all ages flock to take night classes, online courses and in some cases full degrees with the hope of improving their employment prospects. “It’s been years since we’ve had to put on so many classes,” says Deborah Harris, adult education program director at The City University of New York. “We’ve had people from all walks of life coming to retrain, from the ordinary man on the street to Park Avenue professionals in Gucci loafers and Ralph Lauren suits.” Record numbers of people in the US are currently applying for public sector posts, such as police and fire service jobs and administrative positions in federal and state government. Colleges and universities offering courses in nursing are also reporting an increase in queries. Broad skill setAccording to experts, this is not the first time workers have been forced to go back to the drawing board. Just as the economy moves in a cycle of boom and bust, so industries grow and contract over time. “What we’re seeing is proof that people can be flexible, the market can work,” says Mr Gnuschke. “The employees who are adaptable and have a broad skill set are going to do best.”
Afghan climbers hope to make history
By Aunohita Mojumdar
BBC News, Kabul
It sounds like an old joke – a farmer, a cook, a mason and a schoolteacher go climbing together.But this unlikely foursome from the Wakhi community in north-eastern Afghanistan hopes to make mountaineering history. On Thursday, they aim to become the first ever Afghans to scale the country’s highest mountain peak, Mount Noshaq, in a remote corner of Badakshan province. At 7,492m (25,000 ft), Noshaq is the second-highest peak of the famous Hindu Kush range – only just topped by the tallest summit, Tirich Mir. Mt Noshaq is located at the beginning of the Wakhan corridor, the tiny strip of land jutting out of Afghanistan, like a finger pointing towards China, a corridor that separated British Imperial India from Tsarist Russia. From mujahideen to mountaineeringIn the 1960s and 1970s the mountain peaks along the Wakhan were an international draw.
Three decades of war, however, ended that. International teams abandoned the area as many Afghans struggled for survival. Among them was Afiyat Khan. Losing his father at a young age, he dropped out of school and signed up with the mujahideen, joining Northern Alliance commanders in the only area of the country to keep the Taliban at bay. He emerged from the war to become a skilled master mason. But stories of his father, who worked with visiting tourists, stayed with him. “I just had the idea that someday I wanted to climb the mountains,” he recalled. The opportunity came in 2002 when an accomplished Italian climber, Carlo Alberto Pinelli, came to revive mountaineering in Afghanistan, and train local Afghan youths. Mr Khan joined immediately. “At that time I didn’t know we needed special equipment or special shoes. I just started climbing.”
Since then he has been to the Alps on several professional training courses – the latest in April and May. Mt Noshaq was first ascended in 1960 by a Japanese team and most recently tackled, by a European-led expedition, in 2003. But the peak has never been conquered by Afghans before. Making the July expedition possible is a young group of Frenchmen who have been living and working in Afghanistan for the past several years: Louis Meunier, Jerome Veyret and Nicolas Fasquelleis. ‘Symbol of hope’”This is a symbolic expedition,” said Mr Meunier who was in Kabul last week to finish buying supplies and equipment. “The idea is to plant an Afghan flag at the top, as a symbol of hope and achievement in Afghanistan.”
The expedition is being launched by the Rome-based organisation, Mountain Wilderness, and the French national Alpine skiing school, among others. The team will include the four Afghan climbers and two experienced international guides. It aims to “send a message of peace and hope and to foster national pride and unity”. “This will be a strong positive message illustrating the determination of Afghans to overcome difficulties and bring peace and success to a country torn apart by 30 years of war,” the expedition’s mission statement says. There is also a more concrete aim. They hope to pave the way for more high-altitude adventures and sustainable tourism in the area. Despite the violence in other parts of the country, the Wakhan region has remained safe. Tourism here has been growing steadily, with visitors lured by the area’s spectacular beauty and its gentle inhabitants. The area is surrounded by the Pamir, the Karakoram and the Hindu Kush mountain range, which lies between Afghanistan and Pakistan, and each valley is distinct. ‘Luck and pluck’Add to that the pristine peaks and beautiful rivers, and there is every reason for it to prove catnip to tourists and climbers in search of pastures new.
The Wakhan corridor is mostly populated by the Wakhi community
Increased tourism would give a welcome cash injection. The inhabitants of the Wakhan corridor live off subsistence agriculture and herding, with the semi-arid zone yielding few crops. No-one knows this better than the four Wakhis about to attempt the Noshaq. Mr Khan himself has worked as a porter on previous expeditions. Now their own mission will bring short-term employment to the 80 porters who will accompany them to base camp. Training in the Alps, none of the four has climbed heights beyond 6,000m (20,000 ft). Much of the success of the attempt will depend on good weather, luck and sheer pluck. Despite a short warm season, the weather in the area is considered ideal for climbing, as is the short distance from the road to base camp. Adopted as the motto of the expedition is an Afghan proverb that seems to echo not just the determination of the mission, but even the lives of the climbers. It simply says: “There is a path to the top of even the highest mountain.”
DETROIT (Reuters) –
Michael Curry was sacked as Detroit Pistons coach on Tuesday after just one season in charge.
“This was a difficult decision to make,” said Joe Dumars, Pistons president of basketball operations in a statement on the team's website (www.nba.com/pistons).
“I want to thank Michael for his hard work and dedication to the organization. However, at this time, I have decided to make a change.”
Under Curry the Pistons finished with a regular-season record of 39-43 and advanced to the playoffs where they were swept from the first round in four games by the Cleveland Cavaliers.
The results fell far short of the high expectations for a team that had reached the conference finals the previous six years.
A former Pistons player, Curry watched the season unravel following an unpopular trade in which popular point guard Chauncey Billups moved to the Denver Nuggets in exchange for Allen Iverson.
While Billups revived the Nuggets, Iverson flopped in Detroit and ended the season on the injury list.
(Writing by Steve Keating in Toronto; Editing by Ed Osmond)
Manchester United have made their first signing of the summer after confirming a deal has been done for Wigan Athletic winger Antonio Valencia.
Ecuador winger Valencia moves to Manchester United as a replacement for Real Madrid-bound Cristiano Ronaldo.
The 23-year-old Ecuador international has signed a four-year contract after moving for an undisclosed fee, believed to be in the region of 16 million (23 million). Valencia is expected to help fill the void left by Cristiano Ronaldo following the Portuguese winger’s impending 80 million euros (130 million) move to Real Madrid. Latest transfer rumors and gossip “Joining Manchester United is a dream come true for me,” Valencia told the club’s official Web site. “I have enjoyed my time at Wigan, but I am thrilled to have the chance to challenge for the biggest honors in club football here. “Playing in front of 76,000 fans alongside players like Wayne Rooney, Rio Ferdinand and Ryan Giggs will be an amazing experience. I can’t wait to get started with the club. “I hope the fans at Wigan can understand that I am an ambitious guy and a chance like this might never come again for me,” added Valencia, who will be 24 next month. “I am happy that the club has benefited from the move financially because I owe them such a lot. I have had a great time here.”
United edge closer to Valencia deal
United accept record Ronaldo bid
The 20 most wanted players
Latest transfer gossip and rumors
United manager Sir Alex Ferguson admitted he had tracked Valencia’s progress since his arrival at Wigan two seasons ago. “Antonio is a player we have admired for some time now, having spent the last two years in the Premier League with Wigan,” he said. “I am sure his pace and ability will make a significant contribution to the team.” The first Ecuadorian to play for United will make his debut for the Premier League champions on a four-match tour of Asia next month, before the Red Devils head for a four-team tournament in Munich.