Just thought I would pass along this picture of Phil Mickelson‘s pitch shot on the 18th hole that lipped out yesterday and prevented a sudden death playoff between Mickelson and Tiger Woods, who regained the No. 1 World Golf ranking with his victory over Mickelson.
I watched the Woods-Mickelson match yesterday afternoon while working, and the match was so entertaining that it made it seem as if I was not working.
The Texas Public Policy Foundation provides this timely review of the development of asbestos litigation, which is a current hot reform issue in both Washington and Austin.
This Washington Post article reports on drug-coated stents, which are allowing an increasing number of people to avoid having heart bypass surgery. The new generation of tiny, drug-coated metal scaffolds prop open arteries and slowly release medication that prevents the arteries from from reclogging. Check it out.
Uber-investor Warren Buffett‘s 2004 performance letter to Berkshire Hathaway, Inc‘s shareholders was published over the weekend. While citing such diverse characters as W.C. Fields and Jesus Christ, Mr. Buffett accepted blame for a drop in Berkshire’s 2004 earnings. Here is a prior post about Mr. Buffet’s letter from last year.
Mr. Buffett candidly admitted the following:
My hope was to make several multibillion dollar acquisitions that would add new and significant streams of earnings to the many we already have, But I struck out.
As a result, Berkshire’s change in book value increased only 10.5% in 2004, lagging behind that of the S&P 500-stock index’s 10.9% return, a performance that Mr. Buffett characterized as “lackluster.” However, it’s important to remember that Berkshire generated that return while remaining quite liquid — the company has $40 billion in cash reserves earning a small return, but putting the company in an enviable position to make acquisitions. Unfortunately, Mr. Buffett commented that there are currently “very few attractive securities to buy,” continuing a theme that was also used in last year’s letter.
Mr. Buffett’s currency investments allowed him to include the quote from W.C. Fields in his report. Inasmuch as Berkhire’s bets nearly doubled in 2004 to $21.4 billion, Mr. Buffet quoted Mr. Fields’ famous comment to a a beggar’s approach: “Sorry, son, all my money’s tied up in currency.”
Mr. Buffett also criticized U.S. policy makers for the growing current-account deficit and warned that net ownership of U.S. assets by foreign countries over the next decade will amount to about $11 trillion if account deficits continue at current levels. He did not explain why he thought that it was a bad idea for foreigners to overpay for U.S. assets.
Somewhat surprisingly, Mr. Buffett’s letter did not mention investigations by state and federal regulators into transactions between insurance clients and Berkshire’s General Re and other company reinsurance subsidiaries. Those investigations are examining whether some companies have used finite-risk insurance to hide financial obligations and make their results appear stronger than they actually are. You know, sort of like the criminalization of structured finance transactions of Enron fame.
Mr. Buffett also quoted Scripture in defending the independence of Berkshire’s board, which includes several Buffett family members and their friends, including Microsoft Corp.’s Bill Gates. Mr. Buffett contends that the board members’ substantial holdings in their own companies’ stock aligned them with the interests of other shareholders, and then cited Matthew 6:21, in which Jesus is quoted as saying “For where your treasure is, there will your heart be also.” Mr. Buffett concluded that “measured by the biblical standard, the Berkshire board is a model.”
The venerable Louisiana bank, Hibernia Corp., has agreed to be acquired by McLean, Va.-based Capital One Finance Corp. in a $5.35 billion deal that allows one of the nation’s leading credit card issuers finally to enter the retail banking industry. With a market value of approximately $20 billion, Cap One is nearly five times Hibernia’s size.
Hibernia is a Louisiana institution that established in the post-Civil War years. It became best known during the Great Depression, when the late Louisiana Governor and demagogue Huey Long leaned on Hibernia and other banks to finance huge public works projects for the construction of bridges, roads and other infrastructure in Louisiana during the 1930s. Hibernia has more about $22 billion in assets, about 300 branches and operations in Texas, Louisiana and Mississippi.
Cap One’s acquisition is a clear response to a shrinking market share in the credit card business, where competitors such as Bank of America Corp. have invested billions in new products over the past several years. That’s why your and my teenage children continue to receive so many solicitations for credit cards in the mail. Acquiring a retail bank will give Cap One low-cost retail deposits, which it can then use to generate loans at more profitable interest rates to its borrowers.
Hibernia’s banking operation will will fit nicely into Cap One’s business, which also provides financial services such as health insurance and personal loans. Cap One was also attracted to Hibernia’s presence in the Texas banking market, which is growing much faster than Louisiana’s market. The deal is is expected to close by the third quarter of this year. Hibernia shareholders will receive $33 for each of their shares, split into roughly half cash and half Cap One stock, which means that Hibernia stockholders will receive about a 24% premium on their shares’ $26.57 price on the New York Stock Exchange as of this past Friday.
In its first decision since the U.S. Supreme Court’s decision in U.S. v. Booker that overruled the mandatory nature of the federal sentencing guidelines, the Fifth Circuit Court of Appeals on this past Friday explained how Booker issues are to be handled within the Fifth Circuit in its opinion in United States v. Mares. Interestingly, the opinion notes that it was circulated among the judges of the circuit and changed to reflect their comments. Here are the prior posts over the past year on the Booker decision and the developing case law regarding the federal sentencing guidelines.
The Booker analysis in the opinion has two basic parts. First, the Fifth Circuit explains how the sentencing guidelines are to be applied post-Booker. Second, the Court establishes the plain error analysis that it will use in analyzing future Booker issues.
The following is how the Fifth Circuit described the Booker issue in Mares:
Mares? sentence was enhanced based on findings made by the judge that went beyond the facts admitted by the defendant or found by the jury. The jury found that Mares, a felon, possessed ammunition. The judge enhanced the sentence based on his finding that Mares was involved in a felony when he committed the offense.
In regard to the sentencing guidelines under Booker, the Fifth Circuit states as follows:
Even in the discretionary sentencing system established by Booker/Fanfan, a sentencing court must still carefully consider the detailed statutory scheme created by the SRA and the Guidelines, which are designed to guide the judge toward a fair sentence while avoiding serious sentence disparity. Although Booker excised the mandatory duty to apply the Guidelines, the sentencing court remains under a duty pursuant to ß 3553(a) to ?consider? numerous factors. . .
If the sentencing judge exercises her discretion to impose a sentence within a properly calculated Guideline range, in our reasonableness review we will infer that the judge has considered all the factors for a fair sentence set forth in the Guidelines. Given the deference due the sentencing judge?s discretion under the Booker/Fanfan regime, it will be rare for a reviewing court to say such a sentence is ?unreasonable.?
When the judge exercises her discretion to impose a sentence within the Guideline range and states for the record that she is doing so, little explanation is required. However, when the judge elects to give a non-Guideline sentence, she should carefully articulate the reasons she concludes that the sentence she has selected is appropriate for that defendant. These reasons should be fact specific and include, for example, aggravating or mitigating circumstances. . .
Then, in regard to the particular facts of the Mares case, the Fifth Circuit employed its plain error analysis for Booker issues in rejecting Mares? claim of plain error:
An appellate court may not correct an error the defendant failed to raise in the district court unless there is ?(1) error, (2)that is plain, and (3) that affects substantial rights.? Cotton, 535 U.S. at 631. ?If all three conditions are met an appellate court may then exercise its discretion to notice a forfeited error but only if (4) the error seriously affects the fairness, integrity, or public reputation of judicial proceedings.? Id.
The third factor is the most important in that it requires the defendant to show that the trial court’s error affected the outcome and that it undermined confidence in the outcome. On this particular point, the Fifth Circuit enunciated a difficult burden for the defendant to fulfill:
Since the error was using extra verdict enhancements to reach a sentence under Guidelines that bind the judge, the pertinent question is whether Mares demonstrated that the sentencing judge – sentencing under an advisory scheme rather than a mandatory one – would have reached a significantly different result.
Based on the record before us, we reach the same conclusion … We do not know what the trial judge would have done had the Guidelines been advisory. Except for the fact that the sentencing judge imposed the statutory maximum sentence of 120 months(when bottom of the Guideline range was 110 months), there is no indication in the record from the sentencing judge?s remarks or otherwise that gives us any clue as to whether she would have reached a different conclusion. Under these circumstances the defendant cannot carry his burden . . .
Finally, the Court noted the split that is developing among the circuit courts in handling post-Booker decisions, with the Fourth and Ninth Circuits taking a different approach in remanding post-Booker cases than the First, Fifth and Eleventh Circuits are taking.
Although certainly not a slam dunk, my sense is that the Mares decision is a reasonably favorable one for both Jamie Olis — who is serving an unjust 24 year sentence — and the Nigerian Barge defendants, who would be facing mandatory sentences of similar length but for the Booker decision. U.S. District Judge Sim Lake made comments during Mr. Olis’ sentencing that clearly indicated that he was troubled by the length of the sentence that the then mandatory sentencing guidelines required him to impose. Similarly, U.S. District Judge Ewing Werlein is a man of fairness and depth who will not hesitate — if he concludes that the circustances of the Nigerian Barge case so warrants — to make the findings necessary to impose lesser sentences on the Nigerian Barge defendants than those recommended under the sentencing guidelines.
You know, some things are just different in Manhattan.
It’s never easy to defend a personal injury case in certain parts of Texas, and Crystal City in Zavala County is one of them.
This San Antonio Express-News article reports on a case in Crystal City (between San Antonio and Eagle Pass) in which a jury last week awarded $28 million to a plaintiff against Ford Motor Co. in a rollover case. In an almost unbelievable development except that this is Zavala County, the trial was interrupted earlier when Ford lawyers discovered that one of the jurors was the girlfriend of one of the plaintiffs’ lawyers. Moreover, in a hearing over a defense motion for a mistrial, Ford presented evidence that the girlfriend — who happens to be the Crystal City city manager (it’s a very small world in Zavala County) — had also solicited two of the plaintiffs for her boyfriend to represent in the case!
Incredibly, the trial judge denied Ford’s motion for a mistrial. So it goes in small town South Texas.
Will the plaintiff’s lawyer’s failure to disclose that the juror was his girlfriend receive a more appropriate response from the State Bar of Texas? Stay tuned.
That’s the name of a segment on “60 Minutes” this evening, according to this Washington Post article, which examines the ongoing criminal investigation in Austin over House Majority Leader Tom DeLay‘s involvement in various campaign finance violations. Here are the previous posts on the investigation of Mr. DeLay.
By the way, when you hear Mr. DeLay’s aides deride the investigation as a politically-motivated witch hunt of Travis County District Attorney Ronnie Earle, just remember this.
Update: Here is the transcript of the 60 Minutes segment.
On the heels of BofA’s settlement earlier in the week, more “courthouse steps” settlements in the WorldCom shareholder class action lawsuit took place on on Friday as four investment banks settled claims arising from their involvement in underwriting bond sales that were based in part on WorldCom’s false financial statements.
Under the latest settlements, Lehman Brothers Inc. settled for $62.7 million and Credit Suisse First Boston, Goldman, Sachs & Co. and UBS Warburg LLC each settled for $12.54 million. All four participated as underwriters in WorldCom’s May 2000 bond offering. Among the 10 institutions that remain in the litigation are JPMorgan Chase & Co. and divisions of Deutsche Bank AG and ABN AMRO Bank.