The blogosphere has finally responded to New York AG (“attorney general” or “aspiring governor,” take your pick) Eliot Spitzer‘s campaign of criminalizing business, which recently crossed the line from merely misguided to petty and vindictive.
Check out Spitzer Watch, which is “exposing the hypocrisy of New York State Attorney General and gubernatorial candidate Eliot Spitzer.”
My sense is that this is going to be a very busy blog.
Larry Ribstein of the University of Illinois Law School pens the smart Ideoblog that examines an eclectic combination of issues and subjects relating to corporate and securities law, regulation, business crime, economics, and film, among others. In particular, the blog contributions of Professor Ribstein and UCLA Law Professor Stephen Bainbridge of ProfessorBainbridge.com over the past couple of years have done more for the understanding of corporate and securities law issues for professionals and the general public than any other resource of which I am aware.
In this remarkably creative and insightful post, Professor Ribstein predicts the Delaware Chancellory Court’s decision in the corporate case of the decade — i.e., the civil lawsuit over The Walt Disney Co. board’s decision to pay Michael Ovitz a rather generous severance package for essentially doing nothing during his short stay at Disney (earlier posts on the case are here and here). Regardless of whether Professor Ribstein correctly predicts the outcome, his analysis of the case is masterful and should be required reading for anyone who ever deals with corporate governance issues.
Before the blogosphere, this is the type of analysis that would be found only in a thinly-read professional journal or, at best, perhaps buried deep in the op-ed page of the Wall Street Journal or Financial Times. But now, this type of insight is readily available at all times for a much larger number of people than would read any of the more limited mediums. Just another example of how the blogosphere is redefining the way in which specialized information and wisdom is being delivered to our society and the world.
Jury selection begins today in Angleton, Texas in the first personal injury/wrongful death trial against Merck & Co. for alleged non-disclosure of the risks of taking the pain relieving drug Vioxx. Angleton is a small town in a plaintiff-friendly county about an hour south of downtown Houston. Talented Houston-based personal injury trial lawyer Mark Lanier has been receiving quite a bit of free publicity about the upcoming trial (here is the NY Times article and an earlier WSJ ($) article is here), and here are several previous posts on Merck and Vioxx.
Mr. Lanier’s effectiveness as a trial lawyer is in no small part attributable to the fact that he is a devout Christian who regularly teaches a Bible Study class at his church in Houston. Such familiarity with the Bible typically resonates with jurors in small Texas towns, who often rationalize tenuous liability and damage issues through Biblical associations.
Curiously, as Professor Ribstein has pointed out, Mr. Lanier’s case against Merck is based largely on the very un-Biblical concept of resentment and not the truth. Merck pulled Vioxx from the market in October, 2004 after a study showed that it increased the risk of heart attack or stoke, but not necessarily the risk of death. That move prompted Cleveland Clinic cardiologist Eric Topol to go postal over Merck’s handling of the drug, contending that Vioxx resulted in 15 cases of heart attack or stroke per 1,000 patients.
Houston-based Pogo Producing Co. is apparently ready to announce as early as today the $1.8 billion acquisition of Northrock Resources, which owns the western Canada crude-oil and natural-gas properties of Unocal Corp. Pogo has long been one of the best managed and most profitable independent exploration and production companies in Houston, although it’s stock price has not kept pace with industry competitors during the recent run-up in energy prices over the past year.
Inasmuch as Pogo has a market cap of about $3.3 billion, the acquisition is a big bite for the company, which has been selling off interests in a couple of foreign countries recently to raise cash for the transaction. The deal will increase Pogo’s proven oil and gas reserves by 45% as the company will acquire 644 billion cubic feet of natural gas equivalent of estimated proven reserves on about 300,000 acres in Western Canada and another 1.1 million of undeveloped acres. Pogo projects that the Northrock properties contain more than 200 billion cubic feet equivalent of very high quality probable reserves and another 500 billion cubic feet equivalent of possible reserves. The deal reflects Pogo’s bet that energy prices will remain high for the forseeable future, and the company has entered into hedging investments to cover most of its production volumes through 2007 in an effort to protect its rate of return on the investment.
The well-managed but relatively small Pogo is an attractive acquisition target itself in the hot energy industry, but Pogo’s longtime chairman and CEO, Paul G. Van Wagenen — an attorney by background who is one of Houston’s most unassuming and delightful business executives — has built Pogo systematically over the past 35 years and simply will not give up Pogo’s independence unless a takeover deal is too sweet for Pogo’s shareholders to turn down.
The John Deere Classic PGA Tour event this weekend lost much of its luster after Michelle Wie came close but failed to make the cut on Friday. However, the tournament turned out to be highly entertaining even without the Big Wiesy as 23 year old Sean O’Hair — whose troubled life was profiled in this earlier post — fired a six under par 65 in the final round to break through and win his first PGA Tour event.
This has been a fascinating PGA Tour season so far, as young players such as O’Hair and Ben Crane have acquitted themselves in such a superb manner under difficult circumstances that they are now among my favorite players. In fact, it was a very good weekend for my favorite golfers as Peter Jacobsen — one of the genuinely nicest men in the game (see this recent Golf Digest interview) — won his second major championship in his second season on the Champions Tour as he fired a final round 66 to win the Ford Seniors Player Championship in Dearborn, Michigan.
Although he had been a solid player on the PGA Tour from the late 1970’s through the early 1990’s, Jacobsen’s golf game had fallen on hard times for several years when he revived his career in 1995 by changing from a two-plane swing (think Tom Watson, Hale Irwin, and Davis Love) to a one-plane swing (think Ben Hogan, Ernie Els, and Michelle Wie) with the help of his longtime business partner and Houston-based teaching pro Jim Hardy. Hardy recently used his experience in changing Jacobsen’s prior two-plane swing to a one-plane swing as the basis of an exceptional new book on golf swing instruction, The Plane Truth for Golfers (McGraw-Hill 2005).
In this new book, Hardy identifies the two-plane swing and the one-plane swing as the two basic — but much different — golf swings. In so doing, he makes the brilliant insight that much of golf swing instruction over the past generation has been counterproductive because of the failure of golf instructors to tailor their teaching to the particular golf swing that the student is using or should use. Inasmuch as the key elements of the one-plane swing are quite different from those of the two-plane swing, Hardy points out that attempting to teach two-plane concepts to a one-plane swinger (and vice versa) risks having the student adopt swing elements that are ill-suited for the student’s particular swing.
As with Hogan’s classic golf swing book Five Lessons, Hardy’s Plane Truth for Golfers is only a little over 100 pages. However, take it from a self-taught golfer who has read dozens of golf instruction books over the past 25 years, Houstonian Jim Hardy’s Plane Truth for Golfers is a landmark book in the area of golf swing instruction and another of the many contributions that Houstonians have made to golf over the past two generations.
Finally, long John Daly has not won a golf tournament this season, but this touching Bob Verdi/Golf World article tells a wonderful story about something far more important that Daly won for a family that was devastated by the death of its father 15 years ago. The overweight, chain-smoking and problem-laden Daly will never be the cover boy for the PGA Tour, but he is certainly in the competition for having the biggest heart among PGA Tour members.
U.S. News & World Report’s annual “America’s Best Hospitals” survey is out again and, as usual, Houston’s Texas Medical Center is well-represented in the lists of the top hospitals in a number of different categories. Here is a previous post on the 2004 survey.
The U.S. News and World Report survey ranks the country’s top 50 hospitals in 17 specialties. Less than a third of the 6,000 U.S. hospitals meet the eligibility criteria and only 176 of those institutions qualified for a ranking. The rankings are based on a survey of board-certified physicians around the country, patient survival data and various other indicators, such as the ratio of nurses to patients, technologies and services available to patients, the number of discharges over a three-year period, and whether the institution has Magnet status as determined by the American Nurses Credentialing Center.
M.D. Anderson was again ranked as one of the top two hospitals in cancer care, a position that it has held since U.S. News and World Report began its annual survey in 1990. M.D. Anderson held the No. 1 position in 1992, 2000, and 2002 through 2004. M.D. Anderson also ranked fifth in gynecology, and 11th in both otolaryngology (i.e., ear, nose and throat diseases) and in urology.
Other Medical Center institutions also ranked highly in various categories. Texas Children’s Hospital ranked fourth in pediatrics, while The Menninger Clinic ranked tenth in psychiatry and The Institute for Rehabilitation and Research (known as “TIRR”) ranked fifth in rehabilitation. The Texas Heart Institute at St. Luke’s Hospital ranked eighth in heart and heart surgery, while St. Luke‘s also ranked 40th in urology and 42nd in kidney disease. Memorial Hermann Hospital — the teaching hospital for the University of Texas Health Science Center — was ranked 41st in kidney disease and 49th in urology.
Finally, the The Methodist Hospital ranked in more specialties than any other Texas hospital — tenth in neurology and neurosurgery, 13th in urology, 14th in opthamology, 16th in heart and heart surgery, 17th otolaryngology, 19th in psychiatry and 42nd in gynecology.
As I have noted many times, not only is the Texas Medical Center one of Houston’s largest centers of employment, it is an amazing collection of medical services talent.
San Antonio-based businessman Red McCombs has given the University of Texas M.D. Anderson Cancer Center $30 million for its huge $500 million research park that will eventually consist of six centers focusing on cutting edge areas of cancer research.
The gift — which is one of the two largest that M.D. Anderson has ever received — will go to help fund the developing Red and Charline McCombs Institute for the Early Detection and Treatment of Cancer on M.D. Anderson’s 116-acre south campus. That campus is about a mile and a half from the main M.D. Anderson hospital complex in the Texas Medical Center.
As this Chronicle article reports, the evidentiary phase of the Enron Broadband trial closed on Friday as the prosecution rested after putting on a thankfully short rebuttal case that lasted less than a day in a trial that just finished the three month mark. The attorneys in the trial and U.S. District Judge Vanessa Gilmore will meet on Monday to finalize jury instructions and then, on Tuesday, final arguments in the trial will begin.
Interestingly, the Chronicle article on the trial did not report on another potentially important incident of Enron Task Force misconduct that occurred as the defense case wound down this past Thursday afternoon.
During a trial in which the prosecution has already elicited false testimony from its key witness and treated two witnesses (Beth Stier and Lawrence Ciscon) in such a manner that both testified that they felt threatened, Judge Gilmore harshly rebuked Enron Task Force prosecutor Cliff Stricklin for asking a question on cross-examination of defendant Kevin Howard that, if not in direct violation of a limine order (i.e., a pre-trial order directing attorneys not to refer to certain subjects during the trial), at least violated the judge’s prior instructions to the Enron Task Force prosecutors.
The rebuke came at the end of cross-examination of Mr. Howard when Mr. Stricklin asked a question about Canadian Imperial Bank of Commerce (“CIBC”), one of the bank’s that provided financing for the Enron Broadband unit. CIBC entered into this deferred prosecution agreement with the Enron Task Force back in December, 2003 and Judge Gilmore had apparently at least instructed Enron Task Force prosecutors not to ask any questions on that agreement during the Enron Broadband trial. The following is the exchange that occurred:
Mr. Stricklin: In fact, Enron went to CIBC often to fund such deals, isn’t that correct?
Mr. Howard: We had set up a very large investment to fund with a number of banks.
Mr. Stricklin: Including CIBC, is that true?
Mr. Howard: Yes, sir.
Mr. Stricklin: And are you aware that [CIBC has] entered into a deferred prosecution agreement with the Department of Justice . . .
Mr. Howard’s defense attorney: Objection, your Honor!
Judge Gilmore: Stop! Mr. Stricklin, just stop it right now! Have a seat! That’s the end of the questions!
With that, a clearly angered Judge Gilmore — standing in front of her seat on the bench — terminated any further questioning of Mr. Howard by Enron Task Force prosecutors and excused Mr. Howard as a witness. Taking advantage of Judge Gilmore’s reprimand of Mr. Stricklin for emphasis, each of the attorneys for the five Enron defendants promptly announced that each of the defendants had completed putting on their defense.
Given the recent similar incident that occurred in the trial of former HealthSouth Corp CEO Richard Scrushy, it appears that we can now add ignoring judges’ instructions — in addition to at least chilling defense witnesses and making disingenuous market loss claims — as another dubious tactic that Department of Justice prosecutors are willing to use in attempting to taint a jury against unpopular business defendants. However, that tactic backfired in the Scrushy trial, and the use of the tactic in the Enron Broadband trial smacks more of desperation in a prosecution team that is clearly worried about the outcome of a trial that they thought would be the legal equivalent of a tap-in at the outset.
With the terrorist attack yesterday in London and all, potentially the most remarkable sports story of the year is flying under the radar screen today.
Question: What do the following PGA Tour golfers have in common:
Billy Andrade
Aaron Baddeley
Jeff Maggert
Scott Simpson
Steve Stricker
Kevin Stadler
Skip Kendall
Woody Austin
Robert Gamez
Harrison Frazer
David Duval
Lucas Glover
David Gossett
Answer: They all trail 15 year old Michelle Wie after the first round of the PGA Tour’s John Deere Classic taking place this weekend in Silvis, Illinois.
Now that state of affairs will certainly generate more than a few barbs among the men in the tournament locker room this morning.
After posting a one under par 70 in her opening round (the leaderboard is here), Ms. Wie (nicknamed “the Big Wiesy”) is one stroke off the projected score for making the tournament “cut” — i.e., the reduction of the players in the tournament for the two weekend rounds to the 70 players with the best total scores after the first two rounds. If she makes the cut, then Ms. Wie would be the first female player in 60 years — since Babe Didrikson Zaharias in the 1945 Tucson Open — to make the cut in a PGA Tour event.
Ms. Wie is 6 foot tall, possesses a flawless one plane swing, and hits the ball far enough to compete against men on the PGA Tour. She is the real deal, and it’s only a matter of time until she makes the cut in a PGA Tour event. Today may just be the day.
Update: After getting to five under par for the tournament during her round on Friday, the Big Wiesy faltered on the back nine and shot an even par 71, leaving her at one under par for the tournament and two shots off making the cut. Still, quite a remarkable performance by the 15 year old Ms. Wie, who beat a third of the field in the event.
The Chronicle’s Mary Flood reports that Lea Fastow — who served a longer sentence under harsher conditions because of her marriage to former Enron CFO Andrew Fastow — was released early this morning to go home from a halfway house in downtown Houston. Here are the previous posts on the Lea Fastow case.
Mrs. Fastow is the first person in the Enron-related criminal prosecutions to complete her prison sentence. Her husband — who, as with Mrs. Fastow, struck a plea bargain with Enron Task Force prosecutors — is presently scheduled to be sentenced at about this time next year.