Monthly Archives: December 2005

Stros pass on offering Clemens arbitration

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RogerClemens19.jpgThe Stros continue to make some good personnel moves and some dubious ones during the always entertaining Major League Baseball off-season.
First, the good ones. The Stros passed on offering free agent pitcher Roger Clemens salary arbitration, which means that Clemens is free to negotiate a deal with any other Major League club and the Stros cannot strike a deal with him until after May 1, 2006, a month after the beginning of the 2006 season. I don’t expect Clemens to sign with another club because I doubt that he could arrange a deal as sweet as the one he had with the Stros (big money, only required to show up when he pitches, pitch close to home, etc.), but even if he does, the Stros decision not to offer him arbitration was the right one. It simply does not make much economic sense to risk locking up $20 million on a 43 year old pitcher — even one of the all-time best — when the club’s strength is in its young pitching prospects.

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Fastow: “What do you mean ‘tax fraud?'”

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Fastows.jpgThis earlier post noted that Lea Fastow — a former mid-level Enron executive and wife of demonized former Enron CFO Andrew Fastow — was prosecuted more harshly than normal for tax fraud because of her relationship to Fastow and endured longer and harsher punishment because of it. Earlier posts on the Lea Fastow case are here.
The Chronicle’s Mary Flood reports here that Mr. Fastow apparently agrees with me. He has sworn that neither Mrs. Fastow nor he were involved in tax fraud at all. Of course, as Peter Henning points out, Mr. Fastow’s sworn statements raise all sorts of interesting questions.
One of the most interesting questions is for the Enron Task Force — despite his guilty plea to various crimes under a plea bargain, does Mr. Fastow truly believe that he committed crimes at Enron? It would be a good idea for the Task Force prosecutors to pin Fastow down on that little detail before he takes the stand in the upcoming trial of former key Enron executives Ken Lay, Jeff Skilling and Richard Causey.

The hope of the Texans?

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reggiebush-usc05b.jpgHow exactly does a human body make the kind of cut that USC running back Reggie Bush is making in the picture on the left?
Although the Texas Longhorns must find a way to stop Bush in the Rose Bowl, the Houston Texans and their supporters are just hoping that Bush comes out of the game in one piece so that he will be available for the Texans to select with their first round draft choice in the 2006 NFL Draft (at least Texans GM Charlie Casserly didn’t give that draft choice up in the Philip Buchanon deal). Inasmuch as the current Texans team is nearly unwatchable, take a moment to review this slick USC promotional video for Bush’s Heisman Trophy candidacy and the video that is included with this New York Times article of Bush’s exploits while playing high school ball in San Diego. This young man is really something special.

Got your Rose Bowl tickets yet?

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Rose Bowl logo6.jpgThis US Today article reports on the ticket market for this season’s Rose Bowl game between USC and Texas for the BCS National Championship:

[T]ickets in the Texas end zone were selling for $1,050 apiece. Tickets near the 40-yard line were priced at $4,458.

H’mm. Watching the game on HDTV is sounding pretty good, eh?
Speaking of Rose Bowl tickets, you can always count on Craigslist to generate creative new ways to facilitate the exchange of such hot items with, might we say, more traditional services.

The San Antonio Marlins?

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Marlins_.jpgThe Florida Marlins Baseball Club is making the rounds of potential relocation sites, and the first stop was in San Antonio. Other contenders for the club are Las Vegas, Portland, Oregon, and Charlotte, North Carolina. A move could come as soon as the 2008 baseball season, and such a move could also be impacted by the fact that the current MLB Labor Agreement allows the MLB owners to delete up to two clubs after the 2006 season, so stay tuned.
Interestingly, the potential move of the two-time World Series champion Marlins from Miami is being met with a collective yawn by South Floridians. Craig Depken explains why:

In the end, Miami-Dade County residents will survive just fine without baseball. Although their team won two World Series in their first ten years of existence, in comparison to the sights and sounds of Miami, WS rings are a yawner. In this sense, if the good folks of Miami don’t care one way or the other if the Marlins are in town, why should the rest of us?

O’Reilly’s appalling ignorance of markets

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Bill O'Reilly.jpgBill O’Reilly is a popular Fox News show host and author, but he is really nothing more than a fleetingly entertaining demagogue. Case in point is the following exchange between O’Reilly and Neil Cavuto, another Fox News host:

CAVUTO: Okay. Gas prices are down a lot. Why do you think that is?
OíREILLY: Because theyíre afraid theyíll go to jail. And those C.E.O.s who manipulated themñ
CAVUTO: Why are you sure that they manipulated them?
OíREILLY: I have guys that are inside the five major oil companies – my father used to work for one of those oil companies, by the way – who have told me that in those meetings they look for every way to jack up oil prices after Katrina, every way. When they didnít have to. And they got scared because in my reporting and some other reporting, they said ñ

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The legal research racket

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WestlawButton.jpgIn this interesting post, the Wired GC discusses the potential negative impact of Web 2.0 on high-cost legal research services such as Westlaw and Lexis/Nexis, and then passes along this anecdote that should give pause to the legal research vendors:

Then as I am about to leave my office last night and head home to complete this post, I opened a November 30, 2005 letter from an SVP of West. It was one of those customer-friendly letters you get these days. You know, the sort that starts out ìDear Westlaw Subscriberî and goes on to state:

ìTo help us continue upgrading the Westlaw content and functionality that helps you carry out top-quality research, we will be increasing rates for Westlaw usage by an average of six percent (6%) as of January 1, 2006.î

The price increase helps me? I set my 2006 budget months ago. For most technology-driven companies, upgrades typically lower costs for customers. No mention of any enhancements, either.
Memo to West: a form letter that slaps a long-term customer with a 30 day notice of a unilateral price increase is very much Law 1.0. Risking driving a customer away is rather ignoring Law 2.0.

Read the whole post.

Duke traders acquitted on most counts

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duke energy4.gifIn another stunning loss for federal prosecutors in the post-Enron prosecutions of persons involved in the energy trading industry, a federal jury in Houston federal court yesterday acquitted former Duke Energy trader Todd Reid on all counts of conspiracy, fraud and falsifying books, and acquitted co-defendant Timothy Kramer on seven counts of wire fraud, mail fraud, and circumventing Duke Energy internal controls in connection with the award of $9 million in trader bonuses during 2001. Earlier posts on the case are here, here and here.
As of mid-afternoon yesterday, the jury reported to U.S. District Judge Nancy Atlas that they were deadlocked on 15 remaining counts against Kramer. Judge Atlas instructed the jury to continue deliberating and then informed the attorneys involved in the case that she would declare a mistrial if the jury could not agree on a verdict on the remaining counts against Kramer by the end of the day. Later that afternoon, the jurors sent the Judge a note informing her that they had acquitted Kramer on three more counts and that they wanted to return tomorrow to attempt to resolve the remaining 12 counts (a personal matter of one juror prevents the jury from deliberating today). Judge Atlas agreed to allow the jury to do so.

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Ripples from the Wright Amendment compromise

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wright amendment2.jpgFollowing on this post from last week regarding this year’s compromise over the dubious Wright Amendment, this Fort Worth Star-Telegram article reports that American Airlines will move some of its planes to Love Field to compete with Southwest Airlines’ new flights to St. Louis and Kansas City. Those are the two new interstate destinations that can now be flown to out of Love Field as a result of this year’s modification of the Wright Amendment.
According to the article, American rationalizes the move by noting that many of its best customers in Dallas prefer Loveís closer-in location. But how many of those Highland Park-types are going to be going to Kansas City and St. Louis? I could understand American’s move if Love Field had been opened up to fly into New York or Los Angeles, but not St. Louis and Kansas City. This appears to be a money-losing move for the indirect purpose of keeping the Wright Amendment in place and, from my vantage point, that is the type of decision that has had American tailing Southwest financially over the past several years.
Update: Virginia Postrel, who has written extensively on the folly of the Wright Amendment, weighs in here.

A Grotian Moment

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saddam.jpgA “Grotian Moment” is a legal development that is so significant that it can create new customary international law or radically transform the interpretation of treaty-based law. The trial of Saddam Hussein is such a moment, and this Case Western School of Law blog is providing expert commentary on the legal and foreign policy implications of arguably the most important international trial since Nuremberg. The subject of the latest post is former U.S. Attorney General Ramsey Clark, who is a member of Saddam’s defense team. The post’s author — Case Western international law professor Michael Scharf — notes the following:

Clark is known for turning international trials into political stages from which to launch attacks against U.S. foreign policy. He has represented Liberian political figure Charles Taylor during his 1985 fight against extradition from the United States to Liberia; Elizaphan Ntakirutimana, a Hutu leader implicated in the Rwandan genocide; PLO leaders in a lawsuit brought by the family of Leon Klinghoffer, the wheelchair bound elderly American who was shot and tossed overboard from the hijacked Achille Lauro cruise ship by Palestinian terrorists in 1986; and most recently Slobodan Milosevic, the former leader of Serbia who is on trial for genocide before the International Criminal Tribunal for the Former Yugoslavia in The Hague.

Sounds just like your typical former U.S. Attorney General, doesn’t it? ;^)