A recent study shows that United States Senators stock portfolios regularly outperformed the market by an average of 12% a year.
What a surprise! (just joking)
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New 5th Circuit decision on expert witness damages testimony
The Fifth Circuit Court of Appeals issued a decision yesterday on the important issue of expert witness testimony on damages. In this trade secrets case, the Fifth Circuit upheld the district court’s decision admitting lost-profits testimony from two of the plaintiff’s experts because the testimony had no impact on the jury verdict. Accordingly, the Fifth Circuit did not reach the issue of the testimony’s reliability. The Court noted that that the relatively small size of the jury’s $2.2 million award, in comparison with the $25 million in lost profits that the plaintiff claimed, indicated that the jury considered and rejected the entire lost-profits analysis of the plaintiff’s experts. See Dresser-Rand Co. v. Virtual Automation, Inc., No. 02-20834 (5th Cir. Feb. 23, 2004) (DeMoss, Dennis, & Prado, JJ.).
Inside work with no heavy lifting
College students or those of you with college age children, you will want to read this this piece about a job that will interest more than a few college students.
Harvard Prof on Gay Marriage
Harvard University Law Professor Mary Ann Glendon has a Wall Street Journal op-ed ($) today that addresses several important issues that are often overshadowed by the supporters’ casting of the debate as one over civil rights issues:
Those judges are here in Massachusetts, of course, where the state is cutting back on programs to aid the elderly, the disabled, and children in poor families. Yet a four-judge majority has ruled in favor of special benefits for a group of relatively affluent households, most of which have two earners and are not raising children. What same-sex marriage advocates have tried to present as a civil rights issue is really a bid for special preferences of the type our society gives to married couples for the very good reason that most of them are raising or have raised children. Now, in the wake of the Massachusetts case, local officials in other parts of the nation have begun to issue marriage licenses to homosexual couples in defiance of state law.
A common initial reaction to these local measures has been: “Why should I care whether same-sex couples can get married?” “How will that affect me or my family?” “Why not just live and let live?” But as people began to take stock of the implications of granting special treatment to one group of citizens, the need for a federal marriage amendment has become increasingly clear. As President Bush said yesterday, “The voice of the people must be heard.”
Indeed, the American people should have the opportunity to deliberate the economic and social costs of this radical social experiment. Astonishingly, in the media coverage of this issue, next to nothing has been said about what this new special preference would cost the rest of society in terms of taxes and insurance premiums.
The Canadian government, which is considering same-sex marriage legislation, has just realized that retroactive social-security survivor benefits alone would cost its taxpayers hundreds of millions of dollars. There is a real problem of distributive justice here. How can one justify treating same-sex households like married couples when such benefits are denied to all the people in our society who are caring for elderly or disabled relatives whom they cannot claim as family members for tax or insurance purposes? Shouldn’t citizens have a chance to vote on whether they want to give homosexual unions, most of which are childless, the same benefits that society gives to married couples, most of whom have raised or are raising children?
WSJ on KPMG’s tax avoidance problems
As noted in this earlier post, Big Four accounting firm KPMG is the subject of a Manhattan federal grand jury investigation into the sale of tax shelters to corporations and wealthy individuals who used them to escape at least $1.4 billion in federal taxes. This investigation comes on the heels of an earlier IRS petition to enforce summons against KPMG. Today, the Wall Street Journal ($) has a front page story on KPMG’s management decisions that led the firm into the tax avoidance promotion business. The entire article is well worth reading, and here is an example of the deals that KPMG was promoting:
KPMG marketed a range of shelters known by cryptic acronyms. In 1997, it sold Joseph J. Jacoboni a strategy called FLIP. That year, Mr. Jacoboni faced a capital gain of more than $28 million from the sale of his software-support business in Orlando. With KPMG’s guidance, he initially invested $4.7 million in a series of transactions in late 1997, according to filings in federal court in Orlando. He bought stock in a Swiss bank and an expensive warrant from a private Cayman Island company, which in turn bought shares in the Swiss bank. He also bought “put” options and sold “call” options.
As a result of this activity, Mr. Jacoboni’s 1997 tax return showed more than $30 million in capital losses, erasing roughly $7.5 million in tax liability on the sale of his company. His actual cost, after factoring in the return on his investment, was only $2.4 million. The cost included a fee of $437,500 for KPMG. In 2001, the IRS started an audit of Mr. Jacoboni’s 1997 return. He then sued KPMG for fraud and negligent misrepresentation — allegations the firm denies. A trial is scheduled for next month.
FLIP, OPIS and another shelter called BLIPS are under scrutiny by federal prosecutors in the criminal-fraud investigation. The three strategies combined earned KPMG fees of almost $100 million from 1996 through 2000, according to the Senate subcommittee report.
Parmalat’s U.S. Subsidiaries Declare Bankruptcy
In an expected move, Parmalat‘s dairy subsidiaries in the United States filed for bankruptcy protection yesterday in New York City. Included in the filing yesterday were the Parmalat USA Corporation and its Farmland Dairies and Milk Products of Alabama units. The move was expected after Parmalat, the food and beverage giant, sought bankruptcy protection in Italy in December amid an accounting scandal.
More on “The Passion”
Following on yesterday’s post about Mel Gibson‘s new movie, “The Passion,” neither the Chronicle nor the NY Times reviewers were particularly impressed from a filmmaking standpoint. From the Chronicle review:
It’s a stylish and visually polished re-creation of the last 12 hours in the life of Jesus — unrelieved suffering and martyrdom, in other words. Controversy over whether it will inflame anti-Semitism guarantees huge audiences, and many people may be profoundly moved. But as a film it is quite bad.
It isn’t awful merely because of Gibson’s obsessive need to zoom in and linger on bloodletting, although this makes it difficult to watch. It’s awful because everything he knows about storytelling has been swept aside by proselytizing zeal. Without doubt, this is a heartfelt expression of religious faith, but it is so naked an expression — untempered by detached, mediating intelligence — that it speaks solely to the converted.
And the NY Times review adds:
“The Passion of the Christ” is so relentlessly focused on the savagery of Jesus’ final hours that this film seems to arise less from love than from wrath, and to succeed more in assaulting the spirit than in uplifting it. Mr. Gibson has constructed an unnerving and painful spectacle that is also, in the end, a depressing one. It is disheartening to see a film made with evident and abundant religious conviction that is at the same time so utterly lacking in grace.
But Kenneth L. Woodward observes in this NY Times op-ed that the public’s interest in the movie is due largely to the sanitized versions of Christianity that are so prevalant in America today:
Mr. Gibson’s raw images invade our religious comfort zone, which has long since been cleansed of the Gospels’ harsher edges. Most Americans worship in churches where the bloodied body of Jesus is absent from sanctuary crosses or else styled in ways so abstract that there is no hint of suffering. In sermons, too, the emphasis all too often is on the smoothly therapeutic: what Jesus can do for me.
More than 60 years ago, H. Richard Neibuhr summarized the creed of an easygoing American Christianity that has in our time triumphantly come to pass: “A God without wrath brought men without sin into a kingdom without judgment though the ministrations of a Christ without a cross.” Despite its muscular excess, Mr. Gibson’s symbol-laden film is a welcome repudiation of all that.
Indeed, Mr. Gibson’s film leaves out most of the elements of the Jesus story that contemporary Christianity now emphasizes. His Jesus does not demand a “born again” experience, as most evangelists do, in order to gain salvation. He does not heal the sick or exorcise demons, as Pentecostals emphasize. He doesn’t promote social causes, as liberal denominations do. He certainly doesn’t crusade against gender discrimination, as some feminists believe he did, nor does he teach that we all possess an inner divinity, as today’s nouveau Gnostics believe. One cannot imagine this Jesus joining a New Age sunrise Easter service overlooking the Pacific.
Like Jeremiah, Jesus is a Jewish prophet rejected by the leaders of his own people, and abandoned by his handpicked disciples. Besides taking an awful beating, he is cruelly tempted to despair by a Satan whom millions of church-going Christians no longer believe in, and dies in obedience to a heavenly Father who, by today’s standards, would stand convicted of child abuse. In short, this Jesus carries a cross that not many Christians are ready to share.
The religious website beliefnet has been sponsoring an online debate over The Passion and the theological issues it raises. The participants are two scholars representing diverse theological and academic perspectives. John Dominic Crossan is a well-known liberal New Testament scholar whose approach to Jesus is creative, but rather bizarre and skeptical. Ben Witherington III is an outstanding academic from Asbury Theological Seminary who advocates orthodox Christian theology. These two scholars are publishing a measured dialogue that is must reading for people who want to wrestle with the serious issues raised by The Passion of the Christ.
Martha’s team is confident
That is the only explanation for this normally risky move in a white collar criminal case.
An Orthodox Jew’s perspective on “The Passion”
Moe Freedman, an Orthodox Jew who hosts the insightful Occam’s Toothbrush blog, has the following interesting perspective on Mel Gibson’s new movie, “The Passion“:
The Bleeding of the Christ
I went to see “The Passion” tonight, and I would like point out a few things to those of you considering seeing it.
First, on an entertainment level, it isn’t much of a movie in the traditional sense, so if you’re looking for entertainment skip it, this movie is downright painful for anyone not looking for an affirmation of their faith.
Second, on all the Anti-Semitism charges, the really shouldn’t be that much controversy – the movie is anti-Semitic only inasmuch as the gospels are. Don’t get me wrong, Jews come off quite badly, and are the primary causes of Jesus’ death in the film, but that’s pretty much the way the gospels went the last time I read them, so you can’t exactly blame Gibson for that. I do think the Movie will cause some Anti-Semitism (especially in parts of the world prone to it) but again, you can’t blame Gibson for that either.
When it comes to depicting the Jews, the movie mixes up the Sanhedrin, the Kohanim, and the Pharisees in general, into an all purpose villainous group. but it wasn’t all that horrible on that front.
Cinematically it was quite good, and the actors were terrific, though some of them seemed to have problems with the cadence of their Aramaic and Hebrew (I’m nitpicking here). James Caviezel was great as the suffering Jesus, but I thought he was a little stiff during the flashback scenes.
The problem for me though, is that I’m not a Christian (I’m an Orthodox Jew BTW), and so I didn’t really have any emotional involvement other than simple curiosity, and that makes the film just about worthless. The violence didn’t “move” me, it just seemed like a ridiculous amount of overkill. They should have called this “The Bleeding of the Christ,” most of the movie is just that, Jesus bleeding. Charge me with deicide if you will, but after about 2/3’s of the movie I was begging for the guy to die already so we could all go home.
To sum up, if you’re a Christian and want your faith bolstered, tweaked or whatever this is supposed to do, go see it. It certainly seems to work (the two girls sitting next to me were sobbing), But if you aren’t, stay home and I’ll sum it up for you?Bleeding, lots of it.
Although I am a Christian, I share the concerns of many Jewish leaders regarding the potential anti-Semitic impact of the film. James Carroll‘s book “Constantine’s Sword” is flawed in several respects, but its thorough analysis of the troubling history of Christian persecution of the Jews is daunting and thought provoking. Viewed in that broad context, Jewish concerns regarding potential anti-Semitic reaction to Mr. Gibson’s movie are entirely reasonable. Christians accept that all of mankind is responsible for Christ’s death, and Jews certainly should bear no greater responsibility for his death than anyone else. What is more important to me is God’s forgiveness of my complicity in that sin, for which I am eternally grateful.
Business is tough
My law practice mostly involves lawsuits over business transactions, and I am constantly reminded in my practice that most non-business people dramatically underestimate the difficulty involved in running a business successfully. This NY Times article reports that 34 percent of businesses with 500 or fewer employees close within two years of opening, and 50 percent fold after four years. These business difficulties highlight the importance of sound business reorganization and bankruptcy law, and the United States is blessed to have the best business reorganization and bankruptcy system in the world. More on this point later, but it is not a feather in the hats of either the Bush Administration or the Republican Party that they are currently urging Congress to amend the United States Bankruptcy Code.