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Fidel Castro retires as president of Cuba
International | 2008/02/19 08:56

For the first time in nearly half a century, Fidel Castro has stepped down as president of Cuba. The announcement caps a year and a half of limbo and speculation since Mr. Castro fell ill and temporarily ceded power to his younger brother, Raúl Castro.
"I will not aspire to nor accept – I repeat, I will not aspire to nor accept – the post of President of the Council of State and Commander in Chief," read a letter that appeared early Tuesday morning in the Community Party daily Granma.

It is a pivotal moment in the island nation's history. Castro rose to power on New Year's Day in 1959, and quickly became a nemesis of the United States as he turned Cuba into a communist country. Throughout the cold war – and since – US presidents have attempted to topple him with no success. Many Cubans have no memory of anyone other than Castro as the head of state. Even when he handed temporary power to his brother in July 2006, there was an expectation that he would return.



Justices Turn Aside Flood Insurance Plea
Insurance | 2008/02/19 05:12
The Supreme Court refused Tuesday to offer help to Hurricane Katrina victims who want their insurance companies to pay for flood damage to their homes and businesses.

The justices rejected appeals from Xavier University and 68 other individuals and businesses seeking to allow their lawsuits against the insurers to go forward.

Xavier asked the court to step in after the 5th U.S. Circuit Court of Appeals ruled that the policies did not cover damage from floods, even those that resulted from man-made failures such as the collapsed levees in New Orleans.

Other cases working their way through state courts have so far reached differing conclusions. A Louisiana appeals court has said that language excluding water damage from some insurance policies was ambiguous. The Louisiana Supreme Court will hear arguments in that case on Feb. 26.

Xavier and the other plaintiffs had asked the federal court to allow the state Supreme Court to rule on their suits as well. The 5th Circuit refused and the U.S. high court upheld that ruling on Tuesday.



Court turns away Ford appeal in tax case
Elite Lawyers | 2008/02/19 05:11

The Supreme Court on Tuesday turned away, without comment, an appeal by Ford Motor Co. in a tax dispute with the cities of Seattle and Tacoma.

The court's action means the Dearborn, Mich.-based automaker won't be able to recover the $1.7 million in taxes it paid the two cities after they audited the company and assessed it for back taxes in 2003.

While the financial stakes are small, several business groups urged the court to take the case because they argued that more and more localities are imposing the type of tax at issue. Seattle and Tacoma impose a 'business activity' tax on a company's gross receipts from wholesale sales.

'Without the Court's guidance, businesses will be subject to an increasing number of unapportioned business taxes, resulting in multiple taxes' in different jurisdictions, the U.S. Chamber of Commerce, National Association of Manufacturers and other groups said.

Lawyers for the cities said the tax is neither an income tax nor sales tax but a tax on 'the privilege of doing business' in their jurisdictions. They also said in court papers that the tax has been in existence for decades and its use hasn't significantly spread.

Seattle and Tacoma assess their business activity taxes on 100 percent of the gross receipts Ford receives from wholesale sales of cars to Ford dealers in the two cities.

But the automaker argued in court papers that much of its wholesale activity, such as invoicing and transfer of ownership, takes place outside Washington state. As a result, it should pay taxes on only a portion of its receipts, the company said.

The Supreme Court's refusal to consider the case lets stand a ruling by the Washington state Supreme Court in favor of the cities.



Court Won't Hear Ex-Ala. Coaches' Appeal
Court Watch | 2008/02/19 05:07
The Supreme Court declined Tuesday to hear an appeal from two former Alabama assistant football coaches who lost their jobs following an NCAA investigation of the Crimson Tide's football program.

The justices rejected the case of Ronnie Cottrell and Ivy Williams without comment.

Cottrell and Williams sued the NCAA and recruiting analyst Tom Culpepper for defamation, claiming they were unable to find comparable employment following the NCAA's investigation of Alabama. The football program was placed on probation and received other sanctions for rules violations.

Cottrell won a $30 million judgment against Culpepper, but the trial judge threw out the verdict and ordered a new trial. The Alabama Supreme Court upheld that ruling, as well as others that eliminated Williams as a plaintiff and the NCAA as a defendant.

Cottrell still is entitled to a new trial, but could find it harder to prove his claims under the Alabama high court ruling.



Court Rejects ACLU Challenge to Wiretaps
Political and Legal | 2008/02/19 04:07
The Supreme Court has rejected a challenge to the Bush administration's domestic spying program.

The justices' decision Tuesday includes no comment explaining why they turned down the appeal from the American Civil Liberties Union.

The ACLU wanted the court to allow a lawsuit by the group and individuals over the warrantless wiretapping program. An appeals court dismissed the suit because the plaintiffs cannot prove their communications have been monitored.

The government has refused to turn over information about the closely guarded program that could reveal who has been under surveillance.



Firm suspends lawyer in school district scandal
Legal Business | 2008/02/19 03:14

A part-time private attorney who was listed as a full-time employee by five school districts - enabling him to earn health benefits and a nearly $62,000-a-year state-funded pension, while his law firm was paid millions of dollars in fees - has been suspended by his current law firm, one of its partners said yesterday.

Steven Schlesinger, a partner in the Garden City law firm of Jaspan, Schlesinger, Hoffman, said yesterday that his firm had suspended Lawrence Reich and asked for his resignation. Reich had been serving as of counsel, or as a consultant, to the law firm since Jan. 1.

Newsday reported Friday that five school districts falsely reported to the state that Reich, 67, was a full-time employee in each district at the same time. The districts were Baldwin, Bellmore-Merrick High School, Copiague, East Meadow and Harborfields.

"Based on the publicity, it's not any good to have him at the firm," Schlesinger said. "I don't need P.R. liabilities."

He added, however, "I don't think any laws were violated."

Schlesinger said the firm has not heard from Reich since the disclosures. "We're trying to locate him."

Reich, who lives in Centerport, did not return a call for comment yesterday. In an earlier interview, he defended his arrangement with the five districts as "common practice."

At the same time that the districts claimed Reich as an employee, they paid his then-law firm, Ingerman Smith of Hauppauge, more than $2.5 million in fees, according to district records. Under Internal Revenue Service rules, a person cannot be treated as both an employee and independent contractor for the same work.

After the Newsday story appeared, agents with the Federal Bureau of Investigation served all five districts with subpoenas for financial records.

In addition, the New York State comptroller has sent letters to four of the five districts, notifying them that they would be audited. Reich left the payroll of East Meadow on Nov. 30, 2001, according to records.

Reich retired with an annual pension of $61,459 in September 2006. But he continued working for some of the districts, according to letters he sent asking them to "reconfigure" his pay as a retainer, rather than as a salary.

Last July, state auditors uncovered the problem in an audit of the Harborfields school district. Reich said he then contacted the state about his pension eligibility and was assured it was common practice.

The state took no action, and the issue was not included in the final audit of Harborfields.

Nonetheless, Reich notified the districts that he was retiring for good in October.

In December, Ingerman Smith notified the districts that Reich was leaving the firm.



Microsoft targets Web with Yahoo or alone
Mergers & Acquisitions | 2008/02/18 22:21
Microsoft Corp plans to invest heavily in Web search to compete against Google Inc, even if it fails to acquire Yahoo Inc, the company's chairman Bill Gates said on Monday.

Gates, who called Microsoft's offer for Yahoo "very fair", said Google is the only company with "critical mass" in Web search. Microsoft needs a bigger piece of the market to create a more competitive and profitable Web search business.

"We can afford to make big investments in the engineering and marketing that needs to get done. We will do that with or without Yahoo," said Gates in an interview with Reuters.

"But we also see that we'd get there faster if the great engineering work that Yahoo has done and the great engineers there were part of the common effort," said Gates, who is Microsoft's biggest shareholder.

The two companies are at a stand-off in Microsoft's $41.7 billion unsolicited bid to acquire Yahoo. Microsoft has offered to buy Yahoo for $31 a share in cash and stock, a bid which Yahoo's board rejected, saying it undervalued the company.

Microsoft countered by saying its offer was "full and fair," but did not say what it planned to do next. Analysts expect Microsoft to sweeten its bid, possibly to $35 a share, to clinch a deal.

"There is nothing new in terms of the process. We've sent our letter and we've reinforced that we consider that it's a very fair offer," said Gates, who remains the public face of Microsoft, even though he plans to switch to a part-time role at the company in June to focus on his philanthropic work.

Microsoft's stock has fallen 13 percent since its offer for Yahoo, reducing Microsoft's offer price to $29. Yahoo shares closed at $29.66 on the Nasdaq on Friday, indicating that investors expect Microsoft to raise its bid.



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