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Court weighs contempt motion in Calif. prison case
Legal Business | 2009/02/13 03:36
A federal appeals court on Thursday began considering whether Gov. Arnold Schwarzenegger can be held in contempt for refusing to release money to improve inmate health care, testing the limits of federal intrusion into states' control of their prisons.


In a hearing before the 9th U.S. Circuit Court of Appeals, Deputy Attorney General Daniel Powell argued that a judge's demand for a $250 million down payment violates state sovereignty and federal law. A court-appointed receiver wants that money to go toward his $8 billion plan to build seven new medical and mental health facilities for the state's 33 adult prisons.

Powell told the three-judge panel that the plan goes far beyond what's needed to remedy the prison health care system. The state cited proposed amenities such as therapy rooms, basketball courts and bingo boards. Powell added that the state already has taken steps to improve care that has been ruled unconstitutional.

The demand for billions to improve inmate medical care comes during a time of "extreme fiscal crisis," the state argued. California is struggling to bridge a $42 billion budget gap, furloughing employees two days each month, cutting billions from education and social services and considering a variety of tax increases.



Noted Miss. attorney pleads guilty to mail fraud
Attorneys in the News | 2009/02/12 08:47
A noted anti-tobacco attorney jailed for conspiring to bribe a Mississippi judge pleaded guilty to mail fraud Tuesday in a second bribery scheme.


Richard "Dickie" Scruggs admitted he was involved in a scheme to entice a judge to rule in his favor in an asbestos case by promising he'd be appointed to the federal bench with help from Scruggs' brother-in-law, former U.S. Sen. Trent Lott.

Scruggs, who already is serving five years in jail, was sentenced Tuesday to a seven-year term that will run at the same time, basically adding two years to his sentence. He was also fined $100,000.

Scruggs' name was also removed from a sealed indictment that has not been made public. U.S. Attorney Jim Greenlee declined to give details about it.

Scruggs, who was in leg-irons and wore a dark suit during the hearing, told the court that the first time he pleaded guilty he had vowed to come out of the ordeal a better man, a pledge he renewed Tuesday.

"I acknowledge and own up fully to my role and responsibility," Scruggs told the court. "I'm going to do everything I can to make it as right as I can. I'm going to cooperate fully with federal authorities."

U.S. District Judge Glen H. Davidson told Scruggs he had recently read a saying he thought was fitting: "The Romans had a proverb that money was like sea water. The more you drink, the thirstier you become."

Scruggs, who was led out of the courthouse in an orange jumpsuit and shackles, did not acknowledge reporters as he was loaded into a white van with dark-tinted windows.

Lott, who talked to Hinds County Circuit Judge Bobby DeLaughter but ultimately recommended someone else, has not been accused of wrongdoing.

Scruggs, 62, gained national prominence and earned hundreds of millions of dollars in the 1990s with a case that led to a multibillion-dollar settlement from tobacco companies. His efforts were portrayed in the 1999 film "The Insider" starring Al Pacino and Russell Crowe.

But his star fell last year when he admitted conspiring to bribe another Mississippi judge in a dispute over $26.5 million in legal fees from Hurricane Katrina insurance cases. He was disbarred and is serving a five-year sentence in a federal prison in Kentucky.

The judge recommended he be moved to a prison closer to his Oxford home to be near family and the federal authorities investigating the bribery case. Scruggs asked to be sent to the same Arkansas prison where his son is jailed for knowing about the Katrina bribery scheme and not reporting it.



Facebook appraisal pegs company's value at $3.7B
Venture Business News | 2009/02/12 08:44
Facebook Inc. quickly concluded it wasn't worth anywhere near the $15 billion market value implied in a 2007 investment made by Microsoft Corp., according to confidential information obtained Wednesday from court documents.


In a transcript of a June court hearing that was closed to the public, lawyers arguing over a legal settlement revealed Facebook's own appraisal had priced its privately held stock at $8.88 per share, giving it a market value of about $3.7 billion.

The Palo Alto-based company relied on the appraisal to value employee stock options fairly and avert possible tax problems.

Facebook, which runs the Internet's largest social network, made the assessment after striking an October 2007 deal with Redmond, Wash.-based Microsoft. As part of a broader advertising partnership with Microsoft, Facebook agreed to sell a 1.6 percent stake to the software maker for $240 million.

The Microsoft investment implied Facebook's stock was worth $35.90 per share — a figure that was relied upon in the settlement of a lawsuit that accused the company's founder, Mark Zuckerberg, of stealing the idea for his online hangout from three former classmates who started another social network called ConnectU.

Facebook spokesman Barry Schnitt declined to comment on any of the figures obtained from the court documents. Microsoft had no immediate comment.

In last June's court hearing, Facebook's lawyers argued the company's appraisal of its common stock couldn't be held up as an apples-to-apples comparison with the Microsoft investment because the software maker bought Series D preferred stock. Microsoft also had an incentive to pay a premium for Facebook's stock because it wanted to deepen its ties to the company's popular Web site, whose worldwide audience of 150 million people could eventually attract billions of dollars in advertising.

Analysts believe Facebook generated somewhere between $250 million and $300 million in revenue last year.

Lawyers opposing Facebook said the company cited the $35.90 per share figure in the settlement negotiations.



Court says measles vaccine not to blame for autism
Court Watch | 2009/02/12 08:43
A special vaccine court ruled against parents with autistic children Thursday, saying that vaccines are not to blame for their children's neurological disorder.


The judges in the cases said the evidence was overwhelmingly contrary to the parents' claims — and backed years of science that found no risk.

"It was abundantly clear that petitioners' theories of causation were speculative and unpersuasive," the court concluded in one of a trio of cases ruled on Thursday.

The ruling, which was anxiously awaited by health authorities, was a blow to families who have filed more than 5,000 claims for compensation through the government's Vaccine Injury Compensation Program. The claims are reviewed by special masters serving on the U.S. Court of Claims.

To win, the families' attorneys had to show that it was more likely than not that the autism symptoms in the children were directly related to a combination of the measles-mumps-rubella shots and other shots that at the time carried a mercury-containing preservative called thimerosal.

But the court concluded that "the weight of scientific research and authority" was "simply more persuasive on nearly every point in contention."

The court still has to rule on separate claims from other families who contend that rather than a specific vaccine combination, the lone culprit could be thimserosal, a preservative that is no longer in most routine children's vaccines. But in Thursday's rulings, the court may have sent a signal on those cases, too:

"The petitioners have failed to demonstrate that thimerosal-containing vaccines can contribute to causing immune dysfunction," a judge wrote about one theory that the families proposed to explain how autism might be linked.



Fla. executes man for killing Tampa teen in 1983
Criminal Law | 2009/02/12 04:44
A Florida rapist convicted of murdering his girlfriend's teenage daughter more than 25 years ago has been executed.


Wayne Tompkins was pronounced dead at 6:32 p.m. Wednesday after he failed to get courts to listen to his claims of innocence. He was put to death by lethal injection for the murder of 15-year-old Lisa DeCarr, who disappeared from the Tampa home she shared with Tompkins and her mother on March 24, 1983.

Her mom and others thought she had run away, but her body was found a year later under the home's porch. She had been strangled with the belt of her pink bathrobe.

Despite a flurry of last-minute court appeals, Tompkins' attorneys were unable to get a court to issue a stay so they could perform more DNA testing.



Lawyer fatally shot outside suburban Phila. office
Breaking Legal News | 2009/02/12 02:45
A personal injury lawyer walking through a shopping center parking lot to his storefront office was shot in the back of the head Wednesday by an unknown assailant who fled in a minivan, police said.


The shot that killed the lawyer was fired at point-blank range shortly after 9 a.m. Wednesday, Northampton Township Police Chief Barry Pilla said.

The victim worked at Terry D. Goldberg & Associates. Police did not immediately release his name because not all of his family had been notified. He died at St. Mary Medical Center in Langhorne.

No arrests had been made as of early Wednesday evening and no motive was known. Police are seeking the public's help, Pilla said.

"We're specifically interested in anyone that may have been traveling north or south on Buck Road in the vicinity of the scene between 8 o'clock, 7 o'clock in the morning until 9, 9:15," Pilla said.

Police plan to stop motorists in the area Thursday morning in hopes of finding someone with information, Pilla said.

Police stopped someone driving a vehicle similar to the one the gunman fled in and questioned him, but determined later Wednesday that that person was not the gunman.



Federal regulator urges foreclosure halt
Political and Legal | 2009/02/11 11:19
A federal regulator on Wednesday urged more than 800 thrift institutions to suspend all foreclosures while the Obama administration develops plans to keep borrowers in their homes.


John Reich, director of the Office of Thrift Supervision, said that by doing so, thrifts "would be supporting the national imperative to combat the economic crisis." But cooperation with the request is voluntary.

The Obama administration plans to spend $50 billion to combat foreclosures of owner-occupied middle-class homes, but is divulging few details. An announcement of the administration's housing plans is expected in the coming weeks.

"We're urging them to do it, but we're not going to try to force anyone to comply," said William Ruberry, a spokesman for the thrift agency. "We thought it was reasonable -- because the details (of the government's plans) are expected to be imminent."

Thrifts differ from banks in that, by law, they must have at least 65 percent of their lending in mortgages and other consumer loans -- making them particularly vulnerable to the housing downturn.

Some of the largest thrifts have collapsed over the past year. The failure of Seattle-based Washington Mutual Inc. in September was the largest bank collapse in U.S. history. IndyMac Bank, a Pasadena, Calif.-based thrift, failed last July in a prelude to the broader financial crisis that erupted in September.

The institutions regulated by the Office of Thrift Supervision range in size from small community banks to big institutions like ING Bank, part of Dutch financial giant ING Groep NV.

Thrifts are being closely examined by federal inspectors for signs of heavy exposure to declining markets, or troubled areas such as construction and real estate loans.

Twenty-five U.S. banks failed last year, far more than the previous five years combined, and nine banks have failed so far this year. It's expected that many more banks won't survive this year amid the pressures of tumbling home prices, rising mortgage foreclosures and tighter credit. Some may have to merge with other institutions.



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