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JUNE 11, 2007
Edited by Harry Maurer The High Court On Pay Bias A split Supreme Court on May 29 dramatically raised the bar for wage-discrimination suits. In Ledbetter v. Goodyear Tire & Rubber Co. (GT ), a supervisor learned she was earning far less than her male colleagues, even those with lower seniority, years after the company had set her salary. Justice Samuel Alito Jr., writing for the 5-4 majority, said the worker was required by statute to bring her complaint within 180 days after Goodyear's initial salary decision. That finding reverses longstanding federal policy, which typically has allowed such salary complaints to be filed with 180 days of any discriminatory payday, a rule known as "paycheck accrual." Justice Ruth Bader Ginsberg, the court's lone woman, took the majority to task in her minority opinion, calling it "indifferent" to the insidious nature of pay bias, which often begins incrementally: "Only over time is there strong cause to suspect discrimination." The ruling could bar thousands of pay discrimination complaints every year. ABN: Going, Going… The $96 billion bid from a three-bank consortium led by Royal Bank of Scotland on May 29 is unlikely to be a knockout blow in the battle for ABN Amro (ABN ). The offer, nearly 80% cash, does top the agreed-on $87 billion all-share deal with Barclays (BCS ). But Barclays may now shove more chips into the pot. Moreover, it's unclear whether the RBS group can close a deal with Bank of America (BAC ), which already has a deal to buy ABN's Chicago banking subsidiary, LaSalle Bank, for $21 billion.   Shelter Shocked Ernst & Young, like KPMG before it, has dodged a bullet, with the feds deciding not to bring criminal charges against the firm as part of a crackdown on illegal tax shelters. But four current and former partners of the accounting giant were not so lucky. On May 30 a Manhattan grand jury indicted them on fraud, tax evasion, and other charges. Zoellick Gets The Nod The second time just might be the charm, thanks to a charmer. After embattled World Bank President Paul Wolfowitz quit on May 17, President George W. Bush on May 30 chose a unifying figure, former U.S. Trade Representative Robert Zoellick, to head the bank. Zoellick is known for his grasp of global economics and diplomacy, a trait often lacking under the combative Wolfowitz. For the past year, Zoellick, 53, has been a Goldman Sachs (GS ) vice-chairman. See "A Diplomat for the World Bank" Bourse Wars The London Stock Exchange told the Yanks to buzz off, so NASDAQ (NDAQ ) reached out to the Swedes and Finns who run the Nordic stock market, OMX, and struck a friendly $3.7 billion deal on May 25. By creating a second transatlantic bourse behind NYSE Euronext, the pact would keep NASDAQ in the consolidation game. But government-owned Dubai International Financial Centre may make a counterbid, Britain's The Sunday Times (NWS ) reported on May 27. See "A New Jewel in Nasdaq's Crown" Apartment Hunt Tishman Speyer, which owns the Chrysler Building and Rockefeller Center, is really putting the "lord" in landlord. The giant, privately held New York firm is teaming with Lehman Brothers (LEH ) to buy Archstone-Smith (ASN ), the second-biggest apartment REIT, for $22.2 billion including debt. Archstone confirmed the deal on May 29. See "Archstone: Private Equity's Latest Real-Estate Prize" Shanghai Swoon Everyone from Li Ka-Shing to Alan Greenspan has been saying it couldn't last—and it didn't. On May 30, after Beijing tripled a fee on stock trades, from 0.1% to 0.3%, the main Chinese index sagged 6.8%. With 250,000 new investors leaping into the superheated market each day, the state may be getting more serious about cooling it off. See "China Stocks Tumble Back to Earth" Everyday Low Dells Soon you'll be able to stroll into a Wal-Mart (WMT ) to pick up some groceries, a badminton set—and a Dell (DELL ). On May 24 the struggling PC maker said it will begin selling two of its Dimension desktop models at the world's biggest retailer. That's a break from Dell's strategy of selling computers over the phone and the Net, a practice that hasn't kept up with consumers' increasing desire to try before they buy. See "Dude, You're Getting a Dell--at Wal-Mart" From Hero To Goat The hit show Heroes may be about saving the planet, but it couldn't save NBC entertainment chief Kevin Reilly's job. The fourth-ranked network sent its top show-picker packing on May 29. Reilly resigned when it became clear that wunderkind TV producer Ben Silverman and veteran NBC executive Mark Graboff were being elevated to co-heads of a revamped unit that includes NBC and Universal's TV studio. Not So Fast, Google Is Google (GOOG ) getting too nosy? That's the question privacy groups hope the feds will address in their review of the search goliath's proposed $3.1 billion takeover of online ad firm DoubleClick. The investigation will be conducted by the FTC, which oversees privacy issues, rather than the Justice Dept. Privacy advocates worry the deal would let Google peek too closely into people's online lives. See "Much Ado About DoubleClick" Libya, Here We Come Yet another sign that Colonel Muammar Qaddafi's North African redoubt is becoming a hot destination for Big Oil: BP (BP ) and Libya on May 29 signed a gas-exploration deal. BP says it will spend at least $2 billion on its three tracts. See "BP Snares Huge Libyan Gas Fields" Counterattack Of The Week On May 25, fired marketer Julie Roehm did her best to drag Wal-Mart CEO H. Lee Scott Jr. through the mud. In a blistering brief supporting her wrongful-dismissal suit, Roehm accused Scott and other Wal-Mart officials of not following the strict conflict-of-interest rules the company used as one reason to dismiss her in December. Among other things, the suit alleges that Scott bought boats and jewelry through financier Irwin Jacobs, whose company sells boats to Wal-Mart and buys surplus goods from the chain. The suit also claimed that Scott's son worked for a Jacobs entity that did business with Wal-Mart. A Wal-Mart spokesman says: "The improprieties involving our CEO are not true" and adds that the younger Scott's dealings were approved by the board. Jacobs says: "This is 100% off the wall and not true." The case has been nasty and personal from the start, when Wal-Mart said it fired Roehm for having an affair with a subordinate (see BusinessWeek.com, 5/23/07, "File Office Romances Under "O.K.") and for accepting gifts from suppliers—charges she denies. Roehm has even hired high-profile public relations firm Sitrick & Co., BusinessWeek has learned. With all Wal-Mart's other problems, says a PR adviser to the retailer, the Roehm feud "is the last thing it needs."
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