In Business This Week: HEADLINER: GEORGE STEINBRENNER
HOW ABOUT THE TURNPIKE TURNCOATS?
As if the Braves weren't headache enough: In court, the Yankees are fighting fellow New Yorkers.
Principal owner George Steinbrenner III has been threatening for some time to move his team out of the Bronx, casting an eye toward New Jersey and Manhattan. But on Oct. 17, a citizen's group sued to bar him from taking the name, arguing that it belongs in part to the city, which has spent more than $100 million fixing up Yankee Stadium. "They have built their assets on the goodwill of New York," says John Nicholas Iannuzzi, lawyer for the Eternal Vigilance Society.
The Yankees won't comment, but since they own the name and logo, legal experts say they are on safe ground. Teams usually take their names with them when they move. Still, angry Cleveland football fans persuaded the Browns to leave the moniker behind when the team moved to Baltimore. And a state judge has ordered Yankee lawyers into court on Oct. 25 to show why the team should be allowed to consider using the name outside the Bronx. Batter up.EDITED BY KEITH H. HAMMONDSReturn to top
ALL STEAMED UP OVER CONRAIL
NORFOLK SOUTHERN CHIEF David Goode spent years pursuing a merger with Conrail, only to find his quarry in bed with CSX. So on Oct. 23, the jilted suitor struck back, offering $9 billion in cash for Conrail. That's 15% more than the current value of the bid CSX made on Oct. 15. Goode complained in a letter to the Conrail board that the carrier's chief, David LeVan, had twice rebuffed Norfolk's overtures for a meeting since September, and pleaded to talk anew. Like CSX, Goode offered to consider moving his company's headquarters to Philadelphia and to find an "appropriate position" for LeVan. Conrail told shareholders to stand pat until it reviews the new offer.EDITED BY KEITH H. HAMMONDSReturn to top
SMITH BARNEY: THE ALLEGATIONS SPREAD
IN MAY, THREE WOMEN IN one branch office charged discrimination at Smith Barney. Now, 20 women in 10 states have asked a U.S. District Court in New York for the right to file suit as a class. The Oct. 17 amended complaint alleges that the Smith Barney brokers and sales assistants had to endure foul language, unwanted sexual advances, and retaliatory termination. If the class action is allowed, the women would get a jury trial instead of the normal arbitration process that brokers are required to use to settle employment disputes. Smith Barney won't comment.EDITED BY KEITH H. HAMMONDSReturn to top
A DUBIOUS FIRST FOR AT&T
IN NEARLY A DECADE, NO major issuer has reported a loss on credit cards. But in its third quarter, AT&T's financial-services unit, consisting mostly of the Universal Card, posted an operating loss of $35 million, vs. a $47 million profit a year ago. "It's unprecedented," says David Berry, an analyst at Keefe Bruyette & Woods. AT&T blames weak revenues, rising losses from deadbeat borrowers, tough rivals, initiatives to lure and keep customers, and investment in better risk management. "We suspect our problems are a little more severe than the rest of the industry," says acting card unit head Gerald Hines.EDITED BY KEITH H. HAMMONDSReturn to top