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In Business This Week: HEADLINER
STEPHEN RIGGIO: BARNES & NOBLE'S BROTHER ACT
Len Riggio has become famous for making Barnes & Noble the biggest name in book retailing. But the chairman's younger brother, Stephen, is putting together the deals to defend B&N against the online onslaught led by Amazon. com. On Dec. 7, the Barnes & Noble vice-chairman engineered a deal with Microsoft for Barnes & Noble to become the exclusive bookseller on its Microsoft Network.
Riggio, 44, says he has been negotiating with Microsoft since barnesandnoble.com was launched in 1997. The MSN site attracts 25 million visitors each month--"a ton of traffic," he says.
Riggio's other online deals include selling a half-interest in barnesandnoble. com for $200 million to Bertelsmann in October. Next up: a plan to sell 20% of barnesandnoble.com to the public. And B&N has hired AOL executive Jonathan Bulkeley to run the site, with Riggio overseeing E-commerce strategy and acquisitions. Do the moves daunt Amazon.com, almost 10 times barnesandnoble. com's size? A spokeswoman says there's room for all in cyberspace.EDITED BY KELLEY HOLLANDReturn to top
BILL'S NEW SOCIAL SECURITY STANCE
TAKING A STAND: FOR THE FIRST TIME since he called for Social Security reform, President Clinton has signaled he would favor some form of investment in stocks and bonds as part of any fix. Following a private meeting with a bipartisan group of lawmakers at the close of a Dec. 8-9 White House conference on Social Security, a top Administration official said: "There was substantial agreement on the need to bring higher returns into the Social Security system." How would the Administration accomplish that? Clinton has not decided whether to support private investment accounts or a more modest plan that would allow for Social Security assets to be collectively invested in securities, the official says. The White House could unveil a plan by late January.EDITED BY KELLEY HOLLANDReturn to top
WASTE SHOVELS IT TO SHAREHOLDERS
THE COST OF CLEANING UP Waste Management's books is rising again. After taking write-offs and restating earnings to the tune of $2.9 billion, Waste and its auditors, Arthur Andersen, have agreed to settle shareholder class actions for $220 million, one of the largest such deals ever. Waste plans to take a $70 million aftertax charge--if the deal sticks. Plaintiffs' lawyer Sherrie Savett wants to make sure no "out-and-out fraud" was committed. The company is still cooperating with the Securities & Exchange Commission as it probes possible wrongdoing by former Waste execs.EDITED BY KELLEY HOLLANDReturn to top
BAD POLICY AT ALLSTATE?
ARE YOU IN GOOD HANDS WITH ALLSTATE? Pennsylvania's Attorney General doesn't think so. On Dec. 8, the state sued Allstate Insurance, contending it illegally tried to dissuade consumers from seeking a lawyer's advice in claims against Allstate policyholders. The suit claims Allstate mails materials to residents, including a document called "Do I Need An Attorney?" that, the state alleges, suggests they will fare better without one. The suit also says Allstate used deceptive tactics to persuade consumers to give it access to medical and job records. The suit seeks $1,000 for each violation of state law and $3,000 for each violation involving someone 60 or older. Allstate denies the charges and says it believes its communications are protected under the First Amendment. EDITED BY KELLEY HOLLANDReturn to top