"We can now succeed in separating spammers from their money." --Microsoft General Counsel Brad Smith on winning a $7 million settlement from alleged "spam king" Scott Richter
For years the law firm Greenberg Traurig and its controversial lobbyist, Jack Abramoff, got huge checks from casino-rich Indian tribes. Now bucks are flowing the other way. In July, sources say, the firm settled with the Saginaw Chippewa Indian Tribe of Michigan for more than $10 million that the tribe says it was defrauded of by Abramoff, who no longer works at the firm, and PR consultant Michael Scanlon. The tribe says they charged "outrageous fees" for work it has no record of receiving. A spokesman for Abramoff says he had no comment, and Scanlon couldn't be reached. An attorney says the tribe "will not disclose any details related to the agreement." A spokeswoman at the firm says: "Any settlement or talks are confidential."
In a letter to the tribe, Cesar Alvarez, the firm's CEO, apologized for several things, including private e-mails, obtained by investigators, in which Abramoff called tribal officials "morons" and "monkeys." The letter was published in The Observer, a newspaper controlled by the tribe.
The increasingly lucrative Russian TV market has been one of the few beyond Rupert Murdoch's global reach. But when he met Russian President Vladimir Putin in St. Petersburg this June, Murdoch got the surprising news that the Kremlin might be willing to lift its virtual monopoly on national TV networks. That's all the media mogul needed to hear. On Aug. 1, News Corp. (NWS) execs flew to Moscow to explore taking a minority stake in Ren-TV, the No. 6 network.
On the face of it, Ren-TV might not seem like a prize. Its audience share tops out at 5%. But it could be one of the few chances for Murdoch to get a foothold in a market where TV ad spending rocketed 33%, to $970 million, in the first half of 2005, according to the Association of Russian Communications Agencies. News Corp. is interested in taking a 35% stake in Ren-TV, says a source at Severstal Group, a private Russian steel company that in July paid $100 million for a 70% stake in Ren-TV that had been held by power monopoly Unified Energy System. The other 30% was bought by German broadcaster RTL.
The Kremlin may see Murdoch as the ideal foreign investor. After all, he's accustomed to dealing with authoritarian regimes. In China, his satellite network Star TV stopped broadcasting the BBC in 1994 for fear of offending Beijing authorities.
But Murdoch's bid is no sure thing. He faces a rival offer from the network's founders. Also, if Murdoch takes a 35% stake and RTL retains 30%, he needs a waiver from laws limiting foreign shareholders to a network stake of less than 50%. And some Russian media would oppose letting such a powerful foreigner in the door. "In Russia, there's a saying: Keep out of someone else's vegetable garden," says Anton Sergeyev, a spokesman for Gazprom-Media, state-controlled owner of No. 4 broadcaster NTV.
Eight months after the end of import quotas opened the floodgates for cheap Chinese garments, U.S. ports of entry are in turmoil. But it's not the 85% surge in apparel imports that has caused this problem. It's the "safeguard" quotas that were written into trade agreements to protect U.S. suppliers. The old quotas were at least predictable; the new ones kick in whenever imports in an apparel category grow more than 6% to 7.5% annually and when the feds or industry groups complain. Limits were set this summer on 13 major categories, including jeans and other cotton pants, as well as socks and T-shirts.
Imports never hit the old quota ceiling so early in the year. Suddenly, customs officials are blocking some shipments as they arrive in harbors and airports,throwing importers for a loop. At Transport Express, a shipping and warehouse outfit near the port of Long Beach, Calif., workers are separating the tops from 5,000 women's pantsuits -- the bottoms made quota, but the tops didn't. Like other importers, high-end sweater wholesaler Michael Simon air-freighted goods in an attempt to beat the embargoes. But 1,000 sweaters, destined for better boutiques, missed the deadline by mere hours. "That leaves us with inventory to sell next year for next to nothing," gripes company President Michael Simon.
More clothing categories -- such as men's and women's button-down cotton shirts -- are likely to be hit in coming weeks. The big question is whether the quotas will cause shortfalls of key merchandise for the fall and holiday seasons. Los Angeles customs lawyer Richard Wortman believes it's a good possibility. Importers are learning a new meaning for the term "China price."
Enthusiastic readers have kept Freakonomics, the surprisingly accessible book that uses economics to explain issues like school cheating and drug dealers' profits, on The New York Times' best-seller list since its April debut. Sales, which hit 337,000 copies, according to Nielsen BookScan, have leveled off a bit. But authors Steven Levitt and Stephen Dubner may have a plan to extend the brand with knickknacks. T-shirts with the cover image (a mutant apple-orange) are available from Freakonomics.com, with baseball caps, mugs, and (maybe) pocket protectors on the way. The authors have even talked about creating a board game.
Before she became an environmentalist, Lisa Renstrom was a businesswoman and a red-state soccer mom. So in her new job as president of the Sierra Club, she hopes to reach out to Americans who haven't thought of themselves as green but who share the group's goals, including evangelicals, new immigrants, and executives. Next month she'll put that strategy to the test when she welcomes the public to the 113-year-old group's first national convention. "I believe everybody's an environmentalist at heart," she says.
Renstrom, 45, joined the Sierra Club in 1994. She spent a decade running a pair of Acapulco hotels built by her father. When her husband took a job in Charlotte, N.C., she intended to be a full-time mom. But soon after her first club meeting, Renstrom began rising through the ranks. She won a seat on its board, traded her luxury car for a hybrid, and coaxed her mother and husband to do the same. And he's a Republican, she points out.
There is no free lunch on most airlines anymore. Soon there may be no free soft drinks, either. In another sign of just how tightly it is turning the cost screws, Northwest Airlines (NWAC) is studying whether to start charging passengers for sodas, its flight attendants' union reports.
Northwest is already the industry leader in in-flight cutbacks: It charges for snacks, meals, and alcoholic beverages, and stopped handing out magazines and free bags of pretzels on domestic flights in June. Earlier, it quit offering pillows and movies, except on overseas trips. The reason, of course, is money. Northwest, which has been in the red since 2001, is warning it could file for Chapter 11 bankruptcy if it can't cut costs enough. Those freebies do add up: By dropping pretzels, Northwest figures it saves $2 million a year.
Northwest spokesman Kurt Ebenhoch says the carrier has no immediate plans to discontinue its complimentary beverage service -- but indicates that could change. The Professional Flight Attendants Assn. says that management is struggling with how practical selling soft drinks would be, especially on short hops. Image is another issue. Already, Northwest is "the real cheapskate," says Robert Jones, self-appointed "travel frugalist" at Onetravel.com. But the bottom line is the bottom line. Could pay toilets be next?
The 18,000 police departments in the U.S. don't like sharing information, even though it would help solve crimes -- and fight terrorism. The FBI spent $170 million in a failed attempt to change that. But a group of Florida detectives and professors at the University of Central Florida thinks it has a smarter, cheaper way to get cops to exchange data by computer on things like pawn shop records and traffic stops. But can they persuade the feds to take it nationwide?
The current federal data-sharing system is spotty and slow. Local police don't find it up-to-date or useful in alerting them to potential terrorists or other miscreants. The Florida system gives cops more control over what data to share and over policies and procedures. And it cost just $500,000 to launch -- much of it from local police dues and a Justice Dept. grant. Cops have used it to nab burglars and break up a multinational theft ring.
Proponents point out that local crime data can lead to big breaks. September 11 mastermind Mohammad Atta was stopped for a traffic violation in Delray Beach, Fla., in mid-2001 -- but he was let go because officers didn't know of a bench warrant for Atta the next county over. Yet when the Florida folks tried to sell the Homeland Security Dept. on the idea, they got rebuffed. "'We sent the money to Florida. Go talk to them,' is what they told us," says Ernie Scott, former chief detective at the Orange County Sheriffs Office. His group will try again in a meeting set for late August.