Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!usa-post Newsgroups: usa-today.law From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: law Thu, Mar 12 1992 Date: Thu, 12 Mar 92 05:46:03 EST Message-ID: 03-12 0000 DECISIONLINE: Business Law USA TODAY Update March 12, 1992 Source: USA TODAY:Gannett National Information Network GAGE AWARDED $5.3 MILLION: George Gage, a former top executive with GTE Corp., won a $5.3 million arbitration award from Cigna Securities for an alleged scheme to defraud him over investment decisions. Gage's lawyer, Guy Burns, says it is one of the largest arbitration awards in favor of a customer against a securities firm. (For more, see special Ruling package below.) SEC PROPOSES REFORMS: The Securities and Exchange Commission Wednesday formally proposed reforms to make it easier for small businesses to raise money through the stock market. The changes, which the SEC opened to public comment, include: Raising the limit small companies can own in mutual funds to 15% from 10% and simplifying forms small companies use to buy securities. LEGALIZED GAMBLING A HIT: Gambling fever has caught on in Colorado. Gambling was legalized in three Colorado towns last year, and now 27 other communities are trying to get in on the gambling profits. The communities have embarked on petition campaigns for a spot on the November ballot to expand limited stakes poker, black jack and slots. So far, $32 million has been raised in the three towns with gambling. ORDER PREVENTS PHOTOCOPYING: As part of the settlement of a copyright infringement case against Enmark Gas, Pasha Publications this week won a court order preventing cover-to-cover photocopying of a newsletter - believed to be the first ruling of its kind. The case involved Pasha's publication Gas Daily, which the publisher claimed Enmark was making copies of and distributing to other offices. RULING SETS PRECEDENT: A ruling this week by a federal district court judge preventing cover-to-cover photocopying of a newsletter was precedent setting because most such cases are settled out of court, experts say. "This is a major development for the newsletter-publishing industry," says Tod Sedgwick, President of Pasha Publications, which sued Enmark Gas over illegal copying of Gas Daily. FCC TO EASE OWNERSHIP RULES: Federal Communications Commission Chairman Alfred Sikes said Wednesday that the agency plans to ease rules restricting the number of radio stations a company can own but will continue to limit audience share. Sikes said the FCC will meet Thursday to consider amending rules that limit ownership to 12 FM and 12 AM stations, with no more than one of each in each market. CREDITORS CAN SUE LORENZO: A bankruptcy court Wednesday allowed creditors of Continental Airlines to sue former chairman Frank Lorenzo. The creditors want $250 million from Lorenzo, former executive vice-president Robert Snedeker, and a holding company they owned - Jet Capital. The creditors say the pair sold Continental shares to Scandinavian Airlines System despite knowing Continental was insolvent. JUDGE TO CONFIRM REVCO PLAN: Judge Harold F. White of the U.S. Bankruptcy Court for the Northern District of Ohio said Wednesday he will confirm Revco's plan of reorganization, as well as the plan of reorganization for Anac Holding Corp. The court is expected to enter the order of confirmation later this week. Confirmation of the Revco plan will become final after a 10-day period passes with no appeal. FRAUD UNIT SAVES INSURER: Blue Cross and Blue Shield of Michigan said Wednesday that its health care fraud investigation unit saved or recovered more than $4 million in 1991, bringing the total since 1980 to $92 million. That amount includes actual recovery of fraudulent payments, court-ordered restitution and an estimate of the amount that would have been paid out in claims if the unit had not intervened. SPECIAL PACKAGE ON RULING: NASD AWARDS RECORD AMOUNT: Getting talked into bad investments isn't reserved for unsuspecting investors - just ask George M. Gage, former chairman of GTE Florida. A National Association of Securities Dealers Inc. arbitration panel said Tuesday that a Cigna brokerage subsidiary had to pay $5.3 million to Gage - a record award to an investor - over bad investment advice. $2 MILLION SINKS TO $120,000: The NASD ruling for George M. Gage came in a case where Gage paid Cigna Securities Inc. $22,000 to give him advice on how to invest his $2 million in pension money in 1984. His adviser put all the money in 12 Cigna limited partnerships that are collectively worth about $125,000 today, says Guy Burns, Gage's lawyer. Burns said expert analysis showed them to be poor quality partnerships. GAGE PUSHED INTO BAD DEALS: Instead of getting quality, personalized advice about investing his pension, as he thought he was, Gage was pushed into real estate and other partnerships that generated further commissions for Cigna employees, the NASD ruled. As a result, Cigna was told to pay $1.8 million in compensatory damages and an unusually large $3.5 million in punitive damages, the arbitrators said. (End of package.) Business Law Editor: Jason P. Smith. (919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution violates federal law. This article is copyright 1992 Gannett News Service. 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