Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!americast.com!usa-post Newsgroups: usa-today.law,americast.usa-today.law From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: law Tue, Aug 25 1992 Date: Tue, 25 Aug 92 04:24:46 EDT Message-ID: 08-25 0000 DECISIONLINE: Business Law USA TODAY Update Aug. 25, 1992 Source: USA TODAY:Gannett National Information Network RJR SUIT IS SETTLED: A class-action suit against RJR Nabisco has been settled for $72.5 million, documents filed with the U.S. District Court reported Monday. The suit claimed that RJR did not disclose information that might have affected investor's decisions to tender RJR stock or sell options to the company during a period before RJR announced plans for a leveraged buyout in October, 1988. KEATING RELATIVE TO AID SEC: Charles Keating Jr.'s son-in-law agreed Monday to aid regulators in their investigation of Keating, the former chairman of American Continental Corp. The government said Robert Wurzelbacher Jr. will provide help as part of a settlement against him by the Securities and Exchange Commission. Wurzelbacher is a former senior vice president and director at American Continental. (For more, see special Keating package below.) SHAREHOLDER SUES SOUTHNET: Southnet Corporation Monday announced that a shareholder of the company's common and preferred stock filed two lawsuits in Hillsborough County, Fla., against the company and several officers and directors. The suits seek a declaration that a company acquisition wasn't properly approved by the company's shareholders. The company said the suits were without merit. ACQUISITION APPROVAL QUESTIONED: Southnet Corporation Monday said two shareholder-filed lawsuits are without merit and it plans to respond after receiving counsel. The suits seek, among other relief, a declaration that Southnet's acquisition of Telecom America Inc. was not properly approved by shareholders. Southnet provides long-distance and enhanced-operator services to the hospital, hotel and pay-telephone industries. TWA UNION AGREES TO DEAL: TWA's machinist union agreed Monday to a plan that would give employees 45% and creditors 55% of the restructured airline. The pilots' union is almost on board; flight attendants signed Aug. 14. Chairman Carl Icahn will make a $200 million cash infusion, cancel more than $170 million in debt and step out of the picture on ownership of the airline that has been in Chapter 11. TYLENOL'S HEADACHE EASED: Tylenol PM is allowed to stay on the shelves as a federal appeals court decides whether the name infringed on the trademark of rival pain reliever Excedrin PM. But Tylenol Monday lost in its attempt to have the case dismissed. Excedrin says similarities in the combination pain reliever-sleeping pills confuse customers. `CRAZY EDDIE' EXTRADITION OK'D: Electronics mogul Eddie "Crazy Eddie" Antar is one step closer to his day in court in the USA. An Israeli justice minister said Monday he has approved a U.S. extradition request; Jerusalem District Court is expected to rule on the case soon. Antar was arrested June 24 in Israel on racketeering and fraud charges. He has been fighting extradition. CREDIT-CARD FRAUD LOSSES RISE: Banks' losses from credit-card fraud have tripled since 1986, according to Credit Card News. Last year, banks recorded $506 million in losses, up from $318 million in 1990 and $207 million in 1989. The losses have increased every year since 1987, when the losses were $151 million. FTC APPROVES MERGER: The Federal Trade Commission Monday gave early clearance for a $913 million merger between Franklin Resources Inc. and Templeton, Galbraith & Hansberger Ltd. The merger will create the largest publicly traded independent mutual fund in the USA. Companies that plan to acquire assets of $15 million or more, or at least 15%, in another company's securities must get FTC approval. BLOCK OF LTV SALE FAILS: An attempt to block the pending sale of LTV Corp.'s aerospace division failed Monday. The 2nd U.S. Circuit Court of Appeals struck down an attempt by creditors to block the unit's sale to an investment group led by Loral Corp. The ruling supports an earlier bankruptcy court ruling that the $475 million offer is best for LTV creditors. NASD CENSURES EX-EMPLOYEES: The National Association of Securities Dealers Monday censured and fined four former Dillon Securities Inc. employees. Spokane, Wash.-based Dillon has since closed. The four allegedly sold unregistered securities, the NASD said. The four brokers did not admit or deny guilt. The securities: penny stocks Smarty Pants Inc. and Cancer Quest Inc. Dillon closed four months ago. BARR, FDA SUSPEND HEARINGS: Barr Laboratories Inc. and the Food and Drug Administration have agreed to suspend hearings in Federal District Court after two days, it was announced Monday. The FDA wants to keep Barr from making 15 drugs. Both sides have agreed to attempt to settle without further hearings. The judge has made it clear that both parties will return to court if talks break down. SPECIAL PACKAGE ON KEATING: WURZELBACHER WON'T ADMIT GUILT: Robert Wurzelbacher Jr., the son-in-law of Charles Keating Jr., did not admit or deny guilt in a settlement against him by the Securities and Exchange Commission. But he has agreed to aid regulators in their investigation of Keating and provide testimony in their case, the SEC said. The settlement also prohibited Wurzelbacher from further securities laws violations. WURZELBACHER KNEW ABOUT DEAL: The SEC charged that Wurzelbacher knew about a real estate transaction involving the Hidden Valley development in Arizona. American Continental recorded the transaction with improper accounting methods, according to SEC attorney Bruce Hiler. Hiler said that as Keating's son-in-law, Wurzelbacher "had access to top people in the organization." SIMILAR TRANSACTIONS MADE: The transaction was one of a series in which American Continental, parent company of Keating's Lincoln Savings and Loan, persuaded customers to buy its real estate by promising to simultaneously purchase their properties with large, up-front cash payments. This arrangement gave customers money to use as a down payment for American Continental property, Hiler said. (End of package.) Business Law Editor: Beth Mann. (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. Redistribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM