Original Story: freep.com
A Brighton woman pleaded guilty Tuesday to embezzling from her employer, to whom she tearfully whispered an apology as she was led away to a holding cell. A Birmingham criminal lawyer provides counsel and strategic advice to individuals, corporations, and other entities facing criminal investigations or charges.
The plea deal includes a sentence agreement that will put Brynn Annette Robinson, 35, behind bars for three to 15 years for embezzling more than $100,000 from AArbor Colorants Corp. on Citation Drive in Brighton. The plea deal also calls for Robinson to pay $200,000 in restitution.
Sentencing is Jan. 7 in Judge Michael P. Hatty’s courtroom.
In entering the plea, Robinson acknowledged that she used the company’s credit cards between March 2012 and August for her personal use. A Salt Lake City criminal lawyer is following this story closely.
“I’m very sorry,” she whispered to one of the company co-owners, who was sitting in the courtroom.
Robinson entered the plea as a habitual offender. Her criminal history includes a 2003 conviction for embezzling and using a financial transaction device without permission in Washtenaw County and a 2010 attempted filing of a false police report in Shiawassee County. A Hartford employment lawyer is reviewing the details of this case.
AArbor Colorants is a privately held company in business since 1987 that is a “customer-driven flushed colors and dry color pigments manufacturer,” according to its website at www.aarbor.com.
Wednesday, December 16, 2015
Thursday, December 10, 2015
KARMANOS ALLEGES FRAUD IN NEW LAWSUIT AGAINST COMPUWARE
Original Story: freep.com
Peter Karmanos Jr. has filed his own shareholder lawsuit against Compuware, the Detroit-based company he founded, claiming a proposed settlement with other Compuware shareholders is too small.
The Karmanos' lawsuit, which also names his four young sons as co-plaintiffs, alleges fraud and blackmail were involved in the company's decision last year to sell itself to private equity firm Thoma Bravo for $2.4 billion, or $10.92 per share, a price that Karmanos argues was unfair and that undervalued Compuware. A Birmingham securities lawyer is reviewing the details of this case.
Peter Karmanos personally received more than $52.5 million from his Compuware shares -- not including an additional $16.5 million that he was awarded earlier this year by an arbitrator after Karmanos sued the company for firing him as a consultant and for canceling his remaining stock options. The company is still appealing the $16.5 million award.
Compuware's board voted to fire Karmanos for cause in response to profane comments he made regarding board members and the company's largest shareholder, an activist New York hedge fund called Elliott Management that had sought a sale. Karmanos retired from day-to-day work at Compuware in March 2013. A Tulsa finance attorney represents clients in business and investment transactions.
The Karmanos lawsuit was filed last week in Wayne County Circuit Court. It seeks unspecified damages and potentially the unwinding of the Compuware - Thoma Bravo deal.
“Frankly, they felt that the settlement did not provide any economic benefit to them," the Karmanos' attorney, Sharon Almonrode of The Miller Law Firm in Rochester, said Tuesday. "It did not address many of the issues that were raised in our complaint, and accordingly, they opted out.”
She did not say how much money additional Peter Karmanos believes he and his sons are due.
The Karmanos lawsuit contends that Compuware was worth more than what it sold for and that key information was missing from the materials distributed before the shareholder vote, such as Peter Karmanos' interest in perhaps buying parts of Compuware.
It also accuses the company's largest shareholder -- activist hedge fund Elliott Management -- of having "engaged in blackmail, and the other defendants succumbed to the blackmail instead of reporting it to the relevant authorities."
Besides Compuware, the lawsuit names as defendants former Compuware board members or executives including Gurminder Bedi, Fritz Henderson, William Grabe, Bob Paul and Daniel Follis. Thoma Bravo and Elliott Management are also named. A Harrisonburg securities lawyer is following this story closely.
The sale of Compuware to the Thoma Bravo private equity firm was overwhelmingly approved by Compuware shareholders in a December 2014 vote. Prior to the vote, the deal had prompted several shareholder class-action lawsuits that consolidated into one case in Wayne County Circuit Court.
Lawyers on both sides of that case reached an agreement that involved Compuware disclosing additional information before the shareholder vote to show why the deal made sense.
Under the terms of the case's proposed settlement, the plaintiffs' lawyers would declare that the extra information "empowered the shareholders of Compuware to make a fully informed decision" when voting. The settlement is still pending in court. (It also proposes that Compuware pay the plaintiffs' lawyers $525,000 for their fees.)
But Karmanos is not part of that main shareholder lawsuit. He and his four young sons, who are minors, opted out of the earlier lawsuit to retain their right to file a separate lawsuit. The sons' mother, Danialle Karmanos, is acting as their custodian in the lawsuit.
The alleged blackmail was the compiling of dossiers with information on certain board members by an Elliott Management portfolio manager, including a remark to Compuware's then-CEO Bob Paul about the vintage Aston Martin sports car that Paul kept at home in his garage and that few people knew about.
A Compuware representative said the company doesn't comment on legal matters. Elliott Management said in a statement that "(it) is pleased to have been involved in a process that maximized value for Compuware shareholders.” Former CEO Paul did not return a message seeking comment. A Boca Raton corporate attorney has experience representing clients in shareholder lawsuits.
Steven Harms, an adjunct professor in business of Walsh College, said shareholder lawsuits are fairly common in corporate deals but can be tough to win.
"They have a steep road to climb in order to prevail," Harms said. "My guess is that as a lawyer for 39 years, more are lost than won."
Since the December sale, Compuware has been split into two main pieces. Its mainframe business is still headquartered in Detroit on the fourth floor of what was formerly known as the Compuware building.
Peter Karmanos Jr. has filed his own shareholder lawsuit against Compuware, the Detroit-based company he founded, claiming a proposed settlement with other Compuware shareholders is too small.
The Karmanos' lawsuit, which also names his four young sons as co-plaintiffs, alleges fraud and blackmail were involved in the company's decision last year to sell itself to private equity firm Thoma Bravo for $2.4 billion, or $10.92 per share, a price that Karmanos argues was unfair and that undervalued Compuware. A Birmingham securities lawyer is reviewing the details of this case.
Peter Karmanos personally received more than $52.5 million from his Compuware shares -- not including an additional $16.5 million that he was awarded earlier this year by an arbitrator after Karmanos sued the company for firing him as a consultant and for canceling his remaining stock options. The company is still appealing the $16.5 million award.
Compuware's board voted to fire Karmanos for cause in response to profane comments he made regarding board members and the company's largest shareholder, an activist New York hedge fund called Elliott Management that had sought a sale. Karmanos retired from day-to-day work at Compuware in March 2013. A Tulsa finance attorney represents clients in business and investment transactions.
The Karmanos lawsuit was filed last week in Wayne County Circuit Court. It seeks unspecified damages and potentially the unwinding of the Compuware - Thoma Bravo deal.
“Frankly, they felt that the settlement did not provide any economic benefit to them," the Karmanos' attorney, Sharon Almonrode of The Miller Law Firm in Rochester, said Tuesday. "It did not address many of the issues that were raised in our complaint, and accordingly, they opted out.”
She did not say how much money additional Peter Karmanos believes he and his sons are due.
The Karmanos lawsuit contends that Compuware was worth more than what it sold for and that key information was missing from the materials distributed before the shareholder vote, such as Peter Karmanos' interest in perhaps buying parts of Compuware.
It also accuses the company's largest shareholder -- activist hedge fund Elliott Management -- of having "engaged in blackmail, and the other defendants succumbed to the blackmail instead of reporting it to the relevant authorities."
Besides Compuware, the lawsuit names as defendants former Compuware board members or executives including Gurminder Bedi, Fritz Henderson, William Grabe, Bob Paul and Daniel Follis. Thoma Bravo and Elliott Management are also named. A Harrisonburg securities lawyer is following this story closely.
The sale of Compuware to the Thoma Bravo private equity firm was overwhelmingly approved by Compuware shareholders in a December 2014 vote. Prior to the vote, the deal had prompted several shareholder class-action lawsuits that consolidated into one case in Wayne County Circuit Court.
Lawyers on both sides of that case reached an agreement that involved Compuware disclosing additional information before the shareholder vote to show why the deal made sense.
Under the terms of the case's proposed settlement, the plaintiffs' lawyers would declare that the extra information "empowered the shareholders of Compuware to make a fully informed decision" when voting. The settlement is still pending in court. (It also proposes that Compuware pay the plaintiffs' lawyers $525,000 for their fees.)
But Karmanos is not part of that main shareholder lawsuit. He and his four young sons, who are minors, opted out of the earlier lawsuit to retain their right to file a separate lawsuit. The sons' mother, Danialle Karmanos, is acting as their custodian in the lawsuit.
The alleged blackmail was the compiling of dossiers with information on certain board members by an Elliott Management portfolio manager, including a remark to Compuware's then-CEO Bob Paul about the vintage Aston Martin sports car that Paul kept at home in his garage and that few people knew about.
A Compuware representative said the company doesn't comment on legal matters. Elliott Management said in a statement that "(it) is pleased to have been involved in a process that maximized value for Compuware shareholders.” Former CEO Paul did not return a message seeking comment. A Boca Raton corporate attorney has experience representing clients in shareholder lawsuits.
Steven Harms, an adjunct professor in business of Walsh College, said shareholder lawsuits are fairly common in corporate deals but can be tough to win.
"They have a steep road to climb in order to prevail," Harms said. "My guess is that as a lawyer for 39 years, more are lost than won."
Since the December sale, Compuware has been split into two main pieces. Its mainframe business is still headquartered in Detroit on the fourth floor of what was formerly known as the Compuware building.
Thursday, December 3, 2015
MENTAL COMPETENCE SUIT AGAINST REDSTONE RAISES QUESTIONS OVER FUTURE OF VIACOM AND CBS
Original Story: latimes.com
The lawsuit filed this week challenging the mental competence of media mogul Sumner Redstone has raised questions among legal and business experts over the future of the 92-year-old billionaire's empire and how his companies should respond. An Iowa probate lawyer is following this story closely.
Redstone controls CBS Corp. and Viacom Inc., which owns Paramount Pictures, MTV and other media properties. The companies have a combined market value of about $45 billion, but neither has publicly discussed details of Redstone's deteriorating health.
The suit filed in Los Angeles County Superior Court by Manuela Herzer claims Redstone was not mentally competent when he removed her from oversight of his healthcare last month.
Redstone's lawyers have called the legal action by Redstone's ex-girlfriend "preposterous," "meritless" and "riddled with lies" — but it could nonetheless force CBS and Viacom to address the issue of Redstone's competence, some legal experts say.
Companies are not required to disclose medical details about their executives, according to analysts. But they do have to divulge "material" information — in other words, anything that reasonable investors would need to make informed decisions when buying and selling stocks. An ESOP lawyer represents clients in business exit planning and employee stock ownership programs.
If the court finds that Redstone is in fact incapable of making decisions, that could open up the companies to potential lawsuits from shareholders claiming that key information was kept from them, lawyers said.
"It raises the question of who knew what when, and what should've been disclosed to shareholders at what point in time," said Los Angeles attorney Bryan Sullivan, a partner at Early Sullivan Wright Gizer & McRae who has handled fiduciary duty matters. "If one person in the power structure knew he was incompetent, then there is potential liability under SEC regulations for failure to disclose material facts."
A representative for Viacom did not respond to a request for comment, and CBS declined to comment.
The issue of executive health came to the forefront in 2009 when Apple Inc. co-founder Steve Jobs took a medical leave and disclosed a hormone imbalance. Jobs, who had undergone surgery in 2004 to remove a cancerous tumor in his pancreas, did not say whether his cancer had returned at the time but said that the issue was "more complex" and required a six-month leave.
In April 2009, Jobs underwent a liver transplant. That procedure triggered a discussion of whether Apple, long known for its secretive corporate culture, had run afoul of federal securities rules by not disclosing the severity of the executive's condition. Jobs returned to work at Apple in June 2009.
He took another leave from Apple in 2011 — citing health issues — and resigned from his post before he died that October from complications of pancreatic cancer. A Des Moines probate attorney is reviewing the details of this story.
Another recent high-profile case of an executive's declining health taking center stage was former Los Angeles Clippers owner Donald Sterling, who lost control of his enterprise after being declared mentally incapacitated.
In the aftermath of the release of an audio recording of Sterling disparaging blacks in April 2014, the 81-year-old executive's wife sought control of the National Basketball Assn. team.
In May 2014, two doctors found Sterling, who by then was banned for life from the NBA, mentally incapable of continuing on as a member of the family trust that owned the basketball franchise. Shelly Sterling then reached a deal to sell the Clippers to former Microsoft Corp. Chief Executive Steve Ballmer for $2 billion.
Donald Sterling has unsuccessfully fought the sale of the team in court.
Some corporate governance experts say companies have been more forthright about their executives' health problems since the Jobs ordeal. Still, it often makes more sense for companies to stay muted, said law professor Allan Horwich, who practices at the Chicago firm Schiff Hardin. Firms can expose themselves to greater risk if they make affirmative public statements about an executive's health.
"This issue becomes much more difficult for the company when they do say something and they leave out information about the health of an executive who might not be able to serve," said Horwich, who focuses on securities litigation and fiduciary duty matters. He also teaches at Northwestern University's Pritzker School of Law.
Steven Davidoff Solomon, a law professor at UC Berkeley, also said it's unclear what the companies would need to divulge to shareholders and when.
"Given the control he has over the company, one would like to think that the company would think this is material information that should be disclosed," Solomon said. "But it's hard to know how much the company knows and how much it doesn't know and what it's real duties are."
The future of Viacom and CBS has been the subject of much speculation on Wall Street in recent months. Viacom has suffered from falling ratings at its cable networks and a weak film slate from its Paramount Pictures movie studio. Shares of Viacom, which owns MTV, Nickelodeon and Comedy Central, have fallen 32% this year. In contrast, CBS' stock has decreased just 8%.
On Friday, Viacom shares slipped $1.19 to $51.16, while CBS fell 23 cents to $50.75. A Los Angeles finance lawyer is knowledgeable in asset sales, debt and equity finance claims, and financial restructuring matters.
Herzer's suit demands that Redstone receive a mental examination, including a brain scan, and submit to a videotaped deposition. If her suit succeeds, Herzer could return to prominence in Redstone's affairs. Her suit asked the court to determine that her authority as the healthcare agent be reinstated.
Herzer was the agent of Redstone's advance healthcare directive and says she made decisions about his medical care until she was expelled from Redstone's home last month. Viacom Chief Executive Philippe Dauman then took over as the agent of Redstone's healthcare directive. If a doctor determines that Redstone has become incapacitated, Dauman would make decisions on Redstone's behalf. Redstone's lawyers say the former girlfriend filed the suit to avoid being cut out of his will.
--------
For the Record
An earlier version of this article said Manuela Herzer made healthcare decisions on Sumner Redstone's behalf until she was expelled from his home. The article should have said Herzer says she made decisions about Redstone's medical care.
--------
Redstone and his family control 79% of the voting shares of the two companies. Redstone has not been involved in the day-to-day functions of Viacom or CBS for some time. CBS is run by CEO Leslie Moonves.
When Redstone dies, the Sumner M. Redstone National Amusements Trust will determine what happens to his controlling interest in the companies. The companies each have a two-tier stock structure, with most shareholders owning nonvoting shares.
Still, a fraught and protracted legal battle could harm the Redstone empire even if the court finds the allegations to be meritless, said David Becher, a professor of finance at Drexel University.
"Even if it is a frivolous suit and there's nothing going on, I think the distractibility is going to hurt the company," Becher said.
The lawsuit filed this week challenging the mental competence of media mogul Sumner Redstone has raised questions among legal and business experts over the future of the 92-year-old billionaire's empire and how his companies should respond. An Iowa probate lawyer is following this story closely.
Redstone controls CBS Corp. and Viacom Inc., which owns Paramount Pictures, MTV and other media properties. The companies have a combined market value of about $45 billion, but neither has publicly discussed details of Redstone's deteriorating health.
The suit filed in Los Angeles County Superior Court by Manuela Herzer claims Redstone was not mentally competent when he removed her from oversight of his healthcare last month.
Redstone's lawyers have called the legal action by Redstone's ex-girlfriend "preposterous," "meritless" and "riddled with lies" — but it could nonetheless force CBS and Viacom to address the issue of Redstone's competence, some legal experts say.
Companies are not required to disclose medical details about their executives, according to analysts. But they do have to divulge "material" information — in other words, anything that reasonable investors would need to make informed decisions when buying and selling stocks. An ESOP lawyer represents clients in business exit planning and employee stock ownership programs.
If the court finds that Redstone is in fact incapable of making decisions, that could open up the companies to potential lawsuits from shareholders claiming that key information was kept from them, lawyers said.
"It raises the question of who knew what when, and what should've been disclosed to shareholders at what point in time," said Los Angeles attorney Bryan Sullivan, a partner at Early Sullivan Wright Gizer & McRae who has handled fiduciary duty matters. "If one person in the power structure knew he was incompetent, then there is potential liability under SEC regulations for failure to disclose material facts."
A representative for Viacom did not respond to a request for comment, and CBS declined to comment.
The issue of executive health came to the forefront in 2009 when Apple Inc. co-founder Steve Jobs took a medical leave and disclosed a hormone imbalance. Jobs, who had undergone surgery in 2004 to remove a cancerous tumor in his pancreas, did not say whether his cancer had returned at the time but said that the issue was "more complex" and required a six-month leave.
In April 2009, Jobs underwent a liver transplant. That procedure triggered a discussion of whether Apple, long known for its secretive corporate culture, had run afoul of federal securities rules by not disclosing the severity of the executive's condition. Jobs returned to work at Apple in June 2009.
He took another leave from Apple in 2011 — citing health issues — and resigned from his post before he died that October from complications of pancreatic cancer. A Des Moines probate attorney is reviewing the details of this story.
Another recent high-profile case of an executive's declining health taking center stage was former Los Angeles Clippers owner Donald Sterling, who lost control of his enterprise after being declared mentally incapacitated.
In the aftermath of the release of an audio recording of Sterling disparaging blacks in April 2014, the 81-year-old executive's wife sought control of the National Basketball Assn. team.
In May 2014, two doctors found Sterling, who by then was banned for life from the NBA, mentally incapable of continuing on as a member of the family trust that owned the basketball franchise. Shelly Sterling then reached a deal to sell the Clippers to former Microsoft Corp. Chief Executive Steve Ballmer for $2 billion.
Donald Sterling has unsuccessfully fought the sale of the team in court.
Some corporate governance experts say companies have been more forthright about their executives' health problems since the Jobs ordeal. Still, it often makes more sense for companies to stay muted, said law professor Allan Horwich, who practices at the Chicago firm Schiff Hardin. Firms can expose themselves to greater risk if they make affirmative public statements about an executive's health.
"This issue becomes much more difficult for the company when they do say something and they leave out information about the health of an executive who might not be able to serve," said Horwich, who focuses on securities litigation and fiduciary duty matters. He also teaches at Northwestern University's Pritzker School of Law.
Steven Davidoff Solomon, a law professor at UC Berkeley, also said it's unclear what the companies would need to divulge to shareholders and when.
"Given the control he has over the company, one would like to think that the company would think this is material information that should be disclosed," Solomon said. "But it's hard to know how much the company knows and how much it doesn't know and what it's real duties are."
The future of Viacom and CBS has been the subject of much speculation on Wall Street in recent months. Viacom has suffered from falling ratings at its cable networks and a weak film slate from its Paramount Pictures movie studio. Shares of Viacom, which owns MTV, Nickelodeon and Comedy Central, have fallen 32% this year. In contrast, CBS' stock has decreased just 8%.
On Friday, Viacom shares slipped $1.19 to $51.16, while CBS fell 23 cents to $50.75. A Los Angeles finance lawyer is knowledgeable in asset sales, debt and equity finance claims, and financial restructuring matters.
Herzer's suit demands that Redstone receive a mental examination, including a brain scan, and submit to a videotaped deposition. If her suit succeeds, Herzer could return to prominence in Redstone's affairs. Her suit asked the court to determine that her authority as the healthcare agent be reinstated.
Herzer was the agent of Redstone's advance healthcare directive and says she made decisions about his medical care until she was expelled from Redstone's home last month. Viacom Chief Executive Philippe Dauman then took over as the agent of Redstone's healthcare directive. If a doctor determines that Redstone has become incapacitated, Dauman would make decisions on Redstone's behalf. Redstone's lawyers say the former girlfriend filed the suit to avoid being cut out of his will.
--------
For the Record
An earlier version of this article said Manuela Herzer made healthcare decisions on Sumner Redstone's behalf until she was expelled from his home. The article should have said Herzer says she made decisions about Redstone's medical care.
--------
Redstone and his family control 79% of the voting shares of the two companies. Redstone has not been involved in the day-to-day functions of Viacom or CBS for some time. CBS is run by CEO Leslie Moonves.
When Redstone dies, the Sumner M. Redstone National Amusements Trust will determine what happens to his controlling interest in the companies. The companies each have a two-tier stock structure, with most shareholders owning nonvoting shares.
Still, a fraught and protracted legal battle could harm the Redstone empire even if the court finds the allegations to be meritless, said David Becher, a professor of finance at Drexel University.
"Even if it is a frivolous suit and there's nothing going on, I think the distractibility is going to hurt the company," Becher said.
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