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Androvett NewsWire: October 11, 2012: AA Passenger Discontent | Cheating Spouses | Offshore Accounts
 
October 11, 2012 11:02 am

Flyers Fed Up With AMR Labor Dispute
Once-loyal American Airlines passengers have been enduring tedious delays on the tarmac and mass flight cancellations blamed on parent company AMR's bitter relationship with pilots during its contentious bankruptcy. While AMR's bankruptcy endgame is to emerge leaner and more profitable, passengers' negative experiences in the meantime have the potential to cause a lasting impact on American Airlines' bottom line, says forensic accountant Larry Kanter of Dallas-based Kanter Financial Forensics. "Passenger loyalty - particularly among the valuable business traveler base - is hard-earned and difficult to regain when lost," says Kanter, who has experience computing damages models for businesses, including airlines. For more information, contact Robert Tharp at 800-559-4534 or robert@androvett.com.

High-Tech Spying During Divorce Cautioned
Divorcing spouses who are tempted to install hidden cameras, GPS tracking devices or computer spyware to catch a spouse suspected of cheating should make sure what they are doing is not going to get them into legal trouble, advises Scott Downing, a partner in the Family Law firm of McCurley Orsinger McCurley Nelson & Downing L.L.P. "A number of federal and state statutes address electronic snooping, and much depends on how invasive the snooping was," he says. "Were the emails sitting on a family computer or were they on a password-protected website? Was the hidden camera in a shared area of the home or was it somewhere with a reasonable expectation of privacy, like the bedroom?" Electronic eavesdropping can produce significant evidence, but that evidence may never see the light of day if it is acquired improperly. "Not only could it pose problems in the divorce, but there are also potential civil and criminal penalties," he adds. For more information, contact Rhonda Reddick at 800-559-4534 or rhonda@androvett.com.

Meningitis Scare Highlights Pharmacy Concerns
With reports that 12 people have died from a rare form of fungal meningitis linked to contaminated steroid shots, new questions should be raised about how pharmacies mix and dispense drugs, says New York attorney Rick Meadow, head of The Lanier Law Firm's Pharmaceutical Litigation Division. Officials with the U.S. Centers for Disease Control and Prevention have reported more than 100 cases of fungal meningitis stemming from compounded versions of an injectable steroid manufactured by a single specialty pharmacy in Massachusetts. "This outbreak demonstrates the need for government oversight of pharmacies that mix compounds and ship them to unsuspecting consumers throughout the country," says Meadow, who has represented numerous clients injured or killed by defective or contaminated drugs. Officials estimate as many as 13,000 people across 23 states may have been exposed to the tainted drugs. "Congress must get involved to expand the power of the FDA to regulate this dangerous industry," Meadow says. For more information, contact Alan Bentrup at 800-559-4534 or alan@androvett.com.

Supreme Court Eyes UT Admissions Policy
The impending U.S. Supreme Court decision on the University of Texas' reverse discrimination case could have far-reaching implications for colleges and universities across the nation, says Philip Kessler, a partner at Thompson & Knight. Kessler says the UT case hinges on whether the Supreme Court is willing to continue to uphold affirmative action precedents established in cases involving the University of Michigan, the University of Michigan Law School and the University of California. "The Texas admission system has some features in common with the two admission systems that were used by Michigan's undergraduate and law schools to evaluate candidates and were examined by the Supreme Court," Kessler says. "However, the Texas system also appears to have some notable differences. It will be interesting to see whether or not those differences have an impact on the justices' reasoning or decision." For more information, contact Dave Moore at 800-559-4534 or dave@androvett.com.

Expect FCPA Probes to Continue
During the past decade, the federal government has pulled in billions of dollars in civil and criminal penalties through increased enforcement of the Foreign Corrupt Practices Act. That kind of return is one reason that the scrutiny of domestic companies and their overseas business partners is not expected to ease. "It's simply good business for corporations to set proper expectations and exercise control over their foreign subsidiaries," says former SEC Regional Director Rose Romero, now of the Dallas office of Thompson & Knight. "Due diligence on the front-end is critical, as well as the regular monitoring of those arrangements and the investigation of any red flags." Romero notes that questions about the business practices of third-party service providers may lead to a costly internal review, but that investment is likely better than being indicted, and a company's response may reduce the amount of any federal sanction. For more information, contact Barry Pound at 800-559-4534 or barry@androvett.com.

Offshore Accounts: Useful Business Tools
The offshore investment strategies of corporations, as well as presidential candidates, have dominated recent headlines, with most implying that there is something not quite legal going on. However, according to Dallas attorney Dan Baucum of Shackelford Melton & McKinley, modern offshore business deals are neither tax evasion schemes nor ways to avoid creditors. "Foreign companies seeking to acquire or merge with companies in North, Central and South America often create holding companies in tax-neutral countries such as the Cayman Islands that have stable governments, developed infrastructures, financial centers, and well-established legal systems based on English common law," says Baucum, a former special assistant to the IRS associate chief counsel. "International businesses often make use of holding companies in tax-neutral jurisdictions to avoid exposing themselves to potentially unfavorable tax laws of a country where they want to do business." For more information, contact Rhonda Reddick at 800-559-4534 or rhonda@androvett.com.


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