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Archive for Saturday, August 9, 2003

Briefcase

August 9, 2003

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Tenet faces investigation

The state of Florida is investigating hospitals in the Sunshine State with ties to Tenet Healthcare Corp., the latest in a series of probes and lawsuits involving the nation's second-largest for-profit hospital chain.

The disclosure came Friday, a day after the company announced it had a $195 million loss in the second quarter and was spending $2 million to $3 million each month for legal fees and other costs.

The Florida Medicaid Fraud Control Unit issued an investigative subpoena June 6, "seeking employee personnel records and contracts with physicians, therapists and management companies, including loan agreements and purchase and sale agreements," the company said in a filing with the Securities and Exchange Commission.

Tenet said it was cooperating with the investigation, which covers records for the past 11 years.

Mortgages

Ohio sues Freddie Mac

Ohio's attorney general sued mortgage giant Freddie Mac on Friday for what he called the company's "deliberately misleading accounting practices."

Atty. Gen. Jim Petro is seeking to recover more than $25 million lost by state retirement systems for teachers and public employees.

Lawsuits were filed in federal courts in Ohio, Virginia and New York, said Kim Norris, a spokeswoman for Petro. West Virginia also has sued Freddie Mac, saying it lost $1.7 million. Both states have filed to be the lead plaintiff in a class-action lawsuit.

Petro said the company's former executive team knowingly misled the public with an "overly" vague disclosure of information and allowed lower-level managers to make financial decisions even though they didn't have the proper skills and information.

Technology

Intel, Broadcom settle longtime patent disputes

Semiconductor rivals Intel Corp. and Broadcom Inc. announced Friday they have settled their long-running patent disputes and agreed to license various technologies from each other. The firms had filed several lawsuits and counterclaims related to semiconductors and packaging dating from 2000 in federal courts and the International Trade Commission. Under the deal, all the claims and counterclaims will be dismissed.

Broadcom, a maker of communications chips, will pay Intel a total of $60 million spread over the third and fourth quarters of 2003. Broadcom said it would take a one-time charge in the quarter ended June 30.

R.J. Reynolds

Tobacco giant subject of federal probe by SEC

R.J. Reynolds Tobacco Holdings Inc. said Friday it had received a subpoena from the Securities and Exchange Commission as part of an investigation of possible violations of securities laws.

"This has nothing to do with any financial improprieties," RJR spokesman Seth Moskowitz said.

In its quarterly report filed with the SEC, the nation's second-largest cigarette maker said the July 3 subpoena and discussions with the SEC explore whether specific amounts of some of the company's expenses should be quantified separately rather than aggregated with other expense items.

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