A veteran did the brave thing by taking a truck to drive victims of the Las Vegas shooting to the hospital. In the article, the author loosely uses the word “steal,” in reference to the truck, but in fact the defense of necessity would negate any charge of theft.

The veteran stated “he looked for victims with the most serious injuries first, loaded them into the truck bed and drove them to Desert Springs Hospital Medical Center. He made two trips before ambulances arrived on scene.”

Friends said of him: “‘You’re an outstanding example of what we should all strive to be in time of crisis,’” “There’s a lot of unsung heroes that day that stood up and helped people,” the veteran told the press.

Introduction

Tax evasion is the practice of deliberately failing in an individual, corporate or trust’s obligations to remit their correct and due tax liability. The same can culminate into a criminal offense whose elements may require proof of omission or misinterpretation in the remittance or declaration of the correct tax position of the persons indicated above.

The article reviewed herein is “HMRC empowered to name and shame tax evasion ‘enablers,‘” an article done by Jessica Elgot in the Guardian newspaper on the 1st of January, 2017. The article, in essence, alludes to the directive given by the government, mandating the HMRC to target not only the evaders of tax obligations but also the parties who assist with the technical expertise to help the former in evading their obligations.

Review

The article begins with a commentary on the directive, indicating the punitive measures due to the parties that will be found culpable of enabling the crime. The penalty was placed on an amount of $3,000 or the amount they assisted the corporate or individual to evade, whichever amount is higher. The offense created, according to the article, will also encompass the omission to prevent an act of tax evasion. Though broad, the spectrum promises to have a deterrent effect on the players involved in the crime.

Further, the article goes ahead to speak to the future moves that the agencies anticipate about vanquishing the offense. The same entails reparative justice, which involves going after the offenders who have previously participated in the evasion of tax obligations. This final directive might encounter technicality issues due to the principle that laws do not operate retrospectively. However, considering the gravity of the offenses in question, the players, just like other law-abiding citizens, owe a duty to faithfully and honestly remit their taxes.

Source:

https://www.theguardian.com/business/2017/jan/01/hmrc-tax-evasion-enablers-fines

Posted by Milan Rana.

Finally, SEC’s one of the biggest insider trading case reached a settlement on May 18, 2017. This case is no different than other wall street insider trading cases. However, the important thing to note here is unlike other hedge fund managers, Mr. Cooperman did not plead guilty to the charges against him. In an interview with CNBC he said, he would have won the case had it gone forward. Fortunately, he learned from his lawyers that settling the case would cost him far less than dragging it a long way, even though he knew he would have won regardless. Upon reading the details of the case, we realize that the defense seemed to be weak and hard to prove. Yet, it is surprising that how court let him go with a penalty of couple million dollars. On September 21, 2016, the SEC charged hedge fund manager Leon Cooperman and his firm Omega Advisors with insider trading based on the nonpublic information received and used by Mr. Cooperman.  The SEC alleged that in 2010 Mr. Cooperman generated significantly large profits by trading securities of APL (Atlas Pipeline Partners L.P.) based on the information that he received from the APL senior executives. The Venue for this case was carefully selected as the violations of the securities occurred in the Eastern District of Pennsylvania.

After spending 23 and a half years at Goldman Sachs, with last 1 and a half year serving as a Chief Investment Officer, he decided to move on and start his own hedge fund company. He had learned and practiced many client building and maintaining tactics while working at Goldman Sachs. One of the powerful strategies of Cooperman was to accumulate large positions in the publicly traded companies and develop close relations with the company executives. By December 2009, Cooperman held over 9 percent shares APL, valued at approximately $46 Million. As a result of this, he developed such close relationships with company executives that led him access to various information that other smaller shareholders had no access to. On July 7, 2010, Cooperman learned from one of the APL executives that APL was negotiating the sale of Elk City(One of the APL’S largest pipeline plant) for approximately $650 million. He knew that if the deal goes through, APL stock prices would rise significantly.

According to the SEC report filed with the court, Cooperman promised the executive to keep the information secret and would not use it to trade the securities. However, he did not abide by the promise and that same day he started buying APL securities. He bought every security he could – Stocks, Bonds, Call Options. The report also states that until July 7, 2010, there was not a single day on which Cooperman’s Offshore Account, Hedge Fund Accounts, Managed Accounts and Family Accounts traded in APL securities. However, between July 7 – July 28, 2010, Cooperman and his accounts had purchased 343,600 Stocks, 4,500,000 Bonds and 6,781 Call options of APL. On July 27, 2010, Cooperman spoke to one of the executives again and confirmed the sale for $680 Million. Mr. Cooperman allegedly collectively generated $4.09 Million by trading in APL securities. The report also states that in breach of a duty of trust or confidence, Cooperman and Omega knowingly or recklessly traded APL securities on the basis, and while in possession of material nonpublic information related to APL’ s Elk City sale that Cooperman obtained from APL Executive.

According to the article titled “The SEC’s Biggest Insider Trading Case Is Heating Up” in Fortune magazine, stated that in his one of the television appearance Cooperman uttered the words, “These charges are total without merit.” This case has largely impacted his reputation as a hedge fund manager. Two years ago, his firm Omega had $10.4 Billion in assets, which slid to $3.4 Billion now. Moreover, he had also decided that if the case would drag long enough, he would consider closing the business. After all it’s all about the hard-earned respect and reputation he has earned being in this industry.

A Forbes article titled “Hedge Fund Billionaire Leon Cooperman Settles With SEC On Insider Trading Charges.” States that SEC had offered Cooperman the opportunity to settle the case agreeing to five-year industry ban. He instead chose to contest the charges in order to keep his reputation intact. Months after when the case was set for trial, the court approved the settlement of $4.9 Million in fines and penalties and agree to have an independent compliance monitor at his funds. The SEC has also provided the phone conversation of Mr. Cooperman and Executives in their report. Also looking at the transactions that Mr. Cooperman and his firms made, it clearly shows that he has received some kind of tip that he suddenly started buying APL securities. Yet, it is very hard to believe that he got off the hook without pleading guilty, with a smaller fine than expected, and still in business. 

Milan is a graduate student in the Feliciano School of Business, Montclair State University.

Bibliography

Celarier, Michelle. “The SEC’s Biggest Insider Trading Case Is Heating Up.” Fortune Finance. Fortune, 18 Jan. 2017. Web.

Gara, Antoine. “Hedge Fund Billionaire Leon Cooperman Settles With SEC On Insider Trading Charges.” Forbes. Forbes Magazine, 19 May 2017. Web.

SEC VS LEON G. COOPERMAN. No. 2:16-cv-05043-JS. The Eastern District of Pennsylvania. 20 Mar. 2017. Web.

Posted by Marissa Aniolowski.

These two articles both address the same issue that occur in two different companies. This issue is sexual discrimination. In the first article, a woman accuses AutoNation of promoting a male over her solely because she is a female. The second article, addresses the issue of gender pay in the company Oracle.  As a female business student, I am concerned about being a woman in the business world because of issues like these.

In the first article, Jaqueline de la Torre filed a complaint about AutoNation because when the Parts Manager position opened up, AutoNation immediately hired a male despite the fact that they had a female Assistant Parts Manager who had been on the job for 10 years and was more than qualified to be promoted. According to De la Torre she was told they “needed a man” for the position, and she was then required to teach the new Parts Manager how to do his job because he was previously a sales associate at the dealership. Because the company failed to promote her, the Equal Employment Opportunity Commission is suing AutoNation for violating Title VII and the Civil Rights Act of 1964. As a female, I would defend De la Torre’s side because I know women are just as capable as men are. It is a difficult accusation to prove, but women are undermined in the work world, and that needs to change.

In the second article, three women in the senior product development role are accusing Oracle of paying their male colleagues in the same position more money. The article states, “It’s the third time this year that Oracle has been in the news around pay discrimination. In January, the U.S. Department of Labor filed a lawsuit against Oracle claiming the company systematically pays its white male workers more than women, and men of color.” The women’s lawyer is still searching for evidence to support their claim, but their lawyer, “says he wants to file a class action lawsuit that would cover some 1,200 women at Oracle.” How you prove the company is paying the white men more money than the rest of the workers based solely on their gender and color is a difficult task to prove, but why issues like this are still occurring is concerning. How long will it take people to realize that men, women, and people of different races are all capable of doing the same work, and the diversity will only help companies grow?

In many businesses, discrimination is still currently a big issue. It is an issue nationwide, outside the business realm that needs to be fixed, and should no longer be tolerated. The issues with these cases is finding enough evidence to support the claims and prove that they have been discriminate. The great strides that have been made to equality of race and gender are not something to ignore, but in today’s day and age, any person should not tolerate discrimination.

Marissa is a student at the Stillman School of Business, Seton Hall University, Class of 2020.

Sources:

EEOC sues AutoNation for alleged sex discrimination

https://www.bizjournals.com/southflorida/news/2017/10/02/eeoc-sues-autonation-for-alleged-sex.html

Oracle faces possible class-action lawsuit over gender pay discrimination

https://www.bizjournals.com/sanjose/news/2017/10/02/oracle-gender-pay-discrimination-lawsuit-orcl-goog.html

Posted by August Pimentel.

President Donald Trump recently had a libel case against him dismissed in the Supreme Court of New York on the basis that his tweets were spreading opinion rather than fact, and therefore could not be held accountable for libel.

The conflict began in February 2016, when Cheryl Jacobus, a Republican strategist who had previously been recruited by the Trump campaign, went on CNN attempting to expose a political action committee which allegedly was partly funding the campaign. Trump responded to the broadcast via his personal Twitter account, saying “Really dumb @CheriJacobus. Begged my people for a job. Turned her down twice and she went hostile. Major loser, zero credibility!” Jacobus sued the then presidential candidate and his then campaign manager Corey Lewandowski for defamation, pursuing damages of $4M. Jacobus stated that after the tweet, she received no more offers to speak and no employment opportunities.

Barbara Ross of the New York Daily News covered this case with an article in October 2016 on the suit, and another released in January 2017 when the case was dismissed.

“Jacobus had appeared 141 times on CNN to discuss the presidential race before the dust up,” said Ross. “But only once on another station after his tweets.”

The hearings in front of Justice Barbara Jaffe of New York revealed that the Trump campaign had indeed recruited Jacobus for a job and discussed terms of the employment, but rejected her after receiving a request for $20,000 per month in salary. Jacobus’ attorney, Jay Butterman, claimed Jacobus’ entire career was destroyed by those tweets, and the Trump campaign lied about her “begging for a job” and “[acting] hostile.” Trump’s attorney, Lawrence Rosen, claimed Butterman and his client to be engaging in “hyperbole” stating: “To a large extent, Twitter is the wild wild West. People say the darnedest things. Everyone understands that when tweets are made, you take it with a grain of salt.”

Justice Jaffe ruled in favor of President-elect Trump and Lewandowski just ten days before inauguration day. In her decision, Justice Jaffe stated that “professional misconduct, incompetence or a lack of integrity may not be reasonably inferred from being turned down from a job.” The judge also commented on the nature of tweets themselves, similar to Rosen’s argument in the case.

“His tweets about his critics, necessarily restricted to 140 characters or less, are rife with vague and simplistic insults such as ‘loser’ or ‘total loser’ or ‘totally biased loser,’ ‘dummy’ or ‘dope’ or ‘dumb,’ ‘zero/no credibility,’ ‘crazy’ or ‘wacko’ and ‘disaster,’ all deflecting serious consideration.”

Butterman and Jacobus plan to appeal the ruling, claiming it a “sad day for free speech.” Reflecting on this case, there may have been some small falsity in President Trump’s tweet in that his campaign did not turn Jacobus away twice. This was not enough, however, to make Trump guilty of libel. That tweet over a year ago, made by the then prominent presidential candidate, can be interpreted as vague. However, if it is true that Jacobus has lost speaking opportunities for which she would have gotten paid because of a crude tweet, it shows that those companies and media outlets did not take Trump’s tweets “with a grain of salt.” The president has recently boasted about the ability of his tweets to obstruct others, citing that no NFL team has signed Colin Kaepernick because they are afraid to get “a nasty tweet from Donald Trump.” Unfortunately for Jacobus’ case, this appears to be an ethical issue rather than a legal one.

August is an economics major at the Stillman School of Business, Seton Hall University, Class of 2018.

Sources:

http://www.nydailynews.com/news/national/manhattan-judge-tosses-libel-lawsuit-donald-trump-article-1.2942831

http://www.nydailynews.com/news/politics/cheryl-jacobus-trump-destroyed-career-4m-suit-article-1.2818683

Posted by Anna Fajnorova.

On March 26, a gate agent decided to deny two teenage girls from a flight because they were wearing leggings. The girls were traveling on a company travel pass and their leggings were a violation of the airline’s dress code. United Airlines defended the gate agent’s decision and it led to an uproar with many people on social media after the incident was reported. Now does United, being a privately-owned company, have the right to do what they did?

United Airlines allows customers to fly in leggings, but these girls were “pass rider” users. “Pass rider” is a benefit United Airlines employees receive for working for an airline. Employees are able to travel the world and extend their privileges to relatives or friends as long as they use an airline that follows that policy. Employees and “pass rider” users are considered representatives of United and have a dress code to follow. Because the girls were wearing leggings, they went against the dress code and were denied to fly. Other airlines follow the same policy as United and have a set dress code for relatives and friends that receive benefits from their airline. Southwest Airlines has a “relaxed and casual” dress code, but does not allow “low-cut, skimpy, revealing clothing, short shorts, or gym shorts.” JetBlue also does not allow leggings but finds jogging suits acceptable. Besides leggings, low-cut, revealing attire, and sweats of any kind are not allowed. Employees and pass rider beneficiaries must also have clean shoes as well as cover up their tattoos. Another question that should be asked is does United have the right to tell employees and their families what to wear, especially during their leisure time?

Even though there are critics saying several things such as “how would people know about the policy”, “the policy is outdated and strict”, and “it’s sexist because it singles out attire worn primarily by women”, what United Airplanes did was not wrong according to the article. Many “pass rider” users even agreed with United’s decision and believed the teenage girls were taking advantage of the employee benefit and should have known better. United regularly reminds their employees that when a relative or friend is given the benefits of becoming a “pass rider” user, they need to follow dress code. If this is the case, United only followed policy that employees are regularly reminded of and enforced that policy. Yes, the policy seems outdated because leggings are something that many people currently wear but “pass rider” users represent the company along with employees, so they must follow dress code as well.

Anna is a finance major at the Stillman School of Business, Seton Hall University, Class of 2019.

Source: https://www.washingtonpost.com/news/dr-gridlock/wp/2017/03/27/united-airlines-your-leggings-are-welcome-as-long-as-youre-paying-for-your-flight/?utm_term=.31bfbcfaf365

Posted by Ailinulan Aihemaiti.

Politicians are always prone to controversy, and not even the current President of the United States, Donald J. Trump, is exempt from any of it. In 2010, a class suit was filed against Trump University upon allegations that it defrauded its students. The allegations centered around Trump University engaging in aggressive sales tactics and spreading misleading information. Former students say the university promised to teach Trump’s insider secrets of the real-estate business, but after they paid $35,000 for an education, they said they received no such “secrets.” One such student, Bob Guillo stated the Trump University advertised tricks “included using the real estate website Trulia.com to search for properties and learning about tax deductions on the Internal Revenue Service’s website” (Time).  Many others said they received a great education.

After a seven-year long battle, the Trump University lawsuit finally ended on March 31, 2017 when a federal judge declined the request from a Florida attorney to “opt out of the $25 million Trump University global settlement” (Courthouse News Service). The final settlement of $25 million will be a much better deal for the students, giving back 90 percent of what students invested in Trump University rather than the 50 percent of the November settlement. Class attorney Rachel Jensen provides even more good news, saying that the students should get their checks a few months from now if there are no appeals.

However, if an appeal is filed, the court battle could go on for years, and the settlement payments will also be held up. The prospects are still unclear as Sherri Simpson, former student who spent $20,000 on Trump University in 2010, has made movements to opt out in the March 30 hearing; she has expressed her desire to opt out to file her own fraud case against the University, despite filing an earlier claim to recover damages. Although Simpson’s proposal was rejected by a federal judge, she still has 30 days to file an appeal.

Ailinulan is a management major at the Stillman School of Business, Seton Hall University, Class of 2017.

Sources:

http://time.com/money/4573705/trump-university-lawsuit/

Judge Signs Off on $25M Trump U Settlement

http://www.courthousenews.com/wp-content/uploads/2017/03/Trump-U-Settlement-FINAL.pdf

Posted by Jayce Chavez.

Mark Moskowitz, a 48-year-old Short Hills New Jersey resident, pleaded guilty before U.S. District Judge Katharine Hayden to one charge of wire fraud. He admitted to fraudulently using investment money for his personal use. He ran a trading company and defrauded investors of more than $675,000 and used the money for himself. His company was called Edge Trading which was created in 2012, he, “told his investors that the company invested in equities and contracts and was growing even though it was not.” Moskowitz was fined, separately by the New Jersey Bureau of Securities, for$1 million in civil penalties for the sale of fraudulent unregistered securities and misusing investor’s funds. He will be sentenced July 5, 2017 and could face a maximum of 10 years in prison and $250,000 fine.

Joseph Meli, a 42 year old Manhattan New York resident; and Steven Simmons, a 48-year-old Wilton Connecticut resident were arrested in late January this year, “on charges alleging they enticed wealthy individuals to make multi-million-dollar investments.” These gentlemen were caught by a civil complaint to the Securities and Exchange Commission, claiming that this Ponzi scheme led people in 13 states to invest $81 million. This scheme included investments in businesses that would purchase large sections of tickets for concerts and musicals. The SEC says that at least $51 million of the $81 million was used to pay off other investors and for personal expenses for Meli, Simmons, and other coconspirators. Only Meli was charged with the civil complaint but both men were charged criminally with conspiracy, securities fraud and wire fraud. Both men were then freed on a $1 million bail after a prosecutor’s request for them to be held without bail was rejected.

Both of these cases are similar not only because they were both people scheming investors of their money but large sums of the money were used for personal expenses. These cases had criminals who fraudulently used investors’ money for everything but what they had promised the investors. In the first case, Moskowitz had used most of the $625,000 for himself, while on the second case, the 63% of the $81 million was fraudulently split amongst Meli, Simmons, and other co-conspirators. Moreover, this shows that there are Ponzi schemes that range between hundreds of thousands of dollars to millions of dollars. Thus, we must be careful when investing into corporations which are not well-known or established.

Jayce is an accounting major at the Stillman School of Business, Seton Hall University, Class of 2019.

Sources:

http://www.nj.com/essex/index.ssf/2017/03/short_hills_man_admits_to_675k_ponzi_scheme.html

http://www.foxnews.com/us/2017/01/28/2-men-allegedly-raised-81m-in-hamilton-ponzi-scheme.html

Posted by Michael Martin.

Six former executives and managers of the pharmaceutical company Insys Therapeutics Inc. were arrested “on charges that they led a nationwide conspiracy to bribe medical practitioners to unnecessarily prescribe a fentanyl-based pain medication and defraud healthcare insurers” (Dep. of Justice). The spray drug, named “Subsys,” is a strong opioid that is typically prescribed to cancer patients suffering from breakthrough pains. Insys bribed doctors to prescribe their drug to patients, many of which did not even have cancer, in high doses. Insurance companies became skeptical of the drug, because it was not prescribed to cancer patients, which resulted in the former executives of the company to mislead providers with the ““reimbursement unit” which was dedicated to obtaining prior authorization directly from insurers and pharmacy benefit managers” (Dep. of Justice).  Employees of this unit were pretending to call insurers from a doctor’s office. “Insys also set up its phone system to block the origin of the calls” (Thomas).

Insys was writing off the bribes and kickbacks to the doctors as speaking fees. The issue with the speaking fees is that the “events” held by Insys were usually entirely fabricated on paper, and were really just a few Insys members having dinner with a “speaker” doctor at a fancy restaurant. On one occasion, Alec Burlakoff, the former vice president of Insys, texted a sales representative about the communication skills of the doctors saying “They do not need to be good speakers, they need to write a lot of” prescriptions for Subsys. In the case of an Alabama doctor, after becoming a paid speaker, his prescription count increased from two a week to about eleven (Thomas).

The actions of the Insys executives are not only illegal, but are also highly unethical. Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, said “[Insys] contributed to the growing opioid epidemic and placed profit before patient safety” (Dep. of Justice). Michael L. Babich, 40, the former CEO and President of the company, “is charged with conspiracy to commit racketeering, conspiracy to commit wire and mail fraud and conspiracy to violate the Anti-Kickback Law.” Burlakoff, Richard M. Simon, 46, former National Director of Sales; and Regional Sales Directors, Sunrise Lee, 36, and Joseph A. Rowan, 43 “are charged with RICO conspiracy, mail fraud conspiracy and conspiracy to violate the Anti-Kickback Law.” And former Vice President of Managed Markets, Michael J. Gurry, 53, “is charged with RICO conspiracy and wire fraud conspiracy” (Dep. of Justice).

The charges for RICO and fraud crimes are “no greater than 20 years in prison, three years of supervised release and a fine of $250,000, or twice the amount of pecuniary gain or loss.” Plus a mere $25,000 fine for violating the Anti-Kickback Law, with a maximum of five years in prison.” This minimal punishment becomes even more disturbing when you realize that the “actual sentences for federal crimes are typically less than the maximum penalties” (Dep. of Justice).

Michael is an accounting major at the Stillman School of Business, Seton Hall University, Class of 2019.

Sources:

https://www.justice.gov/usao-ma/pr/pharmaceutical-executives-charged-racketeering-scheme

Posted by Nicole Boodhoo.

About 6 years ago, Apple first sued Samsung over the design of their Galaxy S series. Apparently, the designs of the phones infringed on a patent that was created over the design of the original iPhone.  The court closed the case in December of 2016, ruling in Samsung’s favor saying they did not need to pay the $399 million to Apple, but it is now reopened. The court case is not going to be about whether Samsung did or did not infringe on the patents created by Apple but rather how damages will be calculated. Originally, Samsung would have had to pay Apple a percentage of each sale. However, the justices disagreed and stated that they only needed to pay for the components that were claimed to be infringed upon.

According to the article written by Julian Chokkattu, he stated,

“In delivering the court’s majority opinion, Justice Sonia Sotomayor wrote that “article of manufacture” — the legal term that refers to both a product sold to a consumer and a component of said product — has a “broad meaning,” and that an “article” could refer to “a particular thing.” In Samsung’s case, an “article” could be an infringing smartphone’s appearance, for instance, or software feature” (1).

The design patents are at question in this case. A design patent is what protects the look of the product and what makes the product unique. In 2012, the court sided with Apple stating that Samsung did copy the design, featuring “the black rectangle shape and rounded corners, the bezel, and a patent that covered the graphical layout of icons of the iPhone” (Chokkattu 1).  The law states that whoever applies the patented design, without license of the owner, is liable to said owner “to the extent of his total profit, but not less than $250, recoverable in any United States district court having jurisdiction of the parties” (1).  Samsung and all the supporters believe that total profits should not be included in the reward since smartphones are filled with hundreds if not thousands of components that are patented from neither of these two companies.

Apple feels that everything within the phone, as well as the looks of the phone, is what sells the smartphone and states that, “removing the need to pay total profits would hamper legal protection for new products and designs” (Chokkattu 1). Although Apple agreed that “article of manufacturer” could represent only specific features of the product and not the whole thing, financial damage would prevent people in the future from pocketing designs of other products. As the discussion goes on, the design on the Beetle is brought up as a reference stating that one may not buy the car for just its looks, but might be a primary factor into driving sales up. The article states that, “the infringement wasn’t found on the whole phone,” Samsung attorney Kathleen Sullivan said after the hearing. “It asserted three narrow patents. The patent doesn’t apply to the internals of the phone, so Apple doesn’t deserve profits on all of Samsung’s phone” (Chokkattu 1).  She also states that if they do win and are awarded total profits that it would devalue all of the other patents within the smartphone, which roughly has about 250,000 patents. Apple states that this is the 11^th time Samsung has copied an idea and they have been found guilty of it. They believe that if this continues it will pose risks to future designs.  In the last 100 years, a design patent case has not been ruled on in the Supreme Court.

Nicole is a finance major at the Stillman School of Business, Seton Hall University, Class of 2020.