Business, Finance, & Economics: December 2009 Archives

The Wisconsin Supreme Court will hear arguments in the case of Racine County and Oracular Milwaukee next month. Oracular was hired to install new human resources and payroll software. When the completion date came and went and the system was only 50 percent installed, the county terminated the contract and sued Oracular in Racine County Circuit Court.

The three questions the Supreme Court is expected to address in its review are:

- whether expert testimony is required to prove a breach of contract claim based on a delay in completion when the work to be completed is complex and interdependent.

- the proper analysis of when something is considered a "profession." Under Wisconsin law, if professional services have a different standard required for termination.

- whether people who provide computer software programming services relating to customized software are "professionals" under Wisconsin law.

For more, see www.journaltimes.com.

A key mortgage modification program facilitated by federal incentives has not only failed to reach the potential envisioned by its founders, but it also has several key flaws that may have destined it for failure from the start, expert witnesses testified to the House Financial Services Committee Tuesday. Home Affordable Modification Program (HAMP), which allocates capped incentives to servicers, lender/investors and borrowers that participate in modification of mortgages at risk of foreclosure, was a large focus of testimony. 

Real estate finance expert witness Anthony Sanders, professor at George Mason University, testified that "In order to facilitate lasting loan modifications, banks must be allowed to gradually write-off losses and the private sector must be allowed to help modifications."

For more, see housingwire.com.

Warren Buffet's buyout of BNSF has spurred hearings on how and where four cases in Tarrant County, three in Dallas County, and five in Delaware will be consolidated into one class-action lawsuit over the cost of the take over. Buffett’s Berkshire Hathaway agreed to buy BNSF stock for $100 a share, a 31 percent premium over the previous day’s closing stock market price.

Dallas lawyer Trey Branham said says it’s difficult to predict how the judges will decide where the case should be tried.  Branham said such lawsuits are a way to make sure that small, individual stockholders get a fair return on their investment. The shareholders’ attorneys will seek to have expert witnesses testify that BNSF is worth more than the $100 a share Berkshire has agreed to pay.

For more, see www.star-telegram.com.

The Washington State Utilities and Transportation Commission is considering the sale of Verizon Northwest's 487,000 local landline telephone consumers to Frontier Communications Inc.  Public Counsel Sarah Shifley, of the state Attorney General's Office, doesn't think the transaction should be approved, saying that the sale of Verizon could result in a "degradation of service quality."  The public counsel represents residential and small business customers of regulated telecommunications companies in actions before the commission. 

In expert witness testimony filed with the commission the public counsel pointed out Frontier may have a weak financial condition due to the amount of debt it would assume if the sale is approved.  The commission staff members also are concerned Frontier could suffer the same fate as other Verizon spin-offs in Hawaii and New England that have resulted in bankruptcies.

Excerpted from blog.seattlepi.com.