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Archives: Contracts

Rutgers Students Protest Coke Contract

Students at Rutgers University formed a coalition to protest the University’s contract with Coca-Cola Corporation.  Rutgers students wanted to influence the University’s administration to look at other options before making a final decision on the soft drink distributor.  Most of the student-formed coalition consisted of on-campus groups.  These students signed petitions against the University signing another Coke contract.

Many students are upset that a company as large as Coca-Cola is allowed to create a “monopoly” of Coke on their campus.  It appears that many college students of the 21^st century are against large companies such as Coke and Microsoft creating a monopoly at higher education institutions.  The protests served as a way to educate Rutgers students of the issues and concerns in this debate, and to spark activism.

The issues that many Rutgers students have against the soft drink giant are, exclusivity and the ethics of the company.  In the past Coca-Cola has been connected to killings of Columbian union organizers.  An event like this has made students think that Coca-Cola has no interest in their global bottling plants, and consequentially, cannot be responsible for unfavorable events that occur.  In regards to exclusivity, the students would like for Rutgers Administration to look into local distributors in addition to the soft drink company. 

Scientific Games Awarded Lottery Services Contract

Pacific Online Systems Corporation recently awarded Scientific Games Corporation a contract to supply almost one thousand online lottery terminals and a central lottery system.  Pacific Online Systems is the operator for the official Philippines lottery.  The contract awarded to Scientific Games is worth $12 million, and begins in the second part of 2005.   Scientific Games Corporation will provide these services for at least 7 years.

For many years, Scientific Games Corporation have attempted to expand their business abroad.  Obtaining this contract will allow them to keep up with their future global expansion goals.  The contract will allow Pacific Online to help the lottery expand its outlets, and increase sales and proceeds to lottery winners.

Scientific Games is one of the leading integrated suppliers of instant tickets, systems and services to lotteries.  In addition, the corporation has a client base tat spans more than 60 countries.  Therefore, it is no surprise that they were able to land this contract with Pacific Online.  Scientific Games has been able to grow their operations by expanding their markets and resolving any pending future contract litigation in a timely manner. 

New European Law Side with Airline Passengers

A new European law is welcomed with open arms by consumer advocates and criticized by airlines for being the most strict air-passenger rights in the world.  The new law increases penalties on airlines for “bumping” passengers and requires airline carriers to pay passengers for most delays, and cancellation, even if the cause is bad weather.  Customers from all nationalities are covered by this new law when traveling within Europe, and possibly to some trans-Atlantic flights.

The law was introduced last month, and is applicable to 25 member nations of the European Union.  Overall, this law includes most of Europe.  The purpose of the law is to curtail airline carriers from engaging in practices that are annoying to passengers, such as overbooking.  Proponents of the law think that it’s great because the passenger is no longer the victim to airline antics.

Airline carriers don’t argue with the bumping rules, but have a major issue with cancellations that are a result of bad weather.  Carriers contend that the law is going to add to their costs of operation, and in turn will increase the fares for customers in the end anyway.  However, the law does not cover non-European Union airlines that originate outside Europe. 

The High Costs of Contract Language

An Ohio County Department of Job and Family Services has to fix a contract language dispute with their affiliate state offices, or will run the risks of losing more than $200,000 in state reimbursements.  Under a government contract, Ohio covers payment of 66 percent of child enforcement services performed some county courts and other county offices located in Ohio for Job and Family Services purposes. 

Time to correct the contract language is about to run out.  An agreement must be made by the end of this month or Seneca County could lose out on at least $200,00 in 2005 alone.  A local county official stated that county judges and prosecutors had issues with three areas of the contract the Ohio Department of Family Services wants the county to sign in order to get reimbursement for child protective services.  One contract issue that is still left up in the air is that if the current language is left the same, county judges could be exposed to liability since judges are considered officers of the state. 

Confidentiality clauses of the contract also present issues in these negotiations.  Regardless of the contract language in dispute, judges will still have to perform child support enforcement services whether or not if Ohio counties will get reimbursed for the costs. 

NY Governor Implements New Lobbying Bill

New York Governor, George Pataki implemented legislation this week that aims at strengthening public confidence in the state government.  The new legislation will ban gifts from lobbyists, closing a loophole that allows former state employees to avoid punishment for ethics violations, and curtail lobbying for state control.  Pataki’s legislation has achieved the same goal that the New York Legislature has wanted for a long time- drastically limiting lobbying for contracts, and revamping the state’s lobbying laws to encompass a general definition of lobbying.

Although Pataki has introduced this legislation, critics believe that it may be difficult to get the Democratic-led State Assembly and the Republican-led Senate to reach an agreement and implement new laws.  The main issue that needs to be addressed by both sides is that New York citizens are hungry for the government to be more accountable and responsive.  The possible implementation of Pataki’s legislation would be a step in the right direction to meet the public’s needs. 

After incidents in the NY government past, such as the former labor commissioner being convicted of funneling state funds in exchange for money and the former state Senator, pleading guilty to bribery-related accusations helping his dad’s law firm obtain state contracts, it’s no wonder that the NY public wants a more responsible government to represent them. 

Arizona Doctors Seek Protection Against Malpractice Suits

In the near future, Arizona patients may be asked to waive their right to sue doctors before they receive medical treatment as a way to cut malpractice costs.  Doctors voiced their concerns regarding the trend of malpractice suits during strategy sessions attended by business leaders and local politicians.  At these sessions, the overwhelming opinion about this trend is that it is causing the country’s health care system to suffer and that it is only getting worse. 

Some of the strategies emphasized at the strategy sessions included doctors lobbying their patients for reform, shifting to a contract law system where patients agree to waive their rights to sue, and paying injured patients over time rather than one lump sum payment. Arizona politicians believe that tort reform is needed to reduce what they call “lawsit abuse”. 

Republican Senator, Jon Kyl, tried to pass federal legislation that would limit lawyer fees to $2,000 per hour, then $10,000 per hour, and all the way up to $20,000 per hour, but the bill failed because it won only 37 votes in the Senate. 

Kyl favors federal efforts to limit awards on punitive damages.  Some states that have limited these awards have experience relief from rising medical malpractice premiums.  These caps have only stunted the growth of premiums, but have not decreased the rates. 

Gambling Expansion Allows Growth in Florida School Districts

Florida voters approved a ballot initiative that authorize the expansion of gambling in some Florida counties, including Miami County in return for a big return for education.  The initiative would authorize Florida counties to hold separate referendums that will let voters decide whether to allow Las –Vegas style slot machines at dog and horse racetracks in South Florida. 

The debate over the gambling expansion is very political.  Florida Governor, Jeb Bush, and other prominent lawmakers in the GOP Legislature are greatly opposed to efforts to broaden gaming in Florida.  Proponents of the gambling expansion are attempting to guarantee that the new slots will provide millions of dollars each year for Florida education. 

Bush is warning voters against this education promise.  He believes that the big casinos are enticing voters with a hollow promise of more education funding.  Bush contends that the true costs are significant and real, which is the potential long-term decay of Florida’s traditional industries and the social fabric of the communities. 

Oregon Court Rules Lost Rebates Legal

The 2001 Oregon Legislature transferred over $100 million to the federal Medicaid reimbursement from the state’s special health account fund.  Some anti-tax critics believe this transfer is a scam, and proponents view it as “creative accounting”.  The transfer had the effect of reducing tax refunds by almost one-third under Oregon’s kicker law.  Under the state’s kicker law, taxpayers are refunded tax dollars that exceed Oregon’s projected revenue.  This depends on if the unexpected revenue surpasses the estimate by 2 percent or more.

Although the transfer has caused a lot of heat from anti-tax critics, the Oregon Supreme Court held that the tax return reduction was legal.  Proponents believe the transfer was the right thing to do because they believed that it never made sense that federal money that was set aside for healthcare to be transferred in the form of tax rebates to taxpayers. 

Oregon lawmakers are still awaiting a Supreme Court holding regarding a proposal that will completely change the state’s budget.  Oregon justices are deciding whether cost-cutting strategies aimed at reforming the state’s pension system in 2003 violated contract rights.  The 2003 legislation reduced the long-term obligations of the Public Employees Retirement Systems by almost $8 million.  However, these savings resulted from cutting anticipated benefits.  The lawsuit was filed by a coalition of anti-tax activists against the state. 

China Establishes Workers Compensation Program

China is in the works to establish a common workers compensation standard, which will allocate up to twenty years salary in the event of death of injury from work related accidents that are determined to be the fault of the employer.  The initiative is designed to make it really expensive for employers, especially mining and construction industries employers, who inherently have very dangerous working conditions for their workers.

The plan would encourage employers to take out accident insurance on their staff. The new regulations designed to create greater workplace safety were introduced about one year ago.  Many industries in China depend on migrant workers that are very low-paid.  Many of these industry employers till refuse to buy employee accident coverage.

Just last week, there was a fatal gas explosion that killed more than 200 coal miners in the Liaong region of China named Fuxin. The employer involved with the gas accident was alleged to have forced their coal miners to sign a contract specifying a maximum of $18,860 (in Hong Kong dollars) in the event of a fatal explosion at work.  Chinese central government wants to impose provincial legislative bodies to impose the new workers compensation standard and ensure the enforcement of the regulation as soon as possible. 

WorldCom CFO Admits to “Cooking the Books”

Last week, former WorldCom CFO, Scott Sullivan, testified that his goals to meet Wall Street projections clouded his obligation to follow the law. Sullivan cooked the books by making adjustments that were not necessary in order to meet these high expectations.  Sullivan testified that he cooked WorldCom’s books because WorldCom former chief, Bernard Ebbers, instructed him to meet Wall Street’s earnings and revenue targets.

Sullivan is the only witness to connect Bernard Ebbers to the large fraud scandal at WorldCom.  Sullivan testified that he knew it was wrong to go against the law but that he thought he would make it through without problems.  The primary issue in this case is whether a jury believes that either Sullivan or Ebbers was the ringleader in WorldCom’s large accounting fraud.

The accounting fraud that has caused WorldCom to go into bankruptcy is estimated to be a record $11 billion.  On cross-examination, Sullivan testified that every time these adjustments occurred, only Ebbers and himself were present.  Some critics believe that Sullivan took marching orders to make adjustments from Ebbers, to run and commit fraud on his own free will.