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U.S. Supreme Court skeptical of Intel in retirement fund dispute
WASHINGTON (Reuters) - U.S. Supreme Court justices on Wednesday appeared skeptical of Intel Corp’s bid to avoid a lawsuit accusing it of violating federal law in making employee retirement plan investments that cost beneficiaries hundreds of millions of dollars.
The justices heard an hour of arguments in Intel’s appeal of a lower court ruling reviving the proposed class action lawsuit that a judge decided in 2017 had been filed too late. The case is significant for companies because it could expand the time that many plan beneficiaries have to bring lawsuits, which could lead to higher damages.
Conservative and liberal justices alike seemed to sympathize with the former Intel employee who filed suit in 2015 claiming he did not have “actual knowledge” of the alleged investment problems because he did not read the relevant documents that were only posted online.
“Most people don’t read them, or many,” conservative Justice Brett Kavanaugh said. “So how do you have actual knowledge if you haven’t read it?”
“I must say, I don’t read all the mailings that I get about my investments,” echoed liberal Justice Ruth Bader Ginsburg.
hard for you to read it when you are ded.
At issue is the time period for alleging violations of the Employee Retirement Income Security Act, a federal law requiring plan managers to invest prudently. Beneficiaries generally have six years to sue over ill-advised investment decisions. That deadline is cut to three years if a problem is known sooner.
The lawsuit, filed by former Intel engineer Christopher Sulyma, accused company retirement plans and administrators of breaching their fiduciary duty to the participants by placing an overly heavy emphasis on hedge funds and private equity, in contrast to peer funds. Sulyma, backed by President Donald Trump’s administration in the case, said that while employed at Intel between 2010 and 2012 he was unaware of the alternative investments in the online documents, that they performed poorly or even what hedge funds were.
California-based Intel said the lawsuit should be thrown out because the fund participants knew of the issue more than three years before the lawsuit was filed based on emails the company had sent with links to documents about the investments. The investments were chosen to better diversify the plans’ portfolios, the company said.
The San Francisco-based 9th U.S. Circuit Court of Appeals last year let the case proceed, ruling that the three-year deadline applied only if Sulyma was actually aware of the facts of a violation, not merely that those facts were available.
https://www.reuters.com/article/us-usa-court-intel/u-s-supreme-court-skeptical-of-intel-in-retirement-fund-dispute-idUSKBN1Y82P9
>Former U.S. President Jimmy Carter discharged from hospital after treatment for urinary tract infection.
chek'em
Steve Cohen To Buy 80% Stake In The New York Mets
Yet another corpulent billionaires is about to spend billions to own a franchise sports club, just so he can avoid spending billions in taxes.
According to FOX Sports reporter Ken Rosenthal, Fred Wilpon's Sterling Partners, the owners of the New York Mets, is in talks to sell up to 80% of the MLB team to billionaire Steve Cohen, who is already an investor in the club.
BREAKING: The Sterling Partners and Steve Cohen are negotiating an agreement in which Cohen would increase his investment in the #Mets, per source. Fred Wilpon will remain Control Person and CEO for five years and Jeff Wilpon will remain COO for five-year period as well.
— Ken Rosenthal (@Ken_Rosenthal) December 4, 2019
The transaction, which was confirmed by the club, would value the team at $2.6 billion, according to Bloomberg.
According to the proposed deal, real estate developer and billionaire, Fred Wilpon, the team’s current owner, will remain in his role for at least five years, at which time Cohen will have a path to controlling the franchise. Jeff Wilpon, his son, will remain as the team’s chief operating officer for the five-year period.
Meanwhile Cohen, whose net worth is $9.2 billion, according to the Bloomberg Billionaires Index, will remain as chief executive of Point72 Asset Management.
Fred Wilpon is making the move as part of estate and philanthropic planning. The Wilpons will retain a stake in the franchise they assumed control of in 2002, Bloomberg noted.
So what's in it for Cohen, who may have a ice rink in his Connecticut house, but has not indicated any interest in baseball so far? The answer is simple, and the same as why Steve Ballmer bought the LA Clippers for $2 billion several years ago: tax benefits. In the Clippers case, Ballmer could seek as much as half of the purchase price of the team in tax benefits over the next 15 years, according to accountants and sports business analysts familiar with the financial aspects of team ownership.
The same logic would apply to Cohen and the Mets.Buying a team isn’t like buying a factory full of machines; Cohen gets few physical assets for his $2.6 billion. Instead, he pays top dollar to join a successful league and acquire the rights to a star-studded roster. The IRS offers specific tax breaks to any business loaded with such intangible assets.
So, in addition to taking a normal deduction, Ballmer could claim his team is worth additional millions in terms of selling tickets and driving broadcast revenue.
This added value, he could say, was part of the original purchase price. The IRS would then allow him to amortize a significant portion of the $2.6 billion over a number of years in much the same way a factory owner depreciates aging machinery.
It is hard to pinpoint how much Cohen — or the Mets owners — would benefit because of the tax code’s highly interpretive nature. Regardless, sports business analysts and accountants say owners can seek tax benefits equal to about half of the purchase price.
In short, in a time when the "top 1%" are being hounded for their increasingly more original tax-avoidance schemes, one of the world's most prominent billionaires is about to do just that.
https://www.zerohedge.com/economics/steve-cohen-buy-80-stake-new-york-mets
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