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Legal     1 - Duke Energy Employee Advocate

Legal - Page 22

"Labor is prior to, and independent of, capital.   Capital is only the fruit of labor,
and could never have existed if labor had not first existed. Labor is the superior
of capital, and deserves much the higher consideration."   –   Abraham Lincoln

Kangaroo Court

Employee Advocate – – April 28, 2004

It all started when two Texas oil men came to Washington. They received a ticket to the White House, courtesy of the Supreme Court. Justice Antonin Scalia, who was appointed by Ronald Reagan, did his part to send G. W. Bush and Dick Cheney on their way to their greatest adventure of all.

Ken Lay, then CEO of Enron, was so chummy with G. W. Bush that he furnished jets for the Bush presidential Campaign. Would people with such ties to the energy industry show any favoritism to that sector? It’s possible. When the California energy crises erupted, Bush looked the other way.

Then there were the infamous Cheney energy task force meetings. These meetings were very secret. One thing is known about them. Absolutely no environmental groups were invited to them. That seemed to be a little one sided for a group that was to recommend energy policy.

Then the wording that ended up in the energy bill was very similar to the demands made by energy executives. Charges were made that the Bush administration excluded environmental groups and bowed to the wishes of its energy pals and Campaign donors.

The excluded groups requested information about the meetings. The General Accounting Office (GAO) requested the same information. All requests were denied. Cheney intended to keep the whole affair hidden from everyone.

In an unprecedented move, the GAO sued Cheney for the documents. Environmental groups also sued Cheney for information. Cheney has not complied with lower court orders to provide the documents. He appealed to the Supreme Court to save him from having to come clean and provide the requested information.

Supreme Court Justice Antonin Scalia left himself wide open for criticism when he accepted favors from V. P. Dick Cheney. He did this shortly before the Cheney case was to come before the Supreme Court.

This was an inept move, but only one of many. Justice Scalia then refused repeated requests for him to recuse himself from the case. It was only natural that his motives for staying on the case be questioned.

The Supreme Court heard the case on Tuesday. According to the Associated Press (AP), the comments of Justice Scalia favored Dick Cheney.

AP reported: “Raising the gravest concerns about unnecessary snooping into the executive branch was Justice Antonin Scalia, who stayed in the case despite conflict-of-interest questions relating to his friendship with Cheney.”

Could this turn of events have possibly been any more predicable?

Meanwhile, the energy bill is such a giveaway program for the energy industry that Congress has refused to pass it. The Republicans continue to cut out a little pork here and there and bringing the bill back. But the bill still smells. Congress should let the horrible energy bill die. Let the new Congress come up with a real energy bill. This one is hopelessly flawed.

Cheney Versus U.S. District Court

Cheney Versus U.S. District Court

Employee Advocate – – April 26, 2004

Tomorrow, the Supreme Court will hear Cheney v. U.S. District Court, 03-475, according to the Associate Press. V. P. Cheney will get to explain why the public should be left in the dark about the energy task force. All lower courts have ruled against Cheney. He was ordered to make the energy information public two years ago. But Cheney has refused to disclose all the documents.

Anne Gearan writes that both sides agree that the case has more to do with politics than law. G. W. Bush always claims that the world will end if he cannot keep everything a secret from the American public. But legal experts do not think this case will have a lot of bearing on the issue of executive privilege.

Lawyer Doug Kendall said "The administration posture here has been incredibly bad politically. It is unseemly for the administration to have tried to create national energy policy by listening almost exclusively to energy industry executives. It would have been a two-day story if the administration simply had provided the information."

No one has filed a friend-of-the-court brief supporting the administration.

The plot thickened when Supreme Court Justice Antonin Scalia refused to recuse himself from the case. He went on a hunting trip with defendant Cheney, shortly after the high court agreed to hear Cheney's appeal. Justice Scalia has been asked to step aside in this case by legal experts, newspapers, and even the Supreme Court. He had refused all requests.

This is not the first time that Justice Scalia has refused to recuse himself from cases that he was a little too involved in. His latest refusal bring back memories of the Florida vote recount in 2000. Justice Scalia had two sons who were lawyers at law firms working for Bush. Also, the wife of Justice Clarence Thomas was recruiting possible candidates for the Bush administration. Both justices failed to recuse themselves.

The Florida Supreme Court had ruled that the recounts could continue. The U. S. Supreme Court overturned this decision by a vote of 5 to 4. Both of the justices, with ties to Bush, voted to overturn the decision of the Florida Supreme Court. That ruling gave G. W. Bush the key to the White House; votes by the public did not matter.

Bush was selected to occupy the White House. He later elected to occupy Iraq.

Justice Scalia’s Downhill Slide

The "Gore Exception"

401(k) Lawsuit Against Kmart

Employee Advocate – – April 18, 2004

The Associated Press reported that an employee lawsuit against former Kmart executives may obtain class-action certification. Workers charge that they lost millions of dollars in retirement benefits when the company declared bankruptcy in 2002.

Former CEO Charles Conaway, chief administrative officer/executive vice president David Rots, former chairman/CEO James Adamson, other former executives and directors were sued in 2002 for defrauding and misleading employees about the financial condition of Kmart.

Over 50,000 employees lost more than $100 million in their 401(k) plans due to the retirement plan being heavily invested in Kmart stock. The stock became worthless.

Glen Connor, plaintiff attorney, wrote that executives "blindly continued to invest all contributions to the company stock fund in Kmart stock, causing the plan assets to be over concentrated."

Wednesday, U.S. District Judge Avern Cohn said "It's likely that I will declare a class action."

Justice Scalia’s Downhill Slide

Employee Advocate – – April 14, 2004

Controversy seems to follow Supreme Court Justice Antonin Scalia around like a black cloud over his head. The justice gave a speech at the Presbyterian Christian High School, in Hattiesburg, Miss. The Associated Press reported that a Deputy Marshal erased a recording that one of its journalists was making of the speech. A Hattiesburg American reporter also had a recording erased by the deputy.

There is some question as to legality of the recordings being erased. The Reporters Committee for Freedom of the Press said that the law was broken and "the fundamental tenets of press freedom."

What do you suppose the speech was about? Justice Scalia was giving a speech about the Constitution!

The Legal Times reported that the journalists quoted the justice as saying "people don't revere the Constitution like they used to."

Justice Scalia claims that he was misquoted. That is precisely why the reporters were recording his speech – so he would not be misquoted! He had their recordings erased, and then complained about being misquoted!

Justice Scalia gave an encore performance at William Carey College. This time he gave a warning before the college speech that no recording would be allowed. But at a following reception, an uproar about taking pictures ensued! Newspaper photographers were told that they could not take pictures, and the justice told WDAM-TV reporters to leave. When non-media guests started taking photos, college officials did a flip-flop on the ban of picture taking.

Jeanna Graves, William Carey spokeswoman, said she was "embarrassed and angry" over the incident.

At Amherst College, he made an attempt to explain away his duck-hunting trip with V. P. Dick Cheney. The trip was made prior to Cheney’s scheduled appearance before the Supreme Court as a defendant. Justice Scalia said "It's acceptable practice to socialize with executive branch officials when there are not personal claims against them. That's all I'm going to say for now. Quack, quack."

If the Justice did not already have a lifetime job, he could have a great future as a stand-up comedian!

In an uncharacteristic move, Justice Scalia has apologized to the reporters, and claimed "I have learned my lesson."

He apparently has not learned his lesson about accepting favors from defendants in upcoming cases. Justice Scalia has steadfastly refused to recuse in the Dick Cheney energy task force case, even after the media exposed his duck-hunting trip with Cheney.

An aversion to the truth may be the root of his problems dealing with the media. It can be difficult for justices, executives, and politicians to operate in secrecy, with the media constantly blabbing the truth.

Misplaced Energy

Settle a Shameful Case

Seattle Times – Editorial – April 13, 2004

Settle a shameful case of Indian trust money

(4/12/04) - The alternately inept and malicious handling of individual Indian trust accounts by the U.S. government grows more shameful as an 8-year-old lawsuit drags out.

Settle this case. Justice is long overdue.

Last week, the special master in the Cobell v. Norton Indian Trust case resigned in disgust, amidst claims the Bush administration thwarted attempts to gather information. Alan Balaran, a Washington, D.C., attorney, said he had evidence the administration allowed energy companies to pay Indians less than non-Indians for oil and gas leases.

Current failings of the Justice and Interior departments fit into a pattern set more than a century ago.

This case involves 500,000 Indian trust-account beneficiaries and will cost taxpayers billions of dollars to replace assets that are lost and cannot be accounted for. Plaintiffs' attorneys expressed hope the appointment of two new mediators might move stalled settlement talks along.

Five previous attempts to settle the case failed because past administrations argued everything had been properly managed, the plaintiffs said in a statement.

Let the Bush administration's appointment of a new negotiating team be a good-faith signal that a long-running and self-serving federal stance has been abandoned.

Dragging out a case the government will not win compounds a shameful history.

Energy Companies Underpaid Indians

Charges of Energy Price Manipulation

Employee Advocate – – April 9, 2004

Four officers of a Reliant Resources subsidiary were charged with energy price manipulation, according to Reuters. The charges stem from the 2000 and 2001 California energy crisis. Millions of dollars in illegal profits were allegedly reaped.

“Attorney General John Ashcroft told a news conference the charges were the first against a corporation for engaging in fraudulent, manipulative trading practices during the crisis, when soaring electricity prices triggered rolling blackouts.”

U.S. attorney Kevin Ryan said "By shutting off power plants to boost the cost of electricity, Reliant's conduct is alleged to have left millions of consumers vulnerable to the higher costs and potential blackouts at the beginning of one of the worst energy crises in history. Faced with evidence of widespread fraud within the company, Reliant chose to be uncooperative during the federal investigation."

The indictment included charges of conspiracy to commit wire fraud and commodities manipulation; wire fraud; and commodities manipulation.

The other “Big5” energy companies in California were Duke Energy Corp., Dynegy Inc., Mirant Corp., and a partnership between Williams Cos Inc. and AES Corp.

Duke Settles Some California Charges

Proving Age Discrimination

New York Times – Editorial – April 3, 2004

(Published: April 1, 2004) - The Age Discrimination in Employment Act was intended to protect older workers from bias. Federal courts, however, have frequently given the law an unduly narrow interpretation, leaving older Americans vulnerable to unfair treatment. This week, the Supreme Court accepted a case that can rectify this problem — if it decides that older workers can rely on the same burden of proof as plaintiffs in cases of race and sex bias. Doing otherwise would leave millions of working Americans who are 40 or older vulnerable to mistreatment.

The age-bias law's text almost exactly tracks the language of Title VII of the Civil Rights Act of 1964, which bars race and sex discrimination. Under Title VII, plaintiffs can make their case by showing "disparate impact" — that is, that an employer's actions have an unequal impact on their group. After such a showing, the employer has the burden of proving that its supposedly neutral policy serves a legitimate purpose. The disparate-impact standard is important because it is often impossible to prove an employer's intent to discriminate.

In the case the Supreme Court agreed to hear, a pay-discrimination suit by Jackson, Miss., police officers, the United States Court of Appeals for the Fifth Circuit, based in New Orleans, held that age claims could not prevail solely on a showing of disparate impact. The plaintiffs must establish an employer's intent to discriminate. This unnecessarily narrow reading of the age-bias law would make it too easy for employers to discriminate against older workers. Other appeals courts have reached the opposite conclusion, which is more in keeping with Congress's intent in passing the law.

The federal courts have long shown hostility to age-bias claims. Judges often bend over backward to interpret the laws against older workers and ignore evidence of age discrimination. In one case, a federal court ruled that there had been no age discrimination when a 56-year-old worker was fired weeks after his supervisor had told him, "O'Connor, you are too damn old for this kind of work."

Supreme Court justices, who often work well into their 80's, know firsthand the potential of older workers. They should make sure that other older Americans have the right to live up to that potential.

Release the Energy Documents

Employee Advocate – – April 2, 2004

A federal judge ordered that more secret energy documents be released, according to the Associated Press. Dick Cheney has been trying to keep the White House energy task force documents hidden from the public for years.

Judicial Watch and the Sierra Club have sued to obtain the records. They are inquiring into whether energy executives and lobbyists helped draft a policy friendly to energy corporations. The General Accounting Office has previously sued for this information.

A federal court ruling two years ago ordered the release of the information, but Cheney has refused to release all of it. A separate lawsuit is now before the Supreme Court. Justice Antonin Scalia has tarnished the Supreme Court by refusing to step aside in the Cheney case, after going on a recent hunting trip with him.

About 40,000 documents have been released, due to court orders, but Cheney is still sitting on 100,000 documents.

Judicial Watch President Tom Fitton said "This is a brushback to the government. I read it to mean we will finally get documents from the heart of the energy task force."

Protecting Corporations

'Just Get 'Em'

Employee Advocate – – March 29, 2004

Laid-off employees of Shelby Yarn won a settlement of over $2 million, according to the Associated Press. The award, to be divided among 636 people, will not be the greatest in history: $988.92 per employee. But the workers were adamant in demanding some victory, even if only a small victory. The settlement is for back pay and unpaid medical expenses.

Max Gardner III said "What employees told me is they at least wanted a moral victory. They wanted them to pay and wanted to be able to say, `Those guys put profits over people.' Workers said to me, `I don't care if we get 100 dollars, 50 dollars or whatever - just get 'em.' "

The sweetest part of the deal is that the money will come out of the pockets of the CEO, directors, other former officers, and owners. CEO Sidney Kosann will pay $200,000 of the settlement.

Shelby Yarn closed in January 2000. A lavish caviar-and-champagne cruse was taken by Kosann, about the time the plant closed.

Attorney Mark Fancher said "There was a deliberate design to make life difficult for the workers.”

Class Action Bias Suit Against Xerox

Employee Advocate – – March 25, 2004

The New York Law Journal reported that an employee lawsuit against Xerox has received class action status. Black sales workers accused Xerox of failing to promote them and assigning them to unprofitable territories.

Warren v. Xerox Corp., 01 CV 2909 was filed in 2001.

Xerox Offers Cash Balance Pension Settlement

Justice Scalia is in the Wrong Line of Work

Seattle Times – E. J. Dionne – March 24, 2004

FORT LAUDERDALE, Fla. — Perhaps because I'm in Florida, I can't stop thinking about that bizarre memo Supreme Court Justice Antonin Scalia issued last week. It's the one in which the justice heaped scorn and ridicule on all who questioned whether he could be fair in deciding whether Vice President Dick Cheney should have to disclose which oil and gas bigwigs he consulted when he ran President Bush's energy task force.

Let me admit: My view is that Scalia should stay out of any case involving the political interests of this administration. Here, after all, is the man who played such a central role in putting Bush and Cheney into office through that abominable Bush v. Gore decision. How can the kingmaker be expected to offer a fair judgment on the king and his hand-picked deputy?

But forget the past: Scalia's own argument for why he should stay on the Cheney case offers the best evidence for why he should get off.

The 21-page Scalia memo is, in part, a heartwarming buddy story. Scalia fondly describes his tradition of going duck hunting at the camp of a friend named Wallace Carline. "During my December 2002 visit, I learned that Mr. Carline was an admirer of Vice President Cheney," Scalia wrote. "Knowing that the vice president, with whom I am well acquainted (from our years serving together in the Ford administration), is an enthusiastic duck-hunter, I asked whether Mr. Carline would like to invite him to our next year's hunt.

"The answer was yes," Scalia went on. "I conveyed the invitation (with my own warm recommendation) in the spring of 2003 and received an acceptance (subject, of course, to any superseding demands on the vice president's time) in the summer. The vice president said that if he did go, I would be welcome to fly down to Louisiana with him."

Please read those paragraphs over a couple of times. Is there any doubt that this is a justice who is great friends with the person whose case he is deciding? Would a rational person doubt that, all things being equal, the judge just might tilt toward the man with whom he is so "well acquainted"?

Imagine you were in a bitter court fight with a former business partner. Would you want the judge in your case to be someone who went duck hunting with your opponent and flew to the hunt on your opponent's plane? Would it make you feel confident to know that the judge was in a position to issue a "warm recommendation" that your opponent join a particular hunting expedition and thus make one of the judge's friends — an "admirer" of your opponent in the case — feel good?

And now consider that you, as a citizen, have a right to know with whom Cheney consulted in writing an energy bill that was overwhelmingly tilted toward the interests of an industry in which the vice president was once a central player.

Scalia admits that recusal might be in order "where the personal fortune or the personal freedom of the friend is at issue." But not to worry. What's at stake here are only Cheney's political fortunes, the interests of the industry that Cheney once worked for and the public's right to know. No big deal.

This is a scandal. Because of ideological connivance across the branches of our political system, we are abandoning the checks and balances that make our government work. Scalia put aside his own longstanding convictions on issues involving states' rights and equal protection to find a way to put Bush and Cheney in office. Now he says we shouldn't worry that he is friendly with the guy whose case he is deciding in the middle of another election campaign.

Citing past rulings, Scalia wrote in his apologia that his "recusal would be required if, by reason of the actions described above, my 'impartiality might reasonably be questioned.' "

True, Scalia's impartiality can't be questioned. It can't even be imagined. The justice's memo makes clear that he's in the wrong line of work.

A fierce ideologue and a staunch partisan ally of the administration he helped bring to power, Scalia is also very smart and engaging. He belongs in a great law school or in politics. He'd be a great commentator and not a bad comedian. But does he belong on a court where he has to pretend to believe in deciding cases on the merits?

If he can't see why his behavior in this case raises such serious doubts in the minds of his adversaries, what else is he missing?

Supreme Court Conflict of Interest

A Subpoena for Deloitte & Touche

Employee Advocate – – March 20, 2004

Deloitte & Touche has more legal problems, according to The Charlotte Observer. The N.C. Employment Security Commission subpoenaed Deloitte & Touche documents concerning questionable tax shelters.

Deloitte & Touche is the first accounting firm in North Carolina to be linked to possible improprieties involving tax shelters to reduce corporate unemployment-insurance taxes.

The Commission feels that the shelters illegally deprive the state of tens of millions of tax dollars. This is money that should be available to unemployed workers.

Previous article about Duke Energy’s auditor, Deloitte & Touche:

Fraud Claims Against Deloitte Touche

Dole Official Guilty of Fraud

Employee Advocate - - March 20, 2004

The Associated Press reported that a former official of the Elizabeth Dole 2002 election campaign has pleaded guilty to mail fraud. Over $174,000 in campaign money was embezzled. Earl Allen Haywood is facing 20 years in prison.

Mr. Haywood has also raised money for Robin Hayes.

Enron Aided Dole

Supreme Court Conflict of Interest

Employee Advocate – – March 18, 2004

Today, Supreme Court Justice Antonin Scalia refused to recuse himself from the V. P. Dick Cheney energy task force case, according to the Associated Press. Requests for the judge to remove himself have been made by the Sierra Club, congressmen, legal experts, dozens of newspapers and even the U.S. Supreme Court. Justice Scalia remains oblivious to all appeals to block this obvious conflict of interest.

If Justice Scalia wanted to get his pal off the hook, he should have waited until after the case was heard to go on the duck hunting trip with Dick Cheney. Since the Bush administration came to Washington, no one even attempts to hide the government by cronyism.

It all started when Dick Cheney tried to keep the details of the energy task force meetings hidden from the public. The Sierra Club was forced to sue for the information. Even the General Accounting Office took the unprecedented move of filing a lawsuit against Dick Cheney.

Recent court rulings have been going against V. P. Cheney. His only hope of keeping the American public in the dark is for his old duck hunting pal to save him.

There are requirements for judges to disqualify themselves if their impartiality "might reasonably be questioned." But the kicker is that Supreme Court justices have total discretion in making the call. Their decisions are final!

The law may as well read: “If Supreme Court justices want to take bribes to influence upcoming cases, that is fine and dandy.”

The secret energy meetings resulted in the notorious energy bill. This bill is nothing more than a giveaway program for the energy industry. The bill is so putrid that Congress has refused to pass it. Even after some of the pork has been cut out, the bill still smells and continues to languish in Congress.

The Antics of Justice Scalia

EPA Sued Over Contamination

Employee Advocate – – March 16, 2004

Agencies that were created to protect the public are now being used to mislead American citizens. Reuters reported that the citizens of New York have filed a lawsuit against the Environmental Protection Agency (EPA) over contamination from 9/11 debris.

The suit is seeking class-action status. The EPA is charged with avoiding its legal responsibility for contamination cleanup.

Last year, The New York Times reported that the EPA lied to the people after 9/11 and said the air was safe to breathe.

Federal Agencies Turn on Citizens

Unusual Asbestos Case

Employee Advocate – – March 10, 2004

A $6 billion asbestos lawsuit will begin in Angleton Texas, according to the Texas Lawyer. Kelly-Moore Paint Co. Inc. has been burned in the past by asbestos litigation. Now the company is suing Union Carbide Corp. and UCC's successor, Dow Chemical Co.

Kelly-Moore is seeking treble punitive damages because the defendants allegedly did not reveal the risks involved in using asbestos-containing products.

Mass Murder Charges

Employee Advocate – – March 4, 2004

The AFP reported that Stop the War, a coalition of groups opposed to the Iraq invasion, intends to bring mass murder charges against G. W. Bush and Tony Blair. The charges are to be filed in the International Criminal Court in The Hague.

Chris Coverdale, Stop the War spokesman, told Sky News: "What has happened is the mass murder of 20,000 or so Iraqis. We have to ensure that Bush and Blair and all the others associated with that decision to attack and kill Iraqis are held to account for it ."

Stop the War has asked that the accusations be investigated by the police, the prosecution service and the nation's top legal official, Attorney General Lord Goldsmith. Mr. Coverdale said that if national level requests are refused, Stop the War will be "entitled to approach the prosecutor in The Hague to ensure and ask him to initiate an investigation and a criminal prosecution of the offenders."

Mr. Coverdale said "The war with Iraq was illegal but, furthermore, crimes were committed. Therefore you want to ensure that people who have committed the crimes answer for them in court."

Articles in the United Nations charter forbid war, according to Chris Coverdale.

The Antics of Justice Scalia

Employee Advocate – – March 3, 2004

Justice Antonin Scalia has been ignoring all requests for him to step aside in the Dick Cheney energy task force case. He continues to pretend that he does not see a conflict of interest in his accepting gifts from Cheney before the court date.

The U.S. Supreme Court is trying to draw Justice Scalia a big picture that he can grasp. It referred to him a request that he remove himself from the case, according to Reuters. His duck-hunting trip with Cheney has brought questions of his impartiality. More to the point, it looks like Cheney has bought him off.

The more Justice Scalia protests, the more suspicious he looks.

The Sierra Club had to sue Cheney for keeping energy task force information a secret from the public. Cheney has not complied with lower court ruling to turn over the data, and the case is bound for the Supreme Court.

The Sierra Club filed a motion that Scalia disqualify himself from the case because of "an appearance of impropriety."

The motion stated that Scalia's removal would "restore public confidence in the integrity of our nation's highest court." That may have been an overstatement. It would help dampen the image of justices with price tags around their necks.

When one is in quicksand, thrashing about always makes it worse. Scalia's steadfast refusal to recuse himself has brought about other scrutiny. New questions have been asked about another hunting trip he took in 2001.

The Los Angeles Times reported that Justice Antonin Scalia was the guest of a law school and went pheasant hunting on a trip arranged by the school's dean. This occurred within weeks of hearing two cases in which the dean was a lead attorney.

Justice Scalia and Mr. Cheney

Justice Scalia and Mr. Cheney

New York Times – Editorial – March 3, 2004

(February 28, 2004) - Justice Antonin Scalia went duck hunting with Vice President Dick Cheney in January, just weeks after the Supreme Court accepted an important case involving Mr. Cheney. There were widespread calls on Justice Scalia to recuse himself, which he refused. Now it turns out that Justice Scalia accepted free air travel from Mr. Cheney, making the case for recusal far stronger. And there are reports of questionable contacts between Justice Scalia and another person with a case before him. In the interest of justice, and of the court's reputation, Justice Scalia should step aside in Mr. Cheney's case.

The Supreme Court has accepted Mr. Cheney's appeal of a lower-court order requiring him to reveal some of the people who appeared before his secret energy task force in 2001. With the appeal pending, Justice Scalia went duck hunting with Mr. Cheney and accepted free rides for himself and his daughter on Air Force Two. The Los Angeles Times reported yesterday that two years ago, Justice Scalia went pheasant hunting as a guest of the dean of the University of Kansas Law School. Two weeks later, the dean appeared before the Supreme Court, representing the State of Kansas in a prison case.

The law says a federal judge must recuse himself in proceedings where his "impartiality might be questioned." What matters, the Supreme Court has held, is not the reality of bias, but its appearance. By vacationing in a small group with Mr. Cheney and taking things of value, Justice Scalia created an appearance of bias in Mr. Cheney's favor. The Kansas trip is less clear-cut because it was with a lawyer, not a party to a lawsuit. But it still raises an appearance of partiality (the lawyer for the other side in the case would certainly have had reason to feel disadvantaged) and should have been avoided.

Recusal rules protect not only litigants, but also the court itself. Justice Scalia's actions have again made the court fodder for late-night comedy, as it was after the 2000 election. If Justice Scalia stays on the case and votes in Mr. Cheney's favor, the court will no doubt face more criticism. Justice Scalia should recuse himself, either of his own volition or with the encouragement of his colleagues.

Stop Energy Bill Train Wreck

IBM Owes Retroactive Pensions!

Employee Advocate – – February 19, 2004

IBM owes employees retroactive pension payments, according to Brian Bergstein’s Associated Press article. It all started with corporate greed and a cash balance pension conversion.

Last July, Judge G. Patrick Murphy ruled that the IBM cash balance pension plan was age discriminatory. There is nothing too hard to comprehend about that ruling. The ruling made official what employees have known for years.

But you know the routine. When a corporation is caught red-handed, it will invariably start grasping at straws. It will try anything to get out of paying-up – anything! No plea is too nonsensical to try. Check this one out:

IBM argued that it shouldn't be forced to make retroactive payments because it could not have foreseen that the cash balance plan would be declared illegal. Bwahahaha!

That is like saying “Your Honor, could I please be excused from all accountability because I am stupid!” Bwahahaha!

Here's one: “Your Honor, please excuse me for robbing 27 banks because I could not foresee that I would get caught!” Bwahahaha!

IBM will probably be enshrined in the Dumb Crook News forever.

On February 12, 2004, Judge Murphy wrote: “The prohibition against age discrimination existed long before the appearance of cash balance plans. All that has changed is IBM's clever, but ineffectual, response to law that it finds too restrictive for its business model.”

The courts offer no balm for the truly stupid. What tripped up IBM - greed or stupidity? Clearly, it was both. When a corporation is blinded by greed, stupid decisions will follow. IBM claimed to have been “blindsided.” IBM was blindsided by pure GREED.

The damages to be paid by IBM have not been determined. One IBM estimate is $6 billion.

Other corporations have drunk from the same witches’ brew as IBM. They are no doubt worried, now that IBM is lying on the ground kicking.

Duke Energy made a similar cash balance pension conversion before IBM. Duke used one of the same actuarial firms that IBM used. Duke used the same dumb excuses to try to explain the injustice away.

Is IBM Following Duke?

Georgia-Pacific Settles Pension Lawsuit

Employee Advocate – – February 17, 2004

After seven years of litigation, Georgia-Pacific Corp. reached an agreement with former employees to settle a class action pension lawsuit, according to a company press release. Georgia-Pacific was alleged to have underpaid plan participants who terminated employment and received lump sum distributions from the plan.

Additional pension benefits of $67 million dollars will be paid.

Third Strike for Duke

Employee Advocate – – February 17, 2004

Duke Energy tried to maintain a monopoly on gas processing in Panola County, Texas, according to the Houston Business Journal. Last month, the U.S. Court of Appeals for the Fifth Circuit ruled against Duke. The ruling against Duke by the U.S. District Court for the Eastern District of Texas was upheld. An arbitrator previously ruled that Duke Energy Fuels LLC and Duke Energy Field Services Inc. illegally maintained their monopoly power in Panola County.

Shareholder Democracy

Employee Advocate – – February 14, 2004

Corporations often use any tactic to keep their shareholders powerless. The MONY Group sought a preliminary injunction against shareholders using duplicate proxy cards, according to the New York Law Journal. The corporate line was that the duplicate cards triggered the filing and disclosure requirements of rules passed pursuant to § 14(a) of the Securities Exchange Act of 1934.

As it turns out, there is a SEC exemption to these requirements in Rule 14a-2(b)(1), adopted in 1992. A release stated “The federal proxy rules have created unnecessary regulatory impediments to communication among shareholders and others to the effective use of shareholder voting rights.”

Judge Richard J. Holwell denied the injunction in The MONY Group Inc. v. Highfields Capital Management, 04 Civ. 0916.

Court May Block Duke Project

Coastal Alliance on Plant Expansion – Press Release – February 12, 2004

California regulators will be asked to reconsider allowing Duke Energy to use water out of the Morro Bay National Estuary to cool its proposed new Morro Bay Power Plant in light of a major federal appellate court decision.

The decision concluded that power plant owners may not rely on restoration of marine-related habitat to compensate for the killing of fish larvae when sea water is pumped into plants for cooling generators. That process is known as once-through cooling.

A panel of the California Energy Commission (CEC) had tentatively agreed and the staff of the Regional Water Quality Control Board had recommended that Duke should be allowed to use water from the Estuary for a new plant if the resulting huge loss of crab and fish larvae were mitigated by ³habitat enhancement,² a form of restoration.

A three-judge panel of the U.S. Court of Appeals for the Second Circuit in New York said ³we find that the EPA (Environmental Protection Agency) exceeded its authority by allowing compliance with section 316(b) (of the U.S. Clean Water Act) through restoration methods.²

The Feb. 3 decision agreed with EPA rules mandating closed-cycle cooling as the national minimum technology for new power plants and said dry cooling is a type of such technology that would be acceptable.

The court indicated that minimum technology standard also would apply to existing plants. The proposed new Duke plant in Morro Bay is considered an existing plant because it would replace an existing plant.

The far-reaching decision will affect many new and replacement power plant projects along the California coast as well as throughout the nation. The California plants include Moss Landing, which is still before the courts on appeal over allowed use by the regional water board of habitat restoration to mitigate killing of larvae with once-through cooling.

³This effectively marks the end of once-through cooling at new facilities,² said Alex Matthiessen of the Hudson Riverkeeper group, one of the plaintiffs in the suit against EPA . ³We’re extremely pleased that the court prohibited the use of restoration measures as a ruse to avoid installing state-of-the-art technology.²

³This is a tremendous victory for our nation¹s waters, and one that will protect billions of fish from the needless slaughter by power plants,² said Reed Super, lead attorney for the environmental coalition in the litigation. ³EPA recognized, and the federal court has now confirmed, that virtually every new plant can and must install closed-cycle cooling technology to protect aquatic organisms.²

³We don¹t want the CEC and regional water board wasting their time reviewing the Duke project with once-through cooling mitigated by habitat enhancement when those kinds of restoration measures have been prohibited,² said Jack McCurdy, co-president of the Coastal Alliance on Plant Expansion (CAPE).

CAPE, a nonprofit citizens group that is an intervenor in the CEC review of the Duke project, has asked its attorneys to file documents requesting the CEC to reopen its review of the Duke project and the water board staff to reconsider its recommendations to the board, which is scheduled to hold an evidentiary hearing on the project on April 3.

Under habitat enhancement plans supported by a panel of the CEC and the water board staff, habitat would be bought with Duke funds and improved to reduce sedimentation of the Estuary in return for allowing Duke to continue to divert estuary water, killing between 16% and 33% of the crab and fish larvae, according to marine scientists hired by regulatory agencies.

CAPE and its attorneys will argue in the documents that under the federal court decision, habitat enhancement proposed by Duke is not a permissible mitigation for once-through cooling in Morro Bay. If reconsideration is granted, the case, which has been under CEC and water board review since Oct. 23, 2000, would be further delayed.

Even before the decision, habitat enhancement was opposed by the CEC staff, the California Coastal Commission, the California Department of Fish and Game and the National Marine Fisheries Services. Those agencies as well as the CEC Presiding Committee and the water board staff all agree that the loss of larvae represents a significant adverse impact under federal law and must be compensated for. They differ on compensation, all but the Committee and water board staff supporting dry cooling.

CAPE also has advocated dry cooling for the proposed Morro Bay plant. Although the court decision does not require dry cooling, it says it can be considered along with closed-cycle wet cooling, which it said was preferable.

Duke officials have said they would not build a new plant to replace the existing one, which was constructed in the 1950s an 1960s, if dry cooling were required. But they also have said more recently that, even if habitat enhancement were to be allowed, construction of the new plant depends on whether there is a sufficient demand for energy at the time approval is granted, other economic considerations and the regulatory climate in the state.

The court decision applies directly to the CEC and water board staff conclusions that habitat enhancement is acceptable as compensation for once-through cooling because the preliminary CEC decision was based on a finding that habitat enhancement is a permissible mitigation measure under the Clean Water Act, and the water board administers the same law in determining whether power plants may be granted permits.

The court struck down the EPA regulations on restoration that implement Section 316 (b) of the Clean Water Act, which is administered by the EPA as well as some states, including California.

The court¹s ruling dealt with EPA rules for new power plants. However, the court said in reaching its conclusions ³no distinction is...made between new and existing structures...²

However, attorneys for the environmental coalition said they intend to ask the EPA is reconsider pending new rules for existing plants, which allow for habitat restoration as mitigation and were due to be issued this month.

The court decision will serve as guidance for courts and regulators throughout the United States, attorneys said.

At issue before the court was whether habitat enhancement or restoration could be substituted for ³best available technology² that eliminates the killing of fish by power plants. Habitat enhancement or restoration entails improving, and in some cases buying, wildlife habitat to make up for allowing power plants to divert sea water for cooling its generators and killing fish swept up in the water.

Best available technology consists of dry cooling, closed-cycle wet cooling or a hybrid of both. Dry cooling recirculates a limited amount of fresh water that is cooled by banks of fans. Closed-cycle wet cooling also circulates a limited supply of fresh water through cooling towers. Hybrids are a combination of both.

Key findings of the Second Circuit decision:

--Allowing restoration as mitigation for power plant impact is ³plainly inconsistent with the statute¹s text and Congress¹s intent beneficial to the environment, have nothing to do with the location, the design, the construction, or the capacity of cooling water intake structures, because they are unrelated to the structures themselves.²

--²Restoration measures correct for the adverse environmental impacts of impingement and entrainment; they do not minimize those impacts in the first place. Similarly, restoration measures would allow a facility, at least in theory, to impinge and entrain unlimited numbers of organisms provided that other steps maintained acceptable water quality, here measured by wildlife levels as opposed to pollutant concentration.

--We think the EPA's own findings reveal that restoration measures are inconsistent with Congress¹s intent that the ³design² of intake structures be regulated directly, based on the best technology available, and without resort in the first instance to water quality measurements.

--...we note that Congress rejected a proposed amendment to section 316(b) that would have explicitly allowed restoration measures.

--Accordingly, we find that the EPA exceeded its authority by allowing compliance with section 316(b) through restoration methods, and we remand that aspect of the Rule.

--...restoration measures, which we have already determined contradict the plain meaning of the Clean Water Act.

Morro Bay Plant is Half Dead

Legal - Page 21