AMR Corp.’s American Airlines and U.S. Airways are joining forces in an $11 billion merger to create the world’s largest airline company. According to the terms of the deal, AMR bankruptcy creditors will own 72% of the new company while U.S. Airways shareholders will own 28%. Doug Parker, CEO of U.S. Airways, will continue to serve as chief of the new airline, while AMR CEO Tom Horton will become the non-executive chairman. Horton will get a performance payment for successfully guiding AMR through bankruptcy. Read more…
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Archive for the ‘Breaking News’ Category
American Airlines and US Airways announce $11 billion merger
Dell going private for $13.64 per share
Dell has announced a private buyout deal valued at approximately $24.4 billion, which will be the biggest leverage buyout since the financial meltdown. Michael Dell, along with Silver Lake Management LLC, will offer $13.65 per share — a 25% premium to Dell’s trading price before rumors of the deal surfaced on January 11, but below the 52 week high of $18.32 per share. Microsoft Corporation will contribute $2 billion to the deal in an effort to support “the long-term success of the entire PC ecosystem.”
US Supreme Court accepts certiorari in CAFA case
The United States Supreme Court granted certiorari in a case in which the plaintiff stipulated to less than $5 million in damages to deprive the federal courts of jurisdiction to hear the case under the Class Action Fairness Act of 2005 (“CAFA”). The case is entitled Standard Fire Insurance Company v. Knowles. The U.S. Supreme Court framed the issue to be decided as follows:
Last term, this Court held that in a putative class action “the mere proposal of a class …could not bind persons who were not parties.” Smith v. Bayer Corp., 131 S. Ct. 2368, 2382 (2011). Read more…
CFPB to investigate consumer impact of arbitration
The Consumer Financial Protection Bureau (CFPB), a government agency looking “to make markets for consumer financial products and services work for Americans,” recently announced the launch of a public inquiry into how consumers and financial services companies are affected by arbitration and arbitration clauses. Through the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Congress requires the CFPB to study this topic and gives the CFPB the power to issue regulations for the protection of consumers. Read more…
Consumer Financial Protection Bureau proposes rule to supervise larger participants in consumer debt collection and consumer reporting markets
The Consumer Financial Protection Bureau (CFPB) today announced a proposed rule to include debt collectors and consumer reporting agencies under its nonbank supervision program. This would mark the first time these important and far-reaching consumer financial market participants are subject to federal supervision.
“Consumer financial products and services have become more complex over the years and they have expanded well beyond traditional banks,” said Richard Cordray, CFPB Director. “Our proposed rule would mean that those debt collectors and credit reporting agencies that qualify as larger participants are subject to the same supervision process that we apply to the banks. This oversight would help restore confidence that the federal government is standing beside the American consumer.” Read more…
Two senators introduce bill to allow suits v. cell companies
Two senators introduced a bill on October 4, to prohibit wireless companies from having clauses in contracts that prohibit consumers from suing the companies because of hidden fees or other contract disputes.
Senators Richard Blumenthal of Connecticut and Al Franken of Minnesota introduced the measure, which would ban the common practice of putting clauses in wireless phone and data contracts that require consumers to use binding arbitration in the case of a dispute. Read more…
