Court rules against HealthSouth in auditor dispute

Headline Legal News 2014/06/16 15:13   Bookmark and Share
The Alabama Supreme Court ruled against Birmingham-based HealthSouth Corp. on Friday in a legal dispute linked to the accounting fraud that rocked the rehabilitation company more than a decade ago.

The justices rejected an appeal filed by HealthSouth in a legal fight involving its one-time auditing company, Ernst & Young.

Shareholders filed a complaint on behalf of HealthSouth blaming Ernst & Young for failing to detect the $2.6 billion accounting scam that occurred under former CEO Richard Scrushy, who was acquitted of criminal charges in 2005. A civil court later held him responsible for the swindle.

An arbitration panel ruled against HealthSouth in a complaint aimed at making Ernst & Young share responsibility for the fraud, and HealthSouth appealed to Jefferson County Circuit Court. That court sided with the auditor, and HealthSouth appealed again.

The Supreme Court, in a decision written by Justice James Main, upheld the ruling against HealthSouth. The justices said there was no evidence the arbitration decision against HealthSouth was fundamentally unfair or that the panel engaged in any misconduct.

Evidence showed HealthSouth inflated its earnings by some $2.6 billion from the late 1990s through the early 2000s, when the scheme was uncovered. Fifteen HealthSouth employees pleaded guilty and jurors convicted one other.

Scrushy blamed everything on underlings but later served time in federal prison after being convicted in a bribery scheme involving former Gov. Don Siegelman, who remains in prison in Oakdale, La.

Scrushy, who maintains his innocence to all charges, now lives in Texas and sometimes lectures about corporate fraud.
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Court: No blanket exemption for police dashcams

Headline Legal News 2014/06/13 11:52   Bookmark and Share
The state Supreme Court has ruled that state dashboard cameras can't be withheld from public disclosure unless they relate to pending litigation.

Five of the high court's members said Thursday that the Seattle Police Department wrongly used a state statute as a blanket exemption to the state's public records act when it denied providing dashboard camera videos to a reporter with KOMO-TV. Their ruling overturns a 2012 King County Superior Court judge's ruling that said the department could withhold the videos for three years.

The majority awarded KOMO attorney fees and sent the case back to the lower court.

Four justices argued that the statute was clear that that the recordings should not be released to the public until completion of any criminal or civil litigation.
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Court rules against homeowners in toxic water case

Headline Legal News 2014/06/10 12:25   Bookmark and Share
The Supreme Court says a group of homeowners in North Carolina can't sue a company that contaminated their drinking water because a state deadline has lapsed.

The justices ruled 7-2 on Monday that state law strictly bars any lawsuit brought more than 10 years after the contamination — even if residents did not realize their water was polluted until years later.

The high court reversed a lower court ruling that said federal environmental laws should allow the lawsuit against electronics manufacturer CTS Corp. to proceed.

The decision is a setback for the families of thousands of former North Carolina-based Marines suing the federal government in a similar case for exposing them to contaminated drinking water at Camp Lejeune. The government is relying on the same state law to avoid liability.
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Top court rejects bail plea of Indian tycoon

Headline Legal News 2014/06/06 14:36   Bookmark and Share
India's Supreme Court Wednesday rejected an appeal by an Indian tycoon accused of a multibillion dollar fraud to be released from jail and allowed house arrest.

Subrata Roy, head of the Sahara India conglomerate, has been jailed since March 4 on charges that his company failed to return billions of dollars to investors. Bail was earlier set at $1.68 billion and the company has struggled to raise the funds.

India's securities regulator has accused Sahara India of raising nearly 200 billion rupees ($3.2 billion) through bonds that were later found to be illegal.

Sahara is well known throughout India because it sponsors the Indian cricket team. The company also sponsors the Indian hockey team and owns a stake in Formula One racing team, Force India.

The company has interests in microfinance, media and entertainment, tourism, health care and real estate, including New York's landmark Plaza Hotel and London's Grosvenor House.

The court Wednesday allowed the Sahara group to sell properties in nine Indian cities after the company said it had not succeeded in raising the $1.68 billion needed to obtain bail for Roy.

The court had earlier rejected a proposal by the company to pay bail in instalments.
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Washington wants pot tax trial in state court

Headline Legal News 2014/06/03 12:22   Bookmark and Share
The state attorney general's office has asked a federal judge in Seattle to dismiss a lawsuit challenging Washington's authority to tax marijuana sales.

In the motion Friday to U.S. District Judge Marsha Pechman, the state says Martin Nickerson failed to appeal the tax assessments in a timely manner and that the issue should be resolved in state court.

The case arises from the state's attempt to collect sales taxes from a medical marijuana dispensary in Bellingham. Attorney Douglas Hiatt, who represents Nickerson, said it could throw a wrench in Washington's plans for collecting taxes on recreational marijuana, too.

The lawsuit challenges Washington state's authority to tax marijuana as long as marijuana remains illegal under federal law.
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Arkansas court says judge went too far on voter ID

Headline Legal News 2014/05/16 14:58   Bookmark and Share

The Arkansas Supreme Court tossed out a judge's ruling striking down the state's voter ID law on Wednesday, but stopped short of ruling on the constitutionality of the measure.

In a 5-2 ruling, justices vacated a Pulaski County judge's decision that the law violates Arkansas' constitution. Pulaski County Circuit Judge Tim Fox had struck down the law in a case that had focused on how absentee ballots are handled under the law, but justices stayed his ruling while they considered an appeal.

Fox also has ruled the law unconstitutional in a separate case but said he wouldn't block its enforcement during this month's primary. That ruling is being appealed to the high court.

Justices said Fox didn't have the authority to strike down the law in the case focusing on absentee ballots. They noted that there was no request before Fox in the case to strike down the law.
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