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Friday, February 13, 2004 - Page updated at 12:39 A.M.
The Seattle sportswear company sued its former insurer, Genesis Insurance, after Genesis rescinded the company's coverage for directors and officers in late 2002. Earlier in that year, Cutter & Buck restated three years' worth of earnings after announcing it had discovered improper accounting maneuvers.
In a ruling this week, U.S. District Judge Marsha Pechman said Genesis was within its rights to rescind the policy because Cutter & Buck "made material misrepresentations with an intent to deceive."
Chief Executive Fran Conley said Cutter & Buck is disappointed in the ruling and is considering whether to appeal. The company, which is now covered under a different insurance policy, has two minor claims pending before the court.
Bank of America Tower lands law firm as tenant
SEATTLE Equity Office Properties' multimillion-dollar upgrades to the Bank of America Tower seem to be paying off. The company said yesterday it had lured Wilson Sonsini Goodrich & Rosati to Seattle's tallest building from the law firm's space at Carillon Point in Kirkland.
The firm, headquartered in Palo Alto, Calif., leased 21,000 square feet and will move its regional office and about 30 employees to the tower in May. Bank of America Tower has suffered more than other premier high rises in downtown Seattle, losing one of its biggest tenants, law firm Preston Gates & Ellis, just before the bottom fell out of the region's real-estate market.
S&P rating not upgraded for Louisiana-Pacific
PRINCETON, N.J. Louisiana-Pacific's higher earnings, cash flow and lower debt levels don't justify an investment-grade credit rating because of its narrow focus on a business vulnerable to price swings, Standard & Poor's said.
As the biggest maker of oriented-strand board, Louisiana-Pacific has seen prices for the wood product more than double in the past year amid a housing boom. The company last year had its first profit since 1999, ending the year with $1 billion in cash.
Those gains and Louisiana-Pacific's promise to keep trimming debt may not help the Portland, company regain the investment-grade ratings it lost in July 2001. Even with a surge in demand, the company's focus on one product makes its income and cash flow subject to wide swings in prices, S&P said.
Louisiana-Pacific executives were scheduled to meet with analysts at S&P and Moody's Investors Service this week to argue that its credit profile has improved. Debt-covenant restrictions that dictate how Louisiana-Pacific can spend its cash would be lifted if the rating is raised from junk status.
Dassault Systemes inks deal for Boeing 7E7 software
PARIS France's Dassault Systemes will provide software that allows Boeing to design, build and test every aspect of its new 7E7 jetliner before production of the jet begins, the companies said yesterday.
The contract, which also includes U.S. hardware and software giant International Business Machines, was valued in the double-digit millions of dollars by the two technology companies.
Boeing's first new plane in a decade is designed to offer greater fuel efficiency and improved economics compared with current aircraft. The plane is expected to enter service in 2008.
Alaska Airlines seeks to add flights to Washington, D.C.
FAIRBANKS Alaska Airlines wants to add four more Washington, D.C. flights and is enlisting customers for help.
The airline needs federal permission for new flights, so it is asking customers to write letters of endorsement.
Alaska already has three flights a day in and out of the D.C. area: one at Ronald Reagan Washington National Airport and two at Dulles International Airport.
The Seattle-based carrier wants four new daily round-trip flights between Reagan National and the West Coast. Two would originate in Seattle and two in Los Angeles. The Seattle flights would provide same-plane service to Fairbanks and, seasonally, to Juneau.
At Reagan National, Congress limits the number of flights to and from places more than 1,250 miles away. Last year, it boosted the slots by six.
Nation / World
Kodak unveils new cameras as digital sales roar ahead
ROCHESTER, N.Y. Eastman Kodak, which sold more digital cameras in the United States during the end-of-year holiday season than any of its Japanese rivals, introduced six new camera models yesterday in hopes of surpassing top-ranked Sony this year.
Kodak is scrambling to make the transition from film to digital photography after getting blind-sided by the swift rise in popularity of digital cameras. It lost ground to Sony, Canon and Olympus and even gave up a chunk of market share to computer giant Hewlett-Packard.
Kodak jumped ahead of Sony, the No. 1 U.S. seller of digital cameras for the past five years, in both November and December, market researchers say.
Its latest EasyShare consumer cameras, priced between $129 and $499, were unveiled yesterday at the annual International Photo Marketing Association trade show in Las Vegas.
Fifteen brokerage firms settle with SEC over mutual funds
WASHINGTON Fifteen brokerage firms accused of overcharging large-scale investors in mutual funds have reached settlements with the Securities and Exchange Commission and the National Association of Securities Dealers that will require them to pay civil penalties totaling some $21.5 million, and will require the brokerages to make refunds to customers, the regulators announced yesterday.
The firms include American Express Financial Advisors, which agreed to pay a $3.7 million fine; Raymond James Financial Services, which is paying $2.6 million; and Wachovia Securities, $4.8 million.
Seven of the 15 firms signed joint settlements with the SEC and the NASD: American Express Financial Advisors; Legg Mason Wood Walker; Linsco/Private Ledger; Raymond James Financial Services; UBS Financial Services; H.D. Vest Investment Securities and Wachovia Securities.
The other eight firms reached accords with the NASD only: Bear, Stearns; Brecek & Young Advisors; Cresap; Kirkpatrick, Pettis, Smith, Polian; Lehman Brothers; David Lerner Associates; Southwest Securities and SWS Financial Services.
Dell had record shipments, 24 percent earnings growth
AUSTIN, Texas Personal computer bellwether Dell reported a 24 percent increase in fourth-quarter earnings yesterday, citing record product shipments during the quarter.
Dell said it earned $749 million, or 29 cents per share, compared with $603 million, or 23 cents a share, in the same quarter a year ago.
Analysts surveyed by Thomson First Call had expected earnings of 28 cents a share.
"Much of the industry's quarterly growth was at the low ends of the desktop and notebook categories, which offer little if any profitability," said Kevin Rollins, president and chief operating officer. "Dell met its operating targets by pursuing profitable growth."
While Dell did see growth in desktop and notebook sales, chief financial officer Jim Schneider and CEO Michael Dell said they've seen an increase in corporate spending.
Dell's revenue was $11.5 billion, up from $9.7 billion in the same quarter last year.
For the year, the company earned $2.6 billion, up from nearly $2.1 billion in fiscal 2003.
Dell shares sank 12 cents to close at $33.57.
Compiled from Seattle Times business staff, Bloomberg News, Reuters and The Associated Press
Copyright © 2004 The Seattle Times Company
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