Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Non-Tech : Auric Goldfinger's Short List -- Ignore unavailable to you. Want to Upgrade?

To: RockyBalboa who wrote (11511)	4/14/2003 2:24:05 PM
From: Glenn Petersen	Respond to of 19428

HealthSouth CEO’s tale of the tape msnbc.com FBI recording reveals Richard Scrushy defending accounting tricks HealthSouth officials quickly had a statue of former CEO Richard Scrushy removed after local radio disk jockeys urged listeners to "liberate" the company by toppling the bronze icon. By Mike Huckman CNBC BIRMINGHAM, Ala., April 14 — Birmingham is no Baghdad. And former HealthSouth Corp. CEO Richard Scrushy is no Saddam Hussein. But their statues have met a similar fate. WHEN A COUPLE of local radio DJs urged listeners last week to “liberate HealthSouth” and topple Scrushy’s statue outside a sports medicine institute, the company beat any would-be vandals to it and had the statue taken down immediately. Meanwhile, William Owens is the man Scrushy’s lawyers claim is trying to literally take down their client. Owens is the former chief financial officer of HealthSouth who wore a wire for the FBI to record a conversation he had with Scrushy last month in the executive suite at HealthSouth headquarters. Owens began by telling Scrushy about his wife’s concern over Owens’ signing of what he said she called phony financial statements. “She said, ‘I’ve been reading about Enron and I’ve been reading about WorldCom.’” Owens is heard saying on the tape. “She said, ‘I’m afraid that if you keep this up you may end up in prison.’” A few minutes later, Scrushy responded to that by saying, “I think what your wife is telling you is right.” The FBI handed over a 10-minute portion of the recording to SEC lawyers to use in their case to keep Scrushy’s assets frozen. The attorneys claim under the recently passed Sarbanes-Oxley law, Scrushy is not allowed to spend money he may have gotten by defrauding investors. But on Friday, U.S. District Court Judge Inge Johnson permitted Scrushy to sell as much as $17 million worth of stock in his brokerage accounts to pay his state and federal taxes. “I think you do need to pay your taxes. It’s a requirement. So I think it’s a good result also,” said Scrushy’s attorney Thomas Sjoblom. Sjoblom argued in court that William Owens recorded Scrushy because he wanted to get back at him for demoting him to CFO after a brief stint as CEO when Owens allegedly failed to overthrow Scrushy as chairman. But on the recording Scrushy, talking to Owens, made veiled references to accounting problems at HealthSouth. “I just wish we could just burn it and get it where we want it to be and just buckle down on everything,” Scrushy is heard saying. “You’re a bright guy. You oughta be able to engineer your way out of what you engineered your way into. Does that make sense?” And Scrushy acknowledged that the scandal may be taking a toll on his home life as well. “I mean, hell yeah, I can’t sleep at night. . .I mean, I’m holding my little baby every night and my wife is out of town. I got my little babies, I got my little boy,” he says. “And the reality is, look at how profitable this company is. Do we really want to trash all this?” But later Scrushy tried to rationalize the alleged fraud. “I am convinced that there are 8,000 companies out there right now that got [expletive] on their books?” he asks. “Hell, yeah. Everyone I know are involved in this. Everyone I know. You know that.” The feds are still investigating whether or how much Scrushy was involved in the cooking of HealthSouth’s books. His lawyers say he had nothing to do with it. In the meantime, Scrushy and his wife Leslie — who has taken to reading a bible in the courthouse and occasionally quotes passages to her husband — are lying low, but holding their heads high. “He has a very strong faith,” Sjoblom said.

To: RockyBalboa who wrote (11511)	4/14/2003 2:50:47 PM
From: TeamTi	Read Replies (1) \| Respond to of 19428

Congratulations! FAO Loses Funding, May Have to Liquidate Monday April 14, 1:41 pm ET NEW YORK (Reuters) - FAO Inc. (NasdaqNM:FAOOQ - News), parent of the storied FAO Schwarz toy store, said on Monday it lost the funding it needed to emerge from bankruptcy and may have to shut down.

To: RockyBalboa who wrote (11511)	4/15/2003 9:02:31 PM
From: TeamTi	Respond to of 19428

lightreading.com Redback Cuts, Procket Picks -------------------------------------------------------------------------------- Redback Networks Inc. (Nasdaq: RBAK - message board) has confirmed that it has made some staff cuts in recent days, though it won't say how many were cut or from what areas of the company. In addition, it looks as if a popular migration trail is being cut across Silicon Valley from Redback to Procket Networks Inc., as more key managers have defected. Edge routing and DSL equipment specialist Redback is set to announce earnings tomorrow, where it will likely go into more details on the layoffs. Sources close to the company say the cuts affected between 30 and 50 people. In other employee activity, Stuart Monks, VP of Redback's SMS (Subscriber Management System) engineering group; Kevin Dickson, VP of SMS product management; and Cary Hayward, director of SMS product management, have all left Redback to join Procket. Monks and Dickson were the founders of Merlin Systems, the startup Redback bought for $57 million in stock back in May 2001. Merlin, founded in March 2000, helped build Redback's SmartEdge 100 product, a smaller version of Redback's Sonet add/drop multiplexer, the SmartEdge 800, that was introduced in January 2001 (see Redback's Got a Mini-Me, Too ). In October 2001, Redback announced it had shelved the product as part of a series of R&D projects that were cancelled in order to cut costs. The Merlin magicians weren't the first Redbackers to hightail it to Procket. Redback's former sales boss Randall Kruep became Procket's CEO in early 2001 (see Kruep Leaves Redback for Procket ). Another Redback expatriate, Pankaj Patel, the former Siara executive who led Redback’s research and development team, has surfaced at archrival Cisco Systems Inc. (Nasdaq: CSCO - message board). Patel left Redback in January. As if that weren't enough to think about, the company is expected to post more losses when it reports earnings tomorrw. Analysts expect Redback to report a loss of 13 cents a share on revenues of $28.7 million for the first quarter of 2003, according to Multex.com Inc. During the year-ago quarter, Redback lost 19 cents a share on revenues of $40.6 million. Meanwhile, Redback's remaining managers continue to stand behind Joel Arnold, one of the four VPs that lead Redback's operations and report to Redback's CEO Kevin Denuccio. Arnold is one of several former Qwest Communications International Inc. (NYSE: Q - message board) executives named in an SEC civil suit alleging that the executives helped inflate the carrier's revenues in 2000 and 2001 (see Redback's Arnold Included in SEC Suit ). Sources close to Redback say Denuccio issued a memo to Redback's employees in late February expressing support for Arnold: "The executive management team and I are fully supportive of Joel, believe in his integrity, and believe that these allegations will not affect his ability to continue executing in his current capacity at Redback." Though Redback announced a handful of customers during the first quarter, investors were heading for the exits on Tuesday. Redback's stock dropped $0.10 (12%) to $0.74 on Tuesday and hasn't traded above $1 since January 15. — Phil Harvey, Senior Editor, Light Reading