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Business today

By Compiled from Times wires
Published May 22, 2003

COKE FACES LAWSUIT: A former Coca-Cola manager claims in a lawsuit that company officials ran a division as "an illegal racketeering enterprise" that included rigging a marketing test and using a slush fund to boost equipment sales. The company says Matthew Whitley filed the suit after Coke refused a demand to pay him $44.4-million to prevent it. Whitley said he was wrongfully fired a few weeks after telling superiors about a "culture of dishonesty" in the fountain division. Whitley, 37, filed the lawsuit Monday in Atlanta. In an internal memo Tuesday, Coke general counsel Deval Patrick called Whitley's allegations "very serious."

TAUBMANS WIN ONE: A federal judge in Michigan suspended her ruling Tuesday that would have stripped A. Alfred Taubman's family of its right to vote any of its shares to block a takeover bid for its shopping mall empire, Taubman Centers. The decision to defer the ruling, pending appeal, is a victory for Taubman Centers, which is the target of a $1.74-billion hostile takeover bid by the Simon Property Group and Westfield America.

CRYO-CELL LOSES MARKETER: Cryo-Cell International Inc. of Clearwater has fired its director of group marketing less than a month after trumpeting her arrival in a news release. Kathy Notarino had been director of national reimbursement and payer contracts for the National Marrow Donor Program before joining Cryo-Cell. She said it was not her choice to leave the troubled stem cell company but declined further comment. The company has a hearing today with Nasdaq regarding possible delisting for failure to submit financial reports.

INCUBATOR GETS HOME: Pinellas County commissioners have agreed to lease 20,000 square feet in Largo's Young-Rainey STAR Center for a business incubator. The incubator will be funded with a two-year grant of $200,000 from the U.S. Department of Energy. The incubator, Suncoast Technology Enterprise Accelerator, will begin interviewing possible tenants when the money arrives, in about a month. Companies must have been in business a minimum of six months, be funded in part by owners and have a manufacturing/technology focus.

HP KEEPS CUTTING: Hewlett-Packard Co. is in the process of cutting 17,900 jobs related to its merger with Compaq Computer Corp. and said it will cut 3,500 more during the second half of the year. At the same time, HP said, it would add 4,000 jobs in other areas of the company. The cuts were announced as HP beat Wall Street's earnings and revenues expectations.

HASBRO SUES KELLOGG: Hasbro Inc. filed a federal trademark lawsuit late Tuesday against Kellogg Co., claiming a promotion appearing on boxes of Frosted Flakes too closely resembles Hasbro's Memory card game. Both the cereal maker and the toy maker have bought the license for characters from Walt Disney Co.'s new movie, Finding Nemo. In a statement, Hasbro said it filed the suit to protect its trademark against "blatant infringement." Kellogg said it would not comment on pending legal matters.

EXECS BUY DHL AIRWAYS: Cargo carrier DHL Airways Inc. said Wednesday it has agreed to sell the company to an investor group led by its new chairman and chief executive, John Dasburg, for $57-million. The cash deal for the Miami-based airline is expected to be completed June 30, pending approval by the Department of Transportation, company spokesman Ray Lutz said. Dasburg will remain in DHL Airways' top posts, which he assumed April 1. The other owners will be Richard C. Blum, chairman of Blum Capital Partners LP, and Michael R. Klein, chairman of CoStar Group Inc., a real estate firm.

AHOLD OF NUMBERS: Dutch retailer Royal Ahold NV said that restated sales numbers for 2001 and 2002 it issued Friday contained "typing errors," prompting another correction. In 2001, group sales were $63.7-billion at current exchange rates, Ahold said Tuesday. On Friday, it had said sales were $63.3-billion, or $417-million less. While describing the errors in detail, an Ahold spokeswoman said Wednesday the mistakes were made when a news release was drawn up Friday.

RATE RISES FOR 4-WEEK BILLS: The interest rate on the U.S. Treasury's four-week bills increased at the government's auction of the securities. The Treasury sold $22-billion of the bills at a discount rate of 1.09 percent, up from a record low of 1 percent last week and the highest since 1.1 percent April 29.

McDONOUGH APPROVED: The Securities and Exchange Commission has approved the appointment of New York Federal Reserve president William McDonough as chairman of the new U.S. accounting oversight board. McDonough won unanimous backing from the SEC's five commissioners after he passed a background check, the SEC said in a statement. McDonough, 69, will start his new job running the Public Company Accounting Oversight Board on June 11.

UAL MAKING QUICK WORK: Nearly half a year into its restructuring, United Airlines says it's making better progress than expected and might move its targeted exit from bankruptcy up from mid-2004 to as early as this fall. But chief financial officer Jake Brace said in comments published Wednesday that the carrier still needs lagging revenue to pick up or it could miss some of its lenders' financial targets this summer. Both Brace and UAL Corp. CEO Glenn Tilton maintain that the carrier is ahead of schedule despite a $1.3-billion first-quarter loss.

GREENSPAN PANS TARIFFS: The Bush administration should abolish its tariffs on steel "quickly" because the sanctions are forcing American steel consumers to move production overseas, Federal Reserve chairman Alan Greenspan told the Joint Economic Committee of Congress. Steel producers credit the 14-month-old tariffs for letting them buy weak rivals and shed onerous pension costs. Auto parts manufacturers and other steel users counter that the rising prices as a result of levies have forced them to cede production to rivals in China or move operations overseas.

[Last modified May 22, 2003, 01:30:54]

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