Month: October 2012

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Bluebird: Walmart Wants To Be Your “Every Day Low Price” Bank.

 

Frustrated with your bank’s surprise fees and minute interest rates? Shop at Walmart? You may find a solution to your woes in an unusual but convenient location: on the “Every Day Low Price” stores’ shelves. Bluebird, the child of a Walmart and American Express partnership, will offer a prepaid, easy-to-refill, low fee debit account and card that aims to attract disgruntled bank customers and millions of “underbanked” households. The product is poised to change the banking industry (to the dismay of banks) by offering traditional banking services from a non-bank, but consumer activists have voiced concern over the legitimacy of Walmart’s foray into banking and the potential for abuse in the relatively unregulated area of prepaid card accounts.

 

In its quest to be America’s neighborhood “everything” store, Walmart has taken aim at the personal banking industry. The “underbanked” market, populated by “customers who use few, if any, … Read the rest

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Let Organizational Sentencing Get Creative

Earlier this month a United Kingdom court took their turn on stage in the world-wide Apple v. Samsung dispute over copyright infringement. The court upheld a July ruling which took a slap at Apple. This slap did not consist of incarceration or a monetary fine, but instead brought Apple a taste of public shame. The court ruled that Apple must place a link to the ruling on its webpage run advertisements in prominent British magazines saying that Apple is not a copycat. The appeal court stated, “The acknowledgment must come from the horse’s mouth.”[1] This was a small demonstration of a court taking steps to actually hit an organization where it hurts.  In this particular case, Apple was required to tarnish its image.

            While corporations are not people, they are in many regards citizens of their respective states. This privilege of citizenship comes with a great deal of … Read the rest

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Say-On-Pay: The First Results Are In

Pursuant to enacted legislation, shareholders of publicly owned companies are entitled to hold a non-binding vote on executive compensation packages (say-on-pay). With the 2011 say-on-pay votes complete and a substantial portion of the 2012 say-on-pay votes well underway, analysis of all the available data is beginning to give say-on-pay supporters reason to celebrate.

 

During the first Congressional hearing into the financial crisis, Richard Fuld, the former Chief Executive Officer of Lehman Brothers, was forced to defend his receipt of $484 million in salary, bonuses, and stock options between 2000-2008 http://abcnews.go.com/Blotter/story?id=5965360&page=1#.UIFzH6DNlFI. Part of his explanation was to suggest that, because the collapse of Lehman relegated his stock worthless, his actual earnings were closer to $350 million (Id.). He conceded, “That’s still a lot of money” (Id.).

 

That sure is a lot of money for someone who, by virtue of his title as CEO, bears responsibility for the taxpayer … Read the rest

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Non-Lawyers Owning Law Firms

Associate classes are smaller. Partners are leaving firms. Equity partnerships are off the table for promoted associates. Mid-size firms only want laterals. Law firm hiring is not looking great these days. As the recession wages on law firms, and clients for that matter, are tightening up. Firms don’t have the work available to hire new associates. For the associates there, firms can’t afford to provide partnership, let alone equity partnership. Perhaps part of the problem is the model by which law firms have operated. Unlike most other businesses (and the practice of law for-profit is as much a business as anything else), law firms are not open for outside ownership and investment. Rather firms’ own principals are their owners. With dwindling work, it stands to reason new equity partners might not see returns on their initial investments, hence limitations on equity partnerships. Outside of America, other countries like England and … Read the rest

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Student Loans: Trading Your Life for a Degree

            Many of today’s high school students are led to believe that, should they wish to be competitive in the job market, a bachelor’s degree, and often a post-graduate degree to boot, is necessary. Flocking to universities across the nation, America’s youth are betting against their uncertain futures and burying themselves under mountains of debt. Too often, these students find themselves overwhelmed after they have graduated and the bill collectors come knocking.

            In 2010, students borrowed approximately $100 billion to fund their educations. In 2010, graduates who had relied upon student loans to fund their educations emerged from their respective universities with an average of $24,000 in student loan debt. By September of 2010, according to the Department of Education, over 320,000 of the 3.6 million individuals with student loans who had entered their repayment period from October 1, 2008, to September 30, … Read the rest