FIRMS USING NEW LAW\Provisions protect against investor suits.Byline: Rob Wells Associated Press Associated Press: see news agency. Associated Press (AP) Cooperative news agency, the oldest and largest in the U.S. and long the largest in the world. Major companies are beginning to take advantage of controversial new protections against frivolous Of minimal importance; legally worthless. A frivolous suit is one without any legal merit. In some cases, such an action might be brought in bad faith for the purpose of harrassing the defendant. lawsuits by investors. The provisions, passed by Congress last year, shield companies that make erroneous erroneous adj. 1) in error, wrong. 2) not according to established law, particularly in a legal decision or court ruling. forecasts as long as those projections include so-called safe-harbor warnings that unexpected events could affect earning prospects. Recent Securities and Exchange Commission filings show that companies ranging from Motorola Inc. to U.S. Healthcare U.S. Healthcare is a now-defunct healthcare company. The logo had an apple. The merger with Aetna In 1996, the company merged with Aetna, calling it Aetna U.S. Healthcare. The U.S. Healthcare apple logo was next to the Aetna name, and U.S. Healthcare under it. U.S. Inc. have included safe-harbor warnings in their projections. The protections against investor lawsuits were a bitterly fought part of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and , which became law in December over President Clinton's veto. Consumer activists said the protections were too broad and would give executives a license to lie. Advocates, who included an unusual bipartisan coalition in Congress, said the change would actually help investors make better decisions because it also requires executives to disclose more information about business risks. Hints of the bill's promise and peril The designated contingency, risk, or hazard against which an insured seeks to protect himself or herself when purchasing a policy of insurance. Among the various types of perils for which insurance coverage is available are fire, theft, illness, and death. PERIL. were evident in a recent batch of SEC corporate filings. U.S. Healthcare Inc. of Blue Bell, Pa., offered a 21-item list of factors that could "cause the company's actual financial and enrollment results to differ" from forecasts. U.S. Healthcare warned of potential for "adverse state and federal legislation and regulation including limitations on premium levels, . . . increases in medical costs, . . . heightened competition, . . . adverse publicity and news coverage. Texas Instruments See TI. (company) Texas Instruments - (TI) A US electronics company. A TI engineer, Jack Kilby invented the integrated circuit in 1958. Three TI employees left the company in 1982 to start Compaq. Inc. offered a generic one-paragraph warning at the end of a quarterly press release. It warned that risks include "economic conditions, product demand and industry capacity, competitive products and pricing." Opponents of the law said the warnings in the U.S. Healthcare and Texas Instruments documents were too general and did not offer investors enough information to make informed decisions. |
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