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WATCH ON THE MEDIA.

The Associated Press reported Feb. 4 that Sen. John Kerry (D-MA) intervened in the Senate "to keep open a loophole that had allowed a major insurer to divert millions of federal dollars from the nation's most expensive construction project," Boston's "Big Dig."

Writer John Solomon said Kerry then "received tens of thousands of dollars in donations from the company during the next two years, documents show."

The "loophole" was discovered in 1999 when U.S. Transportation Department auditors found managers of the project had overpaid American International Group by $129.8 million for workers' compensation and liability coverage that wasn't needed but allowed AIG to put the money in a trust fund and invest it in the market.

Half the money investment profits went to the project but the rest went to AIG, the auditors found.

Sen. John McCain (R-AZ) responded with legislation that would have required overpayment of insurance premiums to go back to the federal government, along with interest. But Kerry helped kill the bill, Solomon wrote.

AIG executives have given a total of $18,000 to Kerry's Senate and presidential campaigns, Solomon wrote, and the company made three donations of $10,000 each to the Citizen Soldier Fund that Kerry set up to lay groundwork for this year's presidential campaign, Solomon wrote.

Kerry says there is no link between his efforts, which benefited the Big Dig, and the donations.

* * *

A lawsuit seeking class action status against prominent members of the liquor industry for allegedly using unfair and deceptive trade practices and negligently targeting underage drinkers in their advertising was the focus of a Wall Street Journal article Feb. 5.

"The first lawsuits filed against the tobacco industry in the 1950s were more or less laughed out of court," staff writer Christopher Lawton wrote.

"The cigarette companies had huge legal firepower, and both judges and juries weren't inclined to sympathize with smokers who had taken up the habit voluntarily. But like asbestos and breast-implant litigation, the lawsuits began to build on each other until they reached a kind of critical mass ... Now it's alcohol's turn - maybe."

He pointed to a lawsuit filed in superior court of the District of Columbia by David Boies III, "the son of famed attorney David Boies," and one filed in Los Angeles County Superior Court Feb. 3 against Anheuser-Busch Cos. and the Miller Brewing Co.

Under the District of Columbia consumer protection law, Lawton says, Boies would have to show the liquor companies attempted to appeal to persons under 21 years old.

Lawton wrote Boies had confirmed he had documents showing the defendants knew their advertising was reaching underage consumers, but would not confirm whether he had internal company documents.
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Publication:Liability & Insurance Week
Date:Feb 9, 2004
Words:447
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