Top investment banks report strong 3Q
NEW YORK -- Despite the usual lull in activity, Wall Street's biggest names had a pretty good summer.
The leading U.S. investment banks -- Goldman Sachs and Morgan Stanley -- each reported third-quarter profits Tuesday that beat analysts' expectations, helped by strong performance in their trading operations and better-than-expected revenue from stock underwriting.
Goldman, the larger of the two banks, reported a profit of $2.52 billion in the quarter, or $6.28 per share. That's up from $2.13 billion, or $5.02 per share, in the same period a year earlier. The result topped the estimate of $5.38 per share from Wall Street analysts, according to FactSet.
Meanwhile, Morgan Stanley earned a profit of $2.11 billion, or $1.17 per share, which is up 19 percent from a year ago, when the bank earned $1.78 billion, or 93 cents per share. The results beat analysts' estimates of $1.01 per share, according to FactSet.
Both banks make most of their money from advising wealthy clients and corporations on deals, as well as from substantial trading operations. While both banks trade stocks, bonds, commodities and currencies, Morgan is known more for its stock trading operations while Goldman leans more into bonds, commodities and currencies.
-- The Associated Press
Ex-Equifax insider sentenced for scheme
ATLANTA -- A former Equifax manager has been sentenced to serve eight months of home confinement after pleading guilty to insider trading in the wake of the company's data breach last year.
A federal judge also ordered Sudhakar Reddy Bonthu to forfeit the money gained through insider trading and to pay a $50,000 fine. Bonthu, who worked as a software product development manager for the credit-reporting agency, pleaded guilty in July.
Prosecutors say Bonthu used nonpublic information to determine that Equifax had been breached before any public announcement. Prosecutors say he then bought put options in Equifax stock before the breach was announced and made about $75,000 when he exercised those put options after the announcement.
Equifax shares plunged in value after the Atlanta company disclosed the breach on Sept. 7, 2017.
-- The Associated Press
Judge OKs Musk's $40M SEC settlement
PALO ALTO, Calif. -- A U.S. judge approved Tesla Inc. and chief executive Elon Musk's $40 million settlement with the U.S. Securities and Exchange Commission, resolving government claims that Musk misled the public with a flurry of tweets about a plan to take the company private.
U.S. District Judge Alison Nathan in Manhattan signed off on the accord Tuesday after the electric-car maker, Musk and the regulatory agency said in a detailed joint filing that the deal was in the best interest of investors. The company will pay $20 million and Musk will also pay $20 million.
The judge's decision was largely expected, even after Musk muddled the process by insulting the SEC in a series of tweets just a few days after reaching the deal.
The ruling allows Palo Alto, Calif.-based Tesla to resolve an unwelcome distraction as its core business of making electric vehicles is improving. The company hit its targets for production and deliveries in the third quarter as the Model 3 sedan climbed the ranks of the top-selling cars in the U.S. market. Total output of the model probably exceeded 100,000 last week, according to Bloomberg's tracker.
-- Bloomberg News
Jurors call to keep $289M cancer verdict
SAN FRANCISCO -- Jurors who found that agribusiness giant Monsanto's Roundup weedkiller contributed to a school groundskeeper's cancer are urging a San Francisco judge not to throw out the bulk of their $289 million award in his favor, a newspaper reported Monday.
Juror Gary Kitahata told Judge Suzanne Bolanos in a letter that the jury was convinced by the evidence, the San Francisco Chronicle said.
"I urge you to respect and honor our verdict and the six weeks of our lives that we dedicated to this trial," he said.
Juror Robert Howard wrote to the judge that the jury had paid "studious attention" to the evidence, and any decision to overturn the verdict would shake his confidence in the judicial system.
Bolanos said last week that she is inclined to throw out $250 million in punitive damages in favor of DeWayne Johnson. She is also considering dramatically reducing the remaining award. Her final decision is due by Monday.
Monsanto, which was acquired by Bayer AG in June, has asked the judge to override the jury's decision and enter judgment in its favor or order a new trial.
-- The Associated Press
Sears stores' landlord facing losses
WHITE PLAINS, N.Y. -- A Sears liquidation would cost its real estate spinoff 47 percent of its annual rent income, or about $84 million in cash flow, according to regulatory filings.
Seritage Growth Properties, a real estate investment trust, was created in 2015 by Sears Chief Executive Officer Eddie Lampert to be the property owner and landlord for select locations of Sears and its sister chain, Kmart.
As the Sears Holdings Corp. bankruptcy case kicks off in White Plains, N.Y., this week, the retailer hasn't reached an agreement with lenders over how many stores -- if any -- will stay open past the holiday season. The company's chief financial officer in a Monday court filing pleaded for vendors, employees and other stakeholders to help it reorganize in bankruptcy. About 68,000 jobs are on the line.
-- Bloomberg News
Airline sues to demand logo copyright
FORT WORTH -- American Airlines is taking the U.S. Copyright Office to court over the agency's refusal three times to grant copyright protections to the carrier's logo that appears on everything from flight safety videos to advertisements to credit cards.
It's the latest escalation in a years-long back-and-forth during which the copyright office has argued that American's new logo, introduced in 2013, isn't creative enough to warrant a copyright.
To American, the new logo, referred to as "the Flight Symbol," blends red and blue elements to represent the tail of a plane, with the subtle shading of an eagle meant to suggest flight.
The logo's designer, Futurebrand, even won a Clio, a top advertising award, for its work on American's rebranding after its merger with US Airways.
But to the Copyright Office, the logo appears more like an "elongated rectangle" with an "exceedingly common" color palette of red, white and blue, lacking sufficient "original and creative" authorship to warrant protection.
-- The Dallas Morning News
Business on 10/17/2018