HCA securities fraud settlement enters its final chapter (finally)

Something odd came across the Middle District docket reports this week: a recusal in Morse et. al v. McWhorter et. al, the 1997 federal securities class action filed against HCA/Columbia by stockholders in the wake of the HCA fraud prosecution. 

The original litigation was long enough - the $49.5 million settlement was not approved until 2004. And since that time, the case has lied dormant. Technically closed, but still active in the system because of the administration of the fund.

This summer, a motion was filed to closed the fund and distribute the unclaimed remainder in the settlement account (around $52,000) to the Legal Aid Society of Middle Tennessee and the Cumberlands and MFY Legal Services, a New York City legal aid organization. 

The case has long been under the gavel of Judge William Higgins. Having since retired, the motion was assigned to Judge Todd Campbell September 30.

But, Campbell recused himself (for reasons unknown) this week. The case has now be reassigned the Senior Judge William Haynes.

The saga continues?

Oct 7, 2015 7:00 AM

LaVergne mayor smells conspiracy after being accused of calling escorts with city cell phone

LaVergne's mayor's city cell phone shows calls to numbers connected with escorts listed on Backpage.com. He smells conspiracy.

Oct 6, 2015 1:51 PM

Kelsey files amendment to restore local funding if Hall tax is repealed

Sen. Brian Kelsey said he's got a way to keep local governments from not losing a dime if the Hall Tax is repealed:

Local governments would not lose revenue after repeal of the Hall tax under legislation sponsored by Senator Brian Kelsey (R-Germantown).  Kelsey, who continued to assert that the time is right for repeal of the tax, filed a “hold harmless” amendment today which calls for providing cities and counties payment from the state based on an average of the last five years of Hall tax receipts.

“This amendment ensures we repeal the Hall tax without cutting one dime from state or local government,” said Senator Kelsey.

The Hall tax is a six percent tax on interest and dividends enacted in 1929, with 3/8 of the revenue going to cities and counties and the remainder going to the state.  Almost half of those who pay the Hall tax are 65 or older with nearly 9 of 10 individuals earning less than $34,000 per year in investment income.

Repeal of the tax has stalled in past sessions because critics claimed there was not enough state revenue to pay for the tax cut.

“This is the year we will find out whether politicians are serious about repealing this tax, which unfairly penalizes those who have saved for  retirement," Kelsey added.  "We have a $600 million surplus, half of which is expected to be available in future years, according to one of our state’s best economic forecasters.”

Kelsey referred to a recent statement made by University of Memphis Economist Dr. John Gnuschke: “While substantial budget fluctuations occur, the natural growth of state tax collections should exceed $300 million.  Over collections could exceed $300 million as long as state spending is held in check,” Gnuschke said.

The legislation can be considered by the General Assembly when it reconvenes in January and would be implemented the following January 1, 2017.

Senator Kelsey represents Cordova, East Memphis, and Germantown.  He serves as Chairman of the Senate Judiciary Committee.

Oct 6, 2015 8:44 AM

DCS can 'see the horizon' to ending federal court order

DCS has been under extra federal scrutiny for 15 years but a judge acknowledged the department has made substantial progress and is close to meeting all 136 requirements, which would close that lawsuit.

Oct 6, 2015 7:07 AM

Fincher under fire

Just days after an op-ed excorciated Stephen Fincher for being the example par excellence of how Washington can corrupt, he was among 11 Congressmen included in an ethics complaint for receiving campaign contributions from the payday lending industry after sponsoring a bill favorable to same. 

Oct 6, 2015 7:03 AM

Why charters don't save money

WPLN talks to MNPS' finance man on why charter schools don't really result in costs savings for the school system:

Board member Mary Pierce asked Henson's office to look into a hypothetical situation: What if all the students in charter schools moved back into district-run schools?

Henson did the analysis and found the district would be spending $3.5 million more if every charter closed. But he says it's a flawed exercise.

“We put quotation marks around the word ‘savings’ because it’s not a true savings to the district budget.”

The only place Henson sees for potential savings is when charters prevent the district from having to expand schools or build new ones, and even then it depends on a lot of variables.

“It’s very difficult to say yes, the district could save capital costs by a charter opening in an area that has overcrowded schools," he says. "It’s a possibility.”

Oct 5, 2015 1:53 PM

Trump in Franklin

Donald Trump sure likes to talk about his own momentum.

Oct 5, 2015 7:10 AM

Barry will continue Dean-style incentives

The Tennessean looks at what Megan Barry's economic development strategy will be. It's going to look a lot like Karl Dean's.

Oct 5, 2015 7:10 AM

Why local governments love the Hall tax

Local governments are going to oppose any attempt to repeal the Hall tax:

During the fiscal year that ended June 30, the income tax generated $303 million in total revenue, with about $189 million flowing to the state’s general fund and the remaining $114 million distributed to local governments across the state.

State Sen. Brian Kelsey, R-Germantown, said last week he will try again in 2016 to abolish the tax, effective with the 2017 calendar year. Kelsey said the legislature should reimburse cities and counties for their revenue loss but neither the bill nor an amendment he filed last week provides for continuing the revenue stream to local governments.

Memphis is the largest single recipient of Hall tax proceeds — $14.8 million during fiscal year 2015, according to new figures from the state Department of Revenue. Nashville is second at $14.6 million, followed by Knoxville with $10 million. Knox County is seventh with $3.3 million, followed by Germantown with nearly $3.1 million.

Oct 5, 2015 7:06 AM