Business & Finance
A federal judge approved a $750 million fine for MCI to settle fraud claims brought by the Securities and Exchange Commission in the $11 billion accounting scandal at the former WorldCom. US District Judge Jed Rakoff of New York said a higher penalty - as sought by some shareholders and telecommunications rivals - could "unfairly penalize" MCI employees by forcing the company out of business after "extraordinary efforts" to improve corporate practices. Following the decision, MCI lowered revenue and earnings projections through 2005.
HealthSouth Corp. probably can avoid bankruptcy as it seeks to recover from $2.5 billion in accounting irregularities, interim chairman Joel Gordon told shareholders and creditors Monday, reassuring them that core businesses remain "solid and profitable." It's still too early to gauge the full impact of various criminal and regulatory investigations and lawsuits, company officials noted. Eleven former executives have pleaded guilty in the scandal to date. Based in Birmingham, Ala., it's the nation's largest provider of rehabilitation and outpatient surgical services.
EMC Corp., the third-largest maker of data-storage equipment, agreed to buy Legato Systems Inc. in a stock transaction valued at $1.3 billion. The deal announced Tuesday gives EMC of Hopkinton, Mass., a sales staff experienced in selling software and a market that EMC is actively pursuing as it lessens reliance on the less profitable hardware business. Legato is based in Mountain View, Calif.