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<title>Resumes_and_Portfolios RSS : Gourt</title>
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<dc:rights>Copyright 2007, Gourt.com</dc:rights>
<dc:date>2008-07-22T17:21+10:00
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<item rdf:about="http://www.nytimes.com/2007/06/24/business/yourmoney/24mgmt.html?ex=1340337600&#x26;en=e86da63e5fb6e486&#x26;ei=5088&#x26;partner=rssnyt&#x26;emc=rss">
<title>Under New Management: Life After a Merger: Learning on Both Sides</title>
<link>http://www.nytimes.com/2007/06/24/business/yourmoney/24mgmt.html?ex=1340337600&#x26;en=e86da63e5fb6e486&#x26;ei=5088&#x26;partner=rssnyt&#x26;emc=rss</link>
<description><![CDATA[Managers should act promptly (and creatively) to keep the best people after a deal.]]></description>
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<item rdf:about="http://www.nytimes.com/2007/06/24/business/yourmoney/24homefront.html?ex=1340337600&#x26;en=ab542f64a6269d9a&#x26;ei=5088&#x26;partner=rssnyt&#x26;emc=rss">
<title>Home Front: Training for the Twists of Driving a School Bus</title>
<link>http://www.nytimes.com/2007/06/24/business/yourmoney/24homefront.html?ex=1340337600&#x26;en=ab542f64a6269d9a&#x26;ei=5088&#x26;partner=rssnyt&#x26;emc=rss</link>
<description><![CDATA[A program in Brooklyn helps low-income or unemployed New York City residents become bus or truck drivers.]]></description>
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<item rdf:about="http://www.nytimes.com/2007/06/24/business/yourmoney/24boss.html?ex=1340337600&#x26;en=f8aaf630134f762c&#x26;ei=5088&#x26;partner=rssnyt&#x26;emc=rss">
<title>The Boss: When Focus Leads the Way</title>
<link>http://www.nytimes.com/2007/06/24/business/yourmoney/24boss.html?ex=1340337600&#x26;en=f8aaf630134f762c&#x26;ei=5088&#x26;partner=rssnyt&#x26;emc=rss</link>
<description><![CDATA[“New Orleans defines who I am,” said Arnold Donald, chief executive of the Juvenile Diabetes Research Foundation International.]]></description>
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<item rdf:about="http://www.portfolio.com/careers/job-of-the-week/2008/07/20/Investor-Relations-Exec-Jay-Gould?rss=true">
<title>Panic Room</title>
<link>http://www.portfolio.com/careers/job-of-the-week/2008/07/20/Investor-Relations-Exec-Jay-Gould?rss=true</link>
<description><![CDATA[                                                                                                                                                                                                          Job Title: Investor Relations Officer                               Employers: Public companies                         Openings: Search firms and National Investor Relations Institute website                          Salary Cap: $350,000    Number of Jobs: About 6,500              Possibly the only people more stressed out last week than investors who owned shares in banking companies were the people in charge of calming them down.     &nbsp;&nbsp; &nbsp;     As vice president of investor relations for Huntington Bancshares, a $56 billion regional bank holding company based in Columbus, Ohio, Jay Gould certainly didn't sleep much.      &nbsp;&nbsp;&nbsp;      &quot;Everybody is running through their fire drills rights now,&quot; said Gould on Tuesday. &quot;The stock of some companies is down 50, 60, 70, 80 percent. We're fighting rumors in the marketplace. We're fighting fear.&quot;      &nbsp;&nbsp;&nbsp;      Last week, Gould, who has 25 years of experience in I.R., was also fighting numerous deadlines as his company prepared to issue second-quarter earnings on Thursday in the midst of an industry-wide panic. The collapse of IndyMac Bancorp on July 11 sent bank shares into a tailspin, with the 12-stock Standard &amp; Poor's 500 Regional Bank index sinking more than 15 percent in the first two days of the week.      &nbsp;&nbsp;&nbsp;      It was just the latest and most dramatic blow to an industry that has been battered all year. Huntington's share price has fallen from $21 last fall, to under $6 in the days leading up to the earnings announcement.     &nbsp;&nbsp;&nbsp;      &quot;I worked through the weekend,&quot; Gould said. &quot;I haven't pulled an all-nighter yet, but tonight may be one. There's been a flurry of phone calls from investors, probably more than I have time to handle during earnings week.&quot;     &nbsp;&nbsp;&nbsp;      Like most veteran I.R. officers, Gould has seen his share of challenges before. After graduating from California State University&ndash;Northridge with a B.S. and M.S. in finance, Gould began his career in the thrift industry doing financial and corporate planning in 1965. Eventually, he found his niche as the head of investor relations at Security Pacific before moving on to KeyCorp and then Bank One, now a part of J.P. Morgan Chase.&nbsp;      &nbsp;&nbsp;&nbsp;      Before Gould joined Huntington in 2002, shareholders had been so dissatisfied with the bank's performance&mdash;the stock was the worst-performing bank in the S&amp;P 500 in 2001&mdash;that hundreds mobbed the company's annual meeting to complain. A new C.E.O. and Gould were brought in, and the company's stock rose more than 30 percent in the subsequent year.      &nbsp;&nbsp;&nbsp;      In times of crisis, Gould's job entails far more than just calming investors. Gould is also the eyes and ears of management, charged with compiling the most accurate picture of what the marketplace is thinking, and advising them on what to do about it. Nowadays, he says, it's especially important to stay vigilant.     &nbsp;&nbsp;&nbsp;      &quot;You have to keep your feet in the pool all the time,&quot; he says. &quot;I'm spending an exorbitant amount of time reading press headlines, Bloomberg business headlines, and reading blogs now like I never read before.&quot;     &nbsp;&nbsp;&nbsp;      In June, when negative chatter about the company reached a high, sending the stock down from $9 to just over $5 in a two-week period, Gould took the unusual step of recommending his company issue a preemptive press release to calm investors.           In the release, the bank acknowledged the stock price decline but reassured investors that their outlook remained consistent and that they were pleased with their performance. That release helped halt the stock's slide, bumping it up a full dollar.     &nbsp;&nbsp;&nbsp;      &quot;You don't want to set a precedent,&quot; Gould says of issuing the release. &quot;But sometimes you just got to say 'Hey, there's a lot of noise out there' [since] you don't want it to get out of control.&quot;     &nbsp;&nbsp;&nbsp;      With Thursday's earnings announcement, Gould was able to placate investors with the most potent balm of decent results, as Huntington reported a 26 percent increase in second-quarter earnings, although it did lower its forecast for the rest of the year. The stock increased 40 percent to $7.68 per share, and Gould was able to breathe a lot easier.Related LinksJ.P. Morgan Hits It Out of the ParkJ.P. Morgan Ekes Out a GainBig Banks, Bad News
  
]]></description>
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<item rdf:about="http://www.portfolio.com/culture-lifestyle/culture-inc/arts/2008/07/16/Monetary-Value-of-Project-Runway?rss=true">
<title>What&#x27;s Project Runway Worth?</title>
<link>http://www.portfolio.com/culture-lifestyle/culture-inc/arts/2008/07/16/Monetary-Value-of-Project-Runway?rss=true</link>
<description><![CDATA[Hollywood insiders have been waiting for Harvey Weinstein&rsquo;s bubble to burst ever since he and his brother, Bob, split from Disney in 2005. Despite $1 billion in equity from Goldman Sachs, the Weinsteins have yet to produce a huge hit&mdash;except Project Runway, the cult cable-TV show hosted by supermodel Heidi Klum, which features competitions among aspiring fashion designers. This spring, the Weinstein Co. surprised the industry by pulling the show off Bravo and striking a $150 million, five-year licensing deal to air Runway on Lifetime. But if the Weinsteins really want to hit the jackpot, maybe they should consider selling the show. They wouldn&rsquo;t talk, but we spoke to entertainment bankers&shy;&mdash;including Dave Davis of Arpeggio Partners&mdash;and production executives to estimate what the Weinsteins might earn by selling.     1. Existing Episodes   The first step in valuing a TV franchise is determining the revenue from home-video sales, second runs, and the syndication of already aired episodes. Project Runway earns an estimated $10 million in DVD sales and about $700,000 in second runs per season. It has yet to be syndicated, but our industry sources believe that it could make about $350,000 a season in syndication fees. The show completes its fifth season this summer, and its first three seasons are already out on DVD. A new owner would probably collect fees from five seasons of syndication and two of second runs and DVD sales.&nbsp;   Estimated Value: $22.5 million&nbsp;      2. Future Episodes   The next step is estimating the value of all future episodes, including licensing fees, promotional partnerships, home-video sales, and rerun and syndication fees. Under its new deal with Lifetime, the Weinstein Co. reportedly will earn $800,000 an episode (for a total of 140 future episodes). &shy;Promotional partnerships have always played a prominent role on the show: On one episode, contestants were required to modernize various &shy;fashion icons&mdash;like Marilyn Monroe&mdash;for Tresemm&eacute;&rsquo;s print ads; on another, they were &shy;ordered &shy;to design outfits using only materials found in the &shy;Hershey&rsquo;s store in Times Square. By the end of season five, the &shy;Weinsteins were charging major partners like Tresemm&eacute;, L&rsquo;Or&eacute;al, and Macy&rsquo;s as much as $1 million a season to participate. A partnership with Elle recently fell apart after the brothers demanded that the magazine pay $75,000 an episode. The company is now in talks with &shy;Marie Claire.   Estimated Value: $209 million      3. Brand Value  The final step is assessing a premium (if one is &shy;warranted) for brand value. Project Runway played a key role in making Bravo a reality-TV powerhouse, but the show&rsquo;s impending move will serve as a real test of its brand appeal. Not only is it leaving an up-and-coming network for an ailing one, but the show&rsquo;s producers are also staying at Bravo. And compared with similar programs, Runway hasn&rsquo;t fared as well in ratings and international spinoffs: America&rsquo;s Next Top Model has more than 30 international versions; Runway has six. &ldquo;Project Runway is not terribly differentiated relative to other talent competitions,&rdquo; says Andy Bateman, C.E.O. of branding consultancy Interbrand. Some investors would put scant value on Runway&rsquo;s brand, but more entrepreneurial types might be willing to pay a premium of as much as 5 percent.    Estimated Value: Up to $12 million&nbsp;     The Bottom Line: The Weinsteins haven't said they're selling, but maybe they ought to think about it.   Total Estimated Value of Project Runway: As much as $243.5 million   &nbsp;NOTE: Future cash flows have been adjusted to reflect present value. &nbsp;     Related LinksLegal Fight Erupts Over 'Project Runway' MoveVogue Snubs, Covets Project RunwaySummertime Slump
  
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</item>

<item rdf:about="http://www.portfolio.com/news-markets/national-news/portfolio/2008/07/16/Bank-of-Americas-Countrywide-Buy?rss=true">
<title>What Was Ken Lewis Thinking?</title>
<link>http://www.portfolio.com/news-markets/national-news/portfolio/2008/07/16/Bank-of-Americas-Countrywide-Buy?rss=true</link>
<description><![CDATA[Wall Street&rsquo;s debate over Bank of America&rsquo;s purchase of Countrywide Financial is not whether it&rsquo;s a good or bad deal&mdash;but whether it will be C.E.O. Ken Lewis&rsquo; last deal. &ldquo;If this doesn&rsquo;t work, at some point shareholders are going to demand Lewis&rsquo; head,&rdquo; says Josh Rosner, managing director of Graham Fischer &amp; Co., a New York research consultancy that specializes in mortgage finance.      But in keeping with the market axiom that any viewpoint unanimously held is wrong by definition, writing off Lewis so fast may be a mistake. In fact, there&rsquo;s a decent&mdash;and obviously contrarian&mdash;case to be made that the Countrywide deal plays to Lewis&rsquo; strengths, if he can survive long enough to show them off.      First, Lewis is an old hand at big deals. Bank of America is the product of more than 3,000 mergers, and Lewis has worked on many of them, including the epic 1998 union of NationsBank (known as North Carolina National Bank when he started there in 1969) and Bank of America, California&rsquo;s largest bank. It&rsquo;s telling that most analysts were initially skeptical of the two Lewis megadeals that clinched Bank of America&rsquo;s place as the country&rsquo;s first (and still only) truly national consumer bank: the $48 billion acquisition of FleetBoston Financial in 2003 and the $34 billion purchase of credit-card specialist MBNA in 2005. In both cases, B of A was roundly criticized for overpaying. In the end, Lewis and his team squeezed so much value out of FleetBoston and MBNA in integrating them with B of A&rsquo;s existing operations that investor opinion on the deals swung strongly to the positive.      Lewis also showed unusual resolve in sitting on his checkbook even as rivals were paying top dollar to buy mortgage lenders by the dozens in the 1990s. He was deeply ambivalent about the mortgage market, telling colleagues that he &ldquo;loved the product and hated the business.&rdquo; Although he acknowledged that the home loan was a &ldquo;cornerstone of the customer relationship,&rdquo; he considered mortgage lending unnecessarily risky. Not only did housing markets go from boom to bust all too often, but the structure of the industry was too risky because banks outsourced much of their lending to brokers or others.      As soon as Lewis moved up to C.E.O., he began restructuring Bank of America&rsquo;s mortgage-lending operation with the dual aim of reducing risk and forging a closer, more lucrative relationship with his customers. Within a year, the bank had stopped making subprime loans and buying mortgages from other lenders. It also found ways to attract better-quality buyers: It trained about 10,000 personal bankers in its branches to sell home loans directly to consumers, along with checking accounts, credit cards, and certificates of deposit. This might not sound like much, but other banks relied on referrals from homebuilders and real estate brokers, which meant that they had less control over customer quality.      Lewis&rsquo; conservatism was tested during the housing boom that lasted from 2003 to 2006. Countrywide and other lenders fed the frenzy by amending conventional standards of creditworthiness to accept almost anybody willing to fill out a loan application (ability to repay optional). As lending volume exploded, the issue of whether B of A should jump back into the subprime game sparked fierce internal debate. Customers by the millions were going elsewhere for mortgages and taking their banking relationships with them. &ldquo;You don&rsquo;t want to be in a position where you have to say no to customers,&rdquo; says a B of A executive who found himself on the other side of the issue from his C.E.O.      &nbsp;Lewis&rsquo; intransigence became prescience when the credit-market convulsions of mid-2007 brought the subprime house of cards tumbling down on its architects, including Angelo Mozilo, Countrywide&rsquo;s 69-year-old co-founder and C.E.O.&thinsp; While mortgage originations across the industry for the year dropped 15 percent, Bank of America&rsquo;s volume jumped 21 percent, to $93 billion. More important, the $275 billion worth of mortgages the bank held on its books remained solidly profitable even as soaring rates of default and foreclosure pushed many subprime specialists into bankruptcy. For 2007, B of A&rsquo;s net mortgage charge-offs totaled $57 million, a mere 0.02 percent of its portfolio.      For Lewis to acquire the company that underwrote so much of the subprime sludge now polluting the global financial system isn&rsquo;t quite the betrayal of principle it might seem. Until the late-career meltdown of Mozilo&rsquo;s credit judgment, Countrywide was an enterprising, well-managed company that for three decades had subsisted on exactly the sort of conventional home loans to which Lewis limited B of A. Countrywide hasn&rsquo;t made a material subprime loan in nearly a year, and Mozilo is a self-correcting problem&mdash;for Lewis, anyway. The lavishly paid, superannuated poster boy of subprime excess will retire as soon as the sale closes, leaving a horrendous legal mess&mdash;including his Friends of Angelo V.I.P. program&mdash;that could take B of A a few years and a whole lot of money to clean up.       What investors fear above all is that B of A&rsquo;s $3 billion purchase price will turn out to be the mergers-and-acquisitions equivalent of a modest down payment on a grand old mansion that&rsquo;s now so riddled with termites and toxic mold that the bank will have to spend an additional $10 billion to $30 billion to bring it up to code. The money pit consists mainly of the mortgages that Countrywide carried on its books as an investment at the end of the first quarter. As of March 31, 4.16 percent of those mortgages were in default or foreclosure, compared with 1.65 percent six months before and just 0.66 percent at the end of 2006.      This makes for a trend line that big investors might well try to fashion into a noose for Lewis if housing markets like California and Florida fail to stabilize soon. In closing on its purchase of Countrywide, B of A must mark to market its $95 billion mortgage portfolio to something approaching a real price&mdash;a process that analysts expect to be ugly. &ldquo;A year and a half from now, Ken Lewis is going to sit down and tell somebody over drinks, &lsquo;I wish I had walked away from Countrywide,&rsquo;&thinsp;&rdquo; says Paul Miller, an analyst at FBR Capital Markets, who predicts a $28 billion markdown, give or take a few billion.      People inside B of A, though, insist that Lewis is holding firm. In addition to being what is still the busiest mortgage lender in the country&mdash;Bank of America is fifth&mdash;Countrywide also remains the country&rsquo;s largest mortgage servicer, handling the billing and other administrative tasks for nearly $1.5 trillion in loans. Servicing is a business of scale and data-processing precision in which Countrywide&rsquo;s growth has long set the pace and Bank of America has lagged. Shifting B of A&rsquo;s $530 billion portfolio onto Countrywide&rsquo;s servicing platform could result in significant operating economies and better profit margins.      Like all gamblers, Lewis needs to be lucky as well as good. Bank of America&rsquo;s C.E.O. excels at the tricky, painstaking work of postmerger integration but exerts no control whatsoever over the great X factor on which his job security apparently now hangs: housing-market fundamentals. He has told analysts that all is going according to plan. &ldquo;All I can say is nothing has happened that is out of the boundaries of what we contemplated when we did the deal,&rdquo; he said during a recent Deutsche Bank conference call.      On the call, Allen Puwalski of Paulson &amp; Co. pressed Lewis, saying that housing prices could well decline much more than the consensus forecast of 25 percent.       &ldquo;If that&rsquo;s the case,&rdquo; Lewis retorted, &ldquo;we&rsquo;ll be worried about Countrywide, but we&rsquo;ll be worried about a lot of other things too&mdash;and not just at Bank of America.&rdquo; &nbsp;   Related LinksAngelo's Many 'Friends'Mortgage Brokers, RIPAngelo's Fannie Pack 
      
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</item>

<item rdf:about="http://www.portfolio.com/executives/features/2008/07/16/Obit-of-Publicist-Warren-Cowan?rss=true">
<title>Life of the Party</title>
<link>http://www.portfolio.com/executives/features/2008/07/16/Obit-of-Publicist-Warren-Cowan?rss=true</link>
<description><![CDATA[True, he was buried with a cell phone in his hand. But despite that modern touch, Warren Cowan&rsquo;s death, at 87, signaled the end of an era.    If celebrity is a commodity in Hollywood, then Cowan was one of its pioneer traders. (View slideshow.)    Rogers &amp; Cowan, the company that he and Henry Rogers started in 1950, remains one of the powerhouse imagemaking outfits in town. (It was bought in 1987 by Shandwick, which is now a subsidiary of the Interpublic Group of companies.)     Cowan&rsquo;s life spanned the rise of the celebrity publicist. Every powerful flack in town started out at his firm: Pat Kingsley was his secretary; Alan Nierob and Paul Bloch&mdash;who were among the pallbearers at his funeral&mdash;fetched his coffee.    The consummate Hollywood P.R. man, who in recent years had announced other passings (most recently Joey Bishop&rsquo;s) to the world, received his sendoff at a standing-room-only service in May at Mount Sinai Memorial Park in Los Angeles.     Eva Marie Saint read a statement from longtime client Paul Newman, who praised Cowan for bringing an &ldquo;uncommon dignity&rdquo; to his work. Among the mourners, more than one person remarked, were the ghosts of those whose press Cowan had finessed, among them Lucille Ball, Gary Cooper, Judy Garland, Cary Grant, and Frank Sinatra.    Cowan invented the modern Oscar campaign in 1944 by leaking a story about Mildred Pierce&rsquo;s &ldquo;promising&rdquo; Academy Award chances when the film was just three weeks into shooting. &ldquo;If we don&rsquo;t have anything to publicize, let&rsquo;s create it,&rdquo; he once famously said. Cowan founded his last firm, Warren Cowan &amp; Associates, in 1994. He learned he had melanoma only three weeks before he died, and the tireless P.R. man spent part of his final day with his staff gathered around him: He wanted to make sure everything was ready for an event honoring Wayne Newton.Related LinksIdle Chatter: Actors' Strike, 'Arrested Development,' morePeeking Under the TableHollywood Ending: Guilty
  
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</item>

<item rdf:about="http://www.portfolio.com/executives/features/2008/07/16/Lyne-Leaving-Martha-Stewart-Living?rss=true">
<title>Kitchen Confidential</title>
<link>http://www.portfolio.com/executives/features/2008/07/16/Lyne-Leaving-Martha-Stewart-Living?rss=true</link>
<description><![CDATA[ Was Martha as tough to work for as people say?   Martha is a force of nature. The first time I went to meet her in prison, I&rsquo;d seen our designers&rsquo; plans for a new bedding line. I said, &ldquo;God, they were really beautiful, Martha.&rdquo; She said, &ldquo;Did you want them? If you don&rsquo;t want them, they&rsquo;re not good enough.&rdquo; So, yeah, she can be a real taskmaster. But there&rsquo;s a pursuit of excellence that&rsquo;s hard to deny.           What was it like visiting her in prison?   I went to see her every other week. I wasn&rsquo;t allowed to ask what I should do, but I could inform her of what we were doing. We&rsquo;d spend four or five hours together. We played a lot of Scrabble.            You&rsquo;ve been rumored to be in line for a number of jobs, including Time Inc. C.E.O. What&rsquo;s it going to be?   Honestly, I don&rsquo;t know. I want to spend some time traveling, reading, thinking, and listening.                               Why are you leaving?   I said to Martha when I came to the company that I would put a great management team in place. At a certain point, you need to step aside so they can do what they came to do.                    In your prior job as head of programming at ABC, you helped launch Desperate Housewives. Which&nbsp; housewife are you? Felicity Huffman. The idea of carrying a significant job and raising kids, and the chaos that ensues, certainly rang a bell.         What was your worst day at Martha Stewart? The day we met with Eddie Lampert to see if there was a new contract to be done with Kmart and realizing we were so far apart, it was hopeless. We knew the value of our brand to them, and I think he felt we had no other options and could hardball us.           Best day?   The day Martha came back to the company. And the day we could say we were profitable again. That was a fun earnings call.  Is there one Martha Stewart product you can&rsquo;t live with&shy;out?   The lemon zester. It&rsquo;s just a miracle.            Related LinksMartha Stewart: Banned in BritainWhen Public Companies are Still Private FiefsMore Influence than Anxiety at the 'Time 100'
  
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</item>

<item rdf:about="http://www.portfolio.com/executives/features/2008/07/16/Megachurch-Preacher-Joel-Osteen?rss=true">
<title>God Wants Me to Be Rich</title>
<link>http://www.portfolio.com/executives/features/2008/07/16/Megachurch-Preacher-Joel-Osteen?rss=true</link>
<description><![CDATA[Who will save us? Who will lift us up from crushing credit-card debt and resetting mortgage payments and impending foreclosure, from increasing gas prices and decreasing health-insurance coverage? We are a nation stumbling through our worst financial crisis in a generation and our worst housing market in a lifetime. And so we come, seeking gentle salvation, inspiring prayers, steadying words, soothing notions, and calming thoughts that will allow us to become, in Joel Osteen&rsquo;s words, &ldquo;victors, not victims.&rdquo;         We are in Greensboro, North Carolina, making our way into the downtown arena through the hot, buggy air, to worship with the pastor who will save us, the man anointed, by one of his congregants, as &ldquo;Reverend Feelgood.&rdquo; Sixteen thousand will file in this evening, as have millions more to coliseums, concert venues, and baseball stadiums around the country&mdash;all, in a way, his churches. (View a slideshow that tallies the budgets of some of the biggest churches.)         We are a diverse, representative swath of troubled America: families struggling under debt, husbands and wives seeking reconciliation, young couples on first dates, children dragged by pious grandparents who promise them popcorn and BibleMan action figures. It is religion as escapism, criticized throughout the Bible Belt as &ldquo;Christianity lite&rdquo; or &ldquo;prosperity gospel.&rdquo; But this murmuring crowd, slouching toward a kinder, gentler salvation, is a more telling indicator of the state of our union than consumer durables purchased or capital goods ordered. Unemployment they know; they don&rsquo;t need to wait for the Bureau of Labor Statistics to publish a monthly number. O, but come to Joel, lift your hands to Jesus, banish your negative thoughts, and you can find in these dark times a beacon.         If, in this country, there is great hurting, then Osteen is here to soothe that suffering. He does not wish that pain on any of us, and the sight or thought of it will bring forth from him great torrents of tears&mdash;his eyes clamped shut, his fingers pressed into narrow eye sockets, his lips pulled back over pink gums as he grimaces. The crying has become a visual touchstone of an Osteen sermon, the born-again equivalent of James Brown&rsquo;s pre-encore collapse from &ldquo;exhaustion.&rdquo;         Joel feels our pain and has made himself wealthy (reportedly earning $13 million for his last book advance alone) and his church prosperous ($75 million and counting in annual revenue) by urging us to let go of it, to turn it over to God, to accept God&rsquo;s favor so that we may be as prosperous as Joel.         There was always a strain of American Puritanism that pointed to Scripture as justification for asserting that wealth is somehow godly. But ever since evangelical Christianity separated from the mainline faiths in the early 20th &shy;century, some preachers have gone further and linked their focus on personal piety to financial success. The big-tent revivals of the 1930s promised the dust-bowl destitute the possibility of finding Jesus and their next meal just by listening to a fire-and-brimstone message. By the late 1970s and early 1980s, televangelists like Jim Bakker and Jimmy Swaggart made prosperity gospel big business, capitalizing on that era&rsquo;s economic uncertainties to win over a new generation of acolytes, before those ministries were brought down by scandal.         Osteen is one of a new breed of televangelists&mdash;Joyce Meyer, T.D. Jakes, and Creflo Dollar are also rising stars&mdash;who are preaching a less sanctimonious, more inclusive message. His church is in that part of the economy that thrives in troubled times, that can count on full pews when wallets are empty and an ever more receptive audience if we do go into a full-on recession.      &nbsp;   Osteen hasn&rsquo;t necessarily tailored his message for the downturn. Instead, he has continued his feel-good preaching, his exhortations to focus on the positive and banish negative thoughts, his reminders that God wants you to have a good job, a beautiful home, and decent cash flow. His vast ministry has become, in effect, shelter from the storm. &ldquo;God wants you to have a big life,&rdquo; Osteen reminds his flock. &ldquo;That is his blessing. God has a big dream for your life.&rdquo;     We live in a time of miraculous congregations. Osteen&rsquo;s Lakewood Church, in Houston, is the largest in the United States, with 45,000 regular weekly attendees and 7 million more tuning in. His television show is the most-watched inspirational program in America and is seen in 100 countries around the world. He has sold 7 million copies of his two books, Your Best Life Now and Become a Better You. Podcasts of his sermons are downloaded 4.5 million times a month. He preaches to more than 15,000 people at a time in the basketball arena turned sanctuary that is Lakewood Church. His pulpit stands near the spot where Hakeem Olajuwon helped the Houston Rockets win two consecutive N.B.A. titles. But the Rockets, who have since moved across town, never put as many people in the seats as Osteen does.         Osteen will tell you that his success is a result of God&rsquo;s favor, that his message is God&rsquo;s message, and that all that he has achieved is a blessing from God. Clearly, he is more than just an inspiring pastor; he is also a master marketer and&mdash;pardon me for saying this, Joel&mdash;a damn good chief executive.         He presides over an empire that takes in tens of millions of dollars a year and has been growing at a boom-time pace. (Though Osteen gives a significant portion of his book and CD earnings to the church, his take is still ample enough to allow him and his family to live in 5,000 square feet of leopard-skinned luxury in one of Houston&rsquo;s tonier neighborhoods.) Rough economic times, Osteen believes, make the business of saving souls that much richer. &ldquo;I would think that our message would have increased relevancy in a time of economic uncertainty. I think people want to know that God is taking care of you. As it gets darker, I think the brighter message shines.&rdquo;         Joel&rsquo;s father, john osteen, was a pastor who dissociated himself from the Southern Baptist Church to start his own congregation, Lakewood, in an abandoned feedstore in 1959. It was John who started the family march toward a more gentle Jesus, focusing on the goodness and love of God and downplaying the Old Testament anger and wrath. One of John&rsquo;s prevailing themes, and the underpinning for much of Lakewood&rsquo;s current message, can be found in one of his sermons: &ldquo;It&rsquo;s God&rsquo;s will for you to live in prosperity instead of poverty. It&rsquo;s God&rsquo;s will for you to pay your bills and not be in debt. It&rsquo;s God&rsquo;s will for you to live in health and not in sickness all the days of your life.&rdquo;         Joel is the second youngest of six siblings, and the one considered least likely to take the pulpit. To say that he was a quiet child would be an understatement. The diminutive boy&mdash;he would grow six inches after he graduated from high school&mdash;was easy to underestimate. As his lifelong friend Johnny McGowan says, &ldquo;On the basketball court, guys would take a look at Joel and say, &lsquo;I&rsquo;ll guard him,&rsquo; and then Joel would go right by them.&rdquo;          After a year at Oral Roberts University, Osteen dropped out to return to Houston, in part to care for his mother, Dodie, who was then recovering from cancer (a miracle regularly cited at Lakewood Church). He then married his wife, Victoria, and took a formal position at Lakewood, helping out with the television show and the design of the platform, as the stage around the pulpit is known, and eventually becoming the producer of Lakewood&rsquo;s Sunday service. &ldquo;Victoria would kid me because I would spend four hours adjusting a light,&rdquo; Osteen says. &ldquo;I learned you can&rsquo;t separate the message from the presentation of that message.&rdquo;         It was perfect training for a 21st-&shy;century televangelist. Osteen developed a keen understanding of the television market&mdash;time slots, lead-ins, cost per rating point&mdash;and to this day can tell you the top stations in most of his major markets. So passionate was he about the medium that he invested $2 million of Lakewood&rsquo;s money for a stake in a television station, KTBU, in 1998, and an additional $6 million for the remainder in 2005. The independently operated station would turn out to be a wise purchase, returning $32 million when Lakewood sold it in 2006.         &nbsp;Even as he was making his father&rsquo;s church more successful than ever throughout the mid-1990s, Osteen quietly grew frustrated with his father&rsquo;s reluctance to expand as aggressively as Joel would have liked. &ldquo;My dad didn&rsquo;t have it in him. He just wouldn&rsquo;t feel comfortable with that.&rdquo; (In fact, Lakewood&rsquo;s rapid expansion has put it $45 million in debt, thanks to a $75 million bank loan that is still far from being paid off.)         Nevertheless, though three of his siblings were actively involved in the ministry, Osteen never considered taking the pulpit. &ldquo;He was so uncomfortable onstage,&rdquo; recalls Phil Cooke, a producer and consultant at Lakewood. &ldquo;He was very uncomfortable in public. He always loved being behind the scenes.&rdquo;         One Sunday, Osteen agreed to deliver the sermon. He doesn&rsquo;t know why and to this day asserts it was a kind of divine intervention, &ldquo;a strong feeling of God&rdquo; that compelled him to say yes to his father after saying no so many times. The story is often told of how Osteen gave his first sermon on January 17, 1999, as his father, who was suffering from kidney failure, lay in a hospital bed listening to it over the telephone. John Osteen passed away less than a week later.         Joel Osteen&rsquo;s ascension to the pulpit was fraught with uncertainty. He was so nervous about taking over the ministry that he canceled the time slots he had purchased for his father, assuming that no one would want to watch the telecast anymore. Victoria vetoed that. &ldquo;You call them back right now,&rdquo; she told him. He did and stayed on the air. At first, Osteen explains, he just wanted to maintain Lakewood&rsquo;s 5,000-person congregation. It soon became clear, however, that not only was the congregation not shrinking, but the television audience was actually growing. Osteen was proving himself a natural, more personable than his father, easy on the eyes, with a kinder, softer voice.          While Osteen&rsquo;s message wins over the moderate masses, he has become anathema to more-traditional Southern Baptists. His appearance on Larry King Live in 2005, during which he waffled as to whether heaven was barred to Jews, Muslims, and atheists, was posted on YouTube as proof that Osteen doesn&rsquo;t embrace the Gospel. And while Osteen is steadfastly Christian, he defers to God on the more contentious issues, recusing himself from condemning gays, for instance, or women who have had abortions.         Spending time with Osteen and his team, one can sense their discomfort when issues that could anger more-&shy;doctrinaire Christians are raised. Don Iloff, his brother-in-law and chief of communications, almost winces when I ask Osteen his views on intelligent design versus evolution. &ldquo;I believe that God created it all,&rdquo; Osteen says as he stakes out his usual middle ground. &ldquo;I don&rsquo;t know if it&rsquo;s six literal days or 6 million years.&rdquo;         Osteen&rsquo;s message of prosperity doesn&rsquo;t always go over well either. Fellow megapastor Rick Warren has called the idea that God wants everybody to be rich &ldquo;baloney.&rdquo; And some conservative Christian ministers have been quick to dismiss Osteen as a lightweight or, worse, a heretic. Osteen adamantly believes that &ldquo;God wants to give you your own house,&rdquo; explaining, &ldquo;He&rsquo;s not having financial difficulties. He owns it all.&rdquo;         Much of the criticism of Lakewood, no doubt, stems from resentment at Osteen&rsquo;s ministering to the largest and most financially successful church in America. He certainly makes an easy target, with the talk-show-host grin, the gelled hair, the bleached teeth, and the jocular manner. But there is no denying that his message, and his marketing of that message, is getting out to the world while so many other pastors are preaching to empty pews. Osteen dismisses the notion that he has watered down the Scriptures to win over worshippers. &ldquo;It&rsquo;s who we are,&rdquo; he says. &ldquo;The accessibility of my message doesn&rsquo;t bother me a bit. Look, we deal with people who are fighting cancer, fighting to save their marriages, dealing with the death of loved ones. I don&rsquo;t think they need to be beaten down. And I think the success of the message in the marketplace is because we are optimistic, encouraging.&rdquo;         Phil Cooke, a longtime colleague and the author of Branding Faith, says, &ldquo;Oprah has a brand, Nike has a brand, and Joel Osteen has a brand. Joel has made his brand the inspiration brand.&rdquo;       &nbsp;   In person, the 45-year-old Osteen is certainly both optimistic and encouraging. As he sits in the family suite after Sunday services, taking a break before heading up to the editing bay, he has the calm, gentle gravity of a man who never raises his voice and never has to. Everyone leans in to hear Osteen. With his too-small eyes, a sharp nose, and thin lips with parenthetical dimples on each side, his long, drawn face is like a happy, joyous, and free version of Munch&rsquo;s Scream. In his preacher&rsquo;s slacks, yellow tie, and blue striped shirt, he has a disconcerting habit of seeming to run out of words before finishing his sentences; the effect is that you&rsquo;re always left hanging, waiting for another word that might or might not come.         &ldquo;Have you read Good to Great?&rdquo; Victoria asks me at one point, referring to the phenomenally selling business book. &ldquo;Joel is a level-5 leader. He knows there is more than one way to get to a point, and he lets his people get to the point their way. He&rsquo;s a true level-5&mdash;great delegator, great empowerer, great big-picture thinker.&rdquo;         Osteen&rsquo;s boldest brainstorm was leasing the Compaq Center from the city of Houston in 2002 and investing $98 million to renovate it. For Osteen, who had always put a premium on the look and feel of the church, renovating and refitting a basketball arena as a sanctuary was both a great opportunity and a daunting challenge.         The scale of the renovation&mdash;a five-floor office annex, two 30-foot waterfalls, and a children&rsquo;s facility capable of hosting 5,000 kids while their parents are in the main sanctuary&mdash;was a logistical challenge better suited to Halliburton than a house of God. Osteen&rsquo;s brother-in-law Kevin Comes, the chief operating officer and a former construction executive, was the point man on the project, but like almost all of Lakewood&rsquo;s top executives, he deferred to Osteen: &ldquo;Joel made the decision to do it right the first time. We gutted the place and started over.&rdquo; Osteen was consulted on almost every major decision, responding with his usual quiet nod when he was presented with, for example, the new lighting scheme or platform design.          The resulting church is a modern technological marvel and perhaps the most family-friendly worship venue in the world. Kidslife, the $25 million children&rsquo;s facility, was designed by a group of former Disney staffers and provides care and religious services for the children of parents attending Lakewood. It has the look and feel of a giant version of a McDonald&rsquo;s play area, only with neon lettering that refers to a verse in Philippians on the walls.         Such a sterling facility is the logical extension of the Osteen brand. Last year, Lakewood generated $76 million in revenue, which amounts to just over $1,600 for every member of its congregation. Its take includes $44 million donated directly by congregants, who are asked to give 10 percent of their gross income; $10 million in product sales and sermon tapes; and $13 million brought in through direct-mail solicitations, up from about $6 million two years ago. The church&rsquo;s greatest expense is the TV airtime it buys: $22 million last year to broadcast the show in more than 100 markets, a 10 percent annual increase in spending that is easy to justify. &ldquo;Cutting back on airtime would be like saying we won&rsquo;t be sending any trucks to deliver our product,&rdquo; Comes says. An additional $13 million goes to administrative costs and salaries, and $9 million a year is spent on facilities and maintenance.         Osteen hasn&rsquo;t drawn a salary from the church since 2005. He bought his own home, for $331,500 in 1994, and pays to have his kids homeschooled. The considerable income from his books and related products (there were 19 spinoff calendars, daybooks, and inspirational pamphlets from his first book) goes to Osteen, who gives much of that&mdash;&shy;people inside Lakewood say more than 50 percent of his income&mdash;to Lakewood ministries and other charities. That still leaves Osteen with plenty of &ldquo;God&rsquo;s favor.&rdquo; The operation&mdash;the TV time, the basketball arena, the worship events staged across the country&mdash;should all simply be considered as, Comes points out, the delivery system for getting the product, Joel&rsquo;s message, out to the marketplace. The goal of Lakewood&rsquo;s 350 employees is to facilitate and spread that message. The return is measured in souls saved and lives changed. &ldquo;We&rsquo;re always looking for ways to get our message out there more efficiently; in that way, we&rsquo;re no different from any other big brand, a Coke or a Starbucks,&rdquo; Iloff says.         But it takes revenue to win souls, and within the organization are constant discussions about how to most efficiently package the message. Osteen&rsquo;s podcasts, which are free, consistently rank in the top 10 on iTunes, and Comes wonders aloud about how to monetize that. The team is not shy about dreaming big&mdash;and commercially. &ldquo;We sit and try to imagine what our program would look like with a Coca-Cola logo on the front. We&rsquo;re just looking into it,&rdquo; Comes says.          Still, when it comes down to &ldquo;message versus revenue,&rdquo; Comes says, &ldquo;message always wins.&rdquo; At Lakewood, message and revenue tend to work in blessed harmony. Duncan Dodds, Lakewood&rsquo;s executive director, took the podium recently in Greensboro to make a few announcements before Osteen, the choir, the entertainers, and the rest of the Lakewood team began their Night of Hope. &ldquo;We have great worship at Lakewood,&rdquo; Dodds told the crowd of 16,000 still settling into their seats, &ldquo;and that worship is for sale on CDs out on the concourse level.&rdquo;         One hears certain words repeated constantly by the Lakewood team. Meals, services, meetings, and even smoothly flowing traffic over on I-45 are described as awesome. The goal of every operation, sermon, television production, and even expenditure is excellence. And the ultimate purpose of all staffers is to spread the message. That message, functionally, serves as Lakewood&rsquo;s core product. Sure, it is repackaged into books, CDs, DVDs, Bible covers, scented candles, cross necklaces, JESUS FREAK T-shirts, and coffee mugs, but those are all just ways to deliver the message.         &nbsp;The Osteens, like so many American families during the recent real estate boom, spent the better part of the past decade buying, renovating, and selling homes, and became so proficient in the process that Osteen and his wife were able to skip hiring a contractor for their last renovation and go directly to the subcontractors to complete their mansion. Coming off the boom, during which the average American dwelling doubled in size, the Osteens&rsquo; digs are more modest than one might guess. The house is decorated in a rococo style that Victoria has called &ldquo;French&rdquo; and Osteen calls &ldquo;fancy.&rdquo; Their son, Jonathan, 13, and daughter, Alexandra, 9, are homeschooled, in part because their parents&rsquo; schedule requires that their weekend be shifted to Monday and Tuesday. During breaks in their lessons, they can play in the elaborate treehouse or the fenced-in rabbit pen behind the house.        As the actual weekend nears, Osteen rises at 5:30 a.m. to work on his sermons, which he delivers twice weekly. Osteen labors over them, speaking the words aloud as he types them into his computer. He considers the writing, shaping, and memorizing of his sermons to be the single most important part of his job. The message supports the whole enterprise, and he frequently turns to God to guide him when the burden of Lakewood, his success, or the scale of the church and business threatens to overwhelm him. &ldquo;It&rsquo;s just in me, God&rsquo;s favor, faith, and hope.&rdquo;        He believes, resolutely, in the value of the product he is crafting in his office on those quiet mornings. &ldquo;Very rarely will you find a company that produces a widget where everyone is mentally and spiritually into producing a better widget,&rdquo; Osteen says. &ldquo;There&rsquo;s a purpose behind what we&rsquo;re doing. We believe in our widget. We&rsquo;re doing more than giving people a good time or a better toothbrush, because it&rsquo;s hard to put in your heart and soul and sacrifice so much to make a better toothbrush.&rdquo;        Being backstage at a Joel Osteen worship event is remarkably similar to being at an N.B.A. game or a rock concert. Beefy security guards tell you where you can and can&rsquo;t go. Crew members chow down on a buffet laid out by a local caterer and bark into walkie-talkies between bites. At some point, black Town Cars head down the long, curving driveway into the belly of the arena and drop off the pastors and performers, who retreat into private suites. The night is a celebration of music, state-of-the-art visual effects, and, of course, Christ. Lakewood spends a great deal of money attracting top gospel and Christian talent, and music minister Cindy Cruse-Ratcliff leads a team of Grammy Award winners, including gospel singer Israel Houghton. It&rsquo;s a thumping occasion, with people dancing in the aisles and even the security guards singing along to &ldquo;Come Just as You Are&rdquo; and &ldquo;We Have Overcome.&rdquo; Osteen&rsquo;s entire family is in the act. His mother, wife, and children often play parts in the service. But it&rsquo;s Osteen himself we have come to see. He wins the crowd over with wholesome jokes and inspires with his sweet-voiced message. The sermon today is based on the notion of &ldquo;hitting the DELETE button when you have those negative thoughts.&rdquo; He urges us to banish that voice telling us, &ldquo;I&rsquo;ll never get that great job. I&rsquo;ll never meet that special someone. I&rsquo;ll never get married.&rdquo; Hit the delete button, he urges, and reprogram your mind. &ldquo;Just one inferior thought can keep you off balance and away from your God-given destiny.&rdquo;        The crowd is eager, multiracial, and well-intentioned. We want to hear good words, have uplifting thoughts, be inspired by a positive message. Who doesn&rsquo;t? We are here to escape our worries, or even better, to overcome them with hope. These are uncertain times, and we all feel the pangs of doubt. Can we pay our mortgage? Will we keep our job? When will we finally achieve the plus-size life we have been visualizing? Listening to Osteen, it all sounds so easy. Delete those negative thoughts. Focus on the positive. We are victors, not victims.       The highlight of every service is when Osteen asks those who are willing to turn their lives over to Jesus to stand up in the vast arena and make their commitment right then and there. It is an inspiring moment, filled with raised Bibles and palms outstretched to heaven; Osteen and some of the congregation are in tears. If we have been suffering, if we have been in pain, if we have dealt with financial insecurity, then this standing up, this raising of hands to heaven, this simple vow of faith, Osteen assures us, will start us on the road to wellness and prosperity.        For a moment, as the choir sings, &ldquo;When the battle is over / and the fighting is done / we&rsquo;ll lay down our armor / the victories all won,&rdquo; and the orange, red, and purple stage lights are flashing, and a halolike luminescence surrounds Osteen as he promises to free us from our fears, to lift us above our doubts, to lead us to prosperity and joy, I think about my own worries, my debts, my career, my woes.        How tempting it would be to just stand and turn my will and life over to Jesus if, in exchange, I will be led down a righteous path of prosperity, taken in hand by Jesus, and Joel, and delivered to my gilded acre of the American dream. Yes, yes, why shouldn&rsquo;t I stand? Because who am I not to want to be saved? Who doesn&rsquo;t need a little bit of Joel in their life, tonight, every night, forever, leading us from this dark place to our promised land? Together, hands joined, shoulder to shoulder, we will march forward into our glorious future. Delete the negative thoughts, Joel preaches. Yes, yes, delete them.        Related LinksThe Big Easy SellWhen Will Penmanship Become an Anachronism?Huge TV Audience Expected in China For Yao-Yi Showdown
      
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<item rdf:about="http://www.portfolio.com/culture-lifestyle/goods/gadgets/2008/07/16/Facebooks-Impact-on-CEOs?rss=true">
<title>Facebook Creeps Me Out</title>
<link>http://www.portfolio.com/culture-lifestyle/goods/gadgets/2008/07/16/Facebooks-Impact-on-CEOs?rss=true</link>
<description><![CDATA[Bill Gates doesn&rsquo;t get a lot of credit these days for being a visionary. But when it comes to his relationship with Facebook, he may still be a step ahead of the rest of us. The Sun, a British tabloid, reported this year that Gates had quit his half-hour-a-day Facebook habit, partly because he was getting more than 8,000 &ldquo;friend&rdquo; requests daily but also because he was finding &ldquo;weird fan sites about him.&rdquo; (View a slideshow of several &quot;weird fan sites.&quot;) A Microsoft representative confirms that the boss has gone cold turkey but wouldn&rsquo;t disclose whether Gates knew of a Facebook group called &ldquo;Would you have sex with Bill Gates for half of his money?&rdquo;         Actually, it&rsquo;s a wonder that Gates was on Facebook in the first place (Microsoft&rsquo;s $240 million investment in it notwithstanding). Bill Gates obviously doesn&rsquo;t need to schmooze on Facebook. And neither do you, despite the pressure you&rsquo;ve doubtless felt to join it (because, y&rsquo;know, everyone is on Facebook). Perhaps you&rsquo;re like Ben Rosen, who co-founded venture-capital fund Sevin Rosen, which has bankrolled such companies as Electronic Arts and Compaq (which he once led as C.E.O.). Rosen is hardly averse to sharing personal information online; he says his blog, BenRosen.com, has become a small social network of sorts. But he has yet to use his Facebook account. &ldquo;I&rsquo;m trying to figure out the utility for me,&rdquo; he says.         Or perhaps, like Gates, you just find Facebook a little&hellip;creepy. Businesspeople often claim to use Facebook for vague &ldquo;market research&rdquo; purposes or to satisfy idle curiosity. But the social norms of social networking are still in flux, making privacy a real issue, says internet-marketing writer David Weinberger. &ldquo;Younger people violate older people&rsquo;s idea of proper behavior when it comes to privacy,&rdquo; he says.        &ldquo;It&rsquo;s kind of eerie how much information is available about you on a social network,&rdquo; says Michael Fertik, C.E.O. of online-privacy service &shy;Reputation&shy;Defender, &ldquo;and how many conclusions, tentative or otherwise, can be made so handily, fairly or unfairly, based on that information.&rdquo; Fertik estimates that all 55 of his employees use Facebook, and although he doesn&rsquo;t, he&rsquo;s unsettled by the all-consuming, constant-update M.O. it encourages. &ldquo;I&rsquo;ve seen a lot of quiet, passive-aggressive resentments and rumors that come from people just knowing that much about your business,&rdquo; he says. &ldquo;If you&rsquo;re updating people, like, &lsquo;I&rsquo;m at a barbecue at my colleague&rsquo;s house,&rsquo; someone you work with might ask, &lsquo;Why am I not at that barbecue?&rsquo;&thinsp;&rsquo;&rsquo;        The ease with which Facebook can be used to broadcast your whereabouts adds a particularly disturbing dimension for executives who would surround themselves with security in real life but are lulled into complacency by Facebook&rsquo;s tidy veneer. Last year, the British military sent a directive to its army units to avoid revealing their service connections online&mdash;&ldquo;Be particularly careful if you are on Facebook, MySpace, or Friends Reunited&rdquo;&mdash;fearing that, yes, Al Qaeda could use them to track prey. Your business competitors might not be terrorists per se, but Facebook can be useful for anyone trying to poach your M.V.P.&rsquo;s.        Even social-networking evangelists are legitimately nervous about Facebook, given its fiasco last fall with Beacon, an advertising engine that automatically announced users&rsquo; activities on other sites&mdash;revealing their purchases, for example&mdash;without the users&rsquo; necessarily realizing that their every click was being chronicled. Facebook apologized, but that sort of unwitting dissemination of potentially sensitive information has strengthened the market for Connect&shy;Beam, a consultancy that sets up secure social networks for the corporate intranets of Fortune 500 companies. &ldquo;&shy;Companies like Honeywell,&rdquo; says Puneet Gupta, ConnectBeam&rsquo;s C.E.O., &ldquo;could not take a chance to put their information on someone else&rsquo;s cloud&rdquo;&mdash;meaning on the servers of a social-networking site the company doesn&rsquo;t control.        But Facebook&rsquo;s ick factor in the executive suite might have as much to do with its shiny, happy world of &ldquo;friendship&rdquo; as with security. &ldquo;There&rsquo;s almost an inverse relationship between seriousness and how much you participate in social networking,&rdquo; says &shy;ReputationDefender&rsquo;s Fertik, laughing. That basically nails it: Facebook is simply unserious&mdash;particularly given how it prompts hard-driving business executives to regress into adolescent vernacular. &ldquo;Poking&rdquo; people, requesting &ldquo;friends,&rdquo; writing on someone&rsquo;s &ldquo;wall&rdquo;: It&rsquo;s cute when you&rsquo;re in high school or college. But in a corporate environment, it sounds disingenuous and downright silly.        Ultimately, Facebook candy-coats the true nature of business relationships. And it will rot your teeth.Related LinksFacebook Page? Or Exhibit A in Court?MySpace and Friends Need to Make Money. And Fast.Meebo and Facebook Chat
  
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<item rdf:about="http://www.portfolio.com/executives/features/2008/07/16/Death-of-Ice-Cream-Magnate-Carvel?rss=true">
<title>Cold Case</title>
<link>http://www.portfolio.com/executives/features/2008/07/16/Death-of-Ice-Cream-Magnate-Carvel?rss=true</link>
<description><![CDATA[On what would be the final weekend of his life, Tom Carvel drove to his country home in upstate New York, deeply depressed. He&rsquo;d built a namesake national chain of 850 ice cream shops, developing some of the fast-food and franchising concepts that changed how America eats. His sandpaper-voiced pitches in commercials&mdash;&ldquo;Thinny-Thin for your fatty-fat friends,&rdquo; he said in one spot&mdash;had made Carvel a household name. He golfed with Bob Hope and did a guest turn on Late Night With David Letterman. He had recently sold his chain for $80 million, but he held on to a 100-room motel, 40 properties leased to Carvel franchisees, and a golf course in Dutchess County, New York. At 84, Carvel still was going to work every day.    But there were deepening problems inside his empire. Carvel confided to an associate that he no longer trusted Mildred Arcadipane, his corporate secretary of 38 years, or Robert Davis, his longtime lawyer and close financial adviser. Carvel had come to believe that they were scheming behind his back, maybe stealing from him. After agonizing for months, he arrived at his country home on Saturday determined to march into his office on Monday and fire his lawyer and relieve his secretary&mdash;a mercurial woman, according to many who knew her&mdash;of her considerable power.     But Carvel never got the chance. He was found dead in his bed that Sunday morning in 1990, the victim, it appeared, of a heart attack. Instead of being dismissed and demoted, Davis and Arcadipane returned to work and began to take command of Carvel&rsquo;s business and personal finances. The Carvel estate, officially valued at $67 million, spurred what one lawyer calls a &ldquo;feeding frenzy&rdquo;; nearly 18 years later, a bitter fight rages on. In most estate battles, family members square off against one another. But the principal fault lines in this case have put Davis, Arcadipane, and the multimillion-dollar charity that Carvel &shy;left behind on one side, and Carvel&rsquo;s widow, Agnes, and his niece Pamela Carvel on the other. The Carvels had no children, and Agnes &ldquo;was frozen out of everything,&rdquo; Pamela contends. &ldquo;She was denied millions that Tom wanted her to receive.&rdquo;     In 2007, after years of digging by private investigators in Pamela&rsquo;s employ, the case took a bizarre turn. Pamela filed a lawsuit in U.S. District Court in Fort Lauderdale, Florida, alleging that Carvel&rsquo;s death resulted in &ldquo;fraudsters&hellip;controlling all Carvel funds to the exclusion of the Carvels.&rdquo; She asked that her uncle&rsquo;s body be exhumed for an autopsy to determine if he was murdered as part of the alleged scheme. The petition concludes with a question: &ldquo;Will the truth finally be known?&rdquo; And with that, one of the most contested estate fights in New York history also became a murder mystery.     Pamela says she has circumstantial evidence against several former Carvel employees, but a great deal of her ire over the years has been aimed at Davis and Arcadipane, who not only continued to work for the company but also battled Agnes for years over the Carvel fortune from their seats on the Thomas and Agnes Carvel Foundation board&mdash;seats they gained through a document whose validity has been called into question. Both eventually were forced to resign from the board for misappropriating foundation money. Their families and lawyers scoff at any notion that they would ever have harmed Tom Carvel, but even if they had, neither will face justice. They are dead.  &nbsp;By any measure, the Carvel case is a legal colossus. More than 40 lawyers have had a hand in it. Legal fees and commissions have already drained more than $28 million from the Carvel fortune, according to Leonard Ross, one of Agnes&rsquo; former lawyers. Save for Carvel&rsquo;s widow, it is hard to find a guileless participant. Pamela casts herself as the selfless protector of her uncle&rsquo;s millions and her aunt&rsquo;s interests. To her opponents, she&rsquo;s just a desperate relative out for a big financial score. In one of the many lawsuits involving estate funds, a state judge in Florida ruled that there was &ldquo;strong evidence of fraud&rdquo; in the way she once tried to collect more than $10 million from the estate. Still, Fred Welsh, a former New Jersey police detective hired by Pamela, tells me that he has uncovered enough circumstantial evidence&mdash;including the possibility that Carvel&rsquo;s death certificate was forged&mdash;to warrant a homicide investigation.     The battle has played out in three U.S. district courts; state courts in New York, Delaware, and Florida; and in London. It enjoys a certain notoriety in the suburbs north of New York City, where Tom and Agnes Carvel lived in the gentle hills of Ardsley. Four trials have been held in Westchester County, New York; a fifth is ongoing. Four of Carvel&rsquo;s executors have died. When I phoned the Westchester County Courthouse to ask about examining case files, a clerk told me, &shy;&ldquo;I am making the sign of the cross now.&shy;&rdquo; I spent most of a day plowing through five large boxes bursting with pleadings and rulings before a court official said apologetically, &ldquo;We&rsquo;ve found more.&rdquo;    Pamela claims that her uncle once told her that he was worth $250 million, which would mean that tens of millions of dollars in assets have vanished. One thing is certain: Events have not turned out as Carvel wished. His plan to provide for his widow and funnel millions to small charities in the towns that supported Carvel stores backfired, in part because of the unwieldy, complex nature of the estate that he himself approved after consultation with Davis, his lawyer. &ldquo;He was always fearful that somebody was after his money,&rdquo; says Ginny King, a longtime friend.     And in the end, he was right.Born in Greece in 1906, Tom &shy;Carvel immigrated to New York with his parents and six siblings in 1910. As a young man, he test-drove Studebakers, played drums in the Borscht Belt, and fixed cars. After being diagnosed incorrectly with tuberculosis, he set out for the fresh air of Westchester, and with $15 borrowed from his future wife, he began selling ice cream from a beat-up vending truck. One hot weekend in 1934, he suffered a flat in the village of Hartsdale. Flagging down motorists to buy his melting ice cream, Carvel re&shy;alized he could do more business from a fixed location. So he remained for the summer, eventually saving enough to make a down payment on a nearby building. It became the first Carvel shop.       With some tinkering, Carvel discovered how to instantly freeze ingredients to produce a creamy ribbon of ice cream at the flick of a switch. It was the first soft-ice-cream machine of its kind. One store grew to many, and by 1950, 21 stores were operating under the Carvel name. With that, Carvel joined a group of franchising pioneers, including A&amp;W, White Castle, and Howard Johnson&rsquo;s, that were creating roadside chains that served up what would become known as fast food. Still, the ice cream business was a warm-weather enterprise, and Carvel needed to generate store traffic throughout the year. Again, the ice cream gods intervened. Pieces of crumbled cookies accidentally fell into a vat of soft ice cream placed in a freezer, and when the hardened batch was discovered, it led to another innovation: the Carvel ice cream cake.    Carvel&rsquo;s climb might have been even more astounding had he not rejected an invitation from a milkshake-machine salesman named Ray Kroc to join him in a fledgling California hamburger business named McDonald&rsquo;s. &ldquo;Tom claimed it was his biggest error,&rdquo; says Thomas Kornacki, a Carvel vice president in the 1990s who worked for the company for 23 years.    &nbsp;Tom Carvel had a special knack for promotion&mdash;and self-promotion. He sponsored Little Miss Half-Pint contests for young girls and made franchisees attend an 18-day course he called the Carvel College of Ice Cream Knowledge. His raspy, ad-libbed appearances in the company&rsquo;s commercials were ridiculed, but they were memorable and sales soared. The idea of the C.E.O. as pitchman would catch on and influence other company heads, like Frank Perdue and Lee Iacocca. In his ads, Carvel seemed benign, but in real life, he was no Mister Softee. He battled franchisees all the way to the U.S. Supreme Court, winning the groundbreaking right to require them to buy all ingredients and supplies from him, even the napkins.     Despite his wealth, Carvel lived simply. He wore polyester suits and hectored subordinates who didn&rsquo;t drive modest American cars like he did. Visitors to the Carvels&rsquo; Ardsley home were amazed to find couches protected by plastic slipcovers. His office was an oversize motel room with furnishings that would have gone begging at a lawn sale. Yet T.C., as friends called him, could be generous; each Christmas, he gave gifts of $10,000 (tax free) to dozens of nieces and nephews.     By the late 1980s, however, Carvel&rsquo;s fortune had become a burden. By then, he was in his eighties. Without children, he wondered what would happen to all he had accumulated. After wavering for months, he reluctantly sold his ice cream operations in 1989 to Investcorp, a Bahrain-based company that owned Tiffany &amp; Co. and Gucci. &ldquo;He didn&rsquo;t trust anybody in his family or in his executive group to grow the brand,&rdquo; Kornacki says. &ldquo;The company was his legacy, and he didn&rsquo;t want it to die.&rdquo;    Carvel put his personal affairs in order too. One cold Saturday night in February 1988, Tom and Agnes excused themselves from a dinner party to sign identical wills naming the Thomas and Agnes Carvel Foundation as the beneficiary of their fortune after their deaths. Carvel was quite clear about how he intended to bestow his estate. If he died first, Agnes was to receive all the income his estate generated, plus quarterly payouts from a trust fund. The Thomas and Agnes Carvel Foundation was to receive all that was left&mdash;once Agnes died.    Overseeing this estate would be seven executors, Arcadipane and Davis&shy; among them. That number is unusual, but Carvel was convinced that the seven would serve to check and balance one another, safeguarding his money. One of the people who helped fashion the plan was Davis, his lawyer. Whether Carvel was steered into this plan by unscrupulous advisers or driven to it by his own fears about the fate of his fortune is an open question. But he had not been dead for more than a few months before one thing became clear: The elaborate plan, rather than creating checks and balances, set up factions that came to feud over and feast on Carvel&rsquo;s fortune. It was turning into an estate disaster of monumental proportions.    The wild card in Tom Carvel&rsquo;s life seems to have been Mildred Arcadipane. A slight woman, she began working for Carvel in the early 1950s, fresh out of secretarial school. Her job was her life; in the 38 years that she was employed by the Carvel corporation, co-workers recall her taking off just two days&mdash;to attend her father&rsquo;s funeral. She never married, choosing instead to care for her elderly mother at home. By the 1980s, evidence in the many court cases shows, she had become a force inside the company. The accounting and payroll departments had begun to report to her. She &ldquo;knew the nuts and bolts of the company,&rdquo; and with her &ldquo;hot temper&rdquo; and &ldquo;iron fist,&rdquo; she knew how to get things done, Kornacki recalls. She could also be despotic. Some employees complained that underlings who crossed Arcadipane might find themselves without a job or that their health insurance had lapsed.     She had her way with Tom Carvel too. Arcadipane often cursed and shouted at the boss and locked him out of his own office dozens of times, a longtime driver for Carvel testified. On three &shy;occasions, Carvel sent him to New York City to buy jewelry as a peace offering. &ldquo;When she lost her temper,&rdquo; the driver said in the deposition, &ldquo;it would require almost a straitjacket.&rdquo; Asked why he kept Arcadipane on, Carvel once said cryptically that she had him &ldquo;over a barrel,&rdquo; according to another affidavit. Employees whispered that Carvel and Arcadipane, far from being just close business associates, might once have had an affair.  Pamela Carvel was close to Tom too. She grew up in Queens, New York, the eldest daughter of Tom&rsquo;s brother Bruce. Tom and Agnes treated her like the child they never had. As a teenager, she spent her summers living with them and serving ice cream at their Hartsdale shop. Tom took care of her college tuition bills and hired her to make inspections of Carvel stores. When her uncle died, Pamela, who was working and studying abroad, &ldquo;got a call to come home,&rdquo; she says. &ldquo;My aunt told me she needed help.&rdquo;     &nbsp;Tom had made Pamela one of the seven executors of his estate. She returned to New York in December 1990, she says, to find an avalanche of suspicious transactions involving the Carvels&rsquo; finances. Bank accounts were being closed and opened, apparently without Agnes&rsquo; knowledge, and large sums of money were being transferred between Carvel accounts, her lawyers told me. In the middle of these matters, Pamela says, were Davis and Arcadipane. Davis wasn&rsquo;t a Carvel lifer, but he had a long history with Tom Carvel. While working for a Manhattan law firm, Davis had taken Carvel on as a client in 1969 to advise him on how to take his company public that year. Davis later helped negotiate the 1989 sale to Investcorp.    Hints of trouble surfaced before Carvel was even buried. As Agnes attended her husband&rsquo;s wake, Davis entered the Carvel home without her permission to search for Tom&rsquo;s will, bringing a locksmith to crack open the couple&rsquo;s safe, court documents show. Shortly thereafter, Arcadipane began shredding &shy;records at the office, defying orders from other Carvel executors that she stop. The shredder was silenced only after Pamela burst in and cut the electric cord herself. Through it all, Carvel&rsquo;s will could not &shy;be found. It had been given to Arcadipane for safekeeping, but she claimed it was lost. Its disappearance delayed Carvel&rsquo;s executors from officially assuming control of his estate, leaving Davis and Arcadipane in command for months.     Agnes, during this period, seemed overwhelmed. Davis was pressuring her to loan the business $500,000, saying there were cash-flow problems. Agnes demurred, on the advice of Pamela, who considered the request improper. But &shy;Davis persisted. He sent another of Tom&rsquo;s employees to Florida to talk to Agnes while Pamela was in New York, and this envoy convinced the widow to supply the funds. Meanwhile, Thomas Reddy, &shy;a lawyer and a family friend, got Agnes to sign papers creating a trust account for her money. Three trustees would manage the funds and have the authority &shy;to make distributions to her. Known as the Florida trust, it was touted as a safeguard for Agnes&rsquo; assets&mdash;but for the widow, it would become a nightmare.    Unusual things were also happening at the Thomas and Agnes Carvel Foundation. Davis emerged as the foundation&rsquo;s first paid president, at a salary of more than $100,000 a year, and board members&mdash;including Arcadipane&mdash;began drawing stipends, records show. The payments were troubling to Agnes because she and Tom believed that any work for the charity should be done for free. Agnes also became bewildered by the foundation&rsquo;s abrupt shift in direction. Although it bore their names, it was focused more on making six- and seven-figure grants to big, established institutions than on making small grants to the grassroots groups Tom and Agnes favored.    Worse for Agnes, a serious flaw emerged in the estate plan. With the Thomas and Agnes Carvel Foundation now under the sway of Davis and Arcadipane, it took an aggressively adversarial position, questioning Agnes&rsquo; spending and even challenging her right to continue Tom&rsquo;s practice of giving gifts of $10,000 at Christmas, according to Agnes&rsquo; lawyers. (The foundation denies this allegation.) The charity had a reason to be aggressive: Every dollar that Agnes spent or gave away of her husband&rsquo;s fortune would mean less money to the foundation when she died. Agnes and Pamela were rapidly coming to the conclusion that the two people Tom suspected of cheating him before his death had become their enemies too.    As Pamela and Agnes plotted to regain control of the foundation, they got some help. The New York State attorney general&rsquo;s office opened an investigation in 1991. Its findings were shocking: The inquiry discovered that the charity paid $55,000 in tuition for Arcadipane&rsquo;s nephew and two others and tried to camouflage the spending as grants. The attorney general also questioned Davis&rsquo; and Arcadipane&rsquo;s roles in the foundation&rsquo;s sale of Carvel stock, which reaped a quick $5 million profit for some company employees, including $300,000 for Arcadipane.     &nbsp;In August 1993, the attorney general filed a civil lawsuit seeking the ouster of Davis and Arcadipane from the foundation and the repayment of nearly $1 million, plus money paid to cover their legal fees. Far from being chastened, Davis helped prepare a memo to foundation members warning that his and Arcadipane&rsquo;s removal would provide the family &ldquo;with an opportunity to assume control of the foundation.&rdquo; The memo found its way to the Carvels. To Pamela and Agnes, it was a smoking gun. &ldquo;The foundation took an attitude that the Carvel family should not have any say in the operation of the Carvel Foundation,&rdquo; Agnes&rsquo; former lawyer Ross says. &ldquo;Davis was behind that.&rdquo;     Agnes fired off a letter to the foundation. &ldquo;I am appalled that Mr. Davis views this foundation as his own private charity, where the Carvel family is to be treated as the enemy,&rdquo; she wrote. Pamela sent a scalding note to Arcadipane: &ldquo;Obviously, you feel no responsibility nor the slightest twinge of gratitude&rdquo; to the man and the company that had &ldquo;made a secretary into a millionaire!&rdquo;  The battle was on. Agnes and Pamela went to court to oust Davis and Arcadipane as foundation directors and executors of Tom&rsquo;s estate. The foundation countersued, accusing Agnes and Pamela of meddling in its affairs.     The fighting turned so nasty that Davis and Arcadipane asked Judge Albert Emanuelli of the Westchester County Surrogate&rsquo;s Court, in White Plains, New York, to investigate Agnes&rsquo; mental competency. To Agnes&rsquo; lawyers, it was an effort to silence the widow for good. Davis and Arcadipane said they just wanted to make sure that Pamela was not controlling Agnes. In an affidavit, Arcadipane said she looked on Tom and Agnes &ldquo;in many ways as parents&rdquo; and believed that &ldquo;they reciprocated the depth of feeling.&rdquo; She continued, &ldquo;Sadly, since Mr. Carvel&rsquo;s death, his niece Pamela has sought to alter Mrs. Carvel&rsquo;s feelings toward me and view of me and to rewrite history.... She has undertaken to level accusations at me...that are scandalous and shameful.&rdquo;Pamela Carvel is 59 and single. She cuts a bohemian figure, tying her bottle-blond hair into a braid that falls to her waist. The estate fight is a full-time occupation for her. By her own accounting, she has plowed through millions of dollars and fallen into debt to help her Aunt Agnes and stop what she calls the plundering of Tom&rsquo;s estate. Pamela can be strident and difficult; she has had at least four law firms represent her. She now accuses some of those lawyers of betrayal. Still, a few of them speak of her with a weary admiration. &ldquo;Pamela Carvel is a very tough lady who was fiercely dedicated to her aunt and to the memory of her uncle,&rdquo; says John Lang, one of Agnes&rsquo; former lawyers. &ldquo;My sense is that she was completely sincere in what she was doing.&rdquo;     Pamela&rsquo;s critics ardently disagree. Betty Godley, Agnes&rsquo; niece, filed an affidavit in Surrogate&rsquo;s Court accusing Pamela of manipulating Agnes for &ldquo;her own insatiable greed.&rdquo; Godley tells me, &ldquo;I think there were great expectations on Pamela&rsquo;s part of money coming her way.&rdquo; Never close, Pamela and Godley have not talked in more than 10 years. Their split demarcates a family fracture in the Carvel case. &ldquo;From day one, there was a paranoia to Pamela that was incredible,&rdquo; Godley says. &ldquo;Everybody and anybody was an enemy.&rdquo;     Since 1991, Godley has received more than $400,000 in commissions as an executor of Tom&rsquo;s estate and one of the three people overseeing Agnes&rsquo; Florida trust. Still, she talks of her participation as a burden that she wishes would end. &ldquo;I have five kids, a family, everything she doesn&rsquo;t have,&rdquo; Godley says of Pamela. &ldquo;This has been Pamela&rsquo;s life for 17 years.&rdquo;    The seeds of Pamela and Godley&rsquo;s split were planted six months after Tom&rsquo;s death, with the creation of the Florida trust that was supposed to be a vehicle to safeguard Agnes&rsquo; money. Godley was the only family member among the trustees. Pamela has always seen Godley&rsquo;s appointment as a ruse. &ldquo;That was the only way to make it look legitimate, by having a family member on it,&rdquo; she says. But after the trust was created, Agnes &ldquo;no longer had any money in her own name,&rdquo; she adds.    &nbsp;Indeed, in the spring of 1994, things turned bleak for Agnes when, at roughly the same time, the two trusts that doled out her funds&mdash;the Florida trust and the trust set up by Tom, which contained $26 million and was overseen by Davis, Arcadipane, and two other trustees&mdash;both stopped making payments to her, according to a lawyer for Agnes. Both trusts used the same rationale&mdash;that others were manipulating Agnes, who therefore couldn&rsquo;t be trusted with her own money. Ross, her former lawyer, saw a more sinister motive: &ldquo;Mrs. Carvel was being squeezed, I think, to stop all the litigation.&rdquo;     Agnes and Pamela were furious at Godley for withholding the money. The breach became permanent in 1995, when Pamela arranged to have $2 million moved from a Carvel corporation account whose ownership was in dispute into a Swiss bank account registered in Agnes&rsquo; name. Pamela said the money had been owed to Agnes and that she had dutifully notified the required parties. But Godley went to court to challenge the transfer, and Judge Emanuelli of the Surrogate&rsquo;s Court ordered that the money be placed in escrow. Godley and her aunt would never talk again.    By the middle of 1995, the Carvel widow, now 86, was in turmoil, bewildered by the endless swirl of litigation. She was upset at her financial predicament and fearful that Judge Emanuelli, whom she had come to view as hostile, would declare her incompetent, stripping her of whatever control she still had over her life. So she sought refuge in London, moving there with Pamela to live out her days, she hoped, in peace.    Sally Boynton, a Westchester County lawyer appointed by the court to be Agnes&rsquo; legal guardian, took Agnes and Pamela&rsquo;s side after flying to London to judge Agnes&rsquo; competency for herself. The widow, Boynton would later tell the court, had become the victim of the &ldquo;unscrupulous dealings of untrustworthy people&rdquo; and had moved to London &ldquo;to gain control over her assets to prevent &lsquo;the thieves from stealing from her.&rsquo;&thinsp;&rdquo; Boynton also wrote that Agnes expressed &ldquo;unequivocally&rdquo; her trust in Pamela to handle her affairs.     Godley saw it quite differently. She charged that Pamela had become a Svengali, &ldquo;hiding&rdquo; Agnes in London in an attempt to thwart an inquiry into Agnes&rsquo; competency. &ldquo;I feel a heinous crime has been done to my aunt,&rdquo; Godley wrote in an affidavit filed in the Surrogate&rsquo;s Court. Judge Emanuelli forced Boynton to resign her guardianship, and he replaced her with Marc Oxman, a lawyer who at that time was the executive director of the Westchester County Democratic Party.     Oxman was far more skeptical of Agnes&rsquo; competency and Pamela&rsquo;s motives. In his report, Oxman wrote that Agnes had been &ldquo;manipulated and controlled by those individuals who did not have her best interests at heart.&rdquo; As the battle raged, Agnes died in London in August 1998, at the age of 89. Yet even in death, she could find no peace. Her body remained in cold storage for about a month while both sides fought over whether to allow an autopsy to determine if she had suffered from dementia. Pamela, who opposed the examination, prevailed and quickly cremated her aunt&rsquo;s remains.     Rather than hasten a resolution of the case, Agnes&rsquo; death complicated matters, for now there were two estates to fight over: Tom&rsquo;s and Agnes&rsquo;.    Arcadipane and Davis had resigned from the Carvel Foundation in 1996, in a deal with the New York attorney general&rsquo;s office to settle allegations of wrongdoing. Arcadipane died in 2002, at age 74, of a heart ailment. Davis died sometime later. But that didn&rsquo;t end the foundation&rsquo;s fight with Agnes&rsquo; representatives. Indeed, the charity has continued to be a fierce and formidable opponent of Agnes&rsquo; attorneys and Pamela in their fight over Tom Carvel&rsquo;s millions.    The foundation has approximately $36 million in assets, according to its most recent published tax records, from 2005.But today, the charity is connected to the Carvel family in name only. No family member sits on its board. Its directors have paid themselves more than $1.3 million in salaries since Tom Carvel&rsquo;s death, including about $43,000 annually to the foundation&rsquo;s president, William Griffin, the multimillionaire chairman of the Hudson Valley Bank, based in Yonkers, New York. Moreover, the charity has spent many millions battling for the Carvel fortune. In 1998, it was instrumental in torpedoing a proposed settlement that would have ended all litigation and given Agnes $8 million&mdash;a fraction of her husband&rsquo;s estate.    &nbsp;The foundation didn&rsquo;t respond to a request for comment on this; indeed, officials declined to be interviewed. The charity issued a statement that said, in part, that &ldquo;Thomas and Agnes Carvel established the foundation and left the bulk of their estates to it to provide charitable grants to needy children, and the foundation is focusing its energies on fulfilling that mission...rather than responding yet again to Ms. Carvel&rsquo;s baseless allegations.&rdquo;    And still the litigation continues. The latest chapter, playing itself out in the Surrogate&rsquo;s Court stems from a rare, albeit posthumous, victory for Agnes Carvel. In June 2003, five years after she died, a Surrogate&rsquo;s Court judge ruled that she had been denied $7 million in income generated by Tom&rsquo;s estate during her lifetime. The current trial is about what to do with this money and $3 million in other assets. The foundation is claiming all of it as the final beneficiary named in Tom&rsquo;s and Agnes&rsquo; 1988 wills. [Tom&rsquo;s will surfaced several months after his death.] Agnes&rsquo; lawyers argue that because she was wrongly denied the funds while she lived, her new London executor should decide how the money should be spent.     Pamela also made a play for the funds. After obtaining a $15 million judgment in a London court against her aunt&rsquo;s estate for money Pamela says she spent in caring for Agnes and providing for her legal representation, she then tried in three separate American courts to collect the money from Agnes&rsquo; U.S. assets. But she did so without informing the Carvel Foundation&mdash;conduct that caused a Florida judge to suggest that Pamela may have committed fraud. In June 2007, a judge in London removed Pamela as the executor of Agnes&rsquo; British estate and concluded, &ldquo;Her every act has been calculated to promote her own personal interests and prejudice those of the foundation.&rdquo;    Meanwhile, the case, which is expected to drag on at least through the end of this year, continues to devour the Carvel fortune.    And what of Pamela&rsquo;s most provocative theory, that the ice cream king, rather than succumbing to heart disease, was murdered?    Arcadipane&rsquo;s brother, Charles, now 78, says suggestions that his sister might have killed Carvel are ridiculous: &ldquo;My sister could not hurt a fly.&rdquo; Davis&rsquo; last lawyer, Katharine Conroy, says the murder allegations &ldquo;should be taken in the context they are made and weighed against the person who is making them.&rdquo; Boynton, Agnes&rsquo; former guardian, says &ldquo;nothing would surprise me in this case&rdquo; given &ldquo;the sense of entitlement and greed some of these people had toward the Carvel money.&rdquo;    Indeed, questions persist. Welsh, the former New Jersey detective Pamela hired to investigate the case, says he uncovered circumstantial evidence that suggests someone might have fatally tampered with Carvel&rsquo;s heart medicine. Old friends of the Carvels who were staying at the Carvel home the weekend Tom Carvel died told Welsh of an odd development: They got a call from a Carvel employee within hours of Tom&rsquo;s death telling them to remove all prescription drugs from his medicine cabinet. The request befuddled them, but they complied. Welsh also says he was suspicious of how quickly Carvel&rsquo;s body was whisked away to a New York City funeral home.     In the Carvel case&rsquo;s vast paper trail, one item stands out. Pamela&rsquo;s investigators say they tape-recorded Tom&rsquo;s longtime physician, Robert Athans, saying that he does not remember signing Tom&rsquo;s death certificate even though it bears his signature. The doctor declined to comment for this story. If the death certificate was forged, who did it, and why? Was it to prevent an autopsy?    A federal judge in Fort Lauderdale ruled in May 2007 that Tom&rsquo;s exhumation is a matter for New York courts to decide. Pamela says she hopes to file an exhumation request in New York soon.    And if the request is denied, or if an autopsy proves nothing, will that be the end of it?    In one of my last conversations with Pamela, she talked of the exhumation request as if it were her final card to play, but later she recanted. &ldquo;In Florida and in Delaware...I am still going to go after the bastards,&rdquo; she says, cataloging a list of possible lawsuits and legal actions. &ldquo;I have nothing left now. So what do I have to lose?&rdquo;     Related LinksThe Irrational Allure of Free StuffFood Inflation Datapoint of the DayChief Executive Vintners
  
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<title>Time&#x27;s Running Out on the Billable Hour</title>
<link>http://www.portfolio.com/news-markets/top-5/2008/07/13/Curbing-Runaway-Legal-Fees?rss=true</link>
<description><![CDATA[William Nelson Cromwell famously earned a million dollars for his work in selling the Panama Canal a century ago. His fee, the New York Times noted in 1908, was &quot;the like of which can hardly be paralleled in the history of the legal profession.&quot;  News of some recent paydays probably would have Cromwell, whose legacy lives on in the top-tier Wall Street firm Sullivan &amp; Cromwell, wishing he could get back to work.  Delphi, an auto parts maker, racked up nearly $100 million in legal, accounting, and consulting fees in the first eight months of its bankruptcy proceeding in 2006. Lawyers who succeeded in an Iowa antitrust case against Microsoft were awarded $75 million in fees and costs last August. And this March, the law firm representing one segment of investors suing financial institutions tied to the Enron bankruptcy requested a whopping $688 million in fees.  With some lawyers now charging upwards of $1,000 an hour, and phalanxes of partners and associates being marshaled to fight increasingly complex and time-consuming (read: billable-hour-generating) battles, one can rightly wonder whether the first billion-dollar legal bill could be far behind.  The fear of just such a billing Armageddon has caused some of the nation's largest corporations to push back. Some are instituting a moratorium on fee hikes, others are insisting that fees actually be slashed, and many are installing new billing software to track and cap expenses. A few are even prodding law firms to come up with wholly new compensation arrangements that better align their interests with those of their corporate clients.  Last November, the news that some new law firm associates were being paid $160,000 a year spurred Wal-Mart to action. The company responded with a &quot;moratorium on across-the-board rate increases&quot; for all of its outside firms and demanded that they provide the hourly rates charged for every associate working on a Wal-Mart account going back to &quot;the class of 2004.&quot;  That same year, Tyco International named a single firm, Eversheds, as its preferred outside counsel in Europe, the Middle East, and Africa, pulling about $20 million in legal work from more than 200 other firms. Eversheds got the work by discounting fees and agreeing to let Tyco have final approval over cost estimates.  Companies like Pfizer are making strides in reducing legal costs by making law firms compete head to head for business, with cost as a major factor. Others, including AOL, Barclays, and General Motors, have embraced electronic billing systems that flag legal expenses over set amounts. &nbsp; These firms &quot;can't enter a cost that doesn't fit in the box you create,&quot; says Susan Hackett, senior vice president and general counsel of the Association of Corporate Counsel, whose 24,000 members are among the major employers of outside law firms.  &quot;It can be something as simple as saying no plane travel in excess of $500,&quot; Hackett adds. &quot;If the lawyer tries to enter a ticket for $650, it will bounce, and the onus is then on the firm to say why the expense was necessary.&quot;  This September, Hackett's association plans to begin a more organized assault on high legal fees. The multiyear effort will result in a set of tools that can help even small corporations get a handle on legal costs.  These include best-practice guidelines to help model and price specific legal services such as certain stages of litigation, and an online network where corporate counsels and law firms from across the country can easily obtain references and compare fee information in specific geographic areas.  &quot;The billable hour stinks, but it is the symptom of the underlying problem,&quot; Hackett says, noting that most corporate law departments are too small to easily monitor what their outside counsel is doing.  Combined with that reality, &quot;law firms are not run on the concept of how quickly and efficiently they can do work for their client,&quot; Hackett adds. &quot;They are run on how much they can charge their client before they are fired. It's the throw-up point.&quot;  Getting a handle on outside legal costs certainly makes sense for corporations. It can be a boon to the bottom line. Dupont, for instance, pioneered a program to partner with its law firms in the 1990s after mass tort litigation left it swimming in outside legal fees.  &quot;We had a docket in excess of 4,000 cases and we were spending $140 million a year in 1994 dollars,&quot; notes Thomas Sager, Dupont's general counsel and senior vice president of litigation.  The company has since whittled down the number of law firms it uses to 43 from 350, has traded a promise of long-term relationships for a willingness by the firms to offer alternative fees and discounted rates, and has produced a host of systems to better track and monitor the legal work that results.  Sager said Dupont's cost savings is between $15 million and $20 million a year, or about 18 percent of the company's total expenditures on outside counsel.  Felice Wagner, who heads Sugarcrest Development Group, a law firm consultancy, notes that other companies have had similar success. It's no coincidence, she adds, that the industry spending the least on counsel is the group that most aggressively tracks its outside firms. The insurance industry pays, on average, just $294,098 per lawyer per year. &ldquo;They have been very successful at putting the screws into their law firms,&rdquo; says Wagner.  Whether or not these corporations will soon force white-shoe law firms into a new way of thinking is another story. &quot;The Sullivan &amp; Cromwells of the world like the status quo and don't see the need to move toward alternative fees,&quot; Sager says.  It's easy to see why. The 2007 Law Firm Economics Survey from Lexis Nexis found that the operating profit margins at top firms climbed to 41 percent in 2007 from 35 percent a year earlier, while  a separate recent survey by the National Law Journal found billing rates locked in a long-term climb, gaining an average of 7.7 percent in 2007. &nbsp; The bill to clients is considerable. The median amount that large corporations pay annually for each outside lawyer working for them was $616,519 in 2007, according to the 2007 Altman Weil Law Department Metrics Benchmarking Survey. Chemicals manufacturers topped the list, reporting that average outside legal expenses reached more than $1.1 million per lawyer. That is music to the ears of law firms on the receiving end.  Still, some firms see the growing discontent as an opening to take a new tack. Jay Shepherd, who runs the employment-litigation firm Shepherd Law Group in Boston, jettisoned the billable hour system in favor of flat rates for all client matters at his firm.  Other firms have taken similarly drastic steps, though the number can be counted on two hands&mdash;among them, Bartlit Beck Herman Palenchar &amp; Scott and the Valorem Law Group, both in Chicago, Exemplar Law Group, in Boston, Summit Law Group, in Seattle, and Leader &amp; Berkon, in New York.  However, Shepherd's success in gaining business is noteworthy. His firm's year-over-year revenue more than doubled in 2007, after increasing 5 to 10 percent per year between 2004 and 2006. Among his new clients is Adobe Systems.  Although the vast majority of the software company's outside legal work is still done on the billable-hour system, Ronald Friedman, associate general counsel and head of litigation at Adobe, says he's been pleased by Shepherd's flat-fee arrangement, noting that it &quot;allows you to know up front what your costs are going to be.&quot;  He hints that, unless billing rates begin to fall, more such deals could be in the offing.  &quot;I am always interested in exploring alternative billing arrangements,&quot; he says. But &quot;the more the hourly rates continue to increase to the point of being difficult to justify, the more I am going to be interested in exploring other alternatives where the interests of the client and the lawyer are better aligned.&quot;  If enough companies like Adobe make that call, the Sullivan &amp; Cromwells of the world may have to begin listening.Related LinksBeauty and the BarTech Stars Look Different From a College Student's SeatFirst Bytes: Yahoo, Time Warner, Google, Adobe, more...
      
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<item rdf:about="http://www.portfolio.com/careers/job-of-the-week/2008/07/13/Pro-Game-Consumer-Benny-Torres?rss=true">
<title>Mostly Fun and Games</title>
<link>http://www.portfolio.com/careers/job-of-the-week/2008/07/13/Pro-Game-Consumer-Benny-Torres?rss=true</link>
<description><![CDATA[                                                                                                                                                                                              Job Title: Professional videogame consumer                          Employers: Ad agencies                    Openings: Job fairs and networking                      Salary Cap: $65,000       Although Benny Torres recently graduated from college with a degree in psychology and advertising, he got his current job simply by being himself: a 23-year-old guy who&rsquo;s totally into videogames.  Torres spends most of his waking hours playing the latest games and reading all the latest gaming news and gossip online. And since last year, he&rsquo;s been doing it from a cubicle in the Chicago headquarters of ad agency Leo Burnett.  Torres first joined Burnett as an intern last June&mdash;and quickly became known as the go-to guy on videogames. Creatives on the Nintendo account turned to Torres for answers on everything from the key plot points of games to the types of fonts that were used in them. By fall, he had a full-time staff job as an associate planner. That&rsquo;s his official title, but unofficially, he&rsquo;s still the go-to guy on videogames.  &ldquo;We just realized what an incredible wealth of knowledge he had about Nintendo, about gamers, about their habits, about where they talk and where they live,&rdquo; says Rose Cameron, senior vice president and planning director for Leo Burnett.  &nbsp;&nbsp;&nbsp;  Now, Torres&rsquo; job is to research any games that Burnett is going to develop ads for. He pulls together a &ldquo;game brief&rdquo; on how it&rsquo;s played, its history, and the advance buzz about it from the dozens of videogame-related websites, blogs, and message boards that he reads on a regular basis.   &ldquo;I basically scour the Web for anything and everything that I can possibly find about it,&rdquo; says Torres. He also relies on the connections he&rsquo;s built from blogging about gaming in the past and from attending industry events and conferences.   Torres&rsquo; game brief was instrumental in the development of a recent television ad for Mario Kart Wii, a cart-driving game. In the commercial, a huckster named Cowboy Jed enthusiastically tells viewers to check out all the carts they can drive in the game as banjo music jangles in the background.   &ldquo;I made sure our whole team understood this whole game is all about the mayhem and the frenzy and just the craziness of racing,&rdquo; Torres says. The resulting ad was &ldquo;very true to the spirit of the game,&rdquo; he adds.   The Miami native got his first game system, a Nintendo Entertainment System, when he was not yet five years old, and even recalls seeing the delivery truck pull up to his house from his bedroom window. His parents had been avid Atari players when they were younger, and their enthusiasm for videogames rubbed off on him (Torres remembers playing Wheel of Fortune with his mom until late into the night on one occasion).  Torres says his favorite game remains the 1998 action-adventure game, The Legend of Zelda: Ocarina of Time for the Nintendo 64. The bestselling game, in which the player has to travel through time to defeat an evil king, was one of the first to incorporate high-quality 3-D graphics. &ldquo;It&rsquo;s almost like the Gone With the Wind of videogames,&rdquo; Torres says. &ldquo;It was the first game, for me, that created an immersive world that I truly lost myself in.&rdquo;  Torres realizes that getting to play and talk about games like Zelda and its successors is a dream gig, and he credits the videogame industry for being one that inspires such enthusiastic consumers.   &ldquo;Honestly, I feel just really lucky to be given the opportunity,&rdquo; he says. &ldquo;I don&rsquo;t think there&rsquo;s much of a passionate fan base for laundry detergent.&rdquo; Related LinksSpring GamingGame BoyThe Gamesman
  
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