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MAY 30, 2005
Edited by Monica Gagnier HEADLINER Ronald Perelman: Savoring The Verdict  And the winner is...Ronald Perelman! On May 18, jurors in a state court in West Palm Beach, Fla., awarded the billionaire $850 million in punitive damages, on top of $604.3 million in actual damages, in a lawsuit against Morgan Stanley (MWD
). Perelman claimed the investment bank defrauded him seven years ago when it provided him with information that convinced him to sell his company, Coleman, to Sunbeam.Perelman is getting a huge sum -- even by Wall Street standards. Morgan Stanley must pay him $1.45 billion -- over 30% of the $4.5 billion it earned last year. By contrast, New York Attorney General Eliot Spitzer pried $1.4 billion out of the Street in 2002 to settle allegations that it issued misleading research. But this boxing match is hardly over. Morgan Stanley chief Philip Purcell vowed to "fight." Perelman said: "This award should send a clear message to Morgan Stanley about what constitutes professional and ethical behavior." For now, Perelman is reveling in his knockout. By Emily Thornton HP: Fog On The Horizon New Hewlett-Packard (HPQ ) Chief Executive Mark Hurd uncorked upbeat second-quarter results on May 17, but he is still "several months" away from unveiling his game plan for improving the computing giant's fortunes. HP posted 9% growth in net profits, to $966 million, with revenues rising 7%, to $21.6 billion. The news boosted HP's stock price by 4.6%, to $22.55 the next day. Hurd did suggest that his plan will include a fair amount of cost-cutting. "We're reviewing every element of cost structure and operations," said Hurd during a conference call. That could mean an anxious summer for HP employees.   Let The Wines Cross Lines  Oenophiles, raise your glasses. On May 16, the U.S. Supreme Court struck down laws in New York and Michigan that prohibit customers from buying wine directly from out-of-state wineries. The ruling could lead to the repeal of laws in 22 other states that prohibit spirits from being shipped over state lines, opening up markets for direct sales by small vineyards. The 5-4 majority, led by Justice Anthony Kennedy, wrote that the 24 states that limit out-of-state wine deliveries while authorizing shipment by in-state producers discriminate against interstate commerce. States unhappy with the ruling, however, might have the last laugh: They might choose to ban direct shipment of all alcohol.The SEC Has A New Quarry Pension consultants are the latest target of the Securities & Exchange Commission's crackdown on financial firms' failure to manage conflicts of interest. The agency is investigating around a dozen unidentified consultants who advise public and private pension funds. The probes are the result of an 18-month review of 24 consultants that found that more than half had business relationships with money managers that could influence the advice they give pension fund trustees. The SEC said few consultants disclosed their ties to money managers. The agency also is concerned that money managers are being pressured to buy software from consultants or pay to attend conferences they host so that business will be steered to them. The Camry Goes Hybrid Fuel-efficient hybrid engines are about to join moon roofs and side air bags on the list of options for buyers of Camry sedans. Toyota Motor (TM ) announced on May 17 that it will spend $10 million outfitting its plant in Georgetown, Ky., to make gas-electric versions of the Camry, America's best-selling car for the past three years. Japan's top carmaker plans to start churning out the first of 48,000 hybrid Camry models a year by late 2006. It will be the first hybrid made in the U.S. by a Japanese auto manufacturer. Sales of the Prius, Toyota's most popular hybrid, which is made in Japan, totaled 53,991 last year in the U.S. The company began selling two other hybrid models this spring, including a luxury Lexus sport-utility vehicle. Et Cetera... -- UPS (UPS ) is buying trucker Overnite (OVNT ) for $1.25 billion. -- Edward Gramlich will leave the Federal Reserve to return to academia. -- Boise Cascade cut its initial-public-offering price to a range of $17 to $19 a share. Closing Bell: U.S. Steel  Steel prices have been sliding all year. But after data from China showed an unexpected pop in industrial output, investors are hopeful that the declines are ending. As a result, they poured money back into the industry on May 18, lifting U.S. Steel's (X
) stock 4.4%, to $41.02.
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