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  • bancinvstr bancinvstr Aug 24, 2004 9:34 AM Flag

    Analyst's estimates UP for 05

    Anyone out there know when this tax issue will be resolved? How about the maximum it could cost the company? Why was this issue raised by the insurance commissioner and not the franchise tax board?

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    • "Anyone out there know when this tax issue will be resolved? How about the maximum it could cost the company? Why was this issue raised by the insurance commissioner and not the franchise tax board?"

      The lawsuit won't be resolved until next year at the earliest, IMO, under summary judgment. Although a motion to dismiss might work sooner, based on the fact the court approved the order as jointly sought by the DOI and FMT. The maximum cost to the company is irrelevant, since the suit seeks to change an agreement made by all parties and ratified by the judge. What's more, FMT was under direct DOE oversight for a long time prior to the judge's order. It is impossible for them to coherently argue that FMT misled them or hid something when they were calling the shots, and the NOL was spelled out repeatedly, over and over again, as a material part of the deal. Lastly, the suit comes from the DOI and not the FTB because the DOI is grasping at straws. It made a bad deal, and desperately wants out -- even though the DOI is unable to use the NOLs. It's a sour grapes shakedown attempt, pure and simple, and it's not going to amount to much of anything except the present temporary, ridiculously low stock price brought on by the suit itself. (You see, there IS one thing that even a crazy California judiciary respects, and that's the judiciary itself, DOI whiners be damned.)

      • 1 Reply to sharkgame2003
      • sharkgame, you say that the maximum amount this could cost FMT is irrelevant since the suite is asking for an existing agreement to be changed. Are you saying that if FMT loses, then they need to renegotiate the contract? In either case, if DOI made a bad call, how much are we talking about here, 100 million, 200 million, 500 million, 1 billion??? What are they looking to get out of it. What is the likelihood that FMT wins without having to pay more than 50-100 million in legal fees?

 
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