Drug-Testing Company Tied to N.C.A.A. Draws Criticism

KANSAS CITY, Mo. — A wall in one of the conference rooms at the National Center for Drug Free Sport displays magazine covers, each capturing a moment in the inglorious history of doping scandals in sports.

Steve Hebert for The New York Times

The National Center for Drug Free Sport, in Kansas City, Mo., tries to deter doping with programs for high school, college and professional leagues.

Monica Almeida/The New York Times

Don Catlin, formerly of U.C.L.A.’s Olympic Analytical Lab, has raised questions about drug testing at colleges.

The images show Ben Johnson, the sprinter who lost his 1988 Olympic gold medal after testing positive; and Barry Bonds, the tarnished home run king; and Lyle Alzado, one of the first pro football players to admit to steroid use.

“People always assume that it’s the athletes at the top of their sport or the top of their game that are using,” said Frank Uryasz, Drug Free Sport’s founder and president. “But I can assure you that’s not the case. There’s always that desire to be the best, to win. That permeates all level of sport — abuse where you just wouldn’t expect it.”

Over the past quarter-century, athletes like Johnson, Bonds and Alzado stirred widespread concern about doping in sports.

Professional leagues without drug-testing programs have put them in; leagues with drug-testing programs have strengthened them. Congress and medical experts have called on sports officials at all levels to treat doping like a scourge.

It was in this budding American culture of doping awareness that Uryasz found a niche business model. He has spent the past decade selling his company’s services to the country’s sports officials.

The company advises leagues and teams on what their testing protocols should look like — everything from what drugs to test for to how often athletes will be tested to what happens to the specimens after testing. It also handles the collection and testing of urine samples, often with the help of subcontractors.

Drug Free Sport provides drug-testing programs for high school, college and professional leagues.

A privately held company with fewer than 30 full-time employees, it counts among its clients Major League Baseball, the N.F.L., the N.B.A., the N.C.A.A. and about 300 individual college programs.

Many, if not all, of the players on the field Monday night for the Bowl Championship Series title game between Alabama and Notre Dame have participated in a drug-testing program engineered by Drug Free Sport.

Uryasz says his company’s programs provide substantial deterrents for athletes who might consider doping.

Critics, however, question how rigorous the company’s programs are. They say Drug Free Sport often fails to adhere to tenets of serious drug testing, like random, unannounced tests; collection of samples by trained, independent officials; and testing for a comprehensive list of recreational and performance-enhancing drugs.

The critics, pointing to a low rate of positive tests, question Drug Free Sport’s effectiveness at catching athletes who cheat. Since the company began running the N.C.A.A.’s drug-testing program in 1999, for example, the rate of positive tests has been no higher than 1 percent in any year — despite an N.C.A.A. survey of student-athletes that indicated at least 1 in 5 used marijuana, a banned substance. (The N.C.A.A. tests for marijuana at championship competitions but not in its year-round program.)

Uryasz said the rate of positive tests was not meaningful. “I don’t spend a lot of time on the percent positive as being an indicator of very much,” he said.

Independent doping experts contend that having a contract with Drug Free Sport allows sports officials to say they take testing seriously without enacting a truly stringent program.

Don Catlin, the former head of U.C.L.A.’s Olympic Analytical Lab, best known for breaking the Bay Area Laboratory Co-operative doping ring, oversaw the testing of many of Drug Free Sport’s urine samples when he was at U.C.L.A. He said the work by Drug Free Sport and similar companies could be used to mislead fans.

“The problem with these schools is they all want to say they’re doing drug testing, but they’re not really doing anything I would call drug testing,” he said.

A Company’s Origins

Uryasz said he became interested in working with student-athletes while tutoring them as an undergraduate at Nebraska. After he graduated, he earned an M.B.A. from Nebraska and worked in health care administration in Omaha. He said he heard about an opening at the N.C.A.A. through a friend.

Driven in part by scandals in professional sports, the N.C.A.A. voted at its 1986 annual convention to start a drug-testing program.

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Tingye Li, Instrumental in the Laser’s Development, Dies at 81

Tingye Li, an electrical engineer whose calculations in the early 1960s helped guide the development of the laser and propel the dizzying increase in the speed of fiber-optic communication, died on Dec. 27 in Snowbird, Utah. He was 81.

Family photo

Some of the work done by Dr. Li and his colleagues at Bell Labs laid the groundwork for today’s broadband.

The cause was a heart attack while he was on a family ski trip, his family said. He lived in Boulder, Colo.

Lasers were in the early stage of development when Dr. Li and a colleague at Bell Labs, A. Gardner Fox, developed a computer simulation of how lasers produce the focused light energy that has transformed fields from medicine to space travel. They reported their findings in a paper published in 1961.

Dr. Arno Penzias, a former director of Bell, called their paper a tool kit for subsequent designers of lasers and other optical systems. He said it helped transform the “wonderful invention” of the laser — an acronym for light amplification by stimulated emission of radiation — into “a practical communications platform.”

In essence, the researchers provided a mathematical model for how light bounces about inside a laser between two mirrors as it gathers energy, predicting factors like the shape and intensity of light beams. Alan Willner, an electrical engineering professor at the University of Southern California, called the work “the foundational teaching” on the innards of lasers.

“There aren’t many papers that help define a field, but this was one of them,” he said in an interview.

The research that led to nearly instantaneous communication by light waves was itself snail-like. Dr. Li and Dr. Fox had to write their own programs, punching them into decks of cards, for a room-size computer that was less powerful than a palm-size calculator today. The computer ran the program for two or three hours. A frequent error message meant that the researchers had to scour the cards for a single improperly punched letter, Jeff Hecht wrote in “Beam: The Race to Make the Laser” (2010).

Bell Labs was virtually unchallenged as the largest and most inventive laboratory in the world, having a hand in many of the 20th century’s most important inventions. Dr. Li, who wrote or helped write more than 100 papers, patents and books, led research teams at Bell for more than three decades.

Some of their work laid the groundwork for today’s broadband. One area of study was in finding ways to use light waves to convey information on optical fiber rather than copper wire or radio waves. Another team Dr. Li led developed optical amplifiers, which amplify an optical signal directly without the need to first convert it into an electrical signal.

Dr. Li was an early proponent of using the rare earth metal Erbium in the amplifiers, an improvement that helped raise their capacity more than a hundredfold.

“Tingye Li has shaped the lightwave network infrastructure we know today,” the Institute of Electrical and Electronics Engineers said when presenting him with its Edison Medal in 2009.

Li Ding Yi, as his name is transliterated from Chinese, was born in Nanking, China, on July 7, 1931. His mother, Lily, was one of the first generation of Chinese women to receive a modern higher education. She became an activist for women’s rights.

His father, Chao, was a Chinese diplomat who was consul general in Vancouver, where Tingye attended middle school, and was later posted to South Africa, where Tingye earned an undergraduate degree in electrical engineering from the University of Witwatersrand. He earned a Ph.D. in electrical engineering from Northwestern University in Evanston, Ill.

Dr. Li joined the Bell Telephone Laboratories (later AT&T Bell Laboratories) in 1957 and worked there until 1998. He worked there with the Nobel Prize recipients Charles Hard Townes and Arthur L. Schawlow, who together invented the maser, which amplified microwaves the way lasers would soon amplify light.

“There was a lot going on and a lot of people helping each other,” Dr. Penzias said.

Dr. Li often quoted Confucius, though friends suspected he occasionally concocted his own learned sayings and then attributed them to the sage. He frequently went to China to help it develop optical communications. The Chinese Academy sent his family a letter at his death praising him for helping China “leapfrog to a higher level” in handling telecommunications traffic.

Dr. Li is survived by his wife of 56 years, the former Edith Wu; his daughters, Deborah Li Cohen and Kathryn Li Dessau; and four grandchildren.

In a speech on his 80th birthday, Dr. Li revealed that he had proposed marriage to his wife for their next life, after they are both reincarnated. She tentatively agreed, he said, if he behaved.

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India Takes Aim at Poverty With Cash Transfer Program

Manish Swarup/Associated Press

Poor and homeless people waited for food on Tuesday at a New Delhi temple.

NEW DELHI — India has more poor people than any nation on earth, but many of its antipoverty programs end up feeding the rich more than the needy. A new program hopes to change that.

On Jan. 1, India eliminated a raft of bureaucratic middlemen by depositing government pension and scholarship payments directly into the bank accounts of about 245,000 people in 20 of the nation’s hundreds of districts, in a bid to prevent corrupt state and local officials from diverting much of the money to their own pockets. Hundreds of thousands more people will be added to the program in the coming months.

In a country of 1.2 billion, the numbers so far are modest, but some officials and economists see the start of direct payments as revolutionary — a program intended not only to curb corruption but also to serve as a vehicle for lifting countless millions out of poverty altogether.

The nation’s finance minister, Palaniappan Chidambaram, described the cash transfer program to Indian news media as a “pioneering and pathbreaking reform” that is a “game changer for governance.” He acknowledged that the initial rollout had been modest because of “practical difficulties, some quite unforeseen.” He promised that those problems would be resolved before the end of 2013, when the program is to be extended in phases to other parts of the country.

Some critics, however, said the program was intended more to buy votes among the poor than to overcome poverty. And some said that in a country where hundreds of millions have no access to banks, never mind personal bank accounts, direct electronic money transfers are only one aspect of a much broader effort necessary to build a real safety net for India’s vast population.

“An impression has been created that the government is about to launch an ambitious scheme of direct cash transfers to poor families,” Jean Drèze, an honorary professor at the Delhi School of Economics, wrote in an e-mail. “This is quite misleading. What the government is actually planning is an experiment to change the modalities of existing transfers — nothing more, nothing less.”

The program is based on models in Mexico and Brazil in which poor families receive stipends in exchange for meeting certain social goals, like keeping their children in school or getting regular medical checkups. International aid organizations have praised these efforts in several places; in Brazil alone, nearly 50 million people participate.

But one of India’s biggest hurdles is simply figuring out how to distinguish its 1.2 billion citizens. The country is now in the midst of another ambitious project to undertake retinal and fingerprint scans in every village and city in the hope of giving hundreds of millions who have no official identification a card with a 12-digit number that would, among other things, give them access to the modern financial world. After three years of operation, the program has issued unique numbers to 220 million people.

Bindu Ananth, the president of IFMR Trust, a financial charity, said that getting people bank accounts can be surprisingly beneficial because the poor often pay stiff fees to cash checks or get small loans, fees that are substantially reduced for account holders.

“I think this is one of the biggest things to happen to India’s financial system in a decade,” Ms. Ananth said.

Only about a third of Indian households have bank accounts. Getting a significant portion of the remaining households included in the nation’s financial system will take an enormous amount of additional effort and expense, at least part of which will fall on the government to bear, economists said.

“There are two things this cash transfer program is supposed to do: prevent leakage from corruption, and bring everybody into the system,” said Surendra L. Rao, a former director general of the National Council of Applied Economic Research. “And I don’t see either happening anytime soon.”

The great promise of the cash transfer program — as well as its greatest point of contention — would come if it tackled India’s expensive and inefficient system for handing out food and subsidized fuel through nearly 50,000 government shops.

India spends almost $14 billion annually on this system, or nearly 1 percent of its gross domestic product, but the system is poorly managed and woefully inefficient.

Malavika Vyawahare contributed reporting.

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Honduras removes its ambassador to Colombia amid party scandal

TEGUCIGALPA (Reuters) – Honduras has removed its ambassador to Colombia amid reports his personal aide was involved in a wild party held at the embassy of Honduras in Bogota which, according to media, was attended by prostitutes and where cell phones and computers were stolen.

Ambassador Carlos Rodriguez quit his post on Saturday, Honduras’ foreign ministry said in a release, after the government requested his withdrawal.

Rodriguez’s personal aide went out with friends on December 20, picking up some prostitutes in Bogota’s red district before going to the embassy, where they consumed alcohol and trashed the facilities, El Heraldo daily reported.

It was not clear if Rodriguez was present, but the ministry said an investigation was under way.

Last year, about a dozen U.S. Secret Service employees were accused of misconduct for bringing women, some of them prostitutes, back to their hotel rooms ahead of a visit to Colombia by President Barack Obama, in the biggest scandal to hit the agency.

(Reporting By Gustavo Palencia; Editing by Vicki Allen)

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Texans lead Bengals 9-7 at halftime

HOUSTON (AP) — Matt Schaub got Houston's offense out of its rut on Saturday, leading three long field goal drives for a 9-7 lead over the Cincinnati Bengals after a lopsided opening half of their wild-card playoff rerun.

The Pro Bowl quarterback also made a mistake that kept the Bengals in an otherwise one-sided game. His sideline pass was intercepted by Leon Hall and returned for a 21-yard touchdown, the cornerback's second score in three games.

Given how much the Texans dominated the half, the Bengals were fortunate to be so close. Houston piled up 250 yards and held the ball for nearly 23 minutes, but couldn't get into the end zone.

Andy Dalton had a horrid time in the half, completing 4 of 10 passes for 3 yards. With J.J. Watt's sack added in, the Bengals had minus-6 yards passing and only 53 yards overall.

Shayne Graham kicked field goals of 48, 27 and 22 yards, and Hall's interception return kept the Bengals in it.

For the second season in a row, the Bengals opened the playoffs at Houston looking for their first playoff win since 1990, a 21-year drought that was tied for ninth-longest in NFL history. They lost 31-10 last season, with the then-rookie Dalton throwing three interceptions.

The main difference in this one: Schaub was back in charge for Houston. Rookie T.J. Yates filled in after Schaub hurt his foot last season, got the Texans a win in their first-ever playoff game, but couldn't take then any farther.

Their franchise quarterback started a playoff game for the first time in his career. He came into the game in a slump, with the Texans losing three of their last four games while the offense sputtered.

The Texans won the coin toss and decided to take the ball rather than defer to the second half, giving them a chance to get off to a fast start. It backfired — three plays managed 5 yards, setting up a punt.

The second time they got the ball, they got going. Schaub completed an 18-yard pass, Arian Foster had a 17-yard run and Keshawn Martin went 16 yards on a reverse, setting up Graham's field goal.

It became a pattern — move the ball down the field, settle for three points. The fans started booing the familiar, come-up-short endings.

And Schaub did the one thing he wanted to avoid: Let Cincinnati's high-scoring defense get its hands on the ball. Hall anticipated Schaub's throw, stepped in front and returned it untouched for the defense's fourth touchdown in the last four games.

It was the first interception return for a touchdown against the Texans this season.

The Bengals also ended the season by hitting a wall on offense — one touchdown in the last two games.

A lot was on Dalton, who grew up in suburban Katy and had a dreadful playoff debut as a rookie last year in his hometown. He threw three interceptions, including one that Watt returned for a game-turning touchdown just before halftime.

He had to be better if the Bengals were going to end their notable playoff drought. In the first half on Saturday, he wasn't even close.

The Bengals finished the season by winning seven of eight, tying the best closing stretch in franchise history. The offense wasn't much — Dalton threw for only four touchdowns with five interceptions in the last five games — but the defense more than made up for it with a line that had started to dominate.

The defense kept them in it again in the opening half.

___

Online: http://pro32.ap.org/poll and http://twitter.com/AP_NFL

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The New Old Age: Murray Span, 1922-2012

One consequence of our elders’ extended lifespans is that we half expect them to keep chugging along forever. My father, a busy yoga practitioner and blackjack player, celebrated his 90th birthday in September in reasonably good health.

So when I had the sad task of letting people know that Murray Span died on Dec. 8, after just a few days’ illness, the primary response was disbelief. “No! I just talked to him Tuesday! He was fine!”

And he was. We’d gone out for lunch on Saturday, our usual routine, and he demolished a whole stack of blueberry pancakes.

But on Wednesday, he called to say he had bad abdominal pain and had hardly slept. The nurses at his facility were on the case; his geriatrician prescribed a clear liquid diet.

Like many in his generation, my dad tended towards stoicism. When he said, the following morning, “the pain is terrible,” that meant agony. I drove over.

His doctor shared our preference for conservative treatment. For patients at advanced ages, hospitals and emergency rooms can become perilous places. My dad had come through a July heart attack in good shape, but he had also signed a do-not-resuscitate order. He saw evidence all around him that eventually the body fails and life can become a torturous series of health crises and hospitalizations from which one never truly rebounds.

So over the next two days we tried to relieve his pain at home. He had abdominal x-rays that showed some kind of obstruction. He tried laxatives and enemas and Tylenol, to no effect. He couldn’t sleep.

On Friday, we agreed to go to the emergency room for a CT scan. Maybe, I thought, there’s a simple fix, even for a 90-year-old with diabetes and heart disease. But I carried his advance directives in my bag, because you never know.

When it is someone else’s narrative, it’s easier to see where things go off the rails, where a loving family authorizes procedures whose risks outweigh their benefits.

But when it’s your father groaning on the gurney, the conveyor belt of contemporary medicine can sweep you along, one incremental decision at a time.

All I wanted was for him to stop hurting, so it seemed reasonable to permit an IV for hydration and pain relief and a thin oxygen tube tucked beneath his nose.

Then, after Dad drank the first of two big containers of contrast liquid needed for his scan, his breathing grew phlegmy and labored. His geriatrician arrived and urged the insertion of a nasogastric tube to suck out all the liquid Dad had just downed.

His blood oxygen levels dropped, so there were soon two doctors and two nurses suctioning his throat until he gagged and fastening an oxygen mask over his nose and mouth.

At one point, I looked at my poor father, still in pain despite all the apparatus, and thought, “This is what suffering looks like.” I despaired, convinced I had failed in my most basic responsibility.

“I’m just so tired,” Dad told me, more than once. “There are too many things going wrong.”

Let me abridge this long story. The scan showed evidence of a perforation of some sort, among other abnormalities. A chest X-ray indicated pneumonia in both lungs. I spoke with Dad’s doctor, with the E.R. doc, with a friend who is a prominent geriatrician.

These are always profound decisions, and I’m sure that, given the number of unknowns, other people might have made other choices. Fortunately, I didn’t have to decide; I could ask my still-lucid father.

I leaned close to his good ear, the one with the hearing aid, and told him about the pneumonia, about the second CT scan the radiologist wanted, about antibiotics. “Or, we can stop all this and go home and call hospice,” I said.

He had seen my daughter earlier that day (and asked her about the hockey strike), and my sister and her son were en route. The important hands had been clasped, or soon would be.

He knew what hospice meant; its nurses and aides helped us care for my mother as she died. “Call hospice,” he said. We tiffed a bit about whether to have hospice care in his apartment or mine. I told his doctors we wanted comfort care only.

As in a film run backwards, the tubes came out, the oxygen mask came off. Then we settled in for a night in a hospital room while I called hospices — and a handyman to move the furniture out of my dining room, so I could install his hospital bed there.

In between, I assured my father that I was there, that we were taking care of him, that he didn’t have to worry. For the first few hours after the morphine began, finally seeming to ease his pain, he could respond, “OK.” Then, he couldn’t.

The next morning, as I awaited the hospital case manager to arrange the hospice transfer, my father stopped breathing.

We held his funeral at the South Jersey synagogue where he’d had his belated bar mitzvah at age 88, and buried him next to my mother in a small Jewish cemetery in the countryside. I’d written a fair amount about him here, so I thought readers might want to know.

We weren’t ready, if anyone ever really is, but in our sorrow, my sister and I recite this mantra: 90 good years, four bad days. That’s a ratio any of us might choose.

---

Paula Span is the author of “When the Time Comes: Families With Aging Parents Share Their Struggles and Solutions.”

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India Takes Aim at Poverty With Cash Transfer Program

Manish Swarup/Associated Press

Poor and homeless people waited for food on Tuesday at a New Delhi temple.

NEW DELHI — India has more poor people than any nation on earth, but many of its antipoverty programs end up feeding the rich more than the needy. A new program hopes to change that.

On Jan. 1, India eliminated a raft of bureaucratic middlemen by depositing government pension and scholarship payments directly into the bank accounts of about 245,000 people in 20 of the nation’s hundreds of districts, in a bid to prevent corrupt state and local officials from diverting much of the money to their own pockets. Hundreds of thousands more people will be added to the program in the coming months.

In a country of 1.2 billion, the numbers so far are modest, but some officials and economists see the start of direct payments as revolutionary — a program intended not only to curb corruption but also to serve as a vehicle for lifting countless millions out of poverty altogether.

The nation’s finance minister, Palaniappan Chidambaram, described the cash transfer program to Indian news media as a “pioneering and pathbreaking reform” that is a “game changer for governance.” He acknowledged that the initial rollout had been modest because of “practical difficulties, some quite unforeseen.” He promised that those problems would be resolved before the end of 2013, when the program is to be extended in phases to other parts of the country.

Some critics, however, said the program was intended more to buy votes among the poor than to overcome poverty. And some said that in a country where hundreds of millions have no access to banks, never mind personal bank accounts, direct electronic money transfers are only one aspect of a much broader effort necessary to build a real safety net for India’s vast population.

“An impression has been created that the government is about to launch an ambitious scheme of direct cash transfers to poor families,” Jean Drèze, an honorary professor at the Delhi School of Economics, wrote in an e-mail. “This is quite misleading. What the government is actually planning is an experiment to change the modalities of existing transfers — nothing more, nothing less.”

The program is based on models in Mexico and Brazil in which poor families receive stipends in exchange for meeting certain social goals, like keeping their children in school or getting regular medical checkups. International aid organizations have praised these efforts in several places; in Brazil alone, nearly 50 million people participate.

But one of India’s biggest hurdles is simply figuring out how to distinguish its 1.2 billion citizens. The country is now in the midst of another ambitious project to undertake retinal and fingerprint scans in every village and city in the hope of giving hundreds of millions who have no official identification a card with a 12-digit number that would, among other things, give them access to the modern financial world. After three years of operation, the program has issued unique numbers to 220 million people.

Bindu Ananth, the president of IFMR Trust, a financial charity, said that getting people bank accounts can be surprisingly beneficial because the poor often pay stiff fees to cash checks or get small loans, fees that are substantially reduced for account holders.

“I think this is one of the biggest things to happen to India’s financial system in a decade,” Ms. Ananth said.

Only about a third of Indian households have bank accounts. Getting a significant portion of the remaining households included in the nation’s financial system will take an enormous amount of additional effort and expense, at least part of which will fall on the government to bear, economists said.

“There are two things this cash transfer program is supposed to do: prevent leakage from corruption, and bring everybody into the system,” said Surendra L. Rao, a former director general of the National Council of Applied Economic Research. “And I don’t see either happening anytime soon.”

The great promise of the cash transfer program — as well as its greatest point of contention — would come if it tackled India’s expensive and inefficient system for handing out food and subsidized fuel through nearly 50,000 government shops.

India spends almost $14 billion annually on this system, or nearly 1 percent of its gross domestic product, but the system is poorly managed and woefully inefficient.

Malavika Vyawahare contributed reporting.

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Malala Yousafzai, Shot by Pakistani Taliban, Is Discharged From Hospital

Queen Elizabeth Hospital Birmingham, via Reuters

Medical experts say Ms. Yousafzai, 15, has a good chance of making a full recovery because of her youth, but the long-term impact of her head injuries remains unclear.

LONDON — Malala Yousafzai, the Pakistani schoolgirl shot in the head three months ago by the Taliban for advocating the education of girls, has been discharged from a British hospital. Doctors said she had made “excellent progress” and would be staying with her family nearby before returning for further surgery to rebuild her skull in about four weeks.

“Following discussions with Malala and her medical team, we decided that she would benefit from being at home with her parents and two brothers,” said Dr. Dave Rosser, the medical director.

Video released by Queen Elizabeth Hospital in Birmingham, England, showed Ms. Yousafzai walking slowly out of a ward, wearing a head scarf and accompanied by a nurse.

The release was a promising turn for the teenage activist. Her shooting brought global condemnation of the Pakistani Taliban, whose fighters killed six female aid workers this week in the same region in northwestern Pakistan where Ms. Yousafzai was shot.

On Oct. 9, gunmen halted her school bus as it went through Mingora, the main town in the Swat Valley, singled her out and opened fire. A bullet grazed her brain, nearly killing her, and traveled through her head before lodging in her neck.

Six days later, after emergency treatment in Pakistan, she was airlifted to the hospital in Birmingham, which specializes in treating British soldiers wounded in action in Afghanistan.

Medical experts say Ms. Yousafzai has a good chance of making a full recovery because of her youth, but the long-term impact of her head injuries remains unclear.

In recent weeks, she has left the hospital regularly to spend time with her family. The Pakistani government is paying for her treatment.

Ms. Yousafzai rose to prominence in 2009 with a blog for the BBC’s Urdu-language service that described life in Swat under Taliban rule. Later, she was featured in a documentary by The New York Times.

Now her father, Ziauddin, a school headmaster, has accepted a three-year position as education attaché at the Pakistani Consulate in Birmingham, making it unlikely that the family will return to Pakistan anytime soon. In any event, it may be too dangerous, because the Taliban have vowed to attack her again.

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Clearwire investor seeks to block sale to Sprint

(Reuters) – A large Clearwire Corp shareholder on Friday stepped up its campaign against the planned sale of the wireless service provider to its majority owner, Sprint Nextel Corp, saying it plans to ask the U.S. telecoms regulator to block the deal.

Crest Financial’s general counsel also said on a call with reporters that it will ask the U.S. Federal Communications Commission to block Sprint’s plan to sell 70 percent of itself to Softbank Corp of Japan for $ 20 billion.

Going to the FCC is a new line of attack on the Sprint deal by Crest, which has also filed a class action lawsuit on behalf of Clearwire investors. Dave Schumacher, Crest’s general counsel, said the fund said other minority investors told Crest they did not support the Sprint deal, but he did not provide details.

The investment fund, which owns around 8 percent of Clearwire, has said Sprint’s offer of $ 2.97 share for the roughly 50 percent of Clearwire it does not currently own, “grossly undervalues Clearwire.” Sprint’s offer is worth about $ 2.2 billion, but Schumacher said Crest had not done its own valuation and was basing its criticism of the price on estimates by analysts.

In going to the FCC, Crest will argue that the Clearwire deal artificially undervalues the company’s spectrum holdings, Schumacher said. That in turn potentially devalues future revenue for the U.S. government when it auctions off spectrum licenses.

“The merger is therefore a bad deal all around for Clearwire shareholders and also for the public at large,” said Schumacher.

Sprint spokesman Scott Sloat said the deal with Clearwire was the right one for Sprint, Clearwire and American consumers. He said the class action lawsuit was baseless.

A spokesman for Clearwire, Mike DiGioia, declined to comment on Crest’s intention to go to the FCC. He said a special committee of the board conducted a rigorous evaluation of the company’s options before agreeing to the Sprint deal.

Clearwire’s chief executive, Erik Prusch, has said the company does not have attractive alternatives as it seeks funding to continue to upgrade its own network and could risk bankruptcy if the Sprint deal does not succeed.

Crest has sued Clearwire in the Court of Chancery in Delaware, where the company is incorporated, to permanently block the deal.

The Delaware court will hear arguments next week on Crest’s request to expedite the case and Schumacher said Crest hopes to move to a trial in April.

The deal needs approval by a majority of Clearwire’s minority shareholders and Sprint has said it has the support of three large Clearwire investors – Comcast Corp, Intel Corp and Bright House Networks LLC – which hold 13 percent of Clearwire stock. Schumacher said the fund would try to prevent the three from voting because of their affiliation with Sprint.

As Clearwire’s fight with its shareholders heats up, Sprint has its own shareholders to contend with.

A Kansas court on Friday declined Sprint’s request for an early dismissal of a lawsuit by a union pension fund that holds Sprint stock.

The lawsuit alleged that Sprint’s chief executive, Daniel Hesse, rushed merger talks with Softbank and did not get a fair price.

The ruling by Thomas Sutherland, the judge for the District Court of Johnson County, Kansas, will allow the pension fund to begin to demand documents and witnesses as it tries to prove its case.

Sloat, the Sprint spokesman, said the ruling only addressed the technical adequacy of the pension fund’s pleading and did not address the merits of the case. He said Sprint continued to believe the case was without merit.

(Reporting By Tom Hals in Wilmington, Delaware and Sinead Carew in New York; Editing by Bernard Orr and David Gregorio)

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Reid arrives in KC, nears deal to become coach

KANSAS CITY, Mo. (AP) — Andy Reid arrived in Kansas City on Friday, and the Chiefs are close to making an official announcement that he will become their next coach.

Reid and the Chiefs have reportedly agreed to a deal giving the longtime Eagles coach broad authority over football decisions. His deal came hours after the Chiefs announced they had parted with general manager Scott Pioli after four tumultuous seasons.

Reid inherits a team that went 2-14, matching the worst record in franchise history. But he'll also have the No. 1 pick in the NFL draft, and with five players voted to the Pro Bowl, Kansas City has building blocks in place to make a quick turnaround.

While Reid will have authority in personnel decisions, it's expected that he will pursue longtime Packers personnel man John Dorsey to work with him as general manager.

Reid takes over for Romeo Crennel, who was fired Monday after one full season.

The Chiefs first interviewed Reid for about nine hours in Philadelphia on Wednesday, and then spent much of Thursday working out the details before coming to an agreement.

The addition of Reid and the departure of Pioli should help to stabilize a team that was expected to contend for the AFC West title but instead floundered all season.

Reid has experience turning around franchises, too.

He took over a team in Philadelphia that was just 3-13, but two years later went 11-5 and finished second in the NFC East. That began a stretch of five straight years in which Reid won at least 11 games and included a trip to the Super Bowl after the 2004 season.

During his tenure, the Eagles made nine playoff appearances, while Kansas City made three, and won 10 playoff games — something the Chiefs haven't done since 1993. Meanwhile, the Chiefs cycled through five head coaches and are now on their third in three years.

"Overall the job is still attractive," said Chiefs chairman Clark Hunt, who led the search for Crennel's replacement. "The franchise remains very well respected."

The fresh start afforded by the Chiefs should be welcomed by Reid.

Despite a 130-93-1 record and the most wins in Eagles history, he was just 12-20 the past two seasons. Reid also dealt with personal tragedy when his oldest son, Garrett, died during training camp after a long battle with drug addiction.

Reid will have more authority in Kansas City than any previous coach.

Hunt told The Associated Press this week that he was changing the Chiefs' organizational structure so that the coach and general manager report directly to him. Since his late father Lamar founded the team 53 years ago, the coach typically reported to the general manager.

The Chiefs issued a statement Friday that said they had "mutually parted ways" with Pioli after a four-year tenure marked by poor draft choices, ineffective free-agent moves, his own failed coaching hires and a growing fan rebellion.

"The bottom line is that I did not accomplish all of what I set out to do," Pioli said. "To the Hunt family — to the great fans of the Kansas City Chiefs — to the players, all employees and alumni, I truly apologize for not getting the job done."

Most of the Chiefs' top stars were drafted by Pioli's predecessor, Carl Peterson. The former Patriots executive struggled to find impact players, particularly at quarterback, while cycling through coaches and fostering a climate of dread within the entire organization.

Numerous longtime staff members were fired upon Pioli's arrival, and his inability to connect with fans resulted in unprecedented unrest. Some fans even paid for multiple banners to be towed behind planes before home games asking that he be fired.

On Dec. 1, linebacker Jovan Belcher shot the mother of his 3-month-old daughter, Kasandra Perkins, at a home not far from Arrowhead Stadium. Belcher then drove to the team's practice facility and shot himself in the head as Pioli and Crennel watched in the parking lot.

Pioli hasn't spoken publicly since the incident.

The three-time NFL executive of the year, all with New England, often spoke of putting together "the right 53," but he failed to do so, and now it falls on Reid and his staff to finish the job.

The most glaring position of need is quarterback.

Matt Cassel has two years left on a $63 million, six-year deal, but he played so poorly this season that he was benched in favor of Brady Quinn, who is now a free agent.

It's expected that the Chiefs will pursue a veteran quarterback while also choosing one in the draft, giving Reid options in training camp. Reid has had success working with young quarterbacks, including Brett Favre in Green Bay and Donovan McNabb in Philadelphia.

Decisions will also have to be made about left tackle Branden Albert, wide receiver Dwayne Bowe and even Pro Bowl punter Dustin Colquitt, all of whom can become free agents.

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