May 20, 2007

Hail to the Victors of $5.4 Million

JetBlue’s new chief executive, David Barger, is loyal to more than just the blue in the airline’s logo. He also is a big supporter of the maize and blue — the University of Michigan, that is.

This month, Mr. Barger, who studied political science at Michigan, gave the university $5.4 million to endow the Barger Leadership Institute in the university’s Organizational Studies Program. The money will pay for internships, fellowships and other programs meant to expose Michigan students to leadership ideas.

It is Mr. Barger’s second big gift to Michigan, In 2005, he endowed the Barger Family Professorship and started the JetBlue Airways London School of Economics Summer Program, which sends undergraduate students overseas each year. Sadly, those students can’t get there on JetBlue, which doesn’t serve Detroit, or London, for that matter. MICHELINE MAYNARD

WHAT HOUSING SLUMP? When Boston Scientific announced this month that it had hired Sam Leno as its chief financial officer, the company threw in an unusual perk that might make anyone trying to sell a house during the current down market green with envy: it agreed to buy two homes owned by Mr. Leno for a guaranteed minimum price of $1.3 million each.

According to the employment letter filed with the Securities and Exchange Commission, one of the homes is in Winona Lake, Ind., near Zimmer Holdings, where Mr. Leno used to work.

Paul Donovan, a Boston Scientific spokesman, declined to say where the other house was, or whether the company had ever offered to buy two homes from the same executive before.

“We’re committed to attract and retaining the best people possible,” Mr. Donovan said. MICHELLE LEDER

DISCOUNT SHOPPER At 79, Sidney Kimmel, the chairman of the Jones Apparel Group, may not be the prototypical Barneys shopper. But either Mr. Kimmel or someone in his household can’t resist shopping there, especially at a discount of 35 percent.

According to the latest proxy statement from Jones, which acquired Barneys New York in 2004, Mr. Kimmel spent almost $75,000 — minus a director’s discount of more than $25,000 — at the high-fashion chain’s stores last year. PATRICK McGEEHAN

LEAVING UNDER A CLOUD Eugene N. Melnyk, chairman of the Canadian drugmaker Biovail, will be retiring — a decision he announced the morning after United States regulators notified him that he might be sued for possibly violating securities laws.

The company, which makes the antidepressant Wellbutrin, has been under scrutiny by the Securities and Exchange Commission over questionable accounting. That resulted in notices last week to Mr. Melnyk, 47, and Biovail’s chief financial officer, Kenneth G. Howling, 49, which were disclosed on the company’s Web site.

Biovail did not respond to calls asking whether Mr. Melnyk’s retirement was related to the S.E.C. action.

In Mr. Melnyk’s case, federal regulators said they intended to recommend enforcement action involving disclosure of trades and reporting of ownership positions in Biovail shares. Mr. Howling could face action for his earlier role managing the company’s communications and investor relations, Biovail said.

Separately, the S.E.C. notified the company two weeks ago of possible violations of United States securities laws in its accounting and disclosure practices — part of a wide- ranging review that began in November 2003.

Mr. Melnyk, who owns the Ottawa Senators hockey team, also last week settled with the Ontario Securities Commission, which was investigating his compliance with regulations for corporate shares. The commission, which approved the agreement Friday, barred Mr. Melnyk from acting as a Biovail director for one year from his June 30 retirement date and required him to file reports regarding Biovail shares held in certain trusts.

On Mr. Melnyk’s watch, Biovail sued several research firms that had reviewed the company negatively, contending a conspiracy to lower the share price. The lawsuits generated accusations that Biovail had analysts followed to intimidate them. The company denies that, and the cases are ongoing. ELIZABETH OLSON.

CLASSIC, BUT NOT AGELESS Bashing the people who sit in the executive suites never goes out of style. That is why Jossey-Bass is rereleasing the 1970 business classic, “Up the Organization: How to Stop the Corporation From Stifling People and Strangling Profits,” by Robert L. Townsend.

Townsend became famous as the maverick who turned around Avis in the 1960s with the “We Try Harder” advertising campaign. He died in 1998, and his friend Warren Bennis agreed to update Townsend’s hippie-era book.

Some of Townsend’s assertions in the original “Up the Organization” — “the leaders of all our major organizations are operating on the wrong assumptions” — could apply to any era.

But others — “computers are big, expensive, fast, dumb adding machine typewriters” — show their age and fall under the category of history rather than business. PHYLLIS KORKKI



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