Law and legal issues

Citi disclosed Friday in a 10-Q quarterly filing with the Securities and Exchange Commission that it has received subpoenas or requests for information from several self-regulatory agencies and federal authorities, including the SEC and state regulators in Texas, New York, and Massachusetts, which are all investigating the bank's auction-rate securities sales practices.

BRADENTON, Fla. - Jefferson County, Ala., commissioners Friday met in a special session and approved their fourth extension to debt forbearance agreements with liquidity providers, bond insurers, and swap counterparties.

WASHINGTON - Troy Paredes, a securities law professor at Washington University in St. Louis, was sworn in Friday as a member of the Securities and Exchange Commission.

San Diego city attorney Michael Aguirre said he may join Los Angeles and Stockton in lawsuits against municipal bond insurers.

WASHINGTON - Merrill Lynch & Co. sales and trading managers altered their research department's reports on the auction-rate securities market to minimize the risks of the securities and to forestall a collapse of the $330 billion ARS market, Massachusetts Secretary of the Commonwealth William Galvin argued in a lawsuit filed against the firm yesterday.

Federal bankruptcy Judge Michael McManus last week last week ruled that Vallejo employee unions cannot represent retirees in the city’s Chapter 9 bankruptcy case.

BIRMINGHAM, Ala. - Jefferson County as of yesterday afternoon was still seeking a new forbearance agreement with creditors as it continued to struggle to put together a sewer debt restructuring plan acceptable to all parties.

WASHINGTON - Fitch Ratings yesterday proposed changes in its municipal ratings framework that would result in one- to two-notch upgrades on most general obligation bonds and debt backed by broad-based taxes, following a four-month review of the sector.

BIRMINGHAM, Ala. - Jefferson County yesterday was scrambling to get the governor's office to schedule a special session of the Alabama Legislature before Aug. 8 to consider a restructuring plan for the county's troubled sewer debt as it also worked to finalize yet another forbearance agreement with creditors.

CHICAGO - Michigan Gov. Jennifer Granholm this week announced an accelerated schedule for holding a possible hearing on whether to remove embattled Detroit Mayor Kwame Kilpatrick from office.

BIRMINGHAM, Ala. - While Jefferson County continues to negotiate another extension to its forbearance agreements with creditors, the county is planning to hold its first public hearing Aug. 8 on how to deal with the $3.2 billion sewer debt crisis.

SAN FRANCISCO - Orrick, Herrington & Sutcliffe LLP, California's biggest bond counsel firm, has agreed to pay San Diego $2.875 million to settle a lawsuit that accused the firm of negligence for failing to discover the city's pension scandal earlier.

BIRMINGHAM, Ala. - Jefferson County, Ala., negotiators resumed talks with Wall Street creditors yesterday, County Commission President Bettye Fine Collins said in a press conference here.

BRADENTON, Fla. - Several Jefferson County, Ala., officials on Friday said they are continuing to negotiate a resolution to the county's sewer debt crisis that doesn't resort to bankruptcy.

SACRAMENTO - Vallejo, Calif., and Union Bank of California are not close to an agreement to restructure the city's debt, according to testimony a bank official gave in bankruptcy court late last week.

WASHINGTON - The Internal Revenue Service has agreed to close 26 examinations of roughly $800 million of bonds issued by several California school districts without finding the bonds taxable in exchange for $5 million from the lead banker on the controversial deals.

WASHINGTON - An energy nonprofit that a Nebraska judge this month barred from involvement in a $529 million bond-funded public power deal plans to appeal the decision.

BRADENTON, Fla. - The long-awaited Florida Supreme Court decision over the fate of tax increment financing in the state has temporarily blocked a legal decision in the Florida Marlins quest for a new, $515 million Major League Baseball stadium in Miami.

SACRAMENTO - Is Vallejo, Calif., broke or just unwilling to pay its bills?

New York Attorney General Andrew Cuomo became the second state regulator to file securities fraud charges against UBS Securities LLC and UBS Financial Services yesterday, arguing that UBS executives sold $21 million of their personal auction-rate securities while the firm aggressively marketed to retail ARS they knew had liquidity risk.