Edition, January 26, 2000, Page 1
LAW FIRM FOR $1.3M
APCO Assocs., Washington, D.C., sister company
of GCI Group, filed a $1.3 million breach of contract suit
against Akin, Gump, Straus, Hauer & Feld, one of the
six biggest law firms in D.C.
APCO says Akin Gump didnt pay $305,000
in fees and expenses for a system designed to monitor trade
issues for Korea. The suit, filed earlier this month in
D.C. Superior Court, asks $1M in punitive damages.
Akin, Gump, in its response to the suit,
said the Koreans told APCO there were "glitches"
in the software. The PR firm dismisses the memo as part
of the "give-and-take" involved in a relationship.
Cooper of APCO said the firm agreed to work out the problems
and told the Koreans of this in a memo on Akin, Gump stationery.
Hired in 1996
Akin, Gump contacted APCO in June 1996 about
working for two Korean clients, the Korean International
Trade Assn. and the Korea Foreign Trade Assn. Work was to
be split into three phases and APCO was not to contact the
The PR firm completed the database for the
"Korean Information Management System" in September
of that year and demonstrated it to Michael Kaye and Shannon
Herzfeld of the law firm. Demonstrations were also given
to the two Korean clients. Fees for the initial phase were
$92,000. Phase II and Phase III were to start on Nov. 1,
1996 at $35K monthly.
APCO says it received numerous memos expressing
satisfaction from Akin, Gump and/or KITA through November
As of April 1997, APCO had been paid $215,000
by Akin, Gump although it claims the law firm was behind
in its payments.
During November, 1997, Koreas currency
lost about half its value against the dollar, increasing
the cost for KITA and Akin, Gump in dollars. KITA, says
the lawsuit, told Akin, Gump it would pay in the devalued
currency (the won). APCO said its contract called for payment
Despite the dispute, APCO continued to work
on the project through January 1998.
The complaint says the law firm and KITA
did not mention defects with KIMS and did not ask that corrections
be made. Attempts at a settlement were "rebuffed"
by Akin, Gump, says the suit. The law firm sent a letter
to APCO on July 27, 1998, saying that because of KITAs
dissatisfaction with KIMS, it was revoking its acceptance
and returning the software.
IS PR DIRECTOR, ASAE
Courtney C. Gardner, director of marketing
and membership, Health Industry Distributors Assn., was
named director of PR of the 25,000-member American Society
of Assn. Executives, Washington, D.C.
"She will promote the image of the
profession of association management," said Michael
S. Olson, paid president and CEO of the ASAE. One
duty will be publicizing the "Associations Advance
America" program of the ASAE.
The group has been fighting a law that taxes
lobbying. ASAE notes that members spend three times more
on professional development and public information than
on lobbying. Courts have twice rejected attempts to overthrow
the law and the battle is expected to reach the Supreme
Kenneth Sommers, ten-year ASAE veteran who
was PR director, left the group last year. PR staffer Eric
Dyson joined the Council of Growing Companies, McLean, Va.,
as communications manager.
Gardner marketed HIDAs conferences
and annual trade show, developing attendee and exhibitor
promotional materials, ads, and direct mail. She has a B.S.
in journalism from the Univ. of Maryland.
The Canal Jean
Co., New York, $20
million retail apparel store, is looking for a PR firm.
The store, based at 504 Broadway the past 26 years, owns
the building and has never used a PR firm. Harvey Russack,
consultant to his brother Ira, who runs the store, is looking
to expand including a website. 212/226-3663, ext. 200...Royal
Caribbean International named BSMG Worldwide
for an ongoing PR program after using it for projects for
three years. The cruise line will spend $40M on ads...Paul
Carothers named VP of corp. affairs for Kraft
Foods Intl, Rye Brook, N.Y...Carla
DeLuca, producer of CNN Saturday/Sunday Morning,
to Hill and Knowlton/S.F., as a managing director.
The 2000 ODwyers
Directory of PR Executives,
with bios of 10,360 business PR pros with more than five
years in the field, has been published. They work for more
than 5,000 employers whose addresses and phone numbers are
provided. The PR pros are listed by employer as well as
Information includes employment and educational
backgrounds, awards won and professional memberships. $120
from the J.R. ODwyer Co. Buyers who are listed receive
Edition, January 26, 2000, Page 2
QUIET PERIOD RULE IS MISUSED
"The quiet period is basically a misunderstood
period," said Neil Roland, a reporter for Bloomberg
News and member of a panel that discussed the SECs
quiet period rules.
"Many companies have interpreted these
provisions too conservatively and have used them as a kind
of shield or cloak to avoid giving out information at all,"
Roland and members of the financial industry
made up the panel during a session hosted by PR Newswire
on Jan. 11 in New York.
SEC Delays IPO
The genesis of the meeting was a recent
case involving Webvan, a Web-based grocery store whose IPO
was delayed by the SEC because it violated disclosure requirements
during the quiet period.
Adam Lashinsky, Silicon Valley reporter
for TheStreet.com, was allowed into Webvans pre-IPO
conference call and then reported on information from the
call that had not been previously disclosed in the prospectus.
The SEC guidelines are designed to prevent
companies and investment bankers from hyping a stock before
and directly after an IPO.
During the quiet period, a company may still
discuss its current affairs as long as it does not disclose
information not included in the prospectus that could affect
its stock, according to the panel of experts.
When Lashinskys article was published,
the SEC pulled Webvans offering; required the company
to publicly disclose the new information, and forced it
to wait an additional three weeks before going public.
Lashinsky told the PR pros that while they
should consult with their attorneys about media requests
during the quiet period, they should not ignore reporters.
"I dont advise any company or
publicist to do anything that their lawyer isnt comfortable
with," Lashinsky said. "(But) what reporters
really hate, and will leave a bad taste in their mouth,
is pretending the reporter doesnt exist. The
more courteous thing to do is to ask your lawyer to return
the phone call and see if they cant be helpful in
Dont Be Paranoid
Karen Dempsey, securities lawyer and partner
at Pillsbury Madison & Sutro, who was also a panelist,
said; "You can follow the rules and still get your
story out as a company. You dont have to be paranoid
that the SEC is going to shoot you in the foot."
PR counselor Carol Ruth suggested that companies
be creative when in the quiet period.
For example, one of her IPO clients
toured the country promoting a new book written by a company
executive. Company lawyers considered this an acceptable
way to gain publicity during the period.
"Be sure that you are building the
visibility for the company that goes beyond just the people
that use your products," she said.
Glenn Faulkner, VP and officer at Nasdaq,
said Nasdaq will assist firms in the going-public process.
OFFICERS CONTEST NEW SLATE
Ten former officers and presidents of The
New York Financial Writers Assn. have objected to
the removal of Susan Rodetis as a candidate for VP.
The group has proposed an alternate slate
that moves Rodetis, a freelance reporter, up from her current
position as treasurer to VP.
The proposal was made after four of the
seven members of the regular nominating committee, headed
by Sally Heinemann of Bridge News, voted to drop Rodetis
as a candidate for the number two spot because they felt
her part time work as an editor of a mortgage-backed securities
report for Paine Webber made her ineligible to hold office
as an active member.
The alternate slate, which was proposed
by Myron Kandel and Martin Cherrin, who are former presidents
and members of the current nominating committee, said Rodetis
"derives far more than half her income from financial
journalism, and none of her work involves PR.
"Under our bylaws she is totally eligible
to be an active member and officer," Kandel and Cherrin
Other former officers objecting to the ouster
of Rodetis were: Claudia Deutsch, Randall Forsyth, Robert
Kozma, John McCorry, Sidney Rutberg, Terri Thompson, Leonard
Sloane and Alan Wax.
Eugene Smith of Utility Spotlight, who is
the current secy.-asst. treas. was nominated as VP, in place
Allan Chernoff, CNBC, is the new candidate
for treasurer and Kelly Sapp, CNNfn, was nominated for secretary-asst.
The former officers did not oppose the nomination
of Bases or Chernoff.
The election will take place Jan. 26.
FIRM QUARTERBACKS SUPER BOWL SPOTS
Bennett & Co., an Orlando-based PR firm,
is producing and placing a $3 million+ TV ad campaign for
OurBeginning.com, an online superstore that sells personal
stationery for weddings and other events.
B&C has retained Disney i.d.e.a.s. to
direct the spot commercials, which will run during Super
Counselor Laura Bennett said the "marketing
action plan" also includes sponsorship of Brides
magazines "National Will You Marry Me Day,"
which features a live TV show from Times Square on Valentines
Day and a yearlong calendar of national consumer events
aimed at brides-to-be and mothers-to-be, national ad campaigns
on TV and in newspapers and magazines, and on the Internet.
Stone, 75, wife of Robert Stone of The Dilenschneider
Group, died Jan. 10...Ellen B.
Kovak, co-partner of Kovak-Likly Communications,
Wilton, Conn., died Sept. 25...Stanley
H. Brams, 89, Detroit autowriter, who in 1961
founded Press Relations Newswire, which he sold in 1985
to PR Newswire, died Dec. 25.
Edition, January 26, 2000, Page 3
EXECS PLUG INTO THE INTERNET
Parcel Services annual poll of 1,500 top executives
throughout Europe shows real time delivery of business news
as E-business grows is growing in popularity.
survey found 73% of European execs project that online media
will become their primary source of business news within
three to five years.
7% do not foresee the online media coup happening.
58% of European execs say they turn primarily to daily newspapers
to keep up-to-date on business news, followed by weekly
magazines (17%) and online news sources (11%).
execs are strong supporters of online news. Leading
Europe, 15% of them currently rely on the Internet as their
primary source of business news.
French, Italians and Dutch will continue to rely on established
news sources, with only one in five expecting to log on
for business news within the next five years.
UPS Europe Business Monitor was started in 1992.
Harris, London, conducted interviews in the following countries:
Belgium (101), France (253), Germany (252), Italy (254),
The Netherlands (100), Spain (255) and the U.K. (251).
average revenue of businesses interviewed is $1.59 billion;
average employee size is 3,450.
SHOWS HISPANIC TRENDS
rely more heavily on TV and radio to keep them informed,
according to the findings of Simmons new survey of
more than 10,300 Hispanic adults living in the U.S.
higher percentage of this group also views magazines as
a main source of entertainment than the overall population.
percent think products that pollute should be banned, while
38% of the overall population agrees.
who responded to the survey are slightly more likely to
enjoy a wine cooler, imported or domestic beer than the
rest of U.S. consumers. They are also more focused
on controlling their diets.
is the predominant language spoken by this market segment
in five of the top seven U.S. Hispanic markets (New York,
Miami, Chicago, Houston and Los Angeles), while English
is the predominant language spoken by this consumer group
in San Antonio and San Francisco.
over a third of Hispanics own personal computers, as compared
to more than half of the general population.
ODonnell Jr., who is MSNBCs senior
political analyst and host of "Real Time" on MSNBC,
will write a bimonthly column on national politics for New
health editor, Isadore Rosenfeld, M.D., will
discuss the latest medical breakthroughs in his new monthly
column, entitled "Second Opinion."
The Oprah Magazine, is the name of Oprah Winfreys
new monthly magazine, which will make its debut April 17
with an initial printing of 850,000 copies. The magazine
will have articles on fitness, fashion and beauty plus features
related to spirituality and personal growth.
a fashion monthly, has plans to publish three travel supplements
and two Internet buying guides.
FOR WOMEN STAFFS UP FOR FIRST ISSUE
Illustrated for Women, which is gearing up for launch as
a bimonthly magazine in March, has made additions to its
editorial staff, as follows:
Renee Thompson, previously an associate editor at Blaze,
is editor of the "Your Attitude" and the news
section, "Short Takes."
Smith, formerly the photo director at Sports Illustrated
for Kids and a photo editor at Sports Illustrated, is director
Lavergne, previously with Details and photo editor at Elle
magazine, is picture editor.
Deitsch is a writer-reporter. He also will continue
to cover tennis for SI.
Karmatz, previously a researcher at Time magazine, was named
Lucey is chief of reporters.
which will start with a circulation rate base of 300,000,
will be aimed at women ages 18-34 who have a passion for
sports both as participants and fans, and lead active and
Harris, 30, the executive producer of "Moneyline
News Hour" at CNN, and David
Faber, 35, a reporter for CNBC, including "Faber
Report" and "Squawk Box," were married Jan.
Felton has resigned as editor of Regardies
Powera new high-technology magazine based in Washington,
D.C.to join Readers Digest as a political reporter.
Philip Chalk has left as managing editor.
Ingraham has signed off as host of MSNBCs
"Watch It" to cover the Presidential campaign
as a special correspondent for MSNBC.
M. Schroeder, 35, was named CEO/publisher of
Washingtonpost.Newsweek Interactive, new media and electronic
news continued on next page)
Edition, January 26, 2000, Page 4
TV STATION INTERVIEWS CEOs
WTTW-TV will produce a national program that features discussions
Greenfield, a senior analyst at CNN, who has experience
as a broadcast media and political journalist, will conduct
interviews with top executives on the program, which is
called "CEO Exchange."
Schneider, VP of program development at WTTW, is executive
producer of the monthly program.
Kearney, a management consultant firm, will fund the program
over the next three years.
first show, which debuts Feb. 6, features Jim Clark, Netscape
Communications co-founder and currently chairman of myCEO,
and Tom Jermoluk, CEO of Excite@Home.
hourlong show was taped in front of a live audience of business
students at the Univ. of Chicago.
told Jim Kirk, who is The Chicago Tribunes "Media
Talk" columnist, that "our biggest fear was how
to get away from the corporate spin."
WORKERS ASSIST PRODUCERS
National Assn. of Social Workers, Washington, D.C., is working
with the producers and publicists of CBS TV drama
"Judging Amy" to develop story lines and accurate
was involved in a dispute with ABCs "Norm Show"
last April over its portrayal of the social work profession
and "indicted" the shows star, Norm Macdonald,
on four ethics code violations.
PA director Lucy Norman told Association Trends, "We
knew the type of show that `Amy was going to be before
it aired, so we called up the shows producers and
offered our help. They were delighted and receptive."
Amy," which will air Tuesdays at 10 p.m., revolves
around the life of a recently divorced, single mother, who
moves back in with her mother, a family services social
Engelbreits Home Companion, a bimonthly
arts and crafts magazine, has raised its rate base to 525,000.
City News, a monthly magazine owned by Gannett,
will cease publication with the February issue. It
has been covering country music for 37 years.
Washington Post, which recently dissolved Tech
Gazette and TechCapital, has started Washington Techway,
a twice-a-month magazine that will have a website at www.washtech.com.
Co. Digital, Internet division of The New York
Times Co., has launched Abuzz (www.abuzz. com), a free online
service based in Cambridge, Mass., that provides a shared
space where users can ask questions, publish bulletins and
MEDIA ESTIMATES OF AOL DEAL DIFFER
PR pros may have wondered why media estimates of the value
of America Onlines planned purchase of Time Warner
were vastly different.
Washington Post estimated the deal at $183 billion, The
New York Times said it was $165 billion, and The Wall Street
Journal provided an estimate of $156.14 billion.
radio and TV reports estimated the deal at $350B,
which was a figure used in a press release.
Kessler, who is national business editor for The Washington
Post, and oversees the papers estimate of the values
of major deals, said "none of the newspaper estimates
is really wrong. Theyre just figured differently."
AOL is buying Time Warner with its own stock, the value
of the deal depends on three things, according to Kessler:
(A) the ratio of AOL shares to each TW share; (B) the price
of AOL stock; and (C) the number of outstanding TW shares.
times B times C equals the value for the stock portion of
the deal," said Kessler.
said both the Post and Times used the price of AOL stock
before the deal was announced, while the Journal used the
price of AOL stock after the deal was announced. AOLs
stock price fell from Friday to Monday, resulting in a lower
the Post and Times used TWs estimate of the number
of its shares outstanding1.5 billion while the
Journal used 1.461 billion.
said the Post added in the value of TWs debt and the
other papers did not.
are the guidelines the Post uses to estimate major deals:
a company agrees to buy another one with its stock, the
price of the stock before the deal is announced is used.
the acquiring company assumes a significant amount of debt,
it is included in the total purchase price.
figures are used because the estiamte is subject to swings
in the stock market and different financial assumptions.
Auerbach, 32, who was business editor of The
New York Post, was appointed Sunday editor.
replaces managing editor Marc Kalech,
51, who has been in charge of the Sunday Post since its
inception in 1996. Kalech is now head of the arts and entertainment
Greenwood, who was executive editor of Essence,
was named to succeed Susan L. Taylor
as editor-in-chief beginning with the June issue.
who will continue to write her monthly "In the Spirit"
column, was named publication director of Essence Communications.
Edition, January 26, 2000, Page 7
PROS HIT BACK AT CRITIC FERGUSON
high-tech PR executives have answered criticisms of high-tech
PR by Charles Ferguson, who founded the company that invented
the "FrontPage" software for creating web pages
and who sold it to Microsoft in 1995 for $133 million.
in his new book called, "High Stakes, No Prisoners,"
said he found the rank-and-file of PR to be "completely
dominated by attractive young women, various combinations
of dragon lady and bimbette, whose job is social lubricationopening
doors, getting interviews, pushing you through a crowd toward
someone theyre just dying to have you meet."
said the "basic model" for this was pioneered
by Regis McKenna, who was noted for his "army of Regettes."
Ferguson also said its common for high-tech execs
to marry their PR counsels.
Seltzer, president and CEO of Ogilvy PR Worldwide, said
the majority of those in PR today are women and this could
be checked by looking at the membership of groups such as
PR Society of America and the International Assn. of Business
Communicators. Seltzer called Fergusons remarks "bigoted
stupidity." [PRSA is 64% female-Ed. note.]
Horn, of the Horn Group, San Francisco, which has 60 employees
(80% of them women), said the remarks were "offensive
Paul, of Lois Paul & Partners, Burlington, Mass., called
the "dragon lady" and "bimbette" combination
a "silly stereotype." She said she has always
liked high-tech PR because it is "young and also blind
Bohle, whose 45 Bohle Co. employees are split about 50-50
between females and males, said, "We shouldnt
get defensive as a profession or ignore the input.
Comms., with 206 employees in Waltham, Mass., and San Francisco,
is 63% female. Brodeur Porter Novellis San Jose office
is 60% female. Carol Cone, president of Cone, Boston, said
Fergusons comments were "over the top" and
be labeled this way does a disservice to the profession,"
she added. "Women are not joining PR firms because
they want to get married."
agreed saying, "Were here to get a job done,
not get dates. Didnt Ferguson make a lot of money
with FrontPage? Why doesnt he get some therapy?"
RAPS FREEDOM OF INFO. ACT
Purnick, who writes a column called "Metro Matters"
for The New York Times, said government officials use the
Freedom of Information Act to stonewall the press.
said the FoIA, which was intended to help the press get
access to government information, has become a tool to shield
said the problem with the FoIA is it takes at least two
years to get information after a request is made, so editors
tend to lose interest.
who spoke to about 50 members of the Society of the Silurians
at a lunch Jan. 20 at the Players Club, said the Giuliani
Administration, which uses the FoIA to delay the release
of information, has made "it impossible for us to do
our job properly."
Edition, January 26, 2000, Page 8
brought about the arrest of Michael Skakel
on charges of murdering Martha Moxley in Greenwich, Conn.,
in 1975. Former L.A. detective Michael Fuhrmans book
revealed how the inept Greenwich police, in effect, had "sold
out" to the rich Skakel family by working as chauffeurs,
parking cars at parties, serving as paid police in their private
community of homes, etc. Lack of independence (not to
say possible collusion) wrecked the initial investigation.
No search warrant was ever obtained for the Skakel house.
found two uniformed police who said the missing handle of
the murder weapon, a golf club, was with the body when it
was discovered but suddenly disappeared. The Greenwich
police, who stonewalled Fuhrman when he came around, now
seem to be claiming credit. "Police call events of
the week a vindication," said the headline on the Jan.
22 Greenwich Time. A state investigator, formerly with the
local police, is given big credit. No praise is given
to Fuhrman, who said he "back-doored everything"
when he ran into stonewalling by Greenwich officials.
firms selling out to rich ad conglomerates and media
selling or merging with giant media and non-media companies
is of concern to both PR pros and the press. "Love
reporting, hate the business," is a current slogan
among reporters. Clients want opinions from PR firms that
are independent and readers want news unsullied by corporate
Zyman, chief marketing officer of Coca-Cola from 1993-98
and an SVP from 1983-86, has authored "The End of Marketing
as We Know It," in which he says marketing is "too
important to be left solely to the marketing guys."
Marketing is "every contact with consumers,"
he says. Zyman is described by Rochelle Garner in Kinkos
new Impress magazine as "charming" but a "harsh
taskmaster, famous for instilling terror among those who
work for him." He helped create Diet Coke in 1983 ("one
of the biggest marketing coups ever") but also introduced
New Coke in 1985 ("among the greatest marketing fiascos
of the century").