High-flyers want to talk elephants
Virgin Australia’s resident motorhead, John Borghetti, might be advised to jump in his beloved Porsche 911 and escape to the Blue Mountains later this week, far from his Sydney bunker.
The alternative is to face Air New Zealand chief executive Christopher Luxon and Etihad boss James Hogan vying for his precious time when they descend on Sydney. Pure coincidence, but the bosses of two of Virgin’s largest shareholders are in Sydney on separate business on Thursday, Hogan for an investor roadshow and Luxon for a tourism deal. Well-informed planespotters are acutely aware that both feel they deserve more time with Borghetti.
Three weeks ago, Air New Zealand raised its stake from 20 to 23 per cent despite Luxon telling reporters hours earlier: ‘‘We are very comfortable with kind of where we are at the moment.’’
The Kiwis want another 3 per cent of Virgin while Etihad is eager to raise its stake from 10 to 20 per cent. All this comes before the elephant in the room is discussed: who will eventually gain a Virgin board seat?
Locked out of his office in suburban San Diego, accused of forgery and at war with a B-grade US celebrity: it must have been a low point in the glittering career of motivational speaker-entrepeneur Brian Sher.
These days Sher is dispensing wisdom (for a price) at the Fortune Institute, a mentoring business he runs with leftover ’80s adman Siimon Reynolds, but in 2007 he was involved in a business in sunny San Diego flogging menopause medicine.
Investors in MCOA Holdings included Suzanne Somers, a former sitcom actress who these days spruiks weight loss, fitness and health-food products that she promises can help women stay ‘‘sexy forever’’, and her hubby, former Canadian children’s TV host Alan Hamel.
The trouble, which later ended up in court, began in May 2007 after the business, which had 1800 clients in nine states, hired Beth Marmor as chief operating officer.
The investors allege Marmor found Sher and girlfriend Lana Lien were hurting MOCA by ‘‘engaging in improper and unlawful behaviour’’ including allowing staff to sign prescriptions with ‘‘three rubber stamps, with varying styles of signature’’ of a doctor. They also allege that Sher had given the same medico, a Dr Simpson, MOCA’s patient mailing list ‘‘so that Dr Simpson could send solicitation packets for his timeshare/wellness resort in Mexico’’.
Some of the investors were also directors of MOCA, and they fired Sher and Lien, locking the couple out of the building. They claim $US1.8 million was put into MOCA, of which about $US180,000 was ‘‘wrongfully taken by Sher and Lien’’.
Sher and Lien allege they were wrongfully dismissed after Marmor made ‘‘numerous false and defamatory statements’’ about them to the investors, ‘‘including allegations of forgery, which allegations are false’’.
Sher and Lien claimed a total of $62.5 million for everything from defamation to ‘‘intentional infliction of emotional distress’’.
We will never know whose version is correct. After years being batted around from the Californian courts up to the federal courts and back again, the case settled last year. Sher told CBD: ‘‘Both parties are happy to have reached a mutual resolution ... I’m bound by confidentiality.’’
A fee in your ear
The Senate last week unveiled an inquiry into Greg Medcraft’s corporate regulator, ASIC, focusing on its investigation of financial planners run amok at CBA. But CBD has a bone to pick with ASIC: fees, including some search fees, go up on July 1. ASIC’s fees are already outrageous by world standards: a company extract costs about $16 through Fairfax Media’s provider but the same document in Hong Kong is $HK22 (about $3) and in the UK all documents are £1 (about $1.70).
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