Early Briefing: Marketing Michael's Olympic Gold
On Monday's we turn the business section over to news exclusively about local companies:
* It's a great time to be an Olympic winner. And not just if you're the athlete.
Swimmer Michael Phelps's haul of eight gold medals brought him a lot more attention from advertisers. It is also a boost for Octagon Worldwide, whose McLean sports and personalities division claims more Olympians than any other agency. Like other firms whose fortunes rise and fall with the health of the advertising and marketing industries, Octagon has been feeling the pinch of a lousy U.S. economy. But the agency says advertisers are suddenly lining up at its door. And even if it's just for one client in a small segment of its overall business, Octagon is savoring the victory.
* The Olympics have not been quite so good for Chindex International.
Analysts and top management had all forecast that the Olympics would be the Bethesda company's coming-out party -- a chance to show the international community that Chindex could successfully run a Western-style health-care system in China.
But Thursday, the games were one reason chief executive Roberta Lipson listed for the company's loss in the first quarter ended June 30 and additional damage in the current quarter.
Because many expatriates typically leave China for the summer, tourist and business traffic usually fills the void in Chindex hospitals and clinics.
But in the months leading up to the games, these travelers have been shut out of China thanks to the "pre-Olympic visa crunch," Lipson said. Visa restrictions tightened, and government officials started randomly checking the paperwork of foreign visitors and employees.
* For years, Science Applications International Corp. served as an adviser to the Nuclear Regulatory Commission on the development of rules for when radioactive materials could be released from nuclear facilities for recycling.
At the same time, SAIC worked as a contractor on just such a recycling project at a Department of Energy facility, but it did not disclose the conflict as required by federal regulations, according to evidence gathered by the Justice Department.
SAIC said there was no conflict. But after hearing testimony about the apparent conflicts of interest, a federal jury recently found the firm guilty of making dozens of false and fraudulent claims for payment relating to the NRC work.
The case offers a glimpse at one of the consequences of the government's unprecedented reliance on contractors to help federal agencies: Consultants sometimes gain insider knowledge and help draft rules that could benefit their own bottom lines, procurement specialists said.
* Carlyle Group's near-mythic reputation for generating lucrative investment returns for its clients has been bruised over the past several months as the District company has endured some high-profile financial troubles.
* Harvey Pitt, SEC chairman from 2001 to 2003 and chief executive of District-based global consulting firm Kalorama Partners, has teamed up with John Tabacco, chief executive of LocateStock.com, and Tom Ronk, the chief executive of Buyins.net, to launch a new Web site called RegSHO.com to help short sellers.
The D.C. company operates a Web-based, real-time electronic stock lending and location service that provides tools to help sellers and brokerage firms comply with SEC rules governing naked short selling -- the practice the agency sought to prevent -- and regular short sales of stocks. The Web site matches traders with available stocks that can be borrowed for short sales and offers immediate data on the short-sell market. It is named after the SEC's order regulating such trades, Regulation SHO.
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