Briefs (right)Guidant to Report Regularly
On Its Heart Devices
By Barry Meier
THE NEW YORK TIMES
The Guidant Corp., a maker of defibrillators and pacemakers, said Thursday that it planned to start issuing periodic reports that would highlight for each model the number of failures that prevented the units from delivering critical patient therapy.
The move appears to be a significant change because Guidant, like other makers of heart devices, had previously told only doctors about the total number of product malfunctions, rather than separating those that posed high risks to patients from those of lesser concern. As a result, doctors may not be aware that a particular model may be malfunctioning in a way that could harm patients or even contribute to their deaths, several device specialists have said.
Guidant, based in Indianapolis, has been criticized for failing to disclose to doctors such a high-risk defect — the tendency of two devices, a defibrillator and an advanced pacemaker, to short-circuit. Four deaths have been associated with the electrical failures of the devices.
Morgan Stanley Stars Must Sign
By Landon Thomas Jr.
THE NEW YORK TIMES
With bonus season approaching, Morgan Stanley is taking steps to restrict its star bankers from jumping to competitors. In coming days, the firm will ask its top executives to sign contracts requiring that they wait three to six months before moving to another firm.
Such paid hiatuses, known as “gardening leaves,” have become increasingly common on Wall Street and are intended to make it more expensive for competing firms to poach talent.
At Morgan Stanley, the waiting period has been just 30 days — a legacy of the firm’s time as an exclusive Wall Street partnership. Old banking hands have long said that the prestige and pleasure of working for the firm should make such a provision unnecessary as well as contrary to its culture.
But with bankers and traders still jittery in the wake of the bitter leadership battle in the spring for control of Morgan Stanley, the chief executive, John J. Mack, seems prepared to take whatever steps are needed to ensure that his top bankers and traders do not leave the firm once informed of their bonuses on Nov. 30. Indeed, the procession of senior executive departures this past spring was one of the crucial factors that led Philip J. Purcell to step down as chief executive in June.
Since Mack has taken over, executive departures have largely ceased and morale has improved noticeably. Still, continued stagnation in the stock price as well as some recent slippage in competitive investment banking figures could make Morgan Stanley bankers vulnerable to entreaties from newly resurgent competitors.